As filed with the Securities and Exchange Commission on April ~~11, 2019~~28, 2021

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM20-F

Annual Report Pursuant to Section 13 or 15(d) of the Securities

Exchange Act of 1934

for the fiscal year ended December 31, ~~2018~~2020

Commission file number:1-16269

AMÉRICA MÓVIL, S.A.B. DE C.V.

(exact name of registrant as specified in its charter)

America Mobile

(translation of registrant’s name into English)

United Mexican States

(jurisdiction of incorporation)

Lago Zurich 245, Plaza Carso / Edificio Telcel Colonia Ampliación Granada, Miguel Hidalgo 11529 Mexico City, Mexico

(address of principal executive offices)

Daniela Lecuona Torras

Lago Zurich 245, Plaza Carso / Edificio

Telcel, Piso 16 Colonia Ampliación Granada, Miguel Hidalgo 11529 Mexico City,

~~Mexico~~ Telephone: (5255) 2581-3700

/ Facsimile: (5255) 2581-4422

E-mail: daniela.lecuona@americamovil.com

(name, telephone,e-mail and/or facsimile number and address of company contact person)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class:	Trading symbol	Name of each exchange on which registered:
A Shares, without par value	AMOV	New York Stock Exchange
L Shares, without par value	AMX	New York Stock Exchange
~~5.000% Senior Notes Due 2019~~	~~New York Stock Exchange~~
~~5.000% Senior Notes Due 2020~~	~~New York Stock Exchange~~
3.125% Senior Notes Due 2022	AMX22	New York Stock Exchange
3.625% Senior Notes Due 2029	AMX29	New York Stock Exchange
2.875% Senior Notes Due 2030	AMX30	New York Stock Exchange
6.375% Notes Due 2035	AMX35	New York Stock Exchange
6.125% Notes Due 2037	AMX37	New York Stock Exchange
6.125% Senior Notes Due 2040	AMX40	New York Stock Exchange
4.375% Senior Notes Due 2042	AMX42	New York Stock Exchange
4.375% Senior Notes Due 2049	AMX49	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

The number of outstanding shares of each of the registrant’s classes of capital or common stock as of December 31, ~~2018:~~2020:


~~20,602~~ 20,578 million		AA Shares
~~567~~ 520 million		A Shares
45,764 million		L Shares


Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.		Yes	X	No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.		Yes	~~A Shares~~	No	X
	~~44,887 million~~		~~L Shares~~

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.		Yes	X	No



Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this Chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).		Yes	X	No

~~Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.~~ ☒ ~~Yes~~ ☐ No

~~If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.~~ ☐ ~~Yes~~ ☒ No

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. ☒ ~~Yes~~ ☐ No

~~Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of RegulationS-T~~ ~~(§ 232.405 of this Chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).~~ ☒ ~~Yes~~ ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule12b-2 of the Exchange Act.

~~Large accelerated filer~~ ☒ ~~Accelerated filer~~ ☐ ~~Non-accelerated~~ ~~filer~~ ☐ ~~Emerging growth company~~ ☐

Large accelerated filer

Accelerated filer

Non-accelerated filer

Emerging growth company

~~If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate~~Indicate by check mark ifwhether the registrant has ~~elected not~~filed a report on and attestation to ~~use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a)~~its management’s assessment of the ~~Exchange Act.~~ ☐

~~† The term “new or revised~~effectiveness of its internal control over financial ~~accounting standard” refers to any update issued~~reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the ~~Financial Accounting Standards Board to~~registered public accounting firm that prepared or issued its ~~Accounting Standards Codification after April 5, 2012.~~audit report.

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:


~~U.S. GAAP~~ ☐		U.S. GAAP		X		International Financial Reporting Standards as issued by the International Accounting Standards Board☒				Other ☐

If “other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17 ☐Item 18☐

~~If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule12b-2~~ ~~of the Exchange Act).~~

☐ ~~Yes~~ ☒ No

~~2018 ANNUAL REPORT FORM 20-F~~

~~TABLE OF CONTENTS~~

~~(See Form20-F~~ ~~Cross Reference Guide on page 114)~~


If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).		Yes				No		X

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(See Form 20-F Cross Reference Guide on page 89)

Selected Financial Data			26

PART I: INFORMATION ON THE COMPANY			59

About América Móvil			610

Our Networks			1417

Our Competitors			1618

Acquisitions, Other ~~Investments~~Investements and Divestitures			1619

Marketing, Sales and Distribution, Customer Services			1720

PART II: OPERATING AND FINANCIAL REVIEW AND PROSPECTS			1923

Overview			2024

~~Composition of Operating Revenues~~			21

Results of Operations			2226

Liquidity and Capital Resources			3732

~~Risk Management~~			42

~~Critical Accounting Policies and Estimates~~			43

PART III: RISK FACTORS			4737

PART IV: SHARE OWNERSHIP AND TRADING			5949

Major Shareholders			6050

Related Party Transactions			6151

Dividends			6251

Trading Markets			6252

Bylaws			6352

Purchases of Equity Securities by the Issuer and Affiliated Purchasers			6753

Taxation of Shares and ADSs			6854

PART V: CORPORATE GOVERNANCE			7359

Management			7460

Corporate Governance			8464

Controls and Procedures			8766
Corporate Sustainability Report			68
Code of Ethics			8969

~~Corporate Sustainability Report~~			89

PART VI: REGULATION			9171

PART VII: ADDITIONAL INFORMATION			~~109~~87

Employees			~~110~~88

Legal Proceedings			~~110~~88

Principal Accountant Fees and Services			~~111~~89

Additional Information			~~112~~89

Forward-Looking Statements			~~113~~90

Form20-F Cross Reference Guide			~~114~~91

Signatures			~~117~~93

PART VIII: CONSOLIDATED FINANCIAL STATEMENTS			~~119~~

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~~SELECTED FINANCIAL DATA~~

We prepared our audited consolidated financial statements included in this annual report in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). The selected financial information should be read in conjunction with, and is qualified in its entirety by reference to, our audited consolidated financial statements.

We present our financial statements in Mexican pesos. This annual report contains translations of various peso amounts into U.S. dollars at specified rates solely for your convenience. You should not construe these translations as representations that the peso amounts actually represent the U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated. Unless otherwise indicated, we have translated U.S. dollar amounts from pesos at the exchange rate of Ps.19.6829 to U.S.$1.00, which was the rate reported by Banco de México on December 31, 2018,We present our consolidated financial statements in Mexican pesos. This annual report contains translations of various peso amounts into U.S. dollars at specified rates solely for your convenience. You should not construe these translations as representations that the peso amounts actually represent the U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated. Unless otherwise indicated, we have translated U.S. dollar amounts from pesos at the exchange rate of Ps.19.9487 to U.S.$1.00, which was the rate reported by Banco de México on December 30, 2020, as published in the Official Gazette of the Federation (Diario Oficial de la Federación, or “Official Gazette”).

~~We have not included earnings or dividends on a per American Depositary Share (“ADS”) basis. Each L Share ADS represents 20 L Shares and each A Share ADS represents 20 A Shares.~~

FOR THE YEAR ENDED DECEMBER 31,⁽¹⁾

2014

2015

2016

2017

2018

2018



(in millions of Mexican pesos, except share and per share amounts)

(in millions of
U.S. dollars,
except share
and per share
amounts)

STATEMENT OF COMPREHENSIVE INCOME DATA:

Operating revenues Ps.         848,580 Ps.         893,738 Ps.         975,412 Ps. 1,021,634 Ps. 1,038,208 U.S.$ 52,747

Operating costs and expenses 692,026 752,325 865,802         921,490         898,651       45,657

Depreciation and amortization 114,994 125,715 148,526 160,175 155,713 7,911

Operating income 156,554 141,413 109,610 100,144 139,557 7,090

Net profit for the year Ps. 47,498 Ps. 36,961 Ps. 12,079 Ps. 32,155 Ps. 54,517 U.S.$ 2,770

NET PROFIT ATTRIBUTABLE FOR THE YEAR TO:

Equity holders of the parent Ps. 46,146 Ps. 35,055 Ps. 8,650 Ps. 29,326 Ps. 52,566 U.S.$ 2,670

Non-controlling interests 1,352 1,906 3,429 2,829 1,951 100

Net profit for the year Ps. 47,498 Ps. 36,961 Ps. 12,079 Ps. 32,155 Ps. 54,517 U.S.$ 2,770

EARNINGS PER SHARE:

Basic Ps. 0.67 Ps. 0.52 Ps. 0.13 Ps. 0.44 Ps. 0.79 U.S.$ 0.04

Diluted Ps. 0.67 Ps. 0.52 Ps. 0.13 Ps. 0.44 Ps. 0.79 U.S.$ 0.04

Dividends declared per share⁽²⁾ Ps. 0.24 Ps. 0.26 Ps. 0.28 Ps. 0.30 Ps. 0.32 U.S.$ 0.02

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING (MILLIONS):

Basic 69,254 66,869 65,693 65,909 66,055

Diluted 69,254 66,869 65,693 65,909 66,055

BALANCE SHEET DATA:

Property, plant and equipment, net Ps. 588,106 Ps. 573,529 Ps. 701,190 Ps. 676,343 Ps. 640,001 U.S.$ 32,516

Total assets 1,278,357 1,296,487 1,515,042 1,486,212 1,429,223 72,613

Short-term debt and current portion of long-term debt 57,806 119,590 82,607 51,746 96,230 4,889

Long-term debt 545,949 563,627 625,194 646,139 542,692 27,572

Capital stock 96,383 96,338 96,338 96,339 96,338 4,895

Total equity 234,639 160,854 271,024 260,634 245,872 12,492

NUMBER OF OUTSTANDING SHARES (MILLIONS):

AA Shares 23,384 23,384 20,635 20,602 20,602

A Shares 649 625 592 567 546

L Shares 44,120 41,990 44,571 44,901 44,887

⁽¹⁾ As of December 31, 2018, we owned 51.0% of the total outstanding shares of Telekom Austria AG (“Telekom Austria” or “TKA”). We began consolidating Telekom Austria from July 1, 2014. Prior to July 1, 2014, we accounted for Telekom Austria using the equity method, which affects the comparability of our results for 2014 through 2018.
⁽²⁾ Figures for each year provided represent the annual dividend declared at the general shareholders’ meeting that year. For information on dividends paid per share trans- lated into U.S. dollars, see “Share Ownership and Trading—Dividends” under Part IV of this annual report.

~~ABOUT AMÉRICA MÓVIL~~

We have not included earnings or dividends on a per American Depositary Share (“ADS”) basis. Each L Share ADS represents 20 L Shares and each A Share ADS represents 20 A Shares.

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	FOR THE YEAR ENDED DECEMBER 31,

	2016			2017			2018			2019			2020			2020
	(in millions of Mexican pesos, except share and per share amounts)															(in millions of U.S. dollars, except share and per share amounts)

STATEMENT OF COMPREHENSIVE INCOME DATA:
Operating revenues		Ps.	975,412		Ps.	1,021,634		Ps.	1,038,208		Ps.	1,007,348		Ps.	1,016,887		U.S.	50,975
Operating costs and expenses			865,802			921,490			898,651			852,507			851,532			42,686
Depreciation and amortization			148,526			160,175			155,713			158,915			164,244			8,233
Operating income			109,610			100,144			139,557			154,841			165,355			8,289
Net profit for the year		Ps.	12,079		Ps.	32,155		Ps.	54,517		Ps.	70,313		Ps.	51,027		U.S.	2,559

NET PROFIT ATTRIBUTABLE FOR THE YEAR TO:
Equity holders of the parent		Ps.	8,650		Ps.	29,326		Ps.	52,566		Ps.	67,731		Ps.	46,853		U.S.	2,349
Non-controlling interests			3,429			2,829			1,951			2,582			4,174			210
Net profit for the year		Ps.	12,079		Ps.	32,155		Ps.	54,517		Ps.	70,313		Ps.	51,027		U.S.	2,559

EARNINGS PER SHARE:
Basic		Ps.	0.13		Ps.	0.44		Ps.	0.79		Ps.	1.03			0.71			0.04
Diluted		Ps.	0.13		Ps.	0.44		Ps.	0.79		Ps.	1.03			0.71			0.04
Dividends declared per share ⁽¹⁾		Ps.	0.28		Ps.	0.30		Ps.	0.32		Ps.	0.35		Ps.	0.38		U.S.	0.02

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING (MILLIONS):
Basic			65,693			65,909			66,055			66,016			66,265			-
Diluted			65,693			65,909			66,055			66,016			66,265			-

	AS OF DECEMBER 31,

	2016			2017			2018			2019			2020			2020
	(in millions of Mexican pesos, except share and per share amounts)															(in millions of U.S. dollars, except share and per share amounts)

BALANCE SHEET DATA:
Property, plant and equipment, net		Ps.	701,190		Ps.	676,343		Ps.	640,001		Ps.	639,343		Ps.	722,930		U.S.	36,239
Right of use assets			-			-			-			118,003			101,977			5,112
Total assets			1,515,042			1,486,212			1,429,223			1,531,934			1,625,048			81,463
Short-term debt and current portion of long-term debt			82,607			51,746			96,230			129,172			148,083			7,423
Short-term lease debt												25,895			25,068			1,257
Long-term debt			625,194			646,139			542,692			495,082			480,300			24,077
Long-term lease debt												94,702			84,259			4,224
Capital stock			96,338			96,339			96,338			96,338			96,342			4,829
Total equity			271,024			260,634			245,872			226,907		Ps.	315,118		U.S.	15,797
NUMBER OF OUTSTANDING SHARES (MILLIONS):
AA Shares			20,635			20,602			20,602			20,602			20,578			-
A Shares			592			567			546			531			520			-
L Shares			44,571			44,901			44,887			44,872			45,764			-

⁽¹⁾

Figures for each year provided represent the annual dividend declared at the general shareholders’ meeting that year. For information on dividends paid per share translated into U.S. dollars, see “Share Ownership and Trading—Dividends” under Part IV of this annual report.

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HISTORY AND CORPORATE INFORMATION

América Móvil, S.A.B. de C.V. (“América Móvil,” “we” or the “Company”) is a ~~sociedad anó~~Sociedad Anónima ~~bursá~~Bursátil de ~~capital variable~~Capital Variable organized under the laws of Mexico.

We were established in September 2000 when Teléfonos de México, S.A.B. de C.V. (“Telmex”), a fixed-line Mexican telecommunications operator privatized in 1990, spun off to us its wireless operations in Mexico and other countries. We have made significant acquisitions throughout Latin America, the United States, the Caribbean and Europe, and we have also expanded our businesses organically. ~~In 2010, we acquired control of Telmex and Telmex Internacional, S.A.B. de C.V. (“Telmex Internacional”) in a series of public tender offers.~~

Our principal executive offices are located at Lago Zurich 245, Plaza Carso / Edificio Telcel, Colonia Ampliación Granada, Miguel Hidalgo, 11529, Mexico City, Mexico. Our telephone number at this location is (5255) 2581-3700.

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BUSINESS OVERVIEW

We provide telecommunications services in 25 countries. We are a leading telecommunications services provider in Latin America, ranking first in wireless, fixed-line, broadband and Pay TV services based on the number of revenue generating units (“RGUs”).

Our largest operations are in Mexico and Brazil, which together account for over half of our total RGUs and where we have the largest market share based on RGUs. We also have operations in 16 other countries in the Americas and seven countries in Central and Eastern Europe as of December 31, ~~2018.~~2020. For a list of our principal subsidiaries, see ~~note~~Note 2 a(ii) to our audited consolidated financial statements and “Additional Information—Exhibit 8.1” under Part VII of this annual report.

We intend to build on our position as leaders in integrated telecommunications services in Latin America and the Caribbean, and to grow in other parts of the world by continuing to expand our subscriber base through the development of our existing businesses and strategic acquisitions when opportunities arise. We have developed world-class integrated telecommunications platforms to offer our customers new services and enhanced communications solutions with higher data speed transmissions at lower prices. We continue investing in our networks to increase coverage and implement new technologies to optimize our network capabilities. See “Operating and Financial Review and Prospects—Overview” under Part II of this annual report for a discussion on the seasonality of our business.

~~RECENT DEVELOPMENTS~~

~~Acquisition of Nextel Operations in Brazil~~

In March 2019, we entered into an agreement to acquire 100% of the outstanding shares of Nextel Telecomunicações Ltda. (“Nextel Brazil”) from NII Holdings Inc. (“NII”) and AI Brazil Holdings B.V. for U.S.$905 million. The transaction is subject to the satisfaction of certain customary closing conditions, including the approval of the stockholders of NII and receipt of regulatory and antitrust approvals from Brazilian government authorities. Nextel Brazil provides nationwide mobile telecommunications services.

~~Acquisition of Telefónica’s Operations in Guatemala and El Salvador~~

In January 2019, we entered into an agreement to acquire 100% of the outstanding shares of Telefónica Móviles Guatemala, S.A. (“Telefónica Guatemala”) for U.S.$333 million and 99.3% of the outstanding shares of Telefónica Móviles El Salvador, S.A. de C.V. (“Telefónica El Salvador”) for U.S.$315 million. The acquired companies provide mobile and fixed telecommunications services, including voice, data and Pay TV in Guatemala and El Salvador, respectively. The Telefónica Guatemala acquisition was completed on January 24, 2019. The completion of the Telefónica El Salvador acquisition is subject to certain customary closing conditions, including regulatory approval.

711

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ABOUT AMERICA MOVIL The following map illustrates the geographic diversity of our operations and certain key performance indicators ("KPIs") as of December 31, 2018. UNITED STATES / TRACFONE Licensed Population 334 Wireless Subscribers 21,688 Revenue Generating Units (RGUs) - Wireless Penetration 126% Wireless operation CENTRAL AMERICA & CARIBBEAN / CLARO Licensed Population 63 Wireless Subscribers 20,250 Revenue Generating Units (RGUs) 9,011 Wireless Penetration 111% Wireless and fixed operations MEXICO / TELCEL TELMEX Licensed Population 125 Wireless Subscribers 75,448 Revenue Generating Units (RGUs) 22,337 Wireless Penetration 95% Wireless and fixed operations ECUADOR / CLARO Licensed Population 17 Wireless Subscribers 8,246 Revenue Generating Units (RGUs) 384 Wireless Penetration 92% Wireless and fixed operations12

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PERU / CLARO Licensed Population 32 Wireless Subscribers 12,098 Revenue Generating Units (RGUs) 1,472 Wireless Penetration 121% Wireless and fixed operations CHILE / CLARO Licensed Population 19 Wireless Subscribers 6,707 Revenue Generating Units (RGUs) 1,424 Wireless Penetration 153% Wireless and fixed operations AUSTRIA & EASTERN EUROPE Licensed Population 41 Wireless Subscribers 21,000 Revenue Generating Units (RGUs) 6,261 Wireless Penetration 145% Wireless operations: Austria, Belarus, Bulgaria, Croatia, Serbia, Slovenia and Macedonia Fixed operations: Austria, Belarus, Bulgaria, Croatia, Slovenia and Macedonia COLOMBIA / CLARO Licensed Population 50 Wireless Subscribers 29,681 Revenue Generating Units (RGUs) 7,171 Wireless Penetration 119% Wireless and fixed operations BRAZIL / CLARO Licensed Population 210 Wireless Subscribers 56,416 Revenue Generating Units (RGUs) 35,285 Wireless Penetration 111% Wireless and fixed operations ARGENTINA, PARAGUAY & URUGUAY / CLARO Licensed Population 55 Wireless Subscribers 24,264 Revenue Generating Units (RGUs) 775 Wireless Penetration 129% Wireless operation: Argentina, Paraguay and Uruguay Fixed operations: Argentina and Paraguay Licensed Population in millions Wireless Subscribers and Revenue Generating Units in thousands13

~~ABOUT AMÉRICA MÓVIL~~

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KEY PERFORMANCE INDICATORS

We have identified ~~certain KPIs~~RGUs as a key performance indicator (“KPI”) that ~~help~~helps measure the performance of our operations. The table ~~of our KPIs~~ below includes the number of our wireless subscribers and our fixed RGUs, which together make up the total RGUs, in the countries where we operate. Wireless subscribers consist of the number of prepaid and postpaid subscribers to our wireless services. Fixed RGUs consist of fixed voice, fixed data and Pay TV units (which include customers of our Pay TV services and, separately, of certain other digital services). The figures below reflect total wireless subscribers and fixed RGUs of all our consolidated subsidiaries, without adjustments to reflect our equity interest, in the following reportable segments:

Mexico Wireless;

Mexico Fixed;

Brazil;

Colombia;

Southern Cone (Argentina, Chile, Paraguay and Uruguay);

Andean Region (Ecuador and Peru);

Central America (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama);

the Caribbean (the Dominican Republic and Puerto Rico);

the United States; and

Europe (Austria, Belarus, Bulgaria, Croatia, Macedonia, Serbia and Slovenia).


		AS OF DECEMBER 31,				AS OF DECEMBER 31,
		2016	2017	2018		2018		2019		2020
	(in thousands)							(in thousands)
WIRELESS SUBSCRIBERS:
WIRELESS SUBSCRIBERS					WIRELESS SUBSCRIBERS
Mexico Wireless		72,953	73,855	75,448			75,448		76,918		77,789
Brazil		60,171	59,022	56,416			56,416		54,488		63,140
Colombia		28,954	29,353	29,681			29,681		31,104		33,009
Southern Cone		30,377	31,076	30,971			30,971		31,507		30,669
Andean Region		20,801	20,352	20,344			20,344		20,104		18,877
Central America		15,085	15,927	14,364			14,364		15,488		15,044
Caribbean		5,453	5,637	5,887			5,887		6,244		6,422
United States		26,070	23,132	21,688			21,688		20,876		20,682
Europe		20,708	20,658	21,000			21,029		21,296		21,864
Total Wireless Subscribers		280,572	279,012	275,798			275,828		278,025		287,497
FIXED RGUS:
Mexico Fixed		22,178	21,851	22,337			22,337		21,992		21,925
Brazil		36,716	35,904	35,285			35,285		34,048		32,648
Colombia		6,304	6,753	7,171			7,171		7,613		8,318
Southern Cone		1,942	2,023	2,199			2,199		2,514		2,836
Andean Region		1,820	1,765	1,856			1,856		2,049		2,158
Central America		5,392	5,811	6,465			6,465		4,409		4,247
Caribbean		2,663	2,700	2,546			2,546		2,528		2,558
Europe		5,900	6,036	6,261			6,203		6,143		6,050
Total Fixed RGUs		82,915	82,844	84,120			84,062		81,296		80,740
Total RGUs		363,488	361,856	359,919			359,890		359,323		368,237

PRINCIPAL BRANDS

We operate in all of our geographic segments under the Claro brand name, except in Mexico, the United States and Europe, where we principally do business under the brand names listed below.


COUNTRY	PRINCIPAL BRANDS	SERVICES AND PRODUCTS
Mexico	Telcel	Wireless voice
		Wireless data

	Telmex Infinitum	Fixed voice
		Fixed data

United ~~States~~States(1)	TracFone	Wireless voice ~~Wireless data~~
		Wireless data

	Straight Talk	Wireless voice
		Wireless data

Europe	A1⁽¹⁾	Wireless ~~vocie~~voice

		Wireless data

		Fixed voice

		Fixed data

		Pay TV

(1) We entered into an agreement to sell our United States operations to Verizon Communications Inc. as described under “Acquisitions, Other Investments and Divestitures.” We expect the closing to occur during 2021.

⁽¹⁾ ~~Since 2017, Telekom Austria has been extending a rollout of the A1 brand to all its regional operating companies.~~

SERVICES AND PRODUCTS

We offer a wide range of services and products that vary by market, including wireless voice, wireless data and value-added services, fixed voice, fixed data, broadband and IT services, Pay TV andover-the-top (“OTT”) services.

Wireless Operations

In ~~2018,~~2020, our wireless voice and data operations generated revenues of ~~Ps. 529.2~~Ps.561.5 billion, representing ~~51.0%~~55.5% of our consolidated revenues. As of December 31, ~~2018,~~2020, our wireless operations represented approximately ~~76.6%~~78.1% of our total RGUs.

~~Voice and Data~~VOICE AND DATA.

Our wireless subsidiaries provide voice communication services across the countries in which they operate. We offer international roaming services to our wireless subscribers through a network of cellular service providers with which our wireless subsidiaries have entered into international roaming agreements around the world, and who provide GSM, 3G and4G-LTE roaming services.

The voice and data plans are either “postpaid,” where the customer is billed monthly for the previous month, or “prepaid,” where the customer pays in advance for a specified volume of use over a specified period. Postpaid plans increased as a percentage of the wireless base from ~~25.3%~~32.0% in December ~~2017~~2019 to ~~27.5%~~34.0% as of December 31, ~~2018,~~2020, while prepaid plans represented ~~72.5%.~~66.0% as of December 31, 2020.

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Our wireless voice services are offered under a variety of plans to meet the needs of different market segments. In addition, we often bundle wireless data communications services together with wireless voice services. Our wireless subsidiaries had approximately ~~276~~287 million wireless voice and data subscribers as of December 31, ~~2018.~~2020.

Prepaid customers typically generate lower levels of usage and are often unwilling or financially ineligible to purchase postpaid plans. Our prepaid plans have been instrumental to increase wireless penetration in Latin America and Eastern Europe to levels similar to those of developed markets. Additionally, prepaid plans entail little to no risk ofnon-payment, as well as lower customer acquisition costs and billing expenses, compared to the average postpaid plan.

In general, our average rates per minute of wireless voice are very competitive for both prepaid and postpaid plans. ~~The~~On average, rates per minute of wireless voice used in ~~2018~~2020 decreased ~~an average of 11.12%,~~by approximately 27.1% at constant exchange rates relative to ~~2017.~~2019. In addition, the plans we offer our retail customers include selective discounts and promotions that reduce the rates our customers pay.

~~Value-Added Services~~VALUE-ADDED SERVICES.

As part of our wireless data business, our subsidiaries offer value-added services that include Internet access, messaging and other wireless entertainment and corporate services through GSM/EDGE, 3G and 4G LTE networks.

Internet services include roaming capability and wireless Internet connectivity for feature phones, smartphones, tablets and laptops, including data transmission,e-mail services, instant messaging, content streaming and interactive applications. For example, in Mexico, our website for our wireless services (www.telcel.com) through

Radiomóvil Dipsa, S.A. de C.V (“Telcel”), offers a wide range of services and content such as video, music, games and other applications, which our subscribers can access from mobile devices. In addition, we offer other wireless services, including wireless security services, mobile payment solutions,machine-to-machine services, mobile banking, virtual private network (“VPN”) services, video calls and ~~Personal Communications Service~~personal communications services (“PCS”).

