OECD - Driving Performance at Peru’s Telecommunications Regulator

Economic regulators should play an important role as impartial referees to guarantee the predictability and certainty of regulatory regimes crucial features for attracting investment. Their job is inherently a complex one, requiring neutral engagement with a variety of actors, including government, citizens and consumers, and operators. The model of independent economic regulation, based on strong technical capacity, transparency, autonomy and constructive engagement with stakeholders, can help, tackle this complex landscape. Moreover, independent regulators can provide certainty to markets and society during periods of external instability. Regulators need to be correctly equipped, however, to carry out these fundamental tasks and stay abreast of market evolutions.

To support regulators as they face these challenges, the OECD has developed a framework to assess and strengthen their organisational performance and governance structures. The framework analyses regulators internal and external governance, including their organisational structures, behaviour, accountability, business processes, reporting and performance management, as well as role clarity, relationships, distribution of powers and responsibilities with other government and non-government stakeholders.

This report applies this Performance Assessment Framework to Perus telecommunications regulator (Supervisory Agency for Private Investment in Telecommunications, Organismo Supervisor de Inversin Privada en Telecomunicaciones , OSIPTEL). The review finds that OSIPTEL enjoys a strong internal culture and commitment to delivering on its mandate, but needs to better promote the overall benefits of independent economic regulation externally.

As one of four economic regulators created in the 1990s, OSIPTEL has overseen the transformation of Perus telecommunications sector and market into a diverse and competitive market benefitting the countrys citizens and businesses. Stakeholders view the regulator as a technically sound body that has delivered on its mandate over the years. The review finds, however, that there is still scope to improve several areas linked to the regulators governance. These include building more robust and diverse internal decision making mechanisms, including at the level of the Board of Directors, strengthening transparency and integrity processes, and engaging with stakeholders more regularly to report on regulator and sector performance.

Moreover, a more proactive external relations strategy could contribute to a better understanding of the role of the regulator externally and could mitigate risks linked to external factors. This strategy should aim to build a no surprises relationship with stakeholders and could, in the medium term, lay the groundwork for solutions to some structural challenges faced by OSIPTEL such as ensuring that appropriate functions, resource frameworks and coordination mechanisms are in place. Finally, the review, carried out in parallel with that of the Perus energy and mining regulator, Osinergmin, recommends that Perus four economic regulators work together more effectively to share best practices and address common challenges.

These actions, among others put forward in this report, could help OSIPTEL build on its technical work and reputation to become an example of institutional maturity within the Peruvian public administration.

This report is part of the OECD work programme on the governance of regulators and regulatory policy, led by the OECD Network of Economic Regulators and the OECD Regulatory Policy Committee, with the support of the Regulatory Policy Division of the OECD Directorate of Public Governance. The Directorates mission is to help government at all levels design and implement strategic, evidence-based and innovative policies that support sustainable economic and social development.