Fixed Operations

In ~~2018,~~2020, our fixed voice, data, broadband and IT solutions had revenues of ~~Ps.222.6~~Ps.284.6 billion, representing ~~21.4%~~28.1% of our consolidated revenues. As of December 31, ~~2018,~~2020, our fixed operations represented approximately ~~23.4%~~21.9% of our total RGUs, compared to ~~22.9%~~22.6% as of December 31, ~~2017.~~2019.

~~Voice~~VOICE.

Our fixed voice services include local, domestic and international long-distance, ~~and public telephone services,~~ under a variety of plans to meet the needs of different market segments, specifically tailored to our residential and corporate clients.

~~Data~~DATA.

We offer data services, including data centers, data administration and hosting services to our residential and corporate clients under a variety of plans.

~~Broadband~~BROADBAND.

We provide residential broadband access through hybrid fiber-coaxial (“HFC”) or fiber-optic cable. These services are typically bundled with voice services and are competitively priced as a function of the desired or available speed. As a complement to these services, we offer a number of products such as home networking and smart home services.

~~ABOUT AMÉRICA MÓVIL~~

IT ~~Solutions~~SOLUTIONS.

Our subsidiaries provide a number of different IT solutions for small businesses and large corporations. We also provide specific solutions to the industrial, financial, government and tourism sectors, among others.

~~Pay TV~~PAY TV.

We offer Pay TV through cable and satellite TV subscriptions to both retail and corporate customers under a variety of plans. As of December 31, ~~2018,~~2020, we had approximately ~~21.5~~20.1 million Pay TV RGUs, a decrease of approximately ~~88.2~~796 thousand Pay TV RGUs from the prior year.

~~Equipment, Accessories and Computer Sales~~EQUIPMENT, ACCESSORIES AND COMPUTER SALES.

Equipment, accessories and computer sales ~~revenues~~ primarily include ~~revenues from~~ the sale of handsets, accessories and other equipment.

~~Other Services~~OTHER SERVICES.

Other services include ~~revenues from~~ other businesses such as telephone directories, call center services, wireless security services, advertising, media and software development services.

OTT ~~Services~~SERVICES.

We sell video, audio and other media content that is delivered through the internet directly from the content provider to the viewer or end user. Our most important service is ClaroVideo, anon-demand internet streaming video provider with more than ~~25,000~~18,500 content titles sold across all the Latin American and Caribbean markets in which we operate. We offer bundled packages of ClaroVideo, which may include:

Subscription video on demand, providing unlimited access to a catalogue of over ~~15,000~~18,500 titles for a fixed monthly subscription fee;

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Transactional video on demand and electronic sell-through, offering the option to rent or buy new content releases; and

Add-on services such as subscription and other OTT services through a platform payment system, including access to FOX, HBO, Noggin and ~~Noggin.~~

Paramount+, among others.

We also offer an advertised and unlimited music streaming and downloading service in 16 countries in Latin America and Europe through ClaroMúsica, with access to ~~more than 50,000~~approximately 50 million titles across all music genres.

Services and Products by Country

The following table is a summary of our principal services rendered and products produced as of December 31, ~~2018~~2020 in the countries in which we operate.



	WIRELESS VOICE, DATA AND ~~DATA AND~~ VALUE ADDED SERVICES⁽¹⁾	FIXED VOICE, BROADBAND, DATA AND IT SERVICES⁽²⁾	PAY TV	OTT SERVICES⁽³⁾
Argentina	🌑
~~Argentina~~ 🌑	✓ 🌑	✓ 🌑
Austria	✓ 🌑	✓
🌑	🌑	🌑
~~Austria~~ Belarus	✓ 🌑	✓ 🌑	✓ 🌑	✓ 🌑
Brazil	🌑
~~Belarus~~ 🌑	✓ 🌑	✓ 🌑
Bulgaria	✓ 🌑	✓
🌑	🌑	🌑
~~Brazil~~ Chile	✓ 🌑	✓ 🌑	✓ 🌑	✓ 🌑
Colombia	🌑
~~Bulgaria~~ 🌑	✓ 🌑	✓ 🌑
Costa Rica	✓ 🌑	✓
🌑	🌑	🌑
~~Chile~~ Croatia	✓ 🌑	✓ 🌑	✓ 🌑	✓ 🌑
Dominican Republic	🌑
~~Colombia~~ 🌑	✓ 🌑	✓ 🌑
Ecuador	✓ 🌑	✓
🌑	🌑	🌑
~~Costa Rica~~ El Salvador	✓ 🌑	✓ 🌑	✓ 🌑	✓ 🌑
Guatemala	🌑
~~Croatia~~ 🌑	✓ 🌑	✓ 🌑
Honduras	✓ 🌑	✓
🌑	🌑	🌑
~~Dominican Republic~~ Macedonia	✓ 🌑	✓ 🌑	✓ 🌑	✓ 🌑
Mexico	🌑
~~Ecuador~~ 🌑	✓	✓	✓	✓

~~El Salvador~~	✓	✓	✓	✓

~~Guatemala~~	✓	✓	✓	✓

~~Honduras~~	✓	✓	✓	✓

~~Macedonia~~	✓	✓	✓

~~Mexico~~	✓	✓		✓🌑⁽⁴⁾
Nicaragua	🌑
~~Nicaragua~~ 🌑	✓ 🌑	✓ 🌑
Panama	✓ 🌑	✓ 🌑	🌑	🌑
Paraguay	🌑	🌑	🌑	🌑
Peru	🌑	🌑	🌑	🌑
Puerto Rico	🌑	🌑	🌑	🌑
Serbia	🌑			🌑
Slovenia	🌑	🌑	🌑	🌑
Uruguay	🌑			🌑
United States ⁽⁵⁾	🌑


~~Panama~~	✓	✓	✓	✓

~~Paraguay~~	✓	✓	✓	✓

~~Peru~~	✓	✓	✓	✓

~~Puerto Rico~~	✓	✓	✓	✓

~~Serbia~~	✓

~~Slovenia~~	✓	✓	✓	✓

~~Uruguay~~	✓			✓

~~United States~~	✓

⁽¹⁾					Includes voice communication and international roaming services, interconnection and termination services, SMS, MMS,e-mail, mobile browsing, entertainment and gaming applications.

⁽²⁾

Includes local calls, national and international ~~long-distance.~~long distance.

⁽³⁾

Includes ClaroVideo and ClaroMúsica.

⁽⁴⁾

Services provided bynon-concessionaire subsidiaries.

⁽⁵⁾

We entered into an agreement to sell our United States operations to Verizon Communications Inc. as described under “Acquisitions, Other Investments and Divestitures.” We expect the closing to occur during 2021.

1316

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~~OUR NETWORKS~~

Our networks are one of our main competitive advantages. Today, we own and operate one of the largest integrated platforms based on our covered population across 17 countries in Latin America and are ~~in the process of~~ expanding our network in Europe.

INFRASTRUCTURE

For the year ended December 31, ~~2018,~~2020, our capital expenditures totaled ~~Ps.151.8~~Ps.129.6 billion, which allowed us to increase our network, to expand our capacity and to upgrade our systems to operate with the latest technologies. With fully convergent platforms, we are able to deliver high-quality voice, video and data products.

As of December 31, ~~2018,~~2020, the main components of our infrastructure were comprised of:

~~Base stations: 241,990 base stations with 2G, 3G and 4G technologies (of which approximately 65% are equipped with 3G and 4G capabilities) across Latin America and Europe.~~

~~Fiber-optic network: More than 859 thousand km. Our network passed approximately 75 million homes.~~

~~Submarine cable system: Capacity of more than 189 thousand km in submarine cable, including theAMX-1~~ submarine cable that extends 17,500 km and connects the United States to Central and South America with 11 landing points and provides international connectivity to all of our subsidiaries in these geographic areas.

Satellites: Six. Star One S.A. (“Star One”) has the most extensive satellite system in Latin America, with a fleet that covers the United States, Mexico, Central America and South America. We use these satellites to supply capacity for DTH services for Claro TV throughout Brazil and in other DTH Operations, as well as cellular backhaul, video

•

Cell sites : 100,122 sites with 2G, 3G and 4G technologies across Latin America and Europe. Tower space for our cell sites is a combination of towers we own and tower spaces leased from third parties. Additionally, we have been expanding our coverage and improving quality and speed with a number of street cells and indoor solutions. Our Board of Directors has approved a plan to spin off our towers and related passive infrastructure in Latin America into an independent Company. See “Acquisitions, Other Investments and Divestitures.”

•

Fiber-optic network: More than 1,081 thousand km. Our network passed approximately 81 million homes.

•

Submarine cable system: Capacity of more than 189 thousand km in submarine cable, including the AM-1 submarine cable that extends 17,500 km and connects the United States to Central and South America with 11 landing points and provides international connectivity to all of our subsidiaries in these geographic areas.

•

Satellites: Six. Star One S.A. (“Star One”) has the most extensive satellite system in Latin America, with a fleet that covers the United States, Mexico, Central America and South America. We use these satellites to supply capacity for DTH services for Claro TV throughout Brazil and in other DTH Operations, as well as cellular backhaul, video broadcast and corporate data networks. In 2015 and 2016, we launched the Star One D1 and the Star One C4 to replace two limited capacity satellites.

•

Data centers: 31. We use our data centers to manage a number of cloud solutions, such as Infrastructure as a Service (“IAAS”), Software as a Service (“SAAS”), security solutions and unified communications.

Data centers: 27. We use our data centers to manage a number of cloud solutions, such as Infrastructure as a Service (“IAAS”), Software as a Service (“SAAS”), security solutions and unified communications.

In the United States, we do not own any wireless telecommunications facilities or hold any wireless spectrum licenses. Instead, we purchase airtime through agreements with wireless service providers and resell airtime to customers. Through these agreements, we have a nationwide “virtual” network, covering almost all areas in which wireless services are available.

TECHNOLOGY

Our primary wireless networks use GSM/EDGE, 3G and 4G LTE technologies, which we offer in most of the countries where we operate. We aim to increase the speed of transmission of our data services and have been expanding our 3G and 4G LTE coverage. ~~In 2018, we rolled out~~We have begun our ~~4.5G coverage~~5G rollout in ~~most of our operations.~~some countries.

We transmit wireless calls and data through radio frequencies that we use under spectrum licenses. Spectrum is a limited resource, and, as a result, we may face spectrum and capacity constraints on our wireless network. We continue to invest significant capital in expanding our network capacity and reach and to address spectrum and capacity constraints on amarket-by-market basis. ~~In 2018, we spent Ps.4.2 billion on the acquisition of spectrum licenses, mainly in Paraguay and Argentina.~~

The table below presents a summary of the population covered by our network, by country, as of December 31, ~~2018.~~2020.



GENERATION TECHNOLOGY*

	GSM			UMTS			LTE
	(% of covered population)
Argentina		99	%		99	%		98	%
Austria		100	%		97	%		98	%
Belarus		100	%		100	%		-
Brazil		94	%		95	%		87	%
Bulgaria		100	%		100	%		99	%
Chile		97	%		97	%		98	%
Colombia		91	%		80	%		72	%
Costa Rica		85	%		79	%		75	%
Croatia		99	%		99	%		99	%
Dominican Republic		100	%		99	%		97	%
Ecuador		96	%		80	%		76	%
El Salvador		91	%		81	%		66	%
Guatemala		89	%		88	%		82	%
Honduras		89	%		82	%		58	%
Macedonia		100	%		100	%		99	%
Mexico		94	%		95	%		91	%
Nicaragua		76	%		72	%		55	%
Panama		82	%		88	%		82	%
Paraguay		76	%		74	%		70	%
Peru		88	%		84	%		83	%
Puerto Rico		82	%		97	%		98	%
Serbia		99	%		98	%		98	%
Slovenia		100	%		100	%		99	%
Uruguay		96	%		91	%		82	%

*	As of December 31, 2020, our 5G network covered the following percentages of popula- tion in the places indicated: 22.7% in Austria, 16.4% in Brazil and 10% in Puerto Rico.

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GENERATION TECHNOLOGY



GSM



UMTS



LTE


(% of covered population)

Argentina


98



91



88

Austria


100



98



98

Belarus


99



99



—

Brazil


93



94



81

Bulgaria


100



100



99

Chile


99



97



94

Colombia


92



79



61

Costa Rica


74



80



40

Croatia


99



99



99

Dominican Republic


100



99



94

Ecuador


96



76



59

El Salvador


91



82



64

Guatemala


89



81



62

Honduras


86



81



52

Macedonia


100



100



99

Mexico


93



94



86

Nicaragua


85



80



46

Panama


84



84



67

Paraguay


76



73



53

Peru


87



80



73

Puerto Rico


80



96



86

Serbia


99



98



98

Slovenia


100



100



99

Uruguay


96



91



80

~~OUR COMPETITORS~~

We operate in an intensely competitive industry. Competitive factors within our industry include pricing, brand recognition, service and product offerings, customer experience, network coverage and quality, development and deployment of technologies, availability of additional spectrum licenses and regulatory developments.

Our principal competitors differ, depending on the geographical market and the types of service we offer. We compete against other providers, of wireless, broadband and Pay TV that operate on a multi-national level, such as AT&T Inc., Teléfonica and Millicom, as well as various providers that operate on a nationwide level, such as Telecom Argentina in Argentina and ~~TIM.~~Telecom Italia in Brazil. Competition remains intense as a result of saturation in the fixed and wireless

market, increased network investment by our competitors, the development and deployment of new technologies, the introduction of new products and services, new market entrants, the availability of additional spectrum, both licensed and unlicensed, and regulatory changes.

The effects of competition on our subsidiaries depend, in part, on the size, service offerings, financial strength and business strategies of their competitors, regulatory developments and the general economic and business climate in the countries in which they operate, including demand growth, interest rates, inflation and exchange rates. The effects could include loss of market share and pressure to reduce rates. See “Regulation” under Part VI and “Risk Factors” under Part III of this annual report.

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~~ACQUISITIONS, OTHER~~

~~INVESTMENTS AND DIVESTITURES~~

Geographic diversification has been a key to our financial success, as it has provided for greater stability in our cash flow and profitability and has contributed to our strong credit ratings. In recent years, we have been evaluating the expansion of our operations to regions outside of Latin America. We believe that Europe and other areas beyond Latin America present opportunities for investment in the telecommunications sector that could benefit us and our shareholders over the long term.

We continue to seek ways to optimize our portfolio, including by finding investment opportunities in telecommunications and related companies worldwide, including in markets where we are already present, and we often have several possible acquisitions under consideration. ~~We can give no assurance as to the extent, timing or cost of such investments.~~

We may pursue opportunities in Latin America or in other areas in the world. Some of the assets that we acquire may require significant funding for capital expenditures.

We ~~continue~~can give no assurance as to ~~make incremental acquisitions~~the extent, timing or cost of such investments. We also periodically evaluate opportunities for dispositions, in ~~areas~~particular for businesses and in geographies that we no longer consider ~~accretive~~strategic. Recent developments related to acquisitions, other investments and divestitures include:

On September 13, 2020, we entered into an agreement to sell our wholly-owned subsidiary TracFone Wireless, Inc. to Verizon Communications Inc. The consideration for the transaction will include U.S.$3,125 million in cash and U.S.$3,125 million in Verizon common stock (determined based on the pre-closing trading price of Verizon common stock, but subject to a collar on the number of shares, whereby the number of shares constituting the stock consideration will be no less than 47,124,445 and no greater than 57,596,545), subject to customary adjustments, at closing. The agreement also includes up to an additional $650 million in future cash consideration related to the achievement of certain performance measures and other commercial arrangements. The closing of the transaction is subject to customary conditions, including obtaining regulatory approval. Approvals from the Federal Communications Commission and California Public Utilities Commission are still pending. We expect the closing to occur during the second half of 2021.

In September 2020, we terminated our January 24, 2019 agreement to purchase 99.3% of Telefónica Móviles El Salvador, S.A. de C.V. after careful consideration of the conditions to obtaining regulatory approval.

In December 2020, our Brazilian subsidiary, Claro S.A. (“Claro”), together with two other offerors, won a competitive bid to acquire the mobile business owned by Oi Group in Brazil. Pursuant to the transaction, Claro will pay R$3.6 billion for 32% of Oi Group’s mobile business and approximately 4.7 thousand mobile access sites (representing 32% of Oi Group’s mobile business access sites). Claro also committed to enter into long term agreements with Oi Group for the supply of data transmission capacity. The closing of the transaction is subject to customary conditions, including obtaining regulatory approval, and we expect the closing to occur during 2021.

In February 2021, our Board of Directors approved a plan to spin off our telecommunications towers and other related passive infrastructure in Latin America. This operation will maximize the infrastructure’s value, as the resulting entities will be independent from the Company, with their own management and personnel, exclusively focused on developing, building and sharing telecommunications towers for wireless services. We expect to enter into lease agreements with the new entities under which we will continue using the tower space to provide wireless services. The execution of the reorganization plan will comply with applicable requirements under the laws of each applicable jurisdiction, and will be subject to obtaining required regulatory approvals. See note 25 to our ~~existing operations.~~ audited consolidated financial statements.

For additional information on our acquisitions and investments, see ~~Recent Developments above and~~ note 12 to our audited consolidated financial statements included in this annual report.

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~~MARKETING, SALES AND DISTRIBUTION,~~

~~CUSTOMER SERVICES~~

MARKETING

We advertise our services and products through different channels with consistent and distinct branding and targeted marketing. We advertise via print, radio, television, digital media, sports event sponsorships and other outdoor advertising campaigns. In ~~2018,~~2020, our efforts were mainly focused on promoting our 4.5G LTE services, leveraging the speed and quality of our networks and our fixed bundled offers, which compete on broadband speed and premium content.

We build on the strength of our well-recognized brand names to increase consumer awareness and customer loyalty. Building brand recognition is crucial for our business, and we have managed to position our brands as those of a premium carrier in most countries where we operate. ~~For example,~~According to the 2020 Brand Finance Telecom 150 report, Telcel is among the top ten strongest brands in the telecom sector which evaluates marketing investment, customer perception, staff satisfaction and corporate reputation. Also, Claro iswas named the most valuable ~~telecom~~ brand in the Latin America ~~region, according to the Telecoms 300 2018 report by Brand Finance.~~region. BrandZ’s Top 50 Most Valuable Latin American Brands ~~2018 list~~2020 ranked Telcel among the~~top-ten~~ top five brands in Latin America. In the same year, BrandZ also named ~~Telcel and Telmex as the highest recognized telecom brands in Mexico, and~~ Telcel and Claro as two of the highest-ranked telecom brands in Latin America. In addition, ~~Embratel and NET, our brands in Brazil, are among the top fifteen most valuable brands in the country. A 2018~~a year-end 2020 study by Austrian Brand Monitor found that

A1, the brand name behind Telekom Austria, ranked number one in the Austrian telecommunications market for brand awareness, as well as for brand perception as a premium brand.

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SALES AND DISTRIBUTION

Our extensive sales and distribution channels help us attract new customers and develop new business opportunities. We primarily sell our services and products through a network of retailers and service centers for retail customers and a dedicated sales force for corporate customers, with more than ~~450,000~~490,000 points of sale and ~~almost 2,800~~more than 2,900 customer service centers. Our subsidiaries also sell their services and products online.

CUSTOMER ~~SERVICES~~SERVICE

We give priority to providing our customers with quality customer care and ~~support, with approximately 120,000 employees dedicated to customer service.~~support. We focus our efforts on constantly improving our customers’ experience by leveraging our commercial offerings and our sales and distribution networks. Customers may make inquiries by calling a toll-free telephone number, accessing our subsidiaries’ web sites and social media accounts or visiting one of the customer sales and service centers located throughout the countries we serve.

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~~PART II OPERATING AND FINANCIAL REVIEW AND PROSPECTS~~

~~OVERVIEW~~

INTRODUCTION

Effects of the COVID-19 Pandemic

The unprecedented health crisis arising from the spread of the COVID-19 pandemic has resulted in a severe global economic downturn and has caused significant volatility, uncertainty, and disruption. We are closely monitoring the evolution of the COVID-19 pandemic in the countries where we operate to take preventive measures to ensure the continuity of operations and safeguard the health and safety of our personnel and customers. Based on the information available as of the date of this annual report, below is a summary of the main effects of the COVID-19 pandemic on our business and results of operations:

During most of the year, practically all our region of operations was subject to lockdown and other measures implemented to control the spread of COVID-19. These restrictions disrupted commercial activities, resulted in the closure of shops and customer-care centers and imposed constraints on the mobility of our clients. They also disrupted our supply chain for handsets and other equipment. During the second quarter of the year, we disconnected five million wireless clients, including 4.6 million prepaid clients, that were unable to recharge their accounts, and we were unable to disconnect service for a significant amount of other customers as a result of governmental restrictions prohibiting disconnection due to non-payment during the pandemic. As a result, our uncollectible accounts increased temporarily before stabilizing again at pre-pandemic levels. The impact on prepaid revenues was stronger in countries where prepaid services are more prevalent, including Mexico and the Dominican Republic. The impact of COVID-19 was more limited on our fixed-line platform.

During the second half of the year, the economy recovered throughout most of our regions of operations, with confidence levels increasing in November following the U.S. presidential election and, shortly thereafter, the announcements of the approval of COVID-19 vaccines. Latin American currencies, which had depreciated sharply against the U.S. dollar as the pandemic spread, strengthened notably, with the Mexican, Colombian and Chilean pesos appreciating versus the dollar during the fourth quarter. Other currencies also did well during the fourth quarter, including the euro and the Brazilian real.

Segments

We have operations in 25 countries, which are aggregated for financial reporting purposes into ten reportable segments. Our operations in Mexico are presented in two segments—Mexico Wireless and Mexico Fixed, which consist principally of Telcel and Telmex, respectively. Our headquarters operations are allocated to the Mexico Wireless segment. Financial information about our segments is presented in ~~note 22~~

Note 23 to our audited consolidated financial statements included in this annual report.

The factors that drive our financial performance differ in the various countries where we operate, including subscriber acquisition costs, the competitive landscape, the regulatory environment, economic factors and interconnection rates, among others. Accordingly, our results of operations in each period reflect a combination of these effects on our different segments.

Constant Currency Presentation

Our financial statements are presented in Mexican pesos, but our operations outside Mexico account for a significant portion of our revenues. Currency variations between the Mexican peso and the currencies of ournon-Mexican subsidiaries, especially the Euro, U.S. dollar, Brazilian real, Colombian and Argentine peso, affect our results of operations as reported in Mexican pesos. In the following discussion regarding our operating results, we include a discussion of the change in the different components of our revenues between periods at constant exchange rates, i.e., using the same exchange rate to translate the local-currency results of ournon-Mexican operations for both periods. We believe that this additional information helps investors better understand the performance of ournon-Mexican operations and their contribution to our consolidated results.

Effects of Exchange Rates

Our results of operations are affected by changes in currency exchange rates. In ~~2018~~2020 compared to ~~2017,~~2019, the Mexican peso was ~~stronger~~weaker against some of our operating currencies, ~~(including the Brazilian Real and the Argentine Peso) and weaker against others (including~~including the U.S. Dollar and the ~~Euro).~~Euro.

Since most of our debt is issued by América Móvil out of Mexico, to the extent that our functional currency, the Mexican peso, appreciates or depreciates against the currencies in which our indebtedness is denominated, we

may incur foreign exchange gains or losses that are recorded as other comprehensive income in our consolidated statements of financial position.

Changes in exchange rates also affect the fair value of derivative financial instruments that we use to manage our currency-risk exposure, which are generally not accounted for as hedging instruments. In ~~2018,~~2020, the Mexican peso ~~and the Brazilian real~~ weakened against the currencies in which most of our indebtedness is ~~denominated. We~~denominated, and we recorded net foreign exchange losses of ~~Ps.7.3~~Ps.65.4 billion and net fair value ~~losses~~gains on derivatives of ~~Ps.4.7~~Ps.12.4 billion. In ~~2017,~~2019, the Mexican peso ~~and the Brazilian real weakened~~strengthened against the currencies in which most of our indebtedness is ~~denominated. We~~denominated, and we recorded net foreign exchange ~~losses~~gains of ~~Ps.13.8~~Ps.5.2 billion ~~partially offset by~~and net fair value gains on derivatives of ~~Ps.8.2~~Ps.4.4 billion. See ~~note~~Note 7 to our audited consolidated financial statements included in this annual report.

~~Recent Changes in Accounting Standards~~

We adopted IFRS 15 on revenue recognition for the first time in 2018 using the modified retrospective method, which does not require us to restate our financial information from prior periods. The impact of applying IFRS 15 to our audited consolidated financial statements in 2018 was not significant, see note 2 i) to our audited consolidated financial statements included in this annual report.

We have adopted IFRS 16 on leasing as of January 1, 2019 using the modified retrospective method. The implementation of IFRS 16 will have a significant impact on our consolidated statements of financial position by requiring that we recognize~~right-of-use~~ assets and lease liabilities. In our consolidated statements of comprehensive income, we expect the impact of the new standard will be to increase interest expense and depreciation while reducing other operating costs, without a significant impact on net income. The future impact of IFRS 16 on our results of operations will depend not only on the lease agreements in effect at the time of adoption but also on any new lease agreements. For more information, see note 23 to our audited consolidated financial statements included in this annual report.

~~Effects of Regulation~~24

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EFFECTS OF REGULATION

We operate in a regulated industry. Our results of operations and financial condition have been, and will continue to be, affected by regulatory actions and changes. Significant regulatory developments are presented in more detail in “Regulation” under Part VI and “Risk Factors” under Part III of this annual report.

Comparison of Results of Operations Between 2019 and 2018

20Discussions of year-over-year comparisons between 2019 and 2018 that are not included in this report can be found in under Part II, Operating and Financial Review and Prospects of our Form 20-F for the fiscal year ended December 31, 2019.

COMPOSITION OF OPERATING REVENUES

In ~~2018,~~2020, our total operating revenues were ~~Ps.1,038.2~~Ps.1,017 billion.

Revenues from wireless and fixed voice services primarily include charges from monthly subscriptions, usage charges billed to customers and usage charges billed to other service providers for calls completed on our network. The primary drivers of revenues from monthly subscription charges are the number of total RGUs and the prices of our service packages. The primary driver of revenues from usage charges (airtime, international and long-distance calls and interconnection costs) is traffic, which is represented by the number of total RGUs and their average usage.

Revenues from wireless and fixed data services primarily include charges for data, cloud, internet and OTT services and the usage from our data centers. In addition, revenues from value-added services and IT solutions to corporate clients contribute to our results for wireless and fixed data services, respectively. Revenues from IT solutions to our corporate clients mainly consist of revenues from installing and leasing dedicated links and revenues from VPN services.

Pay TV revenues consist primarily of charges from subscription services, additional programming, includingon-demand programming and advertising.

Equipment, accessories and computer sales revenues primarily include revenues from the sale of handsets, accessories and other equipment such as office equipment, household appliances and electronics. Most of our sales in handsets are driven by the number of new customers and contract renewals.

Other services primarily include revenues from other businesses, such as advertising and news companies, entertainment content distribution, telephone directories, call

center services, wireless security services, network infrastructure services and a software development company.

Seasonality of our Business

Our business is subject to a certain degree of seasonality, characterized by a higher number of new customers during the fourth quarter of each year. We believe this seasonality is mainly driven by the Christmas shopping season. Revenue also tends to decrease during the months of August and September, when family expenses shift towards school supplies in many of the countries in which we operate, mainly Mexico.

General Trends Affecting Operating Results

Our results of operations in ~~2018~~2020 reflected several continuing long-term trends, including:

intense competition, with growing costs for marketing and subscriber acquisition and retention, as well as declining customer prices;

~~changes~~developments in the telecommunications regulatory environment;

growing demand for data services over fixed and wireless networks, as well as for smartphones and devices with data service capabilities;

declining demand for voice services; and

growing operating costs reflecting, among other things, higher costs for Pay TV, customer care services and managing larger and more complex networks.

These trends are broadly characteristic of our businesses in all regions in recent years, and they have affected comparable telecommunications providers as well. Our performance in recent years has also been affected by ongoing regulatory changes in Mexico.

LOGO

~~RESULTS OF OPERATIONS~~

CONSOLIDATED RESULTS OF OPERATIONS FOR ~~2018~~2020 AND ~~2017~~2019

Operating Revenues

Total operating revenues for ~~2018~~2020 increased by ~~1.6%~~0.9%, or ~~Ps.16.6~~Ps.9.5 billion, over ~~2017.~~2019. At constant exchange rates, total operating revenues for ~~2018~~2020 decreased by 0.4% over 2019. This decrease principally reflects a decrease in equipment sales and handset financing revenues as well as a decrease in Pay TV services revenues.

SERVICE REVENUES.Revenues services for 2020 increased by ~~3.5%~~2.8%, or Ps.23.5 billion, over ~~2017.~~2019. At constant exchange rates, revenues services for 2020 increased by 1.7% over 2019. This increase principally reflects increases in revenues from our mobile services (both prepaid and postpaid), fixed ~~data services,~~broadband and ~~equipment, accessories and computer sales operations,~~corporate networks, which were partially offset by a decrease in revenues from our ~~mobile and fixed voice services.~~Pay TV services in Brazil.

~~REVENUES SERVICES.~~Revenues services for 2018 decreased by 1.7%, or Ps.14.8 billion, over 2017. At constant exchange rates, revenues services for 2018 increased by 0.5% over 2017. This increase principally reflects increases in revenues from our mobile voice and fixed and mobile data services, which were partially offset by a decrease in revenues from our fixed voice services.

SALES OF EQUIPMENT, ACCESSORIES AND COMPUTERS.Sales of equipment, accessories and computer sales revenues for ~~2018 increased~~2020 decreased by ~~21.9%~~8.1%, or ~~Ps.31.3~~Ps.14.0 billion, over ~~2017.~~2019. At constant exchange rates, revenues from sales of equipment, accessories and computer sales for ~~2018 increased~~2020 decreased by ~~22.1%~~10.7% over ~~2017.~~2019. This ~~increase~~decrease principally reflects ~~higher~~lower sales of smartphones, data-enabled devices and ~~accesories.~~accessories.

Operating Costs and Expenses

COST OF SALES. Cost of sales was ~~Ps.180.0 billion~~Ps.167.5 for ~~2018, an increase~~2020, a decrease of ~~5.8%~~4.0% from ~~Ps.170.2~~Ps.174.5 billion in ~~2017.~~2019. At constant exchange rates, cost of sales for ~~2018 increased~~2020 decreased by ~~5.5%~~8.0% over ~~2017.~~2019. This ~~increase~~decrease principally reflects lower sales ofhigher-end smartphones ~~provided to our postpaid subscribers~~ and ~~an increase in~~ handset financing plans.

COST OF ~~SERVICES.~~SERVICES. Cost of services was ~~Ps.328.8 billion~~Ps.302.9 for ~~2018,~~2020, an increase of ~~0.8%~~1.9% from ~~Ps.326.2~~297.2 billion in ~~2017.~~2019. At constant exchange rates, cost of services for ~~2018 increased~~2020 decreased by ~~2.8%~~0.1% over ~~2017. This increase principally reflects an increase~~2019. We were able to maintain low cost of services in ~~costs related to network operations, including energy and leasing tower sites, third-party technical and IT services, as well as TV content acquisition, which was partially offset by~~significant part because of the success of our ~~coporate cost-savings~~cost savings program.

COMMERCIAL, ADMINISTRATIVE AND GENERAL EXPENSES.Commercial, administrative and general expenses for ~~2018~~2020 decreased by ~~5.6%~~1.8%, or ~~Ps.13.4~~Ps.3.9 billion, over ~~2017.~~2019. As a percentage of operating revenues, commercial, administrative and general expenses were ~~21.9%~~20.9% for ~~2018,~~2020, as compared to ~~23.6%~~21.4% for ~~2017.~~2019. At constant exchange rates, commercial, administrative and general expenses for ~~2018~~2020 decreased by ~~3.8%~~2.7% over ~~2017.~~2019. This decrease principally reflects ~~a decrease~~the success of our corporate cost savings program and better allocation of marketing, advertising, and sales resources, and an increase in ~~costs related~~the proportion of online sales as compared to ~~customer services, systems development and local taxes.~~sales in physical stores due to COVID-19 restrictions.

OTHER EXPENSES.Other expenses for ~~2018~~2020 decreased by ~~Ps.17.4~~Ps.1.1 billion over ~~2017, principally reflecting the payment in 2017 of an arbitration award granted in Colombia.~~2019.

DEPRECIATION AND AMORTIZATION.Depreciation and amortization for ~~2018 decreased~~2020 increased by ~~2.8%~~3.4%, or ~~Ps.4.5~~Ps.5.3 billion, over ~~2017.~~2019. As a percentage of operating revenues, depreciation and amortization was ~~15.0%~~16.2% for ~~2018,~~2020, as compared to ~~15.7%~~15.8% for ~~2017.~~2019. At constant exchange rates, depreciation and amortization for ~~2018 decreased~~2020 increased by ~~1.8%~~2.1% over ~~2017.~~2019. This increase principally reflects depreciation and amortization expenses of Nextel Telecomunicações Ltda. And its subsidiaries (“Nextel Brazil”) in 2020, which were not incurred in 2019 before our acquisition of Nextel Brazil.

Operating Income

Operating income for ~~2018~~2020 increased by ~~39.4%~~6.8%, or ~~Ps.39.4~~Ps.10.5 billion, over ~~2017.~~2019. Operating margin (operating income as a percentage of operating revenues) was ~~13.4%~~16.3% for ~~2018,~~2020, as compared to ~~9.8%~~15.4% for ~~2017.~~2019.

Non-Operating Items

NET INTEREST EXPENSE.Net interest expense (interest expense less interest income) for ~~2018 decreased~~2020 increased by ~~22.8%~~6.2%, or ~~Ps.6.3~~Ps.2.0 billion, over ~~2017.~~2019. This ~~decrease~~increase principally reflects ~~the favorable resolution of certain tax contingencies.~~an increase in interest expense on lease liabilities and a decrease in interest income in Brazil.

FOREIGN CURRENCY EXCHANGE ~~LOSS,~~LOSSES, NET.We recorded a net foreign currency exchange ~~loss~~losses of ~~Ps.7.3~~Ps.65.4 billion for ~~2018,~~2020, compared to our net foreign currency exchange ~~loss~~gain of ~~Ps.13.8~~Ps.5.2 billion for ~~2017.~~2019. The loss principally reflects the ~~depreciation~~appreciation of some of the currencies in which our indebtedness is denominated, particularly the Euro and the ~~pound sterling.~~Dollar.

VALUATION OF DERIVATIVES, INTEREST COST FROM LABOR OBLIGATIONS AND OTHER FINANCIAL ITEMS, ~~NET.~~NET.We recorded a ~~loss~~net gain of ~~Ps.10.2~~Ps.1.3 billion for ~~2018~~2020 on the

valuation of derivatives, interest cost from labor obligations and other financial items, net, compared to a net loss of ~~Ps.1.9~~Ps.7.1 billion for ~~2017.~~2019. The ~~loss~~change in ~~2018~~2020 principally reflects a ~~derivatives loss,~~gain on hedging instruments as a result of the appreciation of some of the currencies in which ~~was partially offset by gains~~our indedebtedness is denominated. See Note 22 to our audited consolidated financial statements included in ~~our monetary position.~~this annual report.

INCOME TAX.Our income tax expense for ~~2018 increased~~2020 decreased by ~~86.3%~~67.9%, or ~~Ps.21.5~~Ps.34.7 billion, over ~~2017.~~2019. This ~~increase~~decrease principally reflects ~~higher pretax~~lower profit before income due to a ~~smaller~~ foreign exchange loss in ~~2018 compared to 2017.~~2020.

Our effective corporate income tax rate as a percentage of profit before income tax was ~~46.0%~~24.3% for ~~2018,~~2020, compared to ~~43.7%~~42.1% for ~~2017.~~2019. This rate differed from the Mexican statutory rate of 30% and changed year over year principally as a

result of ~~changes~~the reversal of certain tax expenses in ~~permanent items such as local~~Brazil, which lowered our income tax ~~inflation effects~~expense and ~~other impacts ofnon-taxable~~ ~~items.~~our effective corporate income tax for 2020.

Net Profit

We recorded a net profit of ~~Ps.54.5~~Ps.51.0 billion for ~~2018, an increase of 69.5%, or Ps.22.4 billion, over 2017.~~

~~CONSOLIDATED RESULTS OF OPERATIONS FOR 2017 AND 2016~~

~~Operating Revenues~~

Total operating revenues for 2017 increased by 4.7%, or Ps.46.2 billion, over 2016. At constant exchange rates, total operating revenues for 2017 increased by 2.0% over 2016. This increase principally reflects increases in revenues from our mobile data, fixed data and Pay TV operations, which were partially offset by a decrease in revenues from our mobile voice and fixed voice operations.

~~MOBILE VOICE.~~Mobile voice revenues for 2017 decreased by 8.5%, or Ps.20.6 billion, over 2016. At constant exchange rates, mobile voice revenues for 2017 decreased by 10.8% over 2016. This decrease principally reflects reduced interconnection rates and traffic in international and domestic long-distance calls, which was driven by higher data usage due to the growing use of social networking platforms.

~~FIXED VOICE.~~~~Fixed voice revenues for 2017 decreased by 5.7%, or Ps.5.4 billion, over 2016. At constant exchange rates, fixed voice revenues for 2017 decreased by 9.1% over~~

2016. This decrease principally reflects reduced interconnection rates and traffic in international and domestic long-distance calls, which was driven by the growing use of wireless technology and broadband voice services, such as WiFi calling.

~~MOBILE DATA.~~Mobile data revenues for 2017 increased by 20.1%, or Ps.51.6 billion, over 2016. At constant exchange rates, mobile data revenues for 2017 increased by 18.8% over 2016. This increase principally reflects the increased use of mobile data services, such as media and content downloading, web browsing, content streaming and~~machine-to-machine~~ ~~services, which was driven in part by the growing use of social networking apps and content downloading on tablets and notebooks.~~

~~FIXED DATA.~~Fixed data revenues for 2017 increased by 10.3%, or Ps.13.0 billion, over 2016. At constant exchange rates, fixed data revenues for 2017 increased by 5.9% over 2016. This increase principally reflects the growth in residential broadband services and corporate data services, such as cloud, dedicated links and data center services.

~~PAY TV.~~Pay TV revenues for 2017 increased by 11.0%, or Ps.8.6 billion, over 2016. At constant exchange rates, Pay TV revenues for 2017 increased by 2.3% over 2016. This increase principally reflects growth in our subscriber base and higher revenues driven by the cross-marketing of bundled packages and new TV channel packages, particularly in Colombia, Central America and the Caribbean.

~~EQUIPMENT, ACCESSORIES AND COMPUTER SALES.~~ Equipment, accessories and computer sales revenues for 2017 decreased by 0.2%, or Ps.0.3 billion, over 2016. At constant exchange rates, revenues from equipment, accessories and computer sales for 2017 decreased by 0.7% over 2016. This decrease principally reflects lower sales of~~higher-end~~ ~~smartphones, other data-enabled devices and tablets, which were partially offset by higher sales oflower-end~~ ~~smartphones due to subsidies provided to our postpaid subscribers and handset financing plans.~~

~~OTHER SERVICES.~~Revenues from other services for 2017 decreased by 2.1%, or Ps.0.7 billion, over 2016. At constant exchange rates, revenues from other services for 2017 decreased by 5.0% over 2016. This decrease principally

~~RESULTS OF OPERATIONS~~

~~reflects lower revenues from advertising and media services, online content, wireless security services, telephone directories and call center services.~~

~~Operating Costs and Expenses~~

~~COST OF SALES AND SERVICES.~~Cost of sales and services for 2017 increased by 2.3%, or Ps.11.3 billion, over 2016, representing 48.6% of operating revenues for 2017, as compared to 49.7% of operating revenues for 2016. At constant exchange rates, cost of sales and services for 2017 decreased by 0.2% over 2016.

~~Cost of sales was Ps.170.2 billion for 2017,~~2020, a decrease of ~~1.4% from Ps.172.5 billion in 2016. This decrease principally reflects higher sales oflower-end~~ ~~smartphones, which were driven by subsidies provided to our postpaid subscribers and an increase in handset financing plans, and improvements in the inventory management of our handsets.~~

Cost of services was Ps.326.2 billion for 2017, an increase of 4.4% from Ps.312.6 billion in 2016. This increase principally reflects an increase in costs related to network operations, including energy and leasing tower sites, third-party technical and IT services, as well as TV content acquisition.

~~COMMERCIAL, ADMINISTRATIVE AND GENERAL EXPENSES.~~~~Commercial, administrative and general expenses for 2017 increased by 5.5%~~27.4%, or ~~Ps.12.5~~Ps.19.3 billion, over 2016. As a percentage of operating revenues, commercial, administrative and general expenses were 23.6% for 2017, as compared to 23.4% for 2016. At constant exchange rates, commercial, administrative and general expenses for 2017 increased by 2.2% over 2016. This increase principally reflects an increase in costs related to customer services, allowance for doubtful accounts, systems development and local taxes.

Telcel and Telmex, like other Mexican companies, are required by law to pay their employees, in addition to their agreed compensation and benefits, profit sharing in an aggregate amount equal to 10.0% of each entity’s taxable income. Our subsidiaries in Ecuador and Peru are also required to pay employee profit sharing at rates of 15.0% and 10.0% of taxable income, respectively. We account for these profit sharing contributions under commercial, administrative and general expenses.

~~OTHER EXPENSES.~~~~Other expenses for 2017 increased by Ps.20.2 billion over 2016, principally reflecting the payment~~

~~of an arbitration award granted in Colombia. For further information on this arbitration proceeding, see note 16 to our audited consolidated financial statements included in this annual report.~~

~~DEPRECIATION AND AMORTIZATION.~~Depreciation and amortization for 2017 increased by 7.8%, or Ps.11.6 billion, over 2016. As a percentage of operating revenues, depreciation and amortization was 15.7% for 2017, as compared to 15.2% for 2016. At constant exchange rates, depreciation and amortization for 2017 increased by 3.4% over 2016. This increase principally reflects investments in our networks and the acceleration of amortizing the costs of various brands of Telekom Austria.

~~Operating Income~~

Operating income for 2017 decreased by 8.6%, or Ps.9.5 billion, over 2016. Operating margin (operating income as a percentage of operating revenues) was 9.8% for 2017, as compared to 11.2% for 2016. Excluding the effects of the approximately U.S.$1.0 billion arbitration payment in Colombia, operating income increased by 8.3%, or Ps.9.1 billion, over 2016.

~~Non-Operating~~ ~~Items~~

~~NET INTEREST EXPENSE.~~Net interest expense (interest expense less interest income) for 2017 decreased by 7.7%, or Ps.2.3 billion, over 2016. This decrease principally reflects lower interest expense due to the amortization of debt during this period.

~~FOREIGN CURRENCY EXCHANGE LOSS, NET.~~We recorded a net foreign currency exchange loss of Ps.13.8 billion for 2017, compared to our net foreign currency exchange loss of Ps.40.4 billion for 2016. The loss in both periods principally reflects the appreciation of some of the currencies in which our indebtedness is denominated, particularly the U.S. dollar, the Euro and the pound sterling.

~~VALUATION OF DERIVATIVES, INTEREST COST FROM LABOR OBLIGATIONS AND OTHER FINANCIAL ITEMS, NET.~~We recorded a loss of Ps.1.9 billion for 2017 on the valuation of derivatives, interest cost from labor obligations and other financial items, net, compared to a loss of Ps.16.2 billion for 2016. The net loss in 2017 principally reflects the interest cost of labor obligations, which was partially offset by a gain in valuation of derivatives.

~~EQUITY INTEREST IN NET INCOME OF ASSOCIATED COMPANIES.~~~~Our share of the net income of associated companies accounted for under the equity method was Ps.0.1 billion in 2017, as compared to Ps.0.2 billion for 2016.~~

~~INCOME TAX.~~~~Our income tax expense for 2017 increased by 118.8%, or Ps.13.5 billion, over 2016. This increase principally reflects the effect of a smaller foreign exchange loss than the one observed in 2016.~~

~~Our effective corporate income tax rate as a percentage of profit before income tax was 43.7% for 2017, compared to~~

48.6% for 2016. This rate differed from the Mexican statutory rate of 30% and changed year over year principally as a result of changes in permanent items such as the valuation of derivatives and other impacts of~~non-taxable~~ ~~items. We are evaluating the impact of the U.S. income tax reform on our U.S. operations, but we do not expect a material impact on our effective corporate income tax rate.~~

~~Net Profit~~

~~We recorded a net profit of Ps.32.2 billion for 2017, an increase of 166.2%, or Ps.20.1 billion, over 2016.~~

~~RESULTS OF OPERATIONS~~

2019.

SEGMENT RESULTS OF OPERATIONS

We discuss below the operating results of each reportable segment. Notes 22. z) and 2223 to our audited consolidated financial statements describe how we translate the financial statements of ournon-Mexican subsidiaries. Exchange rate changes between the Mexican peso and the currencies in which our subsidiaries operate affect our reported results in Mexican pesos and the comparability of reported results between periods.

The following table sets forth the exchange rates used to translate the results of our significantnon-Mexican operations, as expressed in Mexican pesos per foreign currency unit, and the change from the rate used in the prior period indicated. The U.S. dollar is our functional currency in several of the countries or territories in which we operate in addition to the United States, including Ecuador, Puerto Rico, Panama and El Salvador.


MEXICAN PESOS PER FOREIGN CURRENCY UNIT (AVERAGE FOR THE PERIOD)	MEXICAN PESOS PER FOREIGN CURRENCY UNIT (AVERAGE FOR THE PERIOD)													MEXICAN PESOS PER FOREIGN CURRENCY UNIT (AVERAGE FOR THE PERIOD)
				2016/2017					2017/2018
		2016		% CHANGE			2017		% CHANGE			2018			2019	2019/2020 % CHANGE	2020

Brazilian real			5.3868		10.2			5.9346		(10.8	)		5.2937		4.8907	(14.4)	4.1850

Colombian peso			0.0061		4.9			0.0064		1.6			0.0065		0.0059	0.00	0.0058

Argentine peso			1.2632		(9.0	)		1.1489		(36.4	)		0.7311		0.4110	(25.3)	0.3070

U.S. dollar			18.6529		1.5			18.9400		1.6			19.2397		19.2641	11.5	21.4859

Euro			20.6334		3.5			21.3649		6.3			22.7101		21.5642	13.7	24.5080

The tables below set forth operating revenues and operating income for each of our segments for the years indicated.


YEAR ENDED DECEMBER 31, 2018

													YEAR ENDED DECEMBER 31, 2020

													OPERATING REVENUES				OPERATING INCOME
	OPERATING REVENUES						OPERATING INCOME
	(in millions of Mexican pesos)			(as a % of total operating revenues)			(in millions of Mexican pesos)			(as a % of total operating income)			(in millions of Mexican pesos)		(as a% of to- tal operating revenues)		(in millions of Mexican pesos)		(as a% of total operat- ing income)

Mexico Wireless	Ps.	224,557			21.6	%	Ps.	57,451			41.2	%	Ps.	232,242		22.8%	Ps.	70,852		42.8%

Mexico Fixed		96,081			9.3			8,086			5.8			91,589		9.0		11,204		6.8

Brazil		193,306			18.6			23,495			16.8			168,073		16.5		25,204		15.2

Colombia		75,805			7.3			14,389			10.3			77,635		7.6		15,112		9.1

Southern Cone		102,350			9.9			16,976			12.2			56,705		5.6		1,877		1.1

Andean Region		55,787			5.4			5,004			3.6			53,935		5.3		8,699		5.3

Central America		45,033			4.3			4,868			3.5			48,195		4.7		4,005		2.4

United States		153,266			14.8			2,665			1.9			177,179		17.4		10,579		6.4

Caribbean		36,640			3.5			5,812			4.2			38,624		3.8		6,701		4.1

Europe		100,716			9.7			4,732			3.4			111,472		11.0		13,160		8.0

Eliminations		(45,333	)		(4.4	)		(3,921	)		(2.9	)	Ps.	(38,762)		(3.7)		(2,038)		(1.1)

Total	Ps.	1,038,208			100.0	%	Ps.	139,557			100.0	%	Ps.	1,016,887		100%	Ps.	165,355		100%

YEAR ENDED DECEMBER 31, 2019

OPERATING REVENUES

OPERATING INCOME

(in millions of
Mexican pesos)

(as a% of to-
tal operating
revenues)

(in millions of
Mexican pesos)

(as a% of
total operat-
ing income)

Mexico Wireless
Ps. 237,840 23.6% Ps. 67,694   43.7%
Mexico Fixed

96,037

9.5

9,732

6.3

Brazil

181,778

18.0

28,847

18.6

Colombia

74,636

7.4

15,325

9.9

Southern Cone

65,272

6.5

4,008

2.6

Andean Region

55,533

5.5

8,023

5.2

Central America
46,734 4.6 5,712   3.7
United States

155,864

15.5

2,968

1.9

Caribbean

35,718

3.5

5,741

3.7

Europe

98,420

9.8

8,688

5.6

Eliminations

(40,484)

(3.9)

(1,897)

(1.2)

Total

Ps.
1,007,348

100%

Ps.
  154,841

100%

2627

YEAR ENDED DECEMBER 31, 2017

OPERATING REVENUES

OPERATING INCOME


(in millions of
Mexican pesos)

(as a % of total
operating revenues)

(in millions of
Mexican pesos)

(as a % of total
operating income)

Mexico Wireless

Ps.
206,771

20.2
%

Ps.
50,666

50.6
%

Mexico Fixed

98,485

9.6

7,922

7.9

Brazil

215,322

21.1

11,601

11.6

Colombia

72,740

7.1

(4,704
)

(4.7
)

Southern Cone

82,344

8.1

11,676

11.7

Andean Region

56,571

5.5

5,650

5.6

Central America

44,282

4.3

5,252

5.2

United States

148,590

14.5

2,915

2.9

Caribbean

35,215

3.4

4,752

4.7

Europe

93,644

9.2

4,524

4.5

Eliminations

(32,330
)

(3.0
)

(111
)

(0.0
)

Total

Ps.
    1,021,634

100.0
%

Ps.
    100,143

100.0
%

YEAR ENDED DECEMBER 31, 2016

OPERATING REVENUES

OPERATING INCOME


(in millions of
Mexican pesos)

(as a % of total
operating revenues)

(in millions of
Mexican pesos)

(as a % of total
operating income)

Mexico Wireless

Ps.
203,567

20.9
%

Ps.
48,220

44.0
%

Mexico Fixed

102,216

10.5

12,276

11.2

Brazil

197,357

20.2

6,325

5.8

Colombia

67,589

6.9

11,210

10.2

Southern Cone

72,330

7.4

8,317

7.6

Andean Region

56,131

5.8

6,087

5.6

Central America

42,421

4.3

3,831

3.5

United States

140,856

14.4

1,221

1.1

Caribbean

36,498

3.7

6,143

5.6

Europe

86,979

8.9

5,389

4.9

Eliminations

(30,532
)

(3.0
)

591

0.5

Total

Ps.
       975,412

100.0
%

Ps.
    109,610

100.0
%
27
  ~~RESULTS OF OPERATIONS~~

INTERPERIOD SEGMENT COMPARISONS
The following discussion addresses the financial performance of each of our reportable segments ~~first~~ by comparing results for ~~2018~~2020 and ~~2017 and then by comparing results for 2017 and 2016.~~2019. In the~~year-to-~~year-to-year ~~year~~ comparisons for each segment, we include percentage changes in operating revenues, percentage changes in operating income and operating margin (operating income as a percentage of operating revenues), in each case calculated based on the segment financial information presented in ~~note 22~~Note 23 to our audited consolidated financial statements, which is prepared in accordance with IFRS.
Each reportable segment includes all income, cost and expense eliminations that occurred between subsidiaries within the reportable segment. The Mexico Wireless segment also includes corporate income, costs and expenses.
Comparisons in the following discussion are calculated using figures in Mexican pesos. We also include percentage changes in adjusted segment operating revenues, adjusted segment operating income and adjusted operating margin (adjusted operating income as a percentage of adjusted operating revenues). The adjustments eliminate (i) certain intersegment transactions, (ii) for ournon-Mexican segments, the effects of exchange rate changes and (iii) for the Mexican Wireless segment only, revenues and costs of group corporate activities and other businesses that are allocated to the Mexico Wireless segment.
Discussions of year-over-year comparisons between 2019 and 2018 that are not included in this report can be found under Part II, Operating and Financial Review and Prospects of our Form ~~2018~~20-F for the fiscal year ended December 31, 2019.
2020 COMPARED TO ~~2017~~2019
Mexico Wireless
The number of prepaid wireless subscribers for ~~2018~~2020 increased by ~~1.4%~~1.1% over ~~2017,~~2019, and the number of postpaid wireless subscribers increased by ~~5.8%~~1.3%, resulting in an increase in the total number of wireless subscribers in Mexico of ~~2.2%~~1.1%, or ~~1.5 million,~~871 thousand, to approximately ~~75.0~~77.8 million as of December 31, ~~2018.~~2020.
Segment operating revenues for ~~2018 increased~~2020 decreased by ~~8.6%~~2.4% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018 increased~~2020 decreased by ~~11.4%~~2.4% over ~~2017.~~2019. This ~~increase~~decrease in segment operating revenues principally reflects ~~an increase of 11.7%~~a decrease in ~~mobile data revenues, driven by increased use of value-~~
~~added services by our wireless subscribers, including activity from messaging, content downloading, mobile applications~~equipment sales and ~~social media, and an increase in revenues from service plans offering higher data capacity.~~handset financing plans.
Segment operating income for ~~2018~~2020 increased by ~~13.4%~~4.7% over ~~2017.~~2019. Adjusted segment operating income for ~~2018~~2020 increased by ~~20.2%~~1.8% over ~~2017.~~2019.
Segment operating margin was ~~25.6%~~30.5% in ~~2018,~~2020, as compared to ~~24.5%~~28.5% in ~~2017.~~2019. Adjusted segment operating margin for this segment was ~~31.1%~~36.7% in ~~2018,~~2020, as compared to ~~28.8%~~35.1% in ~~2017.~~2019. This increase in segment operating margin for ~~2018~~2020 principally reflects the success of our corporate cost savings program in operations and lower networks and maintenance costs, ~~related~~which we successfully continue to ~~interconnection rates, licensing fees, mobile site infrastructure rentals, maintenance~~implement without affecting the quality of our services and ~~roaming charges.~~coverage.
Mexico Fixed
The number of fixed voice RGUs in Mexico for ~~2018 increased~~2020 decreased by ~~1.0%~~3.1% over ~~2017,~~2019, and the number of broadband RGUs in Mexico increased by ~~3.8%~~3.3%, resulting in ~~an increase~~a decrease in total fixed RGUs in Mexico of ~~2.2%~~0.3% over ~~2017,~~2019, or ~~486~~67 thousand, to approximately ~~22.0~~21.9 million as of December 31, ~~2018.~~2020.
Segment operating revenues for ~~2018~~2020 decreased by ~~2.4%~~4.6% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018~~2020 decreased by ~~3.8%~~7.4% over ~~2017.~~2019. This decrease in segment operating revenues principally reflects a decrease in fixed voice revenues of ~~4.4%, driven~~4.9% and corporate networks services by ~~RGU disconnections, a decrease in long-distance calls and a decrease in fixed data revenues of 0.7%~~0.6%, which was partially offset by higher revenues from ~~broadband and corporate network services.~~broadband.
Segment operating income for ~~2018~~2020 increased by ~~2.1%~~15.1% over ~~2017.~~2019. Adjusted segment operating income for ~~2018~~2020 decreased by ~~18.1%~~33.6% over ~~2017.~~2019. This decrease principally reflects ~~lower revenues from long-distance~~a decrease in services provided, increases in the contractual salary of our employees, higher information technology and ~~equipment sales.~~customer service costs.
Segment operating margin was ~~8.4%~~12.2% in ~~2018,~~2020, as compared to ~~8.0%~~10.1% in ~~2017.~~2019. Adjusted segment operating margin was ~~3.7%~~1.8% in ~~2018,~~2020, as compared to ~~4.3%~~2.5% in ~~2017. This~~2019. The decrease in segment operating margin for ~~2018~~2020 principally reflects ~~increases~~reductions in ~~costs associated with customer service~~equipment sales and ~~service quality improvements, as well as network maintenance.~~lower revenues from voice services, partially offset by a decrease in segment depreciation expenses.
28
Brazil
The number of prepaid wireless subscribers for ~~2018 decreased~~2020 increased by ~~14.9%~~1.9% over ~~2017,~~2019, and the number of postpaid wireless subscribers increased by ~~15.6%~~29.6%, resulting in ~~a decrease~~an increase in the total number of wireless subscribers in Brazil of ~~4.4%~~15.9%, or ~~2.6~~8.6 million, to approximately ~~56.0~~63 million as of December 31, ~~2018.~~2020. The increase in the number of postpaid wireless subscribers is due primarily to commercial efforts aimed at converting prepaid subscribers to postpaid subscribers and additional subscribers as a result of the Nextel Brazil’s acquisition. The number of fixed voice RGUs for ~~2018~~2020 decreased by ~~5.0%~~8.4% over ~~2017,~~2019, the number of broadband RGUs increased by ~~5.0%~~2.8%, and the number of Pay TV RGUs decreased by ~~3.1%~~5.6%, resulting in a decrease in total fixed RGUs in Brazil of ~~1.7%~~4.1%, or ~~619 thousand,~~1.4 million, to approximately ~~35.0~~32.6 million as of December 31, ~~2018.~~2020.
28

Segment operating revenues for ~~2018~~2020 decreased by ~~10.2%~~7.5% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018~~2020 increased by ~~0.5%~~1.6% over ~~2017.~~2019. This increase in segment operating revenues principally reflects higher mobile data and fixed data revenues ~~of 31.0% and 7.6%, respectively,~~ in ~~2018~~2020 over ~~2017.~~2019. The increase in mobile data revenues in ~~2018~~2020 principally reflects the increased usage of social networking platforms, cloud services and other content, and fixed data revenues increased principally due to an increase in broadband RGUs, ~~and corporate network services. The increase~~which were, in ~~segment operating revenues was~~each case, partially offset by a decrease in ~~mobile voice, fixed voice and~~ Pay TV ~~revenues of 31.9%, 17.5% and 5.2%, respectively, in 2018 over 2017, driven by RGU disconnections and lower traffic reflecting a decrease in disposable income.~~revenues.

Segment operating income for ~~2018 increased~~2020 decreased by ~~102.5%~~12.6% over ~~2017.~~2019. Adjusted segment operating income for ~~2018 increased~~2020 decreased by ~~172.4%~~0.5% over ~~2017. This increase principally reflects the favorable resolution of certain tax contingencies.~~2019.

Segment operating margin was ~~12.2%~~15.0% in ~~2018,~~2020, as compared to ~~5.4%~~15.9% in ~~2017.~~2019. Adjusted segment operating margin was ~~11.3%~~14.1% in ~~2018,~~2020, as compared to ~~4.2%~~15.1% in ~~2017.~~2019. This ~~increase~~decrease in segment operating margin for ~~2018~~2020 principally reflects ~~synergy gains in marketing, network maintenance, information technology, subscriber acquisition~~a higher amortization and ~~customer service related~~depreciation expense as a result of changes to the ~~ongoing integration~~useful life of certain assets in Brazil, partially offset by improved cost management as a result of our ~~three Brazilian subsidiaries, which have collectively driven our costs down.~~cost savings program.

Colombia

The number of prepaid wireless subscribers for ~~2018~~2020 increased by ~~0.4%~~6.3% over ~~2017,~~2019, and the number of postpaid wireless subscribers increased by ~~3.7%~~5.6%, resulting in an increase in the total number of wireless subscribers in Colombia of ~~1.1%~~6.1%, or ~~328 thousand,~~1.9 million, to approximately ~~30.0~~33.0 million as of December 31, ~~2018.~~2020. The number of fixed voice RGUs for ~~2018~~2020 increased by ~~10.1%~~7.9% over ~~2017,~~2019, the number of broadband RGUs increased by ~~6.4%~~14.3% and the number of Pay TV RGUs increased by ~~2.8%~~5.2%, resulting in an increase in total fixed RGUs in Colombia of ~~6.2%~~9.3%, or ~~418~~705 thousand, to approximately ~~7.1~~8.3 million as of December 31, ~~2018.~~2020.

Segment operating revenues for ~~2018~~2020 increased by ~~4.2%~~4.0% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018~~2020 increased by ~~2.6%~~5.1% over ~~2017.~~2019. This increase in segment operating revenues principally reflects increases in fixed data revenues, mobile data revenues, ~~fixed voice revenues~~both in prepaid and postpaid mobile data, and Pay TV revenues, which increased by 8.9%, 3.2%, 9.0% and 8.6%, respectively, in 2018, principally due to an increase in sales of bundled packages of wireless services, higher demand for data plans and an increase in subscribers for internet services.revenues. The increase in segment operating revenues was partially offset by a decrease ~~of 8.1%~~ in ~~mobile voice revenues, driven by more competitive commercial offerings in response to pricing pressure from competitors.~~long distance revenues.

Segment operating income for ~~2018 was Ps.14.4 billion, compared to a segment operating loss of Ps 4.7 billion in 2017. This change is principally due to the payment in 2017 of an arbitration award granted in Colombia.~~2020 decreased by 1.4% over 2019. Adjusted segment operating income for ~~2018~~2020 increased by ~~576.5%~~1.4% over ~~2017.~~2019.

Segment operating margin was ~~19.0%~~19.5% in ~~2018,~~2020, as compared to ~~(6.5%)~~20.5% in ~~2017.~~2019. Adjusted segment operating margin was ~~23.3%~~24.7% in ~~2018,~~2020, as compared to ~~(5.0%)~~25.6% in ~~2017.~~2019. This decrease

is due to an increase in ~~segment operating margin for 2018 principally reflects Comcel’s cost savings program.~~amortization expenses caused by increased investments in spectrum and submarine cables.

~~RESULTS OF OPERATIONS~~

Southern ~~Cone—~~Cone - Argentina, Chile, Paraguay and Uruguay

The number of prepaid wireless subscribers for ~~2018~~2020 decreased by ~~1.4%~~5.1% over ~~2017,~~2019, and the number of postpaid wireless subscribers increased by ~~1.7%~~1.6%, resulting in a decrease in the total number of wireless subscribers in our Southern Cone segment of ~~0.3%~~2.7%, or ~~105~~838 thousand, to approximately ~~31.0~~30.6 million as of December 31, ~~2018.~~2020. The number of fixed voice RGUs for ~~2018~~2020 increased by ~~8.3%~~17.4% over ~~2017,~~2019, the number of broadband RGUs increased by ~~12.6%~~29.8%, and the number of Pay TV RGUs ~~increased~~decreased by ~~6.1%~~6.3%, resulting in an increase in total fixed RGUs in our Southern Cone segment of ~~8.7%~~12.8%, or ~~175~~322 thousand, to approximately ~~2.2~~2.8 million as of December 31, ~~2018.~~2020.

Segment operating revenues for ~~2018 increased~~2020 decreased by ~~24.3%~~13.1% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018 increased~~2020 decreased by ~~17.4%~~8.3% over ~~2017.~~2019. This ~~increase~~decrease principally reflects ~~an increase of 33.4%~~a decrease in adjusted operating revenues in Argentina, Paraguay and Uruguay. ~~This~~In Argentina, we experienced decrease in revenues from prepaid and postpaid wireless voice, corporate networks, and fixed voice, which were attributable to adverse economic conditions and which were partially offset by an increase ~~was driven by higher data usage, particularly~~ in ~~the form of mobile data, video streaming, content downloading and~~broadband. In Chile, we experienced a decline in wireless service ~~package purchases in Argentina, Paraguay and Uruguay and in the form of Pay TV, corporate network and broadband services in Chile.~~revenues due to competitive pressures. For this segment, we analyze results in Argentina, Paraguay and Uruguay in terms of the Argentine peso, because Argentina accounts for the major portion of the operations in these three countries.

Segment operating income for ~~2018 increased~~2020 decreased by ~~45.4%~~53.2% over ~~2017.~~2019. Adjusted segment operating income for ~~2018 increased~~2020 decreased by ~~52.1%~~16.8% over 2017. This increase principally reflects an increase in adjusted operating income of 41.0% in Argentina, Paraguay and Uruguay, which was partially offset by a decrease in adjusted operating loss of 16.2% in Chile.2019.

Segment operating margin was ~~16.6%~~3.3% in ~~2018,~~2020, as compared to ~~14.2%~~6.1% in ~~2017.~~2019. Adjusted segment operating margin was ~~20.2%~~15.7% in ~~2018,~~2020, which ~~increased~~decreased in comparison to ~~17.0%~~18.5% in ~~2017.~~2019. This ~~increase~~decrease in the segment operating margin for ~~2018~~2020 principally reflects ~~the cost saving programs~~a decrease in revenues, as described above, coupled with an increase in costs and expenses, including as a result of ~~our subsidiaries in the Southern Cone.~~inflation or exchange rates.

Andean ~~Region—~~Region - Ecuador and Peru

The number of prepaid wireless subscribers for ~~2018~~2020 decreased by ~~0.1%~~4.7% over ~~2017,~~2019, and the number of postpaid wireless subscribers ~~increased~~decreased by ~~0.2%~~8.9%, resulting in a decrease in the total number of wireless subscribers in our Andean Region segment of ~~0.04%~~6.1%, or ~~8 thousand,~~1.2 million, to approximately ~~20.3~~18.9 million as of December 31, ~~2018.~~2020. The number of fixed voice RGUs for ~~2018 increased~~2020 decreased by ~~2.9%~~4.4% over ~~2017,~~2019, the number of broadband RGUs increased by ~~12.4%~~ 21.9%

and the number of Pay TV RGUs decreased by ~~3.2%,~~13.6 %, resulting in an increase in total fixed RGUs in our Andean Region segment of ~~5.2%~~5.3%, or 91109 thousand, to approximately ~~1.8~~2.1 million as of December 31, ~~2018.~~2020.

Segment operating revenues for ~~2018~~2020 decreased by ~~1.4%~~2.9% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018~~2020 decreased by ~~2.0%~~9.8% over ~~2017.~~2019. This decrease principally reflects a decrease ~~of 0.1%~~in revenues in Ecuador, ~~and~~partially offset by an increase in Peru. The decrease in revenues in Ecuador reflects a decrease ~~of 4.3%~~ in ~~Peru. This decrease was driven~~revenues from prepaid and postpaid wireless and Pay TV services, partially offset by a slight increase in revenues from fixed voice services. In Peru, fixed service revenues increased, and they were partially offset by lower revenues from our wireless and fixed voice operations, an increase in tax obligations and bad debt expenses in Ecuador and competitive pricing practices, bundled packages and smartphones subsidies in Peru, which was partially offset by higher revenues fromon postpaid mobile ~~data and higher revenues from fixed data, especially broadband and corporate data~~ services.

Segment operating income for ~~2018 decreased~~2020 increased by ~~11.4%~~8.4% over ~~2017.~~2019. Adjusted segment operating income for ~~2018~~2020 decreased by ~~5.5%~~2.9% over ~~2017.~~2019. This decrease principally reflects ~~a decrease~~an operating income increase of ~~15.4%~~40.0% in Peru and a decrease of ~~0.1%~~21.0% in Ecuador.

Segment operating margin was ~~9.0%~~16.1% in ~~2018,~~2020, as compared to ~~10.0%~~14.4% in ~~2017.~~2019. Adjusted segment operating margin was ~~15.1%~~18.4% in ~~2018,~~2020, as compared to ~~15.9%~~17.1% in ~~2017.~~2019. This ~~decrease~~increase in the segment operating margin for ~~2018~~2020 principally reflects ~~gains from~~a recovery in Peru and reduced costs as a result of our ~~cost-~~cost savings program, ~~and lower direct taxes in Ecuador as well as operation, information technology, marketing and sales costs, which was~~ partially offset by ~~postpaid subscriber acquisition costs driven by~~ a ~~more aggressively competitive environment~~decrease in ~~Peru.~~operating income in Ecuador.

Central America—Guatemala, El Salvador, Honduras, Nicaragua, Panama and Costa Rica

The number of prepaid wireless subscribers for ~~2018~~2020 decreased by ~~11.3%~~1.5% over ~~2017,~~2019, and the number of postpaid wireless subscribers decreased by ~~1.5%~~9.7%, resulting in a decrease in the total number of wireless subscribers in our Central America segment of ~~9.8%~~2.9%, or ~~approximately 1.6 million,~~444 thousand, to approximately ~~14.3~~15 million as of December 31, ~~2018.~~2020. The number of fixed voice RGUs for ~~2018 increased~~2020 decreased by ~~8.7%~~8.0% over ~~2017,~~2019, the number of broadband RGUs increased by ~~16.0%~~5.3%, and the number of Pay TV RGUs ~~increased~~decreased by ~~3.2%~~5.1%, resulting in ~~an increase~~a decrease in total fixed RGUs in our Central America segment of ~~11.3%~~3.7%, or ~~654~~162 thousand, to approximately ~~6.4~~4.2 million as of December 31, ~~2018.~~2020.

Segment operating revenues for ~~2018~~2020 increased by ~~1.7%~~3.1% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018 were unchanged~~2020 decreased by 7.8% over ~~2017.~~2019.

Segment operating income for ~~2018~~2020 decreased by ~~7.3%~~29.9% over ~~2017.~~2019. Adjusted segment operating income for ~~2018~~2020 decreased by ~~6.7%~~32.7% over 2017. This decrease principally reflects a decrease of 14.9% in Guatemala and a decrease of 131.5% in Honduras, which was partially offset by an increase of 18.3% in El Salvador, an increase of 3.1% in Nicaragua, an increase of 30.2% in Panama and an increase of 27.7% in Costa Rica.2019.

Segment operating margin was ~~10.8%~~8.3% in ~~2018,~~2020, as compared to ~~11.9%~~12.2% in ~~2017.~~2019. Adjusted segment operating margin was ~~12.2%~~10.1% in ~~2018,~~2020, as compared to ~~13.1%~~13.7% in ~~2017.~~2019. This decrease in segment operating margin for ~~2018~~2020 principally reflects ~~higher costs related~~a decrease in income, particularly in Panama, partially offset by the cost savings program that continues to ~~doubtful accounts, aone-time~~ ~~charge related to~~be implemented in the ~~settlement of an interconnection dispute in Guatemala and an unusual charge arising from a government challenge to tax credits in Honduras.~~operating segment.

~~Caribbean—~~Caribbean - Dominican Republic ~~and~~& Puerto Rico

The number of prepaid wireless subscribers for ~~2018~~2020 increased by ~~4.8%~~3.3% over ~~2017,~~2019, and the number of postpaid wireless subscribers increased by ~~3.7%~~1.8%, resulting in an increase in the total number of wireless subscribers in our Caribbean segment of ~~4.4%~~2.9%, or ~~approximately 250~~178 thousand, to approximately ~~5.9~~6.4 million as of December 31, ~~2018.~~2020. The

number of fixed voice RGUs for ~~2018~~2020 decreased by ~~8.1%~~2.5% over ~~2017,~~2019, the number of broadband RGUs ~~decreased~~increased by ~~6.4%~~6.1% and the number of Pay TV RGUs increased by ~~3.9%~~2.4%, resulting in ~~a decrease~~an increase in total fixed RGUs in our Caribbean segment of ~~5.7%~~1.2%, or ~~154~~30 thousand, to approximately ~~2.6~~2.5 million as of December 31, ~~2018.~~2020.

Segment operating revenues for ~~2018~~2020 increased by ~~4.0%~~8.1% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018 increased~~2020 decreased by ~~2.6%~~3.3% over ~~2017.~~2019. This ~~increase~~decrease in segment operating revenues principally reflects ~~an increase in segment mobile data revenues and an increase in Pay TV revenues~~exchange rate losses in the Dominican Republic, ~~which was~~ partially offset by ~~lower~~an increase in operating revenues ~~from wireless and fixed voice services~~ in Puerto Rico. We analyze segment results in U.S. dollars because it is the functional currency of our operations in Puerto ~~Rico, and the currency of the Dominican Republic is relatively stable against the U.S. dollar.~~Rico.

Segment operating income for ~~2018~~2020 increased by ~~22.3%~~16.7% over ~~2017.~~2019. Adjusted segment operating income for ~~2018~~2020 increased by ~~20.7%~~2.8% over ~~2017.~~2019. This increase principally reflects an increase of ~~21.9%~~29.7% in ~~the Dominican Republic~~Puerto Rico and an increase of ~~730.5%~~6.2% in ~~Puerto Rico.~~the Dominican Republic.

Segment operating margin was ~~15.9%~~17.3% in ~~2018,~~2020, as compared to ~~13.5%~~16.1% in ~~2017.~~2019. Adjusted segment operating margin was ~~16.3%~~14.9% in ~~2018,~~2020, as compared to ~~13.8%~~14.1% in ~~2017.~~2019. This increase in segment operating margin for ~~2018~~2020 principally reflects ~~lower unusual costs~~an increase in ~~2018 related to the reconstruction and operation of our networks~~service revenues in ~~the aftermath of Hurricane Maria, as well as increased~~Puerto Rico, all revenues in the Dominican Republic and ~~our corporate cost-savings program.~~the effects of the cost savings program, partially offset by the depreciation of the Dominican Peso.

United States

The number of prepaid wireless subscribers for ~~2018~~2020 decreased by ~~6.2%~~0.9% over ~~2017,~~2019, or ~~approximately 1.4 million,~~194 thousand, to approximately ~~22.0~~20.6 million total wireless subscribers in the United States as of December 31, ~~2018.~~2020.

Segment operating revenues for ~~2018~~2020 increased by ~~3.1%~~13.7% over ~~2017.~~2019. Adjusted segment operating revenues for ~~2018~~2020 increased by ~~1.6%~~1.9% over ~~2017.~~2019. This increase in segment operating revenues principally reflects higher mobile voice and data usage ~~and revenues driven by~~as the ~~success~~mix of ~~existing unlimited data plans and increased equipment sales ofhigher-end~~ ~~smartphones.~~clients continues to shift towards to our high-usage Tracfone brands.

~~RESULTS OF OPERATIONS~~

Segment operating income for ~~2018 decreased~~2020 increased by ~~8.6%~~256.4% over ~~2017.~~2019. Adjusted segment operating income for ~~2018 decreased~~2020 increased by ~~17.4%~~58.6% over ~~2017.~~2019.

Segment operating margin was ~~1.7%~~6.0% in ~~2018,~~2020, as compared to ~~2.0%~~1.9% in ~~2017.~~2019. Adjusted segment operating margin was ~~6.8%~~11.0% in ~~2018,~~2020, as compared to ~~8.4%~~7.1% in ~~2017.~~2019. This ~~decrease~~increase in segment operating margin for ~~2018~~2020 principally reflects ~~an increase in content costs as a result of increased data usage.~~better controls over commercial, operational and administrative costs.

Europe

The number of prepaid wireless subscribers for ~~2018~~2020 decreased by ~~5.8%~~6.7% over ~~2017,~~2019, and the number of postpaid wireless subscribers increased by ~~4.1%~~5.1%, resulting in an increase in the total number of wireless subscribers in our Europe segment of ~~1.7%~~2.7%, or approximately 342 thousand, to approximately 21.0 million as of December 31, 2018. The number of fixed voice RGUs for 2018 decreased by 2.9% over 2017, the number of broadband RGUs increased by 2.4% and the number of Pay TV RGUs increased by 15.9%, resulting in an increase in total fixed RGUs in our Europe segment of 3.7%, or 224 thousand, to approximately 6.2 million as of December 31, 2018.

Segment operating revenues for 2018 increased by 7.6% over 2017. Adjusted segment operating revenues for 2018 increased by 1.2% over 2017. This increase in segment operating revenues principally reflects an increase in high-value customers in the mobile business and an ongoing strong fixed-line business, along with an increase in connectivity. We analyze segment results in euros because it is the functional currency in our operations in Europe.

~~Segment operating income for 2018 increased by 4.6% over 2017. Adjusted segment operating income for 2018 decreased by 4.3% over 2017.~~

Segment operating margin was 4.7% in 2018, as compared to 4.8% in 2017. Adjusted segment operating margin was 4.8% in 2018, as compared to 5.0% in 2017. This decrease in segment operating margin for 2018 principally reflects increases in costs related to marketing and subscriber acquisition.

~~2017 COMPARED TO 2016~~

~~Mexico Wireless~~

The number of prepaid wireless subscribers for 2017 increased by 0.2% over 2016, and the number of postpaid wireless subscribers increased by 6.2%, resulting in an increase in the total number of wireless subscribers in Mexico of 1.2%, or 902 thousand, to approximately 73.9 million as of December 31, 2017.

Segment operating revenues for 2017 increased by 1.6% over 2016. Adjusted segment operating revenues for 2017 increased by 1.2% over 2016. This increase in segment operating revenues principally reflects an increase of 18.9% in mobile data revenues, driven by increased use of value-added services by our wireless subscribers, including activity from messaging, content downloading, mobile applications and social media, and an increase in revenues from service plans offering higher data capacity. The increase in segment operating revenues was partially offset by a decrease of 24.0% in mobile voice revenues, reflecting a decrease in the average wireless rates per user.

~~Segment operating income for 2017 increased by 5.1% over 2016. Adjusted segment operating income for 2017 increased by 0.9% over 2016.~~

Segment operating margin was 24.5% in 2017, as compared to 23.7% in 2016. Adjusted segment operating margin for this segment was 28.8% in 2017, which remained stable in comparison to 28.9% in 2016. The segment operating margin in 2017 principally reflects costs related to interconnection rates, licensing fees, mobile site infrastructure rentals, maintenance and roaming charges.

~~Mexico Fixed~~

The number of fixed voice RGUs in Mexico for 2017 decreased by 2.8% over 2016, and the number of broadband RGUs in Mexico increased by 0.4%, resulting in a decrease in total fixed RGUs in Mexico of 1.5% over 2016, or 327568 thousand, to approximately 21.9 million as of December 31, ~~2017.~~

Segment operating revenues for 2017 decreased by 3.7% over 2016. Adjusted segment operating revenues for 2017 decreased by 3.9% over 2016. This decrease in segment operating revenues principally reflects a fall in fixed voice revenues of 8.2%, driven by RGU disconnections and a fall in long-distance calls. The decrease in segment operating revenues was partially offset by an increase in fixed data revenues of 2.9%, principally due to higher revenues from broadband and corporate network services.

~~Segment operating income for 2017 decreased by 35.5% over 2016. Adjusted segment operating income for 2017 decreased by 49.1% over 2016.~~

Segment operating margin was 8.0% in 2017, as compared to 12.0% in 2016. Adjusted segment operating margin was 4.3% in 2017, as compared to 8.3% in 2016. The decrease in the segment operating margin in 2017 principally reflects increases in costs associated with customer service and service quality improvements, as well as network maintenance.

~~Brazil~~

The number of prepaid wireless subscribers for 2017 decreased by 7.6% over 2016, and the number of postpaid wireless subscribers increased by 11.1%, resulting in a decrease in the total number of wireless subscribers in Brazil of 1.9%, or 1.1 million, to approximately 59.0 million as of December 31, 2017.2020. The number of fixed voice RGUs for ~~2017~~2020 decreased by ~~2.8%~~5.4% over ~~2016,~~2019, the number of broadband RGUs increased by ~~4.2%,~~0.4% and the number of Pay TV RGUs ~~decreased by 5.3%, resulting in a decrease in total fixed RGUs in Brazil of 2.2%, or 812 thousand, to approximately 35.9 million as of December 31, 2017.~~

Segment operating revenues for 2017 increased by 9.1% over 2016. Adjusted segment operating revenues for 2017 decreased by 1.4% over 2016. This decrease in segment operating revenues principally reflects a fall in mobile voice, fixed voice and Pay TV revenues of 18.8%, 15.1% and 0.4%, respectively, in 2017 over 2016, driven by RGU disconnections and lower traffic reflecting a decrease in disposable income following an overall economic downturn inalmost remained the country. The decrease in segment operating revenues was partially offset by higher mobile data and fixed data revenues of 28.1% and 5.2%, respectively, in 2017 over 2016. Mobile data revenues increased principally due to the

~~usage of social networking platforms, cloud services and content, and fixed data revenues increased principally due to an increase in broadband RGUs and corporate network services.~~

~~Segment operating income for 2017 increased by 83.4% over 2016. Adjusted segment operating income for 2017 increased by 81.1% over 2016.~~

Segment operating margin was 5.4% in 2017, as compared to 3.2% in 2016. Adjusted segment operating margin was 4.2% in 2017, as compared to 2.3% in 2016. The increase in segment operating margin in 2017 principally reflects synergy gains in marketing, network maintenance, information technology, subscriber acquisition and customer service related to the ongoing integration of our three Brazilian subsidiaries, which have collectively driven our costs down.

~~Colombia~~

The number of prepaid wireless subscribers for 2017 increased by 0.4% over 2016, and the number of postpaid wireless subscribers increased by 5.0%, resulting in an increase in the total number of wireless subscribers in Colombia of 1.4%, or 399 thousand, to approximately 29.4 million as of December 31, 2017. The number of fixed voice RGUs for 2017 increased by 11.1% over 2016, the number of broadband RGUs increased by 8.1% and the number of Pay TV RGUs increased by 3.3%, resulting in an increase in total fixed RGUs in Colombia of 7.1%, or 450 thousand, to approximately 6.8 million as of December 31, 2017.

Segment operating revenues for 2017 increased by 7.6% over 2016. Adjusted segment operating revenues for 2017 increased by 2.8% over 2016. This increase in segment operating revenues principally reflects increases in fixed data revenues, mobile data revenues, fixed voice revenues and Pay TV revenues, which increased by 9.7%, 14.3%, 11.7% and 15.9%, respectively, in 2017, principally due to an increase in sales of bundled packages of wireless services, higher demand for data plans and an increase in subscribers for internet services. The increase in segment operating revenues was partially offset by a decrease of 13.9% in mobile voice revenues, driven by more competitive commercial offerings in response to pricing pressure from competitors.

~~RESULTS OF OPERATIONS~~

Segment operating income for 2017 decreased by 142.0% over 2016. Adjusted segment operating income for 2017 decreased by 125.2% over 2016. Excluding the effects of the approximately U.S.$1.0 billion arbitration payment in Colombia, adjusted segment operating income for 2017 increased by 15.2%.

Segment operating margin was (6.5)% in 2017, as compared to 16.6% in 2016. Adjusted segment operating margin was (5.0)% in 2017, as compared to 20.5% in 2016. The decrease in segment operating margin for 2017 principally reflects higher costs related to the arbitration payment in Colombia, content licensing and maintenance of our networks, which was partially offset by Comcel’s cost savings program.

~~Southern Cone—Argentina, Chile, Paraguay and Uruguay~~

The number of prepaid wireless subscribers for 2017 increased by 2.0% over 2016, and the number of postpaid wireless subscribers increased by 2.9%, resulting in an increase in the total number of wireless subscribers in our Southern Cone segment of 2.3%, or 699 thousand, to approximately 31.1 million as of December 31, 2017. The number of fixed voice RGUs for 2017 increased by 4.6% over 2016, the number of broadband RGUs increased by 9.1%, and the number of Pay TV RGUs increased by 0.6%, resulting in an increase in total fixed RGUs in our Southern Cone segment of 4.2%, or 81 thousand, to approximately 2.0 million as of December 31, 2017.

Segment operating revenues for 2017 increased by 13.8% over 2016. Adjusted segment operating revenues for 2017 increased by 19.0% over 2016. This increase principally reflects an aggregate increase of 22.5% in Argentina, Paraguay and Uruguay and an increase of 10.9% in Chile. This increase was driven by higher data usage, particularly in the form of mobile data, video streaming, content downloading and service package purchases, in Argentina and Chile. For this segment, we analyze results in Argentina, Paraguay and Uruguay in terms of the Argentine peso, because Argentina accounts for the major portion of the operations in these three countries.

Segment operating income for 2017 increased by 40.4% over 2016. Adjusted segment operating income for 2017 increased by 56.2% over 2016. This increase principally reflects an increase in adjusted operating income of 16.8%

~~in Argentina, Paraguay and Uruguay, which was partially offset by an increase in adjusted operating loss of 30.8% in Chile.~~

Segment operating margin was 14.2% in 2017, as compared to 11.5% in 2016. Adjusted segment operating margin was 17.0% in 2017, which remained stable in comparison to 17.0% in 2016. The segment operating margin in 2017 principally reflected the cost saving programs of our subsidiaries in the Southern Cone.

~~Andean Region—Ecuador and Peru~~

The number of prepaid wireless subscribers for 2017 decreased by 4.3% over 2016, and the number of postpaid wireless subscribers increased by 2.5%, resulting in a decrease in the total number of wireless subscribers in our Andean Region segment of 2.2%, or 450 thousand, to approximately 20.4 million as of December 31, 2017. The number of fixed voice RGUs for 2017 decreased by 7.1% over 2016, the number of broadband RGUs increased by 5.4% and the number of Pay TV RGUs decreased by 7.8%,same, resulting in a decrease in total fixed RGUs in our ~~Andean Region segment of 3.0%, or 55 thousand, to approximately 1.8 million as of December 31, 2017.~~

Segment operating revenues for 2017 increased by 0.8% over 2016. Adjusted segment operating revenues for 2017 decreased by 2.4% over 2016. This decrease principally reflects a decrease of 8.9% in Ecuador, which was partially offset by an increase of 3.6% in Peru. This decrease was driven by lower revenues from our wireless and fixed voice operations, an increase in tax obligations and bad debt expenses in Ecuador and competitive pricing practices in Peru, which were partially offset by higher revenues from mobile data and higher revenues from fixed data, especially broadband and corporate data services.

Segment operating income for 2017 decreased by 7.2% over 2016. Adjusted segment operating income for 2017 increased by 0.9% over 2016. This increase principally reflects an increase of 138.7% in Peru, which was partially offset by a decrease of 21.4% in Ecuador.

Segment operating margin was 10.0% in 2017, as compared to 10.8% in 2016. Adjusted segment operating margin was 15.9% in 2017, as compared to 15.1% in 2016. This increase principally reflects gains from our cost-savings program and

lower direct taxes in Ecuador as well as operation, information technology, marketing and sales costs, which was partially offset by postpaid subscriber acquisition costs driven by a more aggressively competitive environment in Peru.

~~Central America—Guatemala, El Salvador, Honduras, Nicaragua, Panama and Costa Rica~~

The number of prepaid wireless subscribers for 2017 increased by 5.4% over 2016, and the number of postpaid wireless subscribers increased by 6.7%, resulting in an increase in the total number of wireless subscribers in our Central America segment of 5.6%, or approximately 842 thousand, to approximately 15.9 million as of December 31, 2017. The number of fixed voice RGUs for 2017 decreased by 0.1% over 2016, the number of broadband RGUs increased by 15.1% and the number of Pay TV RGUs increased by 3.9%, resulting in an increase in total fixed RGUs in our Central America segment of 7.8%, or 419 thousand, to approximately 5.8 million as of December 31, 2017.

Segment operating revenues for 2017 increased by 4.4% over 2016. Adjusted segment operating revenues for 2017 increased by 3.2% over 2016. This increase principally reflects higher mobile data, fixed data and Pay TV revenues in Central America, which was partially offset by decreases in mobile voice and fixed voice in Guatemala, El Salvador, Honduras, Nicaragua and Costa Rica and decreases in mobile voice and Pay TV in Panama. For this purpose, we analyze adjusted segment results in U.S. dollars because it is the functional currency for our operations in El Salvador and Panama, and the currencies in Costa Rica, Guatemala, Honduras and Nicaragua are relatively stable against the U.S. dollar.

Segment operating income for 2017 increased by 37.1% over 2016. Adjusted segment operating income for 2017 increased by 41.2% over 2016. This increase principally reflects an increase of 4.2% in Guatemala, an increase of 10.2% in El Salvador, an increase of 56.2% in Honduras, an increase of 41.2% in Nicaragua, an increase of 30.0% in Panama and an increase of 1.4% in Costa Rica.

~~Segment operating margin was 11.9%, as compared to 9.0% in 2016. Adjusted segment operating margin was 13.1% in~~

~~2017, as compared to 9.6% in 2016. This increase principally reflects lower costs related to maintenance, customer service and customer acquisition.~~

~~Caribbean—Dominican Republic and Puerto Rico~~

The number of prepaid wireless subscribers for 2017 increased by 3.0% over 2016, and the number of postpaid wireless subscribers increased by 4.1%, resulting in an increase in the total number of wireless subscribers in our Caribbean segment of 3.4%, or approximately 184 thousand, to approximately 5.6 million as of December 31, 2017. The number of fixed voice RGUs for 2017 decreased by 1.3% over 2016, the number of broadband RGUs increased by 1.6% and the number of Pay TV RGUs increased by 11.4%, resulting in an increase in total fixed RGUs in our Caribbean segment of 1.4%, or 37 thousand, to approximately 2.7 million as of December 31, 2017.

Segment operating revenues for 2017 decreased by 3.5% over 2016. Adjusted segment operating revenues for 2017 decreased by 5.5% over 2016. This decrease in segment operating revenues principally reflects lower revenues from wireless and fixed voice services in Puerto Rico, which was partially offset by an increase in segment mobile data revenues and an increase in Pay TV revenues in the Dominican Republic. We analyze segment results in U.S. dollars because it is the functional currency in our operations in Puerto Rico, and the currency in the Dominican Republic is relatively stable against the U.S. dollar.

Segment operating income for 2017 decreased by 22.6% over 2016. Adjusted segment operating income for 2017 decreased by 23.8% over 2016. This decrease principally reflects a decrease of 5.7% in the Dominican Republic and a decrease of 102.2% in Puerto Rico.

Segment operating margin was 13.5% in 2017, as compared to 16.8% in 2016. Adjusted segment operating margin was 13.8% in 2017, as compared to 17.2% in 2016. This decrease principally reflects higher unusual costs related to the reconstruction and operation of our networks in the aftermath of Hurricane Maria and bad debt expense in Puerto Rico and higher costs related to upgrades to our information technology systems in the Dominican Republic, which were partially offset by our corporate cost-savings program.

~~RESULTS OF OPERATIONS~~

~~United States~~

The number of prepaid wireless subscribers for 2017 decreased by 11.3% over 2016, or approximately 2.9 million, to approximately 23.1 million total wireless subscribers in the United States as of December 31, 2017.

Segment operating revenues for 2017 increased by 5.5% over 2016. Adjusted segment operating revenues for 2017 increased by 4.1% over 2016. This increase in segment operating revenues principally reflects higher mobile voice and data usage and revenues driven by the success of existing unlimited data plans, principally those offered under our Straight Talk brand and our recently acquired Walmart Family Mobile brand.

~~Segment operating income for 2017 increased by 138.8% over 2016. Adjusted segment operating income for 2017 increased by 15.0% over 2016.~~

Segment operating margin was 2.0% in 2017, as compared to 0.9% in 2016. Adjusted segment operating margin was 8.4% in 2017, as compared to 7.6% in 2016. This increase principally reflects a decrease in subscriber acquisition costs.

~~Europe~~

The number of prepaid wireless subscribers for 2017 decreased by 10.4% over 2016, and the number of postpaid wireless subscribers increased by 3.6%, resulting in a decrease in the total number of wireless subscribers in our

Europe segment of ~~0.2%~~1.5%, or approximately 50 thousand, to approximately 20.7 million as of December 31, 2017. The number of fixed voice RGUs for 2017 decreased by 3.7% over 2016, the number of broadband RGUs increased by 3.3% and the number of Pay TV RGUs increased by 10.7%, resulting in an increase in total fixed RGUs in our Europe segment of 2.3%, or 13693 thousand, to approximately 6.0 million as of December 31, ~~2017.~~2020.

Segment operating revenues for ~~2017~~2020 increased by ~~7.7%~~13.3% over ~~2016.~~2019. Adjusted segment operating revenues for ~~2017 increased~~2020 decreased by ~~4.1%~~0.3% over ~~2016.~~2019. This ~~increase~~decrease in segment operating revenues principally reflects ~~higher revenues~~a decrease in ~~Pay TV as well as~~ mobile ~~and fixed data, which were~~voice, partially offset by ~~lower revenues from wireless and~~an increase in fixed voice services due to the negative effects of the elimination of retail roaming in the EU in June 2017 and April 2016, as well as losses in the prepaid segment. We analyze segment results in euros because it is the functional currency in our operations in Europe.services.

Segment operating income for ~~2017 decreased~~2020 increased by ~~16.0%~~51.5% over ~~2016.~~2019. Adjusted segment operating income for ~~2017 decreased~~2020 increased by ~~16.3%~~32.2% over ~~2016.~~

2019. Segment operating margin was ~~4.8%~~11.8% in ~~2017,~~2020, as compared to ~~6.2%~~8.8% in ~~2016.~~2019. Adjusted segment operating margin was ~~5.0%~~11.7% in ~~2017,~~2020, as compared to ~~6.2%~~8.8% in ~~2016. The decrease~~2019. This increase in segment operating margin for 2020 principally reflects ~~increases~~our corporate cost savings program in ~~costs related to marketing, subscriber acquisitions~~all countries and ~~local taxes.~~improved performance in some countries.

3631

LOGO

~~LIQUIDITY AND CAPITAL RESOURCES~~

FUNDING REQUIREMENTS

We generate substantial cash flows from our operations. On a consolidated basis, our cash flows from operating activities were ~~Ps.248.3~~Ps.280.8 billion in ~~2018,~~2020, compared to ~~Ps.217.8~~Ps.234.3 billion in ~~2017.~~2019. Our cash and cash equivalents amounted to ~~Ps.21.7~~Ps.35.9 billion at December 31, ~~2018,~~2020, compared to ~~Ps.24.3~~Ps.19.7 billion at December 31, ~~2017.~~

2019. We believe our working capital is sufficient for our present ~~requirements.~~requirements, and we anticipate generating sufficient cash to satisfy our long-term liquidity needs. We use the cash that we generate from our operations and from borrowings principally for the following purposes:

~~Capital expenditures.~~We make substantial capital expenditures to continue expanding and improving our networks in each country in which we operate. Our capital expenditures on plant, property and equipment and acquisition or renewal of licenses were Ps.151.8 billion in 2018, Ps.136.7 billion in 2017, and Ps.155.0 billion in 2016. The amount of these capital expenditures varies significantly from year to year, depending on acquisition opportunities, concession renewal schedules and the need for more spectrum. We have budgeted capital expenditures for 2019 of approximately U.S.$8.5 billion (Ps.169.0 billion), which will be primarily funded by our operating activities.

•

Capital expenditures -We make substantial capital expenditures to continue expanding and improving our networks in each country in which we operate. Our capital expenditures on plant, property and equipment and acquisition or renewal of licenses were Ps.129.6 billion in 2020, Ps.151.8 billion in 2019 and Ps.151.8 billion in 2018. The amount of capital expenditures can vary significantly from year to year, depending on acquisition opportunities, concession renewal schedules and the need for more spectrum. We have budgeted capital expenditures for 2021 of approximately U.S.$7.5 billion (Ps.152.1 billion), which will be primarily funded by our operating activities. That amount is subject to change as we continue to evaluate our capital expenditure needs and opportunities in light of the ongoing COVID-19 outbreak.

~~Acquisitions.~~In some years, we have made substantial expenditures on acquisitions. In 2019 we entered into agreements to acquire Nextel Brazil, Telefónica Guatemala and Telefónica El Salvador. See “Recent Developments” under Part I in this annual report.

~~Indebtedness.~~
• Acquisitions -In December 2020, we entered into an agreement to acquire 32% of Oi Group’s Brazilian mobile business for R$3.6 billion. The completion of the acquisition is subject to certain customary conditions, including regulatory approval.
• Short-term debt and contractual obligations -We must pay interest on our indebtedness and repay principal when due. As of December 31, 2020, we had approximately Ps.247.6 billion in debt and contractual obligations due in 2021, including approximately Ps.148.1 billion of principal and amortization, Ps.25.1 billion in short-term lease debt, and Ps.74.4 billion in purchase obligations.
Long-term debt and contractual obligations - As of December 31, ~~2018,~~2020, we had approximately ~~Ps.96.2~~Ps.267.1 billion in debt and contractual obligations due between 2022 and 2024, including approximately Ps.169.4 billion of principal and amortization, ~~due in 2019.~~
~~Dividends.~~~~We pay regular dividends. We paid Ps.22.4~~Ps.58.1 billion in dividends in 2018 and Ps.16.1 billion in 2017. Our shareholders approved on April 9, 2019 the payment of a Ps.0.35 ordinary cash dividend per share in two installments in 2019. See “Share Ownership and Trading—Dividends” under Part IV in this annual report.long-term lease debt,
~~Share repurchases.~~We regularly repurchase our own shares. We spent Ps.511.4 million repurchasing our own shares in the open market in 2018 and Ps.1.2 billion in 2017. Our shareholders have authorized additional repurchases, and as of March 31, 2019, we have spent Ps.171 million repurchasing our shares in the open market in 2019, but whether we will continue to do so will depend on our operating cash flow and on various other considerations, including market prices and our other capital requirements.
~~OFF-BALANCE~~ ~~SHEET ARRANGEMENTS~~
~~As of December 31, 2018, we had nooff-balance~~ ~~sheet arrangements that require disclosure under applicable SEC regulations.~~

~~LIQUIDITY AND CAPITAL RESOURCES~~

and Ps.39.6 billion in purchase obligations. On the same date, we had approximately Ps.350.6 billion in debt and contractual obligations due between 2025 and 2026, including approximately Ps.310.9 billion of principal and amortization, Ps.26.1 billion in long-term lease debt, and Ps.13.6 billion in purchase obligations.

~~CONTRACTUAL OBLIGATIONS~~

The following table summarizes certain contractual obligations as of December 31, 2018. Many of our obligations are denominated in currencies other than Mexican pesos. The table does not include accounts payable, pension liabilities, interest payments or payments under derivatives contracts. See note 16 to our audited consolidated financial statements included in this annual report.

•

Dividends -We pay regular dividends. We paid Ps.9.6 billion in dividends in 2020 and Ps.24.2 billion in 2019. Our shareholders approved on April [26], 2021 the payment of a Ps.0.40 ordinary dividend per share in two installments in 2021. See “Share Ownership and Trading—Dividends” under Part IV in this annual report.

PAYMENTS DUE BY PERIOD

LESS THAN

Total

1 Year

1-3 Years

4-5 Years

After 5 Years

(in millions of Mexican pesos)

CONTRACTUAL OBLIGATIONS AS OF DECEMBER 31, 2018

Equipment leases, real estate leases and mobile site rentals Ps. 138,052 Ps. 24,057 Ps. 37,652 Ps. 26,317 Ps. 50,026

Short-term debt 96,230 96,230 — — —

Long-term debt 542,692 — 263,402 53,923 225,367

Purchase obligations 225,085 88,234 123,528 13,323 —

Total Ps. 1,002,059 Ps. 208,521 Ps. 424,582 Ps. 93,563 Ps. 275,393
• Share repurchases -We regularly repurchase our own shares. We spent Ps.5,241.3 million repurchasing our own shares in the open market in 2020 and Ps.429.8 million in 2019. Our shareholders have authorized additional amounts to repurchase, and as of March 31, 2021, we have spent Ps.4,538.8 million repurchasing our shares in the open market in 2021, but whether we will continue to do so will depend on our operating cash flow and on various other considerations, including market prices and our other capital requirements.
Other than the amounts ~~in the table~~described above, we had no other outstanding material purchase commitments as of December 31, ~~2018.~~2020. We enter into a number of supply, advertising and other contracts in the ordinary course of business, but those contracts are not material to our liquidity. The obligations described above do not include accounts payable, pension liabilities, interest payments or payments under derivatives contracts. See notes 14, 15 and 17 to our audited consolidated financial statements included in this annual report.
BORROWINGS
In addition to cash flows generated from operations, we rely on a combination of borrowings from a range of different sources, including the international capital markets, capital markets in Mexico and other countries where we operate, international and local banks, equipment suppliers and export credit agencies. We seek to maintain access to diverse sources of funding. In managing our funding, we generally seek to keep our leverage, as measured by the ratio of net debt to EBITDA, at a level that is consistent with maintaining the ratings given to our debt by the principal credit rating agencies. Our total consolidated indebtedness as of December 31, ~~2018~~2020 was ~~Ps.638.9~~Ps.628.4 billion, of which ~~Ps.96.2~~Ps.148.1 billion was short-term debt (including the current portion of ~~long- term~~long-term debt), compared to ~~Ps.697.9~~Ps.624.3 billion as of December 31, ~~2017.~~2019.

Management defines net debt as total debt minus cash and cash equivalents, minus marketable securities (including Koninklijke KPN N.V. (“KPN”) shares) orand other short-term investments. As of December 31, ~~2018,~~2020, we had net debt of ~~Ps.568.2~~Ps.537.8 billion, compared to ~~Ps.614.5~~Ps.556.8 billion as of December 31, ~~2017.~~2019. Without taking into account the effects of derivative financial instruments that we use to manage our interest rate and currency risk, approximately ~~88.7%~~87.5% of our indebtedness at December 31, ~~2018~~2020 was denominated in currencies other than Mexican pesos (approximately ~~34.6%~~33.9% of suchnon-Mexican peso debt in U.S. dollars and ~~65.4%~~66.1% in other currencies), and approximately ~~5.9%~~10.9% of our consolidated debt obligations bore interest at floating rates. After the effects of derivative transactions and excluding the debt ~~owned by~~of Telekom Austria, approximately ~~29.3%~~44.9% of our net debt as of December 31, ~~2018~~2020 was denominated in Mexican pesos.

The weighted average cost of all our third-party debt at December 31, ~~2018~~2020 (excluding commissions and reimbursement of certain lenders for Mexican taxes withheld) was approximately ~~4.3%~~3.72% per annum.

Our major categories of indebtedness at December 31, ~~2018~~2020 are summarized in the table below. ~~The majority of our consolidated indebtedness is owed by América Móvil and most of the remaining debt is owed by Telekom Austria, in which we own a 51% interest.~~ See also ~~note~~Note 14 to our audited consolidated financial statements included in this annual report.



DEBT
~~(millions~~
(millions of Mexican pesos)

SENIOR NOTES
~~SENIOR NOTES~~

DENOMINATED IN U.S. DOLLARS

~~América Móvil 5.000% Senior Notes due 2019~~	~~Ps.~~	~~14,762~~

~~Telmex 5.500% Senior Notes due 2019~~		~~7,428~~

~~América Móvil 5.000% Senior Notes due 2020~~		~~41,823~~

América Móvil 3.125% Senior Notes due 2022		~~31,493~~
31,918

América Móvil 3.625% Senior Notes due 2029		19,949

América Móvil 2.875% Senior Notes due 2030		19,949

América Móvil 6.375% Senior Notes due 2035		~~19,315~~
19,576

América Móvil 6.125% Senior Notes due 2037		~~7,267~~
7,365

América Móvil 6.125% Senior Notes due 2040		~~39,366~~
39,897

América Móvil 4.375% Senior Notes due 2042		~~22,635~~
22,941
~~Total~~			~~Ps.~~	~~184,089~~

~~DENOMINATED IN MEXICAN PESOS~~ América Móvil 4.375% Senior Notes due 2049		24,936



Total			186,531



~~América Móvil 6.000% Senior Notes due 2019~~ *DENOMINATED IN MEXICAN PESOS*	~~Ps.~~	~~10,000~~

~~América Móvil 8.600% Domestic Senior Notes due 2020~~		~~7,000~~

América Móvil 6.450% Senior Notes due 2022		22,500


América Móvil 7.125% Senior Notes due 2024		11,000


América Móvil 0.000% Domestic Senior Notes due 2025		~~4,629~~
4,911

América Móvil 8.460% Senior Notes due 2036		7,872


Telmex 8.360% Domestic Senior Notes due 2037		5,000



Total	~~Ps.~~	~~68,001~~ 51,283



DENOMINATED IN EURO

~~América Móvil 4.125% Senior Notes due 2019~~	~~Ps.~~	~~22,559~~

~~América Móvil B.V. 0.000% Exchangeable Bonds due 2020~~		~~64,108~~

América Móvil 3.000% Senior Notes due 2021		~~22,558~~
24,369

TKA 3.125% Senior Notes due 2021		~~17,569~~
18,277

TKA 4.000% Senior Notes due 2022		~~18,028~~
18,277



América Móvil 4.750% Senior Notes due 2022		~~16,919~~
18,277

TKA 3.500% Senior Notes due 2023		~~7,132~~
7,311

América Móvil 3.259% Senior Notes due 2023		~~16,919~~
18,277

América Móvil 1.500% Senior Notes due 2024		~~19,175~~
20,714

TKA 1.500% Senior Notes due 2026		~~16,919~~
18,277

América Móvil 0.750% Senior Notes due 2027		24,369

América Móvil 2.125% Senior Notes due 2028		~~14,663~~
15,840

América Móvil B.V. -0.230% to -0.310% Commercial Paper due 2021		40,941

Total	~~Ps.~~	~~236,549~~ 224,929



DENOMINATED IN POUND STERLING

América Móvil 5.000% Senior Notes due 2026	~~Ps.~~	~~12,551~~
13,635

América Móvil 5.750% Senior Notes due 2030		~~16,316~~
17,726

América Móvil 4.948% Senior Notes due 2033		~~7,530~~
8,181

América Móvil 4.375% Senior Notes due 2041		~~18,826~~
20,452
~~Total~~	~~Ps.~~	~~55,223~~

~~LIQUIDITY AND CAPITAL RESOURCES~~


~~DEBT~~
~~(millions of Mexican pesos)~~ Total			59,994



DENOMINATED IN JAPANESE YEN

América Móvil 2.950% Senior Notes due 2039	~~Ps.~~	~~2,335~~
2,512



Total	~~Ps.~~	~~2,335~~ 2,512



DENOMINATED IN CHILEAN PESOS

América Móvil 3.961% Senior Notes due 2035	~~Ps.~~	~~3,905~~
4,078



Total	~~Ps.~~	~~3,905~~ 4,078



DENOMINATED IN BRAZILIAN REAIS

~~Claro Brasil 102.400% of CDI Domestic Senior Notes due 2019~~	~~Ps.~~	~~5,080~~

~~Claro Brasil 103.250% of CDI Domestic Senior Notes due 2019~~		~~1,829~~

~~Claro Brasil 103.900% of CDI Domestic Senior Notes due 2019~~		~~5,080~~

~~Claro Brasil 102.900% of CDI Domestic Senior Notes due 2020~~		~~7,619~~

Claro Brasil 104.000% of CDI Domestic Senior Notes due 2021		~~5,587~~
4,222

Claro Brasil 104.250% of CDI Domestic Senior Notes due 2021		~~7,696~~
5,816
~~Total~~			~~Ps.~~	~~32,891~~

~~HYBRID NOTES~~ Claro Brasil CDI + 0.600% Domestic Senior Notes due 2021		1,382

~~DENOMINATED IN EURO:~~ Claro Brasil CDI + 0.960% Domestic Senior Notes due 2022		9,597

Claro Brasil 106.000% of CDI Domestic Senior Notes due 2022		7,677

Claro Brasil 106.500% of CDI Domestic Senior Notes due 2022		3,839



Total			32,533

HYBRID NOTES



DENOMINATED IN EURO

América Móvil ~~Euro~~ NC10 ~~(Euro Series~~(Series B) Capital Securities due 2073	~~Ps.~~	~~12,407~~
13,403

~~Total~~	~~Ps.~~	~~12,407~~

~~DENOMINATED IN POUND STERLING~~ Total		13,403



~~América Móvil GBP NC7 Capital Securities due 2073~~	~~Ps.~~	~~13,806~~

~~Total~~	~~Ps.~~	~~13,806~~

BANK DEBT AND OTHER

~~DENOMINATED IN U.S. DOLLARS~~	~~Ps.~~	~~11,699~~

DENOMINATED IN MEXICAN PESOS	~~Ps.~~	~~4,500~~
27,100
~~DENOMINATED IN EUROS~~			~~Ps.~~	~~5,527~~

DENOMINATED IN CHILEAN PESOS	~~Ps.~~	64
8,926
~~DENOMINATED IN BRAZILIAN REAIS~~			~~Ps.~~	27

DENOMINATED IN PERUVIAN SOLES	~~Ps.~~	~~7,899~~ 17,094



Total		53,120
~~Total~~			~~Ps.~~	~~29,716~~

Total Debt	~~Ps.~~	~~638,922~~
628,383



Less short-term debt and current portion of long-term debt	~~Ps.~~	~~96,230~~
148,083



Total Long-term Debt	~~Ps.~~	~~542,692~~
480,300



~~EQUITY:~~ *EQUITY*

Capital stock		96,342

~~Capital stock~~	~~Ps.~~	~~96,338~~

Total retained earnings		~~237,255~~
314,718

Other comprehensive income (loss) items		~~(137,598~~	)
(151,669)

Non-controlling interest		~~49,877~~
74,235



Total Equity	~~Ps.~~	~~245,872~~
333,626

Total Capitalization (total long-term debt plus equity)	~~Ps.~~	~~788,564~~ 813,926

4033

Additional information about certain categories of our indebtedness is provided below:

Mexican peso-denominated international notes.Our 8.46% senior notes due 2036 are denominated in Mexican pesos, but all amounts in respect of the notes are payable in U.S. dollars, unless a holder of notes elects to receive payment in Mexican pesos in accordance with specified procedures.

Mexican peso-denominated domestic notes. Our domestic senior notes (certificados bursátiles) sold in the Mexican capital markets have varying maturities, ranging from 2025 through 2037, and bear interest at fixed rates.

•

~~Mexican peso-denominated domestic notes.~~~~Our domestic senior notes (~~~~certificados bursátiles~~~~) sold in the Mexican capital markets have varying maturities, ranging from 2019 through 2037, and bear interest at fixed rates.~~

Global peso notes program.The global peso notes program was established in November 2012. Since its establishment, we have issued peso-denominated notes that can be distributed and traded on a seamless basis in Mexico and internationally. The notes are registered with the SEC in the United States and with the CNBV in Mexico.

International notes.We have outstanding debt securities in the international markets denominated in U.S. dollars, ~~pound~~pounds sterling and euros. We have also issued debt securities in the local ~~markets~~market in ~~Switzerland and~~ Japan.

On March 31, 2021, we redeemed in full our 3.000% senior notes due 2021 with an aggregate principal outstanding amount of EUR 1 billion.
Hybrid notes.We have outstanding ~~two~~one series of Capital Securities maturing in ~~2073: one series~~2073, denominated in euros totaling€550 ~~million, and one series denominated in pound sterling in the amount of £550~~ million. The Capital Securities are subject to redemption at our option at varying dates beginning in ~~2023 for the euro-denominated series and beginning in 2020 for the sterling-denominated series.~~2023. Our hybrid notes are deeply subordinated, and when they were issued, the principal rating agencies stated that they would treat ~~only~~ half of the principal amount as indebtedness for purposes of evaluating our leverage (an analysis referred to as ~~50.0%~~50% equity credit).
Standard & Poor’s now treats 100% of the principal amount under the hybrid notes as indebtedness.
Bank loans.At December 31, ~~2018,~~2020, we had approximately ~~Ps.29.7~~Ps.53.1 billion outstanding under a number of bank facilities bearing interest at fixed and variable rates. We also have two revolving syndicated credit facilities—one for U.S.$2.5 billion expiring in ~~November 2019~~August 2024 and one for the Euro equivalent of U.S.$2.0 billion expiring in May 2021. We are currently negotiating with the lenders under the Euro credit facility for a 5-year extension and a reduction to the Euro equivalent of U.S.$1.5 billion. As long as the facilities are committed, a commitment fee is paid. As of December 31, ~~2018,~~2020, these
credit facilities were not drawn. Both facilities include covenants that limit our ability to incur secured debt, to effect a merger in which the surviving entity would not be América Móvil or to sell substantially all of our assets. In addition, both facilities require us to maintain a consolidated ratio of debt to EBITDA not greater than 4.0 to 1.0 and a consolidated ratio of

credit facilities were undrawn. Both facilities include covenants that limit our ability to incur secured debt, to effect a merger in which the surviving entity would not be América Móvil or to sell substantially all of our assets. In addition, both facilities require us to maintain a consolidated ratio of debt to EBITDA not greater than 4.0 to 1.0 and a consolidated ratio of EBITDA to interest expense not less than 2.5 to 1.0. As of the date of this annual report, we are in compliance with these covenants. Telekom Austria also has an undrawn revolving syndicated credit facility for€1.0 billion (the “TKA Facility”) expiring in November 2019. The TKA Facility includes covenants that limit Telekom Austria’s ability to incur secured debt, effect certain mergers or sell substantially all of its assets and our ability to transfer control over, or reduce our share ownership in, Telekom Austria. For more information, see note 14 to our audited consolidated financial statements included in this annual report.

EBITDA to interest expense not less than 2.5 to 1.0. As of the date of this annual report, we are in compliance with these covenants. Telekom Austria has an undrawn revolving syndicated credit facility for €1.0 billion (the “TKA Facility”) expiring in July 2026. The TKA Facility includes covenants that limit Telekom Austria’s ability to incur secured debt, effect certain mergers or sell substantially all of its assets and our ability to transfer control over, or reduce our share ownership in, Telekom Austria. For more information, see Note 14 to our audited consolidated financial statements included in this annual report.

Options involving ~~KPN and~~ TKA shares.The Company has entered into certain option contracts related to shares that are or have been a strategic investment for the Company. These options include a sale of call options related to our KPN shares with an exercise period that will expire in May 2020 and the sale of a cash-settled put option related to TKA shares that will expire in August 2023. See ~~note~~Note 7 to our audited consolidated financial statements included in this annual report.

Bonds exchangeable for KPN shares. On March 2, 2021, our wholly-owned Dutch subsidiary, América Móvil B.V., issued approximately EUR 2.1 billion principal amount of senior unsecured bonds. The bonds will mature in 3 years, will not bear interest and were issued at an issue price of 104.75% of their principal amount. The Bonds will be exchangeable into ordinary shares of KPN and the initial exchange price is EUR 3.1185.

Euro-denominated commercial paper program. At December 31, 2020, debt under our euro-denominated commercial paper program aggregated to Ps.$40.9 billion.

As of December 31, 2020, we had, on an unconsolidated basis, unsecured and unsubordinated indebtedness of approximately Ps.455.6 billion (U.S.$22.8 billion), excluding guarantees of subsidiaries’ indebtedness. As of December 31, 2020, our subsidiaries had indebtedness (excluding guarantees of indebtedness of us and our other subsidiaries) of approximately Ps.172.7 billion (U.S.$8.7 billion), and a substantial portion of our subsidiaries’ indebtedness is owed by Telekom Austria.

As of December 31, 2020, we had no off-balance sheet arrangements that require disclosure under applicable SEC regulations.

GUARANTOR FINANCIAL INFORMATION

In March 2020, the SEC amended Rule 3-10 of Regulation S-X and adopted Rule 13-01 to simplify disclosure requirements related to certain registered securities, which we have adopted effective immediately. Some of the public securities issued by América Móvil in international and Mexican capital markets are guaranteed by ~~Telcel.~~Telcel, a wholly-owned subsidiary. As of December 31, ~~2018, we had, on an~~2020, the aggregate principal amount of debt guaranteed by Telcel was Ps.122,215 million. The guarantees provide that, in case of the failure of the Company to punctually make payment of any principal, premium, interest, additional amounts or any other amounts that may become payable by the Company in respect of the notes, Telcel agrees to immediately pay the amount that is due and required to be paid.

The following table presents summarized unconsolidated ~~basis, unsecured~~financial information for the Company and unsubordinated indebtedness of approximately Ps.509.7 billion (U.S.$25.9 billion), excluding guarantees of subsidiaries’ indebtedness. As of December 31, 2018, our subsidiaries had indebtedness (excluding guarantees of indebtedness of usTelcel after eliminating transactions and ~~our other subsidiaries) of approximately Ps.129.2 billion (U.S.$6.6 billion).~~balances between them.

DECEMBER 31, 2020

   PARENT    GUARANTOR
Current Assets
   Ps. 45,320,066    Ps. 45,909,283
Total Assets


80,095,274

145,711,133
Current Liabilities


93,871,633

41,939,310
Total Liabilities


504,150,282

75,949,203
Total revenues
   Ps. 72,124,718    Ps. 132,393,542
Operating Income


18,559,695

3,304,582
Net profit for the year


(37,332,145)

50,569,556

RISK MANAGEMENT

We regularly assess our interest rate and currency exchange exposures in order to determine how to manage the risk associated with these exposures. We have indebtedness denominated in currencies other than the currency of our operating environments, and we have expenses for operations and for capital expenditures in a variety of currencies. We use derivatives to adjust the resulting exchange rate and interest rate exposures. We do not use derivatives to hedge the exchange rate exposures that arise from having operations in different countries.

Our practices vary from time to time depending on our judgment of the level of risk, expectations as to exchange or interest rate movements and the costs of using derivative financial instruments. We may stop using derivative financial instruments or modify our practices at any time.

As of December 31, ~~2018,~~2020, we had derivatives positions with an aggregate net fair value ~~liability~~asset of ~~Ps.11.8~~Ps.6.7 billion, which are described in ~~note~~Note 7 to our audited consolidated financial statements. For additional information, see ~~note~~Note 2 v) ~~to our audited consolidated financial statements included in this annual report.~~

~~CRITICAL ACCOUNTING POLICIES AND ESTIMATES~~

~~USE OF ESTIMATES IN CERTAIN ACCOUNTING POLICIES~~

In preparing our financial statements, we make estimates concerning a variety of matters. Some of these matters are highly uncertain, and our estimates involve judgments we make based on the information available to us. In the discussion below, we have identified several of these matters for which our financial presentation would be materially affected if either (i) we used different estimates that we could reasonably have used or (ii) in the future, we change our estimates in response to changes that are reasonably likely to occur.

The discussion addresses only those estimates that we consider most important based on the degree of uncertainty and the likelihood of a material impact if we used a different estimate. There are many other areas in which we use estimates about uncertain matters, but the reasonably likely effect of changed or different estimates is not material to our financial presentation.

~~ESTIMATED USEFUL LIVES OF PLANT, PROPERTY AND EQUIPMENT~~

We estimate the useful lives of particular classes of plant, property and equipment in order to determine the amount of depreciation expense to be recorded in each period. Depreciation expense is a significant element of our costs and expenses, amounting in 2018 to Ps.129.1 billion, or 14.4% of our operating costs and expenses. See note 10 to our audited consolidated financial statements included in this annual report.

We currently depreciate most of our property, plant and equipment based on an estimated useful life determined upon the expected particular conditions of operations and maintenance in each of the countries in which we operate.

The estimates are based on our historical experience with similar assets, anticipated technological changes and other factors, taking into account the practices of other telecommunications companies. We review estimated useful lives each year to determine whether they should be changed, and, at times, we have changed them for particular classes of assets. We may shorten the estimated useful life of an asset class in response to technological changes,

~~changes in the market or other developments, which would result in higher depreciation expense.~~

~~IMPAIRMENT OF LONG-LIVED ASSETS~~

We have large amounts of long-lived assets, including property, plant and equipment, intangible assets, investments in associates and goodwill, on our balance sheet. Under IFRS, we are required to test long-lived assets for impairment when circumstances indicate a potential impairment or, in some cases, at least on an annual basis. The impairment analysis for long-lived assets requires us to estimate the recovery value of the asset, which is the greater of its fair value (minus any disposal costs) and its value in use. To estimate the fair value of a long-lived asset, we typically take into account recent market transactions, or, if no such transactions can be identified, we use a valuation model that requires the making of certain assumptions and estimates. Similarly, to estimate the value in use of long-lived assets, we typically make various assumptions about the future prospects for the business to which the asset relates, consider market factors specific to that business and estimate discounted future cash flows to be generated by that business. Based on this impairment analysis, including all assumptions and estimates related thereto, as well as guidance provided by IFRS relating to the impairment of long-lived assets, we determine whether we need to recognize an impairment to reduce the carrying value of the asset as stated on our balance sheet. Assumptions and estimates about future values and remaining useful lives are complex and often subjective. They can be affected by a variety of factors, including external factors, such as industry and economic trends, and internal factors, such as changes in our business strategy and our internal forecasts. Different assumptions and estimates could materially impact our reported financial results. More conservative assumptions of the anticipated future benefits from these businesses could result in impairment charges, which would decrease net income and result in lower asset values on our balance sheet. Conversely, less conservative assumptions could result in lower or no impairment charges, higher net income and higher asset values. See note 2 ab) to our audited consolidated financial statements included in this annual report.

4335

~~CRITICAL ACCOUNTING POLICIES AND ESTIMATES~~

~~DEFERRED INCOME TAXES~~

~~We are required to estimate our income taxes in each of the jurisdictions in which we operate. This process involves thejurisdiction-by-jurisdiction~~ estimation of actual current tax exposure and the assessment of temporary differences resulting from the differing treatment of certain items, such as accruals and amortization, for tax and financial reporting purposes, as well as net operating loss carry forwards and other tax credits. These items result in deferred tax assets and liabilities, which are included in our consolidated balance sheets. We must assess, in the course of our tax planning procedures, the fiscal years of the reversal of our deferred tax assets and liabilities, and if there will be future taxable profits in those periods to support the recognition of the deferred tax assets. Significant management judgment is required in determining our provisions for income taxes, deferred tax assets and liabilities. The analysis is based on estimates of future taxable income in the jurisdictions in which the group operates and the period over which the deferred tax assets and liabilities will be recoverable or settled. If actual results differ from these estimates, or if we adjust these estimates in future periods, our financial position and results of operations may be materially affected.

We record deferred tax assets based on the amount that we believe is more likely than not to be realized. In assessing the future realization of deferred tax assets, we consider future taxable income and ongoing tax planning strategies. In the event that our estimates of projected future taxable income and benefits from tax planning strategies are lowered, or changes in current tax regulations are enacted that would impose restrictions on the timing or the extent of our ability to utilize the tax benefits of net operating loss carry forwards in the future, an adjustment to the recorded amount of deferred tax assets would be made.

~~ACCRUALS~~

Accruals are recorded when, at the end of the period, we have a present obligation as a result of past events whose settlement requires an outflow of resources that is considered probable and can be measured reliably. This

obligation may be legal or constructive, arising from, but not limited to, regulation, contracts, common practice or public commitments which have created a valid expectation for third parties that we will assume certain responsibilities. The amount recorded is the best estimation performed by our management in respect of the expenditure that will be required to settle the obligations, considering all the information available at the date of our financial statements, including the opinion of external experts, such as legal advisors or consultants. Accruals are adjusted to account for changes in circumstances for ongoing matters and the establishment of additional accruals for new matters.

If we are unable to reliably measure the obligation, no accrual is recorded and information is then presented in the notes to our audited consolidated financial statements. Because of the inherent uncertainties in this estimation, actual expenditures may be different from the originally estimated amount recognized.

~~LABOR OBLIGATIONS~~

We recognize liabilities on our balance sheet and expenses in our statement of comprehensive income to reflect our obligations related to our post-retirement seniority premiums, pension and retirement plans in the countries in which we operate and offer defined contribution and benefit pension plans. The amounts we recognize are determined on an actuarial basis that involves many estimates and assumptions for post-retirement pension and termination benefits in accordance with IFRS.

We use estimates in four specific areas that have a significant effect on these amounts: (i) the rate of return we assume our labor obligation plans will achieve on their investments, (ii) the rate of increase in salaries that we assume we will observe in future years, (iii) the discount rates that we use to calculate the present value of our future obligations and (iv) the expected rate of inflation. The assumptions we have applied are identified in note 17 to our audited consolidated financial statements included in this annual report. These estimates are determined based on actuarial studies performed by independent experts using the projected unit-credit method.

[Graphic Appears Here]

~~PART III RISK FACTORS~~

~~RISK FACTORS~~

RISKS RELATING TO OUR OPERATIONS

Competition in the telecommunications industry is intense and could adversely affect the revenues and profitability of our operations

Our businesses face substantial competition. We expect that competition will intensify in the future as a result of the entry of new competitors, the development of new technologies, products and services and convergence. We also expect consolidation in the telecommunications industry, as companies respond to the need for cost reduction and additional spectrum. This trend may result in larger competitors with greater financial, technical, promotional and other resources to compete with our businesses.

Among other things, our competitors could:

provide higher handset subsidies;

offer higher commissions to retailers;

provide free airtime or other services (such as internet access);

offer services at lower costs through double, triple and quadruple play packages or other pricing strategies;

expand their networks faster; or

develop and deploy improved technologies faster, such as 5G LTE technology.

Competition can lead us to increase advertising and promotional spending and to reduce prices for services and handsets. These developments may lead to lower operating margins, greater choices for customers and increasing movement of customers among competitors, which may make it difficult for us to retain or add new customers. The cost of adding new customers may also continue to increase, reducing profitability even if customer growth continues.

Our ability to compete successfully will depend on our coverage, the quality of our network and service, our rates, customer service, effective marketing, our success in selling double, triple and quadruple play packages and our ability to anticipate and respond to various competitive factors affecting the telecommunications industry, including new

services and technologies, changes in consumer preferences, demographic trends, economic conditions and discount pricing strategies by competitors.

If we are unable to respond to competition and compensate for declining prices by adding new customers, increasing usage and offering new services, our revenues and profitability could decline.

Governmental or regulatory actions could adversely affect our operations

Our operations are subject to extensive government regulation and can be adversely affected by changes in law, regulation or regulatory policy. The licensing, construction, operation, sale, resale and interconnection arrangements of telecommunications systems in Latin America and elsewhere are regulated to varying degrees by government or regulatory authorities. Any of these authorities having jurisdiction over our businesses could adopt or change regulations or take other actions that could adversely affect our operations. In particular, the regulation of prices that operators may charge for their services and environmental matters, including renewable energy and climate change regulation, could have a material adverse effect by reducing our profit margins. See “Regulation” under Part VI for a discussion on the functional separation of Telmex and Telnor wholesale services, “Legal Proceedings” under Part ~~VII~~VI and Note 1617 to our audited consolidated financial statements included in this annual report.

In addition, changes in political administrations could lead to new regulation and the adoption of policies that could adversely affect our operations, including those concerning competition and taxation of communications services. For example, since 2013, Mexico has implemented reforms to the telecommunications sector that aim to promote more competition and investment by imposing asymmetric regulation upon economic agents deemed “preponderant or dominant.” The asymmetric regulations that are applicable to us, which have adversely affected the results of our Mexican operations, may be reviewed every two years. We are unable to anticipate the effect of an amendment on existing asymmetric regulations, or the imposition of new ones, on our results or operations in Mexico. In other countries, we could also face policies such as preferences for local over foreign ownership of communications licenses and assets or for government over private ownership, which could make it more cumbersome or impossible for us to continue to develop our businesses. Restrictions such as those described above could result in lower revenues and require capital investments, all of which could materially adversely affect our businesses and results of operations.

Our failure to meet or maintain quality of service goals and standards could result in fines and other adverse consequences

The terms of the concessions under which our subsidiaries operate require them to meet certain service quality goals, including, for example, minimum call completion rates, maximum busy circuits rates, operator availability and responsiveness to repair requests. Failure to meet service quality obligations in the past has resulted in the imposition

of material fines by regulatory entities. We are also subject to and may be subject to additional claims by customers, including class actions, seeking remedies for service problems. Our ability to comply with these obligations in the future may be affected by factors beyond our control and, accordingly, we cannot assure that we will be able to comply with them.

Dominant carrier related regulations could adversely affect our business by limiting our ability to pursue competitive and profitable strategies

Our regulators are authorized to impose specific requirements as to rates (including termination rates), quality of service, access to active or passive infrastructure and information, among other matters, on operators that are determined to have substantial market power in a specific market. We cannot predict what steps regulatory authorities might take in response to determinations regarding substantial market power in the countries in which we operate. However, adverse determinations against our subsidiaries could result in material restrictions on our operations. We may also face additional regulatory restrictions and scrutiny as a result of our provision of combined services.

If dominant carrier regulations are imposed on our business in the future, they could likely reduce our flexibility to adopt competitive market policies and impose specific tariff requirements or other special regulations on us, such as additional requirements regarding disclosure of information or quality of service. Any such new regulation could have a material adverse effect on our operations.

~~Changes in the regulatory framework for telecommunications services in Mexico may have a material adverse effect on our business and results of operations~~

The Mexican legal framework for the regulation of telecommunications and broadcasting services has changed, beginning with constitutional amendments in 2013, implementing legislation in 2014, and the establishment in 2014 of a new regulator, the Federal Telecommunications Institute (~~Instituto Federal de~~~~Telecomunicaciones~~, or the “IFT”). The IFT determined in 2014 that our operating subsidiaries in Mexico are part of an “economic interest group” that is a “preponderant economic agent” in the Mexican telecommunications sector, and, based on this determination, the IFT has imposed extensive asymmetric regulations on our Mexican fixed-line and wireless businesses. The asymmetric regulations took effect in 2015 and were amended in 2017, when the IFT added new requirements, including the functional separation of certain assets used to provide local loop unbundling services. For further information, see “Regulation” under Part III of this annual report. The IFT measures and biennial reviews of the asymmetric measures applicable to us have adversely affected the results of our Mexican operations, and we expect that those effects will continue.

We must continue to acquire additional radio spectrum capacity and upgrade our networks in order to expand our customer base and maintain the quality of our wireless services

Licensed radio spectrum is essential to our growth and the quality of our wireless services and for the operation and deployment of our networks, including new generation networks such as 5G LTE technology, to offer improved data and value-added services. We obtain most of our radio spectrum through auctions conducted by governments of the countries in which we operate. Participation in spectrum auctions in most of these countries requires prior government authorization, and we may be subject to caps on our ability to acquire additional spectrum. Our inability to acquire additional radio spectrum capacity could affect our ability to compete successfully because it could result in,

~~RISK FACTORS~~

among other things, a decrease in the quality of our network and service and in our ability to meet the demands of our customers.

In the event we are unable to acquire additional radio spectrum capacity, we can increase the density of our network by building more cell and switch sites, but such measures are costly and may be subject to local restrictions and regulatory approvals, and they would not meet our needs as effectively.

We have concessions and licenses for fixed terms, and the government may revoke or terminate them as well as reacquire the assets under our concession under various circumstances, some of which are beyond our control

Our concessions and licenses have specified terms, ranging typically from five to 20 years, and are generally subject to renewal upon payment of a fee, but renewal is not assured. The loss of, or failure to renew, any one concession could have a material adverse effect on our business and results of operations. Our ability to renew concessions and the terms of renewal are subject to a number of factors beyond our control, including the prevalent regulatory and political environment at the time of renewal. Fees are typically established at the time of renewal. As a condition for renewal, we may be required to agree to new and stricter terms and service requirements. In some of the jurisdictions where we operate and under certain circumstances, mainly in connection with fixed services, we may be required to transfer certain assets covered by some of our concessions to the government pursuant to valuation methodologies that vary in each jurisdiction. It is uncertain whether reversion would ever be applied in many of the jurisdictions where we operate and how reversion provisions would be interpreted in practice. For further information, see “Regulation” under Part VI of this annual report and ~~note 16~~Note 17 to our audited consolidated financial statements included in this annual report.

In addition, the regulatory authorities in the jurisdictions in which we operate can revoke our concessions under certain circumstances. In Mexico, for example, the Federal Law on Telecommunications and Broadcasting gives the

government the right to ~~expropriate~~temporarily seize our concessions or to take over the management of our networks, facilities and personnel in cases of failures to meet obligations under our concession agreements, imminent danger to national security, internal peace or the national economy, natural disasters and public unrest. See “Regulation” under Part VI of this annual report.

We continue to look for acquisition opportunities, and any future acquisitions and related financing could have a material effect on our business, results of operations and financial condition

We continue to look for investment opportunities in telecommunications and related companies worldwide, including in markets where we are already present, and we often have several possible acquisitions under consideration. Any future acquisitions, and related financing and acquired indebtedness, could have a material effect on our business, results of operations and financial condition, but we cannot provide assurances that we will complete any of them. In addition, we may incur significant costs and expenses as we integrate these companies in our systems, controls and networks.

We are subject to significant litigation

Some of our subsidiaries are subject to significant litigation that, if determined adversely to our interests, may have a material adverse effect on our business, results of operations, financial condition or prospects. Our significant litigation is described in “Regulation” under Part VI and in ~~note 16~~Note 17 to our audited consolidated financial statements included in this annual report.

We are contesting significant tax assessments

We and some of our subsidiaries have been notified of tax assessments for significant amounts by the tax authorities of the countries in which we operate, especially in Brazil, Mexico and Ecuador. The tax assessments relate to, among other things, alleged improper deductions and underpayments. We are contesting these tax assessments in several administrative and legal proceedings, and our challenges are at various stages. If determined adversely to

us, these proceedings may have a material adverse effect on our business, results of operations, financial condition or prospects. In addition, in some jurisdictions, challenges to tax assessments require the posting of a bond or security for the contested amount, which may reduce our flexibility in operating our business. Our significant tax assessments are described in ~~note 16~~Note 17 to our audited consolidated financial statements included in this annual report.

Failure to comply with anti-corruption, ~~anti- bribery~~anti-bribery and anti-money laundering laws could harm our reputation, subject us to substantial fines and adversely affect our business

We operate in multiple jurisdictions and are subject to complex regulatory frameworks with increased enforcement activities worldwide. Our governance and compliance

processes may not prevent future breaches of legal, accounting or governance standards and regulations. We may be subject to breaches of our code of ethics, anti-corruption policies and business conduct protocols and to instances of fraudulent behavior, corrupt practices and dishonesty by our employees, contractors or other agents. Our failure to comply with applicable laws and other regulatory requirements could harm our reputation, subject us to substantial fines, sanctions or penalties and adversely affect our business and ability to access financial markets.

A system failure could cause delays or interruptions of service, which could have an adverse effect on our operations

We need to continue to provide our subscribers with a reliable service over our network. Some of the risks to our network and infrastructure include the following:

physical damage to access lines and fixed networks;

power surges or outages;

natural disasters;

climate change;

malicious actions, such as theft or misuse of customer data;

limitations on the use of our radio bases;

software defects;

human error; and

other disruptions beyond our ~~control.~~control, including as a result of civil unrest in the regions where we operate.

In Brazil, for example, our satellite operations may be affected if we experience a delay in launching new satellites to replace those currently in use when they reach the end of their operational lives. Such delay may occur because of, among other reasons, construction delays, unavailability of launch vehicles and/or launch failures. In addition, ~~in 2017,~~ our operations ~~in Puerto Rico suffered significant damage in the aftermath of Hurricane Maria,~~have been disrupted by natural disturbances such as hurricanes and ~~our operations in Mexico experienced network overloads and power outages following the earthquake on September 19, 2017.~~earthquakes.

We have instituted measures to reduce these risks. However, there is no assurance that any measures we implement will be effective in preventing system failures under all circumstances. System failures may cause interruptions in services or reduced capacity for our customers, either of which may have an adverse effect on our operations due to, for example, increased expenses, potential legal liability, loss of existing and potential subscribers, reduced user traffic, decreased revenues and reputational harm.

Our financial condition and results of operations may be adversely affected by the occurrence of severe weather, natural or man-made disasters and other catastrophic events, including war, terrorism and other acts of violence, and disease

Our operations can be disrupted by unforeseen events, including war, terrorism, and other international, regional, or local instability or conflicts (including labor issues), embargos, public health issues (including tainted food, food-borne illnesses, food tampering, tampering with or failure of water supply or widespread or pandemic illness such as coronavirus (“COVID-19”), Ebola, the avian or H1N1 flu, MERS), and natural disasters such as earthquakes, tsunamis, hurricanes, or other adverse weather and climate conditions in the countries in which we operate. These events could disrupt or prevent our ability to perform functions and otherwise impede our ability to continue business operations in a continuous manner, which in turn may materially and adversely impact our business and operating results.

The COVID-19 pandemic has had a material impact on the global economy and our business

The COVID-19 pandemic has had, and continues to have, a material impact on businesses around the world and the economic environments in which they operate. Governments in jurisdictions where we operate have taken aggressive measures to slow the spread of COVID-19, including quarantines and lock-downs, restrictions on travel, and closing of businesses and public and private institutions. In addition, governments have imposed a wide variety of consumer protection measures that limit how certain businesses, including telecommunications companies, can operate their businesses and interact with their customers. The virus continues to spread globally and cause significant social and market disruption.

There are a number of consequences of the pandemic and its impact on global economies that could have a material adverse effect on our business.

In 2020, the economic slowdown had an adverse impact on our customers’ ability to pay for our services.

We have been required to change or restrict many of our operations, including customer support, servicing and repairs, network maintenance, retail operations and investment projects. We have also experienced supply chain disruptions for handsets and other equipment. This could have an impact on our costs.

We have implemented policies, including work-from-home policies and social distancing policies, that could limit the efficiency and effectiveness of our operations and our reporting and internal controls.

The extent of the impact of the COVID-19 on the Company’s operational and financial performance will depend on future developments, including the duration and spread of the pandemic, and the availability and effectiveness of vaccines, all of which are highly uncertain and cannot be predicted. If the COVID-19 pandemic continues to spread, the impact on our operations, our clients, our suppliers and financial markets could materially adversely affect our financial condition or results of operations. See “Operating And Financial Review And Prospects—Effects of the COVID-19 Pandemic.”

Increases in labor and employee benefit costs may reduce our profitability, increase our funding requirements and could have an adverse impact on our operations

Many of our employees are members of labor unions with which we conduct collective negotiations on wages, benefits and working conditions. We use actuarial methodologies and assumptions such as discount rate, salary increase and mortality, among others, for the determination and valuation of our employee benefits, including retirement benefits. We evaluate from time to time, with the support of specialists, our actuarial methodologies and assumptions, as well as the valuation of the assets related to these benefits.

Our labor costs and the costs of maintaining employee benefits could be affected by several factors, including legislative and regulatory changes, work stoppages, subsequent negotiations, increases in healthcare costs, minimum wages, decreases in investment returns on the assets held in funds to support the payment of certain employee benefits and changes in the discount rate and mortality assumptions. An increase in labor and employee benefit costs could reduce our profitability, increase our funding requirements and have an adverse impact on our operations.

We rely on highly skilled personnel throughout all levels of our business. Our business could be harmed if we are unable to retain or motivate key personnel, hire qualified personnel or maintain our corporate culture.

The market for highly skilled workers and leaders in our industry is extremely competitive. We believe that our future success depends in substantial part on our ability to recruit, hire, motivate, develop, and retain talented personnel for all areas of our organization, including our CEO and the other members of our senior leadership team. Our inability to retain these employees or to replace them with qualified and capable successors could hinder our strategic planning and execution. If key employees depart, our business could be negatively impacted. We may incur significant costs in identifying, hiring and replacing departing employees and may lose significant expertise and talent. As a result, we may not be able to meet our business plan and our revenue growth and profitability may be materially adversely affected.

Cybersecurity incidents and other breaches of network or information technology security could have an adverse effect on our business and our reputation

Cybersecurity incidents, and other tactics designed to gain access to and exploit sensitive information by breaching critical systems of large companies, are evolving and have been increasing in both sophistication and occurrence in recent years. While we employ a number of measures to prevent, detect and mitigate such incidents, there is no guarantee that we will be able to adequately anticipate or prevent one. Cybercrime, including attempts to overload our servers with ~~denial-of-service~~denial-of-service attacks, theft, social engineering, phishing, ransomware or similar disruptions from unauthorized access or attempted unauthorized access to our systems could result in the destruction, misuse or release of personal information or other sensitive data. ~~As of the date of this annual report, we have no knowledge of any significant compromise or material financial or data loss related to a cybersecurity incident.~~

~~RISK FACTORS~~

However, it is difficult to detect or prevent evolving forms of cybersecurity incidents, and our systems, and those of our third-party service providers and of our customers, are vulnerable to cybersecurity incidents.

In the event that our systems are breached or damaged for any reason, we may suffer loss or unavailability of data and interruptions to our business operations. If such an event occurs, the unauthorized disclosure, loss or unavailability of data and the disruption to our fixed-line or wireless networks may have a material adverse effect on our business and results of operations. The costs associated with a cybersecurity incident could include increased expenditures on information and cybersecurity measures, damage to our reputation, loss of existing customers and business partners

and lead to financial losses from remedial actions and potential liability, including possible litigation and sanctions. Any of these occurrences may result in a material adverse effect on our results of operations and financial condition.

Failure to achieve proper data governance could lead to data mismanagement

We process large amounts of personally identifiable information of customers and employees and are subject to various compliance, security, privacy, data quality and regulatory requirements. Failure to achieve proper data governance could lead to data mismanagement which in turn could result in data loss, regulatory investigations or sanctions, and cybersecurity risk. We are subject to data privacy regulations in the countries where we operate. Complying with such regulations may expose us to increased costs and limit our ability to transfer data between certain jurisdictions, which may adversely affect our operations.

If our churn rate increases, our business could be negatively affected

The cost of acquiring a new subscriber is much higher than the cost of maintaining an existing subscriber. Accordingly, subscriber deactivations, or “churn,” could have a material negative impact on our operating income, even if we are able to obtain one new subscriber for each lost subscriber. A substantial majority of our subscribers are prepaid, and we do not have long-term contracts with them. Our average churn rate on a consolidated basis was ~~4.2%~~3.8% for the year ended December 31, ~~2018~~2020 and 4.1% for the year ended December 31, ~~2017.~~2019. If we experience an increase in our churn rate, our ability to achieve revenue growth could be materially impacted. In addition, a decline in general

economic conditions could lead to an increase in churn, particularly among our prepaid subscribers.

We rely on key suppliers to provide equipment that we need to operate our business

We rely upon various key suppliers to provide us with handsets, network equipment or services, which we need to expand and operate our business. Our key suppliers include Huawei, Ericsson and Alcatel. If these suppliers fail to provide equipment or service to us on a timely basis, we could experience disruptions, which could have an adverse effect on our revenues and results of operations. In addition, we might be unable to satisfy requirements under our concessions.

Government or regulatory actions with respect to certain suppliers may impact us. For example, the government of the United States and Canada, among others, are currently conducting a regulatory review of certain international suppliers of network equipment and technologies to evaluate

potential risks. We are currently unable to predict the outcome of such reviews, including any possible restrictions placed on our key suppliers, , and as a result we cannot determine their potential impact on our business.

Our ability to pay dividends and repay debt depends on our subsidiaries’ ability to pay dividends and make other transfers to us

We are a holding company with no significant assets, other than the shares of our subsidiaries and our holdings of cash and cash equivalents. Our ability to pay dividends and repay debt depends on the continued transfer to us of dividends and other income from our subsidiaries. The ability of our subsidiaries to pay dividends and make other transfers to us may be limited by various regulatory, contractual and legal constraints that affect them.

We may fail to realize the benefits anticipated from acquisitions, divestments and significant investments we make from time to time

The business growth opportunities, revenue benefits, cost savings and other benefits we anticipated to result from our acquisitions, divestments and significant investments may not be achieved as expected, or may be delayed. Our

divestments may also adversely affect our prospects. For example, we may be unable to fully implement our business plans and strategies for the combined businesses due to regulatory limitations, and we may face regulatory restrictions in our provision of combined services in some of the countries in which we operate. To the extent that we incur higher integration costs or achieve lower revenue benefits or fewer cost savings than expected, or if we are required to recognize impairments of acquired assets, investments or goodwill, our results of operations and financial condition may suffer.

A downgrade of Mexico’s credit rating could affect us

Credit rating agencies regularly evaluate Mexico and its sovereign rating based on various factors including macroeconomic trends, tax and budgetary conditions and indebtedness metrics. If Mexico’s sovereign credit rating is downgraded by credit rating agencies, the rating of our securities may also be downgraded, which could negatively affect our financing costs and the market price of our securities.

Changing expectations from stakeholders with respect to our environmental, social and governance practices may impose additional costs on us or expose us to new or additional risks

Influential investors and other stakeholders are increasingly focused on the environmental, social and governance (“ESG”) practices of companies across all industries. If we do not adapt to or comply with evolving expectations, or if we are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage, and our business, financial condition or stock price could be materially and adversely affected. If we do not meet our stakeholders’ expectations or we are not effective in addressing ESG matters or achieve relevant sustainability goals, trust in our brand may suffer and our business or our ability to access capital could be harmed.

RISKS RELATING TO THE TELECOMMUNICATIONS INDUSTRY GENERALLY

Changes in the telecommunications industry could affect our future financial performance

The telecommunications industry continues to experience significant changes as new technologies are developed that offer subscribers an array of choices for their communications needs. These changes include, among others, regulatory changes, evolving industry standards, ongoing improvements in the capacity and quality of digital technology, shorter development cycles for new products, evolving renewable energy and clean technologies, and changes inend-user needs and preferences. There is uncertainty as to the pace and extent of growth in subscriber demand, and as to the extent to which prices for airtime, broadband access, Pay TV and fixed-line rental may continue to decline. Our ability to compete in the delivery of high-quality internet and broadband services is particularly important, given the increasing contribution of revenues from data services to our overall growth. If we are unable to

meet future advances in competing technologies on a

timely basis or at an acceptable cost, we could lose subscribers to our competitors. In general, the development of new services in our industry requires us to anticipate and respond to the varied and continually changing demands of our subscribers. It also requires significant capital expenditure, including investment in the continual maintenance and upgrading of our networks, in order to expand coverage, increase our capacity to absorb higher bandwidth usage and adapt to new technologies. We may not be able to accurately predict technological trends or the success of new services in the market. In addition, there could be legal or regulatory restraints to our introduction of new

services. If these services fail to gain acceptance in the marketplace, or if costs associated with implementation and completion of the introduction of these services materially increase, our ability to retain and attract subscribers could be adversely affected. This is true across many of the services we provide, including wireless and cable technology.

The intellectual property used by us, our suppliers or service providers may infringe on intellectual property rights owned by others

Some of our products and services use intellectual property that we own or license from others. We also provide content we receive from content producers and distributors, such as ringtones, text games, video games, video, including TV programs and movies, wallpapers or screensavers, and we outsource services to service providers, including billing and customer care functions, that incorporate or utilize intellectual property. We and some of our suppliers, content distributors and service providers have received, and may receive in the future, assertions and claims from third parties that the content, products or software utilized by us or our suppliers, content producers and distributors and service providers infringe on the patents or other intellectual property rights of these third parties. These claims could require us or an infringing supplier, content distributor or service provider to cease engaging in certain activities, including selling, offering and providing the relevant products and services. Such claims and assertions also could subject us to costly litigation and significant liabilities for damages or royalty payments, or require us to cease certain activities or prevent us from selling certain products or services.

~~RISK FACTORS~~

Concerns about health risks relating to the use of wireless handsets and base stations may adversely affect our business

Portable communications devices have been alleged to pose health risks, including cancer, due to radio frequency emissions. Lawsuits have been filed in the United States against certain participants in the wireless industry alleging various adverse health consequences as a result of wireless phone usage, and our subsidiaries may be subject to similar litigation in the future. Government authorities could increase regulation on electromagnetic emissions of mobile handsets and base stations, which could have an adverse effect on our business, financial condition and results of operations. Research and studies are ongoing, and there can be no assurance that further research and studies will not demonstrate a link between radio frequency emissions and health concerns. Any negative findings in these studies could adversely affect the use of wireless technology and, as a result, our future financial performance.

Developments in the telecommunications sector have resulted, and may result, in substantial write-downs of the carrying value of certain of our assets

Where the circumstances require, we review the carrying value of each of our assets, subsidiaries and investments in associates to assess whether those carrying values can be supported by the future discounted cash flows expected to be derived from such assets. Whenever we consider that due to changes in the economic, regulatory, business or political environment, our goodwill, investments in associates, intangible assets or fixed assets may be impaired, we consider the necessity of performing certain valuation tests, which may result in impairment charges. The recognition of impairments of tangible, intangible and financial assets could adversely affect our results of operations. ~~See “Critical Accounting Policies and Estimates—Impairment of Long-Lived Assets” under Part II of this annual report.~~

RISKS RELATING TO OUR CONTROLLING SHAREHOLDERS, CAPITAL STRUCTURE AND TRANSACTIONS WITH AFFILIATES

Members of one family may be deemed to control us and may exercise their control in a manner that may differ from the interest of other shareholders

Based on reports of beneficial ownership of our shares filed with the SEC, Carlos Slim Helú, ~~a member of our Board of Directors,~~ together with his sons, daughters and grandchildren (together, the “Slim Family”)~~, including his two sons, Carlos Slim Domit and Patrick Slim Domit, who serve as the Chairman and Vice Chairman of our Board of Directors, respectively,~~ may be deemed to control us. The Slim Family may be able to elect a majority of the members of our Board of Directors and to determine the outcome of other actions requiring a vote of our shareholders. The interests of the Slim Family may diverge from the interests of our other investors.

We have significant transactions with affiliates

We engage in various transactions with Telesites, S.A.B. de C.V. (“Telesites”) and certain subsidiaries of Grupo Carso, S.A.B. de C.V. (“Grupo Carso”) and Grupo Financiero Inbursa, S.A.B. de C.V. (“Grupo Financiero Inbursa”), all which may be deemed for certain purposes to be under common control with América Móvil.

These transactions occur in the ordinary course of business. Transactions with affiliates may create the potential for conflicts of interest.

We also make investments together with related parties, sell investments to related parties and buy investments from related parties. For more information about our transactions with affiliates, see “Related Party Transactions” under Part IV of this annual report.

Our bylaws restrict transfers of shares in some circumstances

Our bylaws provide that any acquisition or transfer of 10.0% or more ~~than 10.0%~~ of our capital stock by any person or group of persons acting together requires the approval of our Board of Directors. You may not acquire or transfer more than

10.0% of our capital stock without the approval of our Board of Directors. ~~See “Bylaws—Restrictions of Certain Transfers” under Part IV of this annual report.~~

The protections afforded to minority shareholders in Mexico are different from those in the United States

Under Mexican law, the protections afforded to minority shareholders are different from those in the United States. In particular, the law concerning fiduciary duties of directors is not as fully developed as in other jurisdictions, the procedure for class actions is different, and there are different procedural requirements for bringing shareholder lawsuits. As a result, in practice it may be more difficult for minority shareholders of América Móvil to seek remedies against us or our directors or controlling shareholders than it would be for shareholders of a company incorporated in another jurisdiction, such as ~~the~~ Delaware.

Holders of L Shares and L Share ADSs have limited voting rights

Our bylaws provide that holders of L Shares are not permitted to vote, except on such limited matters as, among others, the transformation or merger of América Móvil or the cancellation of registration of the L Shares with the Mexican Securities Registry (~~Registro~~(Registro Nacional de Valores,, or “RNV”) maintained by the CNBV or any stock exchange on which they are listed. If you hold L Shares or L Share ADSs, you will not be able to vote on most matters, including the declaration of dividends, which are subject to a shareholder vote in accordance with our bylaws.

Holders of ADSs are not entitled to attend shareholders’ meetings, and they may only vote through the depositary

Under our bylaws, a shareholder is required to deposit its shares with a custodian in order to attend a shareholders’ meeting. A holder of ADSs will not be able to meet this requirement and, accordingly, is not entitled to attend shareholders’ meetings. A holder of ADSs is entitled to instruct the depositary as to how to vote the shares represented by ADSs, in accordance with procedures provided for in the deposit agreements, but a holder of ADSs will not be able to vote its shares directly at a shareholders’ meeting or to appoint a proxy to do so.

Our bylaws may only be enforced in Mexico

Our bylaws provide that legal actions relating to the execution, interpretation or performance of the bylaws may be brought only in Mexican courts. As a result, it may be difficult fornon-Mexican shareholders to enforce their shareholder rights pursuant to the bylaws.

It may be difficult to enforce civil liabilities against us or our directors, officers and controlling persons

América Móvil is organized under the laws of Mexico, with its principal place of business in Mexico City, and most of our directors, officers and controlling persons reside outside the United States. In addition, all or a substantial portion of our assets and their assets are located outside of the United States. As a result, it may be difficult for investors to effect service of process within the United States on such persons or to enforce judgments against them, including in any action based on civil liabilities under U.S. federal securities laws. There is doubt as to the enforceability against such persons in Mexico, whether in original actions or in actions to judgments of U.S. courts, of liabilities based solely on U.S. federal securities laws.

You may not be entitled to participate in future preemptive rights offerings

Under Mexican law, if we issue new shares for cash as part of certain capital increases, we must grant our shareholders the right to purchase a sufficient number of shares to maintain their existing ownership percentage in América Móvil. Rights to purchase shares in these circumstances are known as preemptive rights. Our shareholders do not have preemptive rights in certain circumstances such as mergers, convertible debentures, public offers and placement of repurchased shares. We may not be legally permitted to allow holders of ADSs or holders of L Shares or A Shares in the United States to exercise any preemptive rights in any future capital increase unless we file a registration statement with the U.S. Securities and Exchange Commission (the “SEC”) with respect to that future issuance of shares. At the time of any future capital increase, we will evaluate the costs and potential liabilities associated with filing a registration statement with the SEC and any other factors that we consider important to determine whether we will file such a registration statement.

~~RISK FACTORS~~

We cannot assure you that we will file a registration statement with the SEC to allow holders of ADSs or U.S. holders of L Shares or A Shares to participate in a preemptive rights offering. As a result, the equity interest of such holders in América Móvil may be diluted proportionately. In addition, under current Mexican law, it is not practicable for the depositary to sell preemptive rights and distribute the proceeds from such sales to ADS holders.

RISKS RELATING TO DEVELOPMENTS IN MEXICO AND OTHER COUNTRIES

Economic, political and social conditions in Latin America, the United States, the Caribbean and Europe may adversely affect our business

Our financial performance may be significantly affected by general economic, political and social conditions in the markets where we operate. Many countries in Latin America and the Caribbean, including Mexico, Brazil and Argentina, have undergone significant economic, political and social crises in the past, and these events may occur again in the future. We cannot predict whether changes in political administrations will result in changes in governmental policy and whether such changes will affect our business. Factors related to economic, political and social conditions that could affect our performance include:

significant governmental influence over local economies;

substantial fluctuations in economic growth;

high levels of inflation, including hyperinflation;

changes in currency values;

exchange controls or restrictions on expatriation of earnings;

high domestic interest rates;

price controls;

changes in governmental economic, tax, labor or other policies;

imposition of trade barriers;

changes in law or regulation; and

overall political, social and economic ~~instability.~~instability and civil unrest.

Adverse economic, political and social conditions in Latin America, the United States, the Caribbean or in Europe may inhibit demand for telecommunication services and create uncertainty regarding our operating environment or may affect our ability to renew our licenses and concessions, to maintain or increase our market share or profitability and may have an adverse impact on future acquisitions, which could have a material adverse effect on our company. In addition, the perception of risk in the countries in which we operate may have a negative effect on the trading price of our shares and ADSs and may restrict our access to international financial markets.

In various countries where we operate, for example, elections took place during 2018, which could lead to economic, political and social changes over which we have no control. Our business may also be especially affected by conditions in Mexico and Brazil, two of our largest markets. Mexican elections in July 2018 resulted in a new president and in a new Congress with a majority of members in both houses

representing a different political party from the parties that have been in power in the past. We cannot predict what changes in policy the Mexican administration may adopt, or their impact on our operations. Additionally, in Mexico, economic conditions are strongly impacted by those of the United States. There is continuing uncertainty regarding U.S. policies with respect to matters of importance to Mexico and its economy, particularly with respect to trade and migration.

Possible replacement of the LIBOR benchmark interest rate may have an impact on our business

On July 27, 2017, the U.K. Financial Conduct Authority (the authority that regulates LIBOR) announced that it would phase out LIBOR as a benchmark by the end of 2021. The discontinuation date for submission and publication of rates for certain tenors of USD LIBOR (1-month, 3-month, 6-month and 12-month) has been extended by the ICE Benchmark Administration (the administrator of LIBOR) until June 30, 2023. It is unclear whether new methods of calculating LIBOR will be established such that it continues to exist after 2021. Similarly, it is not possible to predict whether LIBOR will continue to be viewed as an acceptable market benchmark, what rate or rates may become acceptable alternatives to LIBOR, or what effect these changes in views or alternatives may have on financial markets for LIBOR-linked financial instruments. Potential changes, or uncertainty related to such potential changes may adversely affect the market for loans with LIBOR-indexed interest rates. When LIBOR ceases to exist, we may need to amend the credit and loan agreements with our lenders that utilize LIBOR as a factor in determining the interest rate based on a new standard that is established, if any. There is no guarantee that a transition from LIBOR to an alternative will not result in financial market disruptions,

significant increases in benchmark rates, or borrowing costs to borrowers, any of which could have an adverse effect on our business, results of operations and financial condition.

Changes in exchange rates could adversely affect our financial condition and results of operations

We are affected by fluctuations in the value of the currencies in which we conduct operations compared to the currencies in which our indebtedness is denominated. Such changes result in exchange losses or gains on our net indebtedness and accounts payable. In ~~2018,~~2020, we reported net foreign exchange losses of ~~Ps.7.3~~Ps.65.4 billion.

In addition, currency fluctuations between the Mexican peso and the currencies of ournon-Mexican subsidiaries affect our results as reported in Mexican pesos. Currency fluctuations are expected to continue to affect our financial income and expense.

Major depreciation of the currencies in which we conduct operations could cause governments to impose exchange controls that would limit our ability to transfer funds between us and our subsidiaries

Major depreciation of the currencies in which we conduct operations may result in disruption of the international foreign exchange markets and may limit our ability to transfer or to convert such currencies into U.S. dollars and other currencies for the purpose of making timely payments of interest and principal on our indebtedness. ~~For example,~~The government of Argentina has adopted exchange controls and restrictions on the movement of capital and has taken other measures in response to capital flight and the significant depreciation of the Argentine peso. In addition, although the Mexican government does not currently restrict, and for many years has not restricted, the right or ability of Mexican or foreign persons or entities to

convert Mexican pesos into U.S. dollars or to transfer other currencies out of Mexico, it could institute restrictive exchange rate policies in the future. Similarly, the Brazilian government may impose temporary restrictions on the conversion of Brazilian reais into foreign currencies and on the remittance to foreign investors of proceeds from investments in Brazil whenever there is a serious imbalance in Brazil’s balance of payments or a reason to foresee a serious imbalance. In the past, the government of Argentina has adopted restrictions on access to the foreign exchange market and the transfer of foreign currency outside Argentina. The Argentine government could impose further exchange controls or restrictions on the movement of capital and take other measures in the future in response to capital flight or a significant depreciation of the Argentine peso.

Developments in other countries may affect the market price of our securities and adversely affect our ability to raise additional financing

The market value of securities of Mexican companies is, to varying degrees, affected by economic and market conditions in other countries, including the United States, the European Union (the “EU”) and emerging market countries. Although economic conditions in such countries may differ significantly from economic conditions in Mexico, investors’ reactions to developments in any of these other countries may have an adverse effect on the market value of securities of Mexican issuers. Crises in the United States, the EU and emerging market countries may diminish investor interest in securities of Mexican issuers. This could materially and adversely affect the market price of our securities, and could also make it more difficult for us to access the capital markets and finance our operations in the future on acceptable terms or at all.

5747

~~MAJOR SHAREHOLDERS~~

The following table sets forth our capital structure as of March 31, ~~2019.~~2021.

SERIES

NUMBER OF SHARES
(MILLIONS)
PERCENT OF CAPITAL
COMBINED A SHARES AND AA
SHARES⁽¹⁾

L Shares (no par value)
44,883 68.0 % —

AA Shares (no par value)
20,602 31.2 % 97.5 %

A Shares (no par value)
539 0.8 % 2.5 %

Total⁽²⁾
66,024 100.0 % 100.0 %
  SERIES    NUMBER OF
SHARES
(MILLIONS)
PERCENT OF
COMBINED
CAPITAL
A SHARES AND
AA SHARES⁽¹⁾
  L Shares
   45,448    68.3 %      –
  (no par value)
  AA Shares
   20,578    30.9 % 97.6 %
  (no par value)
  A Shares
   515    0.8 % 2.4 %
  (no par value)
  Total⁽²⁾
   66,541    100 % 100 %
(1)
⁽¹⁾The AA Shares and A Shares of América Móvil, together, are entitled to elect a majority of our directors. Holders of L Shares are entitled to limited voting rights under our bylaws. See “Bylaws—Voting Rights” under this Part IV.
(2)
⁽²⁾Figures in the table may not recalculate exactly due to rounding.
According to reports of beneficial ownership of our shares filed with the SEC, the Slim Family may be deemed to control us through their interests in a Mexican trust that holds AA Shares and L Shares for their benefit (the “Family Trust”), their interest in Inversora Carso, S.A. de C.V., including its subsidiary Control Empresarial de Capitales, S.A. de C.V. and their direct ownership of our shares. See “Management—Directors” and “Management—Executive Committee” under Part V and “Related Party Transactions” under this Part IV of this annual report.
The following table identifies owners of more than 5.0% of any series of our shares as of March 31, ~~2019.~~2021. Except as described in the table below and the accompanying notes, we are not aware of any holder of more than 5.0% of any series of our shares. Figures below do not include L Shares that would be held by each shareholder upon conversion of AA Shares or A Shares, as provided for under our bylaws. See ~~“Bylaws—Shareholders’ Equity” under this Part IV and~~ “Management—Share Ownership of Directors and Senior Management” under Part V of this annual report.


SHAREHOLDER		SHARES OWNED (MILLIONS)		PERCENT OF CLASS⁽¹⁾		SHAREHOLDER	SHARES OWNED (MILLIONS)		PERCENT OF CLASS⁽¹⁾

AA SHARES:	AA SHARES:

Family Trust⁽²⁾			10,894		52.9%			10,894		52.9%

Inversora Carso⁽³⁾			4,381		21.3%			4,381		21.3%

Carlos Slim Helú			1,879		9.1%			1,879		9.1%

L SHARES:	L SHARES:

Inversora Carso⁽³⁾			6,020		13.4%			6,020		13.2%

Family Trust⁽²⁾			5,998		13.4%			5,998		13.2%

Carlos Slim Helú			3,072		6.8%			3,072		6.8%

BlackRock, Inc.⁽⁴⁾			2,918		6.5%			2,466		5.4%

(1)

⁽¹⁾Percentage figures are based on the number of shares outstanding as of March 31, ~~2019.~~2021.

(2)

⁽²⁾The Family Trust is a Mexican trust that holds AA Shares and L Shares for the benefit of members of the Slim Family. In addition to shares held by the Family Trust, members of the Slim Family, including Carlos Slim Helú, directly own an aggregate of 3,558 million AA Shares and 9,570 million L Shares representing 17.3% and ~~21.3%~~21.1%, respectively, of each series. According to beneficial reports filed with the SEC, none of these members of the Slim Family, other than Carlos Slim Helú, individually directly own more than 5.0% of any class of our shares.

(3)

⁽³⁾Includes shares owned by subsidiaries of Inversora Carso. Based on beneficial ownership reports filed with the SEC, Inversora Carso is a Mexican sociedad anó~~nima~~n- ima de capital variable and may be deemed to be controlled by the Slim Family.

(4)

⁽⁴⁾Based on beneficial ownership reports filed with the SEC.

As of March 31, ~~2019, 15.9%~~2021, 15.7% of the outstanding L Shares were represented by L Share ADSs, each representing the right to receive 20 L Shares, and ~~99.9%~~99.98% of the L Share ADSs were held by ~~7,077~~6,532 registered holders with addresses in the United States. As of such date, ~~35.9%~~37.2% of the A Shares were held in the form of A Share ADSs, each representing the right to receive 20 A Shares, and ~~99.8%~~99.9% of the A Share ADSs were held by ~~3,450~~3,215 registered holders with addresses in the United States. Each A Share may be exchanged at the option of the holder for one L Share.

We have no information concerning the number of holdings or holders with registered addresses in the United States that hold:

AA Shares;

A Shares not represented by ADSs; or

L Shares not represented by ADSs.

6050

~~RELATED PARTY TRANSACTIONS~~

Our subsidiaries purchase materials or services from a variety of companies that may be deemed for certain purposes to be under common control with us, including Telesites, Grupo Carso and Grupo Financiero Inbursa and their respective subsidiaries.

These services include insurance and banking services provided by Grupo Financiero Inbursa and its subsidiaries. In addition, we sell products in Mexico through the Sanborns and Sears Operadora México, S.A. de C.V. ~~(“Sears”)~~ store chains. Some of our subsidiaries also purchase network construction services and materials from subsidiaries of Grupo Carso. Our subsidiaries purchase these materials and services on terms

no less favorable than they could obtain from unaffiliated parties, and would have access to other sources if our related parties ceased to provide them on competitive terms.

We and Telesites have entered into an agreement providing for site usage fees, annual price escalations and fixed annual charges that permit us to install apre-determined amount of equipment at the ~~sites~~Telesite towers and provide for incremental fee payments if capacity use is exceeded. The principal economic terms of the agreement conform to the reference terms published by Telesites and approved by IFT.

Note 6 to our audited consolidated financial statements included in this annual report provides additional information about our related party transactions.

~~DIVIDENDS~~

We regularly pay cash dividends on our shares. The table below sets forth the nominal amount of dividends paid per share on each date indicated, in Mexican pesos and translated into U.S. dollars at the exchange rate reported by Banco de México, as published in the Official Gazette, for each of the respective payment dates.



~~Payment Date~~	~~Pesos Per Share~~		~~Dollar Per Share~~

~~November 12, 2018~~	~~Ps. 0.16~~	~~U.S.$~~	~~0.0080~~

~~July 16, 2018~~	~~Ps. 0.16~~	~~U.S.$~~	~~0.0085~~

~~November 13, 2017~~	~~Ps. 0.15~~	~~U.S.$~~	~~0.0079~~

~~July 17, 2017~~	~~Ps. 0.15~~	~~U.S.$~~	~~0.0085~~

~~November 14, 2016~~	~~Ps. 0.14~~	~~U.S.$~~	~~0.0068~~

~~July 15, 2016~~	~~Ps. 0.14~~	~~U.S.$~~	~~0.0076~~

~~November 13, 2015~~	~~Ps. 0.13~~	~~U.S.$~~	~~0.0078~~

~~September 25, 2015~~	~~Ps. 0.30~~	~~U.S.$~~	~~0.0177~~

~~July 17, 2015~~	~~Ps. 0.13~~	~~U.S.$~~	~~0.0082~~

~~November 14, 2014~~	~~Ps. 0.12~~	~~U.S.$~~	~~0.0082~~

~~July 18, 2014~~	~~Ps. 0.12~~	~~U.S.$~~	~~0.0082~~

  PAYMENT DATE    PESOS PER SHARE      DOLLARS PER SHARE
  November 9, 2020
   Ps.    0.19      U.S.$    0.0092
  July 20, 2020
   Ps.    0.19      U.S.$    0.0085
  November 11, 2019
   Ps.    0.17      U.S.$    0.0090
  July 15, 2019
   Ps.    0.18      U.S.$    0.0095
  November 12, 2018
   Ps.    0.16      U.S.$    0.0080
  July 16, 2018
   Ps.    0.16      U.S.$    0.0085
  November 13, 2017
   Ps.    0.15      U.S.$    0.0079
  July 17, 2017
   Ps.    0.15      U.S.$    0.0085
  November 14, 2016
   Ps.    0.14      U.S.$    0.0068
  July 15, 2016
   Ps.    0.14      U.S.$    0.0076

~~We have offered our shareholders the option to receive a scrip dividend in the form of either cash, Series L shares or a combination thereof and may continue to do so in the future.~~

On April ~~9, 2019,~~26, 2021 our shareholders approved a cash dividend of ~~Ps.0.35~~Ps.0.40 per share, of which ~~Ps.0.18~~Ps.0.20 per share is payable on July ~~15, 2019~~19, 2021 and ~~Ps.0.17~~Ps.0.20 is payable on November ~~11, 2019.~~8, 2021.

The declaration, amount and payment of dividends by América Móvil is determined by majority vote of the holders of AA Shares and A Shares, generally on the recommendation of the Board of Directors, and depends on our results of operations, financial condition, cash requirements, future prospects and other factors considered relevant by the holders of AA Shares and A Shares.

Our bylaws provide that holders of AA Shares, A Shares and L Shares participate equally on aper-share basis in dividend payments and other distributions, subject to certain non-materialpreferential dividend rights of holders of L Shares. ~~See “Bylaws—Dividend Rights” and “Bylaws—Preferential Rights of L Shares” under this Part IV.~~

LOGO

~~TRADING MARKETS~~

Our shares and ADSs are listed on the following markets:



~~Security~~	~~Stock Exchange~~ SECURITY	~~Ticker Symbol~~STOCK EXCHANGE	TICKER SYMBOL

L Shares	Mexican Stock Exchange—Mexico City	AMXL

L Share ADSs	New York Stock Exchange—New York	AMX

A Shares	Mexican Stock Exchange—Mexico City	AMXA

A Share ADSs	New York Stock Exchange—New York	AMOV

~~BYLAWS~~

~~Below is~~We are a Sociedad Anónima Bursátil de Capital Variable organized under Mexican law. For a description of our AA Shares, A Shares and L Shares, and a brief summary of certain significant provisions in our current bylaws and Mexican ~~law. It does not purport to be complete and is qualified by reference to~~law, see “Description of Securities Registered Under Section 12 of the ~~bylaws themselves. An English translation of our bylaws has been~~Exchange Act,” filed ~~with the SEC~~ as ~~an exhibit and is incorporated by reference to~~Exhibit 2.1 with this annual report. For a description of our Board of Directors, Executive and Audit and Corporate Practices Committees and External Auditor, see “Management” under Part V of this annual report.

~~Organization~~

~~We are a sociedad anónima bursátil de capital variable organized under Mexican law.~~

~~Shareholders’ Equity~~

~~We have three classes of outstanding shares: AA Shares, A Shares and L Shares, all without par value, fully paid andnon-assessable.~~

~~AA Shares and A Shares have full voting rights~~

~~L Shares may vote only in limited circumstances as described under “—Voting Rights” under this Part IV.~~

The rights of all series of shares are generally identical except for voting rights and the limitations on nonMexican ownership of AA Shares and A Shares. The AA Shares must always represent at least 51.0% of the combined AA Shares and A Shares. At least 20.0% of our outstanding shares must consist of AA Shares, and not more than 80% can be A Shares and L Shares.

Each AA Share or A Share may be exchanged at the option of the holder for one L Share, provided that the AA Shares may never represent less than 20.0% of our outstanding shares or less than 51.0% of our combined AA Shares and A Shares.

~~Any capital increase must be represented by new shares of each series in proportion to the number of shares of each series outstanding.~~

~~Voting Rights~~

~~Each AA Share or A Share entitles the holder to one vote at any shareholders meeting.~~

Each L Share entitles the holder to one vote at any meeting at which L Shares are entitled to vote. L Shares are entitled to vote to elect only two members of the Board and the corresponding alternate directors, as well as on the following limited matters: our transformation from one type of company to another; any merger involving us; the extension of our authorized corporate duration; our voluntary dissolution; any change in our corporate purpose; any transaction that represents 20.0% or more of the Company’s consolidated assets; any change in our jurisdiction of incorporation; removal of our shares from listing on the Mexican Stock Exchange or any foreign exchange; and any action that would prejudice the rights of L Shares. A resolution on any of the specified matters requires the affirmative vote of both a majority of all outstanding shares and a majority of the AA Shares and the A Shares voting together.

~~Shares of any series are also entitled to vote as a class on any action that would prejudice the rights of that series and are entitled to judicial relief against any action taken without their vote.~~

~~Shareholders’ Meetings~~

General shareholders’ meetings may be ordinary or extraordinary. Extraordinary general meetings are those called to consider certain specified matters, including, principally, changes to the bylaws, liquidation, merger and transformation, as well as to consider the removal of our shares from listing on the Mexican Stock Exchange or any foreign stock exchange. General meetings called to consider all other matters are ordinary meetings.

An ordinary general meeting of AA Shares and A Shares must be held each year to consider the approval of the financial statements for the preceding fiscal year, to elect directors and to determine the allocation of the profits. Transactions that represent 20.0% or more of our consolidated assets in any fiscal year must be approved by an ordinary general shareholder meeting of all shareholders, including L Shares. All other matters on which L Shares are entitled to vote would be considered at an extraordinary general meeting.

~~The two directors elected by the L Shares are elected at a special meeting of L Shares. A special meeting of the L Shares must be held each year for the election of directors.~~

~~BYLAWS~~

The quorum for an ordinary general meeting of the AA Shares and A Shares is 50.0% of such shares, and action may be taken by a majority of the shares present. If a quorum is not available, a second meeting may be called at which action may be taken by a majority of the AA Shares and A Shares present, regardless of the number of such shares. Special meetings of L Shares are governed by the same rules applicable to ordinary general meetings of AA Shares and A Shares. The quorum for an extraordinary general meeting at which L Shares may not vote is 75.0% of the AA Shares and A Shares, and the quorum for an extraordinary general meeting at which L Shares are entitled to vote is 75.0% of the outstanding capital stock. If a quorum is not available in either case, a second meeting may be called and action may be taken, provided a majority of the shares entitled to vote is present. Whether on first or second call, actions at an extraordinary general meeting may be taken by a majority vote of the AA Shares and A Shares outstanding and, on matters which L Shares are entitled to vote, a majority vote of all the capital stock.

Holders of 20.0% of our outstanding capital stock may have any shareholder action set aside by filing a complaint with a Mexican court of law within 15 days after the close of the meeting at which such action was taken and showing that the challenged action violates Mexican law or our bylaws. In addition, any holder of our capital stock may bring an action at any time within five years challenging any shareholder action. Relief under these provisions is only available to holders who were entitled to vote on, or whose rights as shareholders were adversely affected by, the challenged shareholder action and whose shares were not represented when the action was taken or, if represented, voted against it.

Shareholders’ meetings may be called by the Board, its chairman, its corporate secretary, the Chairman of the Audit and Corporate Practices Committee or a Mexican court of law. The Chairman of the Board or the Chairman of the Audit and Corporate Practices Committee may be required to call a meeting of shareholders by the holders of 10.0% of the outstanding shares. Notice of meetings must be published at least 15 days prior to the meeting.

A shareholder is required to deposit its shares with a custodian in order to attend a shareholders’ meeting. A holder of ADSs will not be able to meet this requirement, and accordingly is not entitled to attend shareholders’

meetings. A holder of ADSs is entitled to instruct the depositary as to how to vote the shares represented by ADSs, in accordance with procedures provided for in the deposit agreements. However, a holder of ADSs will not be able to vote its shares directly at a shareholders’ meeting or to appoint a proxy to do so.

~~Dividend Rights~~

At the annual ordinary general meeting of AA Shares and A Shares, the Board submits our financial statements for the previous fiscal year to the holders of AA Shares and A Shares for approval. Once financial statements are approved, the allocation of our net profits is determined, and we must allocate 5.0% of such net profits to a legal reserve, which is not thereafter available for distribution except as a stock dividend, until the amount of the legal reserve equals 20.0% of our capital stock. The remainder of net profits is available for distribution.

All shares outstanding are entitled to participate in a dividend or other distribution. L shares are entitled to a nominal preference with respect to dividends or liquidation, but the preference has no economic significance.

~~Preemptive Rights~~

In new issuances of shares, each shareholder has a preferential right to subscribe for a sufficient number of shares of the same series to maintain its existing proportionate holdings, except in certain circumstances such as mergers, convertible debentures, public offers and placement of treasury or repurchased shares. These rights cannot be traded separately from the shares. As a result, there is no trading market for such rights. Holders of ADSs may exercise these rights only through the depositary. We are not required to take steps that may be necessary to make this possible.

~~Limitations on Share Ownership~~

~~AA Shares and A Shares may be owned only by holders that qualify as Mexican investors as defined in the Foreign Investment Law (~~~~Ley de Inversión Extranjera~~~~) and our bylaws. AA Shares can only be held or acquired by Mexican citizens, Mexican corporations whose capital stock is held completely by Mexican citizens or other Mexican qualified investors.Non-Mexican~~ ~~investors cannot hold AA Shares except through trusts that effectively neutralize their votes.~~

~~If a foreign government or state acquires our AA Shares, such shares would immediately be rendered without effect or value.~~

We have a foreign exclusion clause that restricts ownership of our shares to holders that qualify as Mexican investors. It does not apply to the L Shares, and, under transitional provisions adopted by our shareholders, it does not limit foreign ownership of A Shares outstanding as of the date of the shareholders’ meeting approving the amendment.

~~Restrictions on Certain Transfers~~

Any transfer of more than 10.0% of our voting shares, in one or more transactions, by any person or group of persons acting in concert, requires prior approval by our Board. If the Board denies such approval, however, it shall designate an alternate transferee, who must pay market price for the shares as quoted on the Mexican Stock Exchange.

~~Restrictions on Deregistration in Mexico~~

~~Our shares are registered with the RNV maintained by the CNBV.~~

If we wish to cancel our registration, or if it is cancelled by the CNBV, we are required to conduct a public offer to purchase all of the outstanding shares prior to such cancellation. Such offer shall exclude our controlling group of shareholders. If, after the public offer is concluded, there are still outstanding shares held by the general public, we will be required to create a trust for a period of six months, with funds in an amount sufficient to purchase, at the same price as the offer price, the number of outstanding shares held by the public that did not participate in the offer.

Unless the CNBV authorizes otherwise, upon the prior approval of the Board, which must take into account the opinion of the Audit and Corporate Practices Committee, the offer price will be the higher of (i) the average of the closing price during the previous 30 days on which the shares may have been quoted or (ii) the book value of the shares in accordance with the most recent quarterly report submitted to the CNBV and to the Mexican Stock Exchange.

The voluntary cancellation of the registration shall be subject to (i) the prior authorization of the CNBV and (ii) the authorization of not less than 95.0% of the outstanding capital stock in a general extraordinary shareholders’ meeting.

~~Tender Offer Requirement~~

~~Certain significant acquisitions of our capital stock may require the purchaser to make a tender offer.~~

~~Other Provisions~~

~~EXCLUSIVE JURISDICTION.~~~~Our bylaws provide that legal actions relating to the execution, interpretation or performance of the bylaws shall be brought only in Mexican courts.~~

~~PURCHASE OF OUR OWN SHARES.~~We may repurchase our shares on the Mexican Stock Exchange at any time at the then-prevailing market price. Any such repurchase must conform to guidelines established by the Board, and the amount available to repurchase shares must be approved by the general ordinary shareholders’ meeting. The economic and voting rights corresponding to repurchased shares may not be exercised during the period in which we own such shares, and such shares are not deemed to be outstanding for purposes of calculating any quorum or vote at any shareholders’ meeting during such period.

~~CONFLICT OF INTEREST.~~A shareholder that votes on a business transaction in which its interest conflicts with our interests may be liable for damages, but only if the transaction would not have been approved without its vote.

~~WITHDRAWAL RIGHTS.~~Whenever a shareholders meeting approve a change of corporate purposes, change of nationality of the corporation or transformation from one type of company to another, any shareholder entitled to vote on such change that has voted against may withdraw and receive the book value of its shares, provided this right is exercised within 15 days following the meeting.

~~BYLAWS~~

~~American Depositary Shares~~

Citibank, N.A. (“the Depositary”) serves as the depositary for our ADSs and our American Depository Receipts (“ADR”) program. ADS holders are required to pay various fees to the Depositary, and the Depositary may refuse to provide any service for which a fee is assessed until the applicable fee has been paid.

ADS holders are required to pay the Depositary amounts in respect of expenses incurred by the Depositary or its agents on behalf of ADS holders, including expenses arising from (i) taxes or other governmental charges, (ii) registration fees payable to us that may be applicable to the transfer of shares upon deposits to or withdrawals from the ADS program, (iii) cable, telex and facsimile transmission, (iv) conversion of foreign currency into U.S. dollars, (v) compliance with exchange control regulations and other regulatory requirements or (vi) servicing of the ADSs or the shares underlying ADSs. The Depositary may decide in its sole discretion to seek payment either by billing holders or by deducting the fee from one or more cash dividends or other cash distributions.

~~ADS holders are also required to pay additional fees for certain services provided by the Depositary, as set forth in the table below.~~


~~DEPOSITARY SERVICE~~		~~FEE PAYABLE BY ADS HOLDERS~~

~~Issuance and delivery of ADSs, including in connection with share distributions, purchase rights, sales and stock splits~~		~~Up to U.S.$5.00 per 100 ADSs (or a fraction thereof)~~

~~Cash distributions~~		~~Up to U.S.$5.00 per 100 ADSs (or a fraction thereof)~~

~~Surrender, withdrawal or cancellation~~		~~Up to U.S.$5.00 per 100 ADSs (or a fraction thereof)~~

~~Share distributions other than ADSs or rights to purchase additional ADSs (i.e.,spin-off~~ ~~shares)~~		~~Up to U.S.$5.00 per 100 ADSs (or a fraction thereof)~~

~~ADS services~~		~~Up to U.S.$5.00 per 100 ADSs (or a fraction thereof) held on the applicable record date(s) established by the Depositary~~

~~Payments by the Depositary~~

The Depositary reimburses us for certain expenses we incur in connection with the ADR program, subject to a ceiling agreed between us and the Depositary from time to time. These reimbursable expenses currently include legal and accounting fees, listing fees, investor relations expenses and fees payable to service providers for the distribution of material to ADS holders. During the year ended December 31, 2018, the Depositary reimbursed us a total of U.S.$2.1 million for reimbursable expenses.

~~PURCHASES OF EQUITY SECURITIES BY THE ISSUER~~

~~AND AFFILIATED PURCHASERS~~

We periodically repurchase at our discretion our L Shares and A Shares on the open market pursuant to guidelines approved by our Board of Directors, using funds up to an amount authorized by our shareholders specifically for the repurchase of L Shares and A ~~Shares by us at~~Shares. In our ~~discretion. In the~~2021 annual ordinary shareholders’ meeting, ~~held on April 9, 2019,~~ our shareholders authorized an allocation of ~~Ps.3.0~~Ps.25 billion to repurchase L Shares and A Shares from April ~~2019~~2021 to April ~~2020.~~2022.

The following tables set out information concerning purchases of our L Shares ~~and A Shares~~ by us and our affiliated purchasers in ~~2018.~~2020. We did not repurchase our L Shares ~~or A Shares~~ other than through the share repurchase ~~program.~~program, and we did not repurchase any A Shares.

PERIOD
TOTAL NUMBER
OF L SHARES
PURCHASED⁽¹⁾ AVERAGE PRICE
PER L SHARES TOTAL NUMBER OF L SHARES
PURCHASED AS PART OF
PUBLICLY ANNOUNCED
PLANS OR PROGRAMS APPROXIMATE MEXICAN PESO
VALUE OF L SHARES THAT MAY
YET BE PURCHASED UNDER THE
PLANS OR PROGRAMS⁽²⁾

January 2018
4,300,000 Ps.      16.82 4,300,000 Ps.       2,186,861,427

February 2018
1,318,000 17.26 1,318,000 2,162,900,627

March 2018
— — — 2,162,900,627

April 2018
— — — 2,162,900,627

May 2018
2,560,156 16.14 2,560,156 2,958,688,268

June 2018
2,080,000 15.49 2,080,000 2,926,474,720

July 2018
3,210,000 16.15 3,210,000 2,874,640,889

August 2018
2,680,000 15.86 2,680,000 2,832,132,042

September 2018
2,081,508 15.45 2,081,508 2,799,978,412

October 2018
7,880,400 14.46 7,880,400 2,686,010,961

November 2018
4,988,725 13.09 4,988,725 2,620,438,367

December 2018
2,918,607 13.94 2,918,607 2,579,763,369
Total
34,017,396 34,017,396

⁽¹⁾ This includes purchases by us and our affiliated purchasers in 2018.
⁽²⁾ This is the approximate peso amount available at the end of the period for purchases of both L Shares and A Shares pursuant to our share repurchase program.

  PERIOD TOTAL NUMBER OF
SHARES PURCHASED⁽¹⁾ AVERAGE PRICE
PER SHARE TOTAL NUMBER OF SHARES
PURCHASED AS PART OF
PUBLICLY ANNOUNCED
PLANS OR PROGRAMS APPROXIMATE MEXICAN PESO
VALUE OF SHARES THAT MAY
YET BE PURCHASED UNDER
THE PLANS OR PROGRAMS⁽²⁾
January 2020
5,650,000 Ps. 15.34 5,650,000 Ps. 2,664,468,912
February 2020
2,200,000 16.06 2,200,000 2,629,333,277
March 2020
- - - 2,629,333,277
April 2020
11,000,000 13.64 11,000,000 5,930,090,256
May 2020
19,975,000 14.99 19,975,000 5,632,443,872
June 2020
22,000,000 15.26 22,000,000 5,298,718,225
July 2020
22,500,000 14.64 22,500,000 4,971,126,848
August 2020
21,000,000 14.14 21,000,000 4,675,982,377
September 2020
32,000,000 13.49 32,000,000 4,246,872,865
October 2020
43,000,000 13.60 43,000,000 3,665,445,685
November 2020
80,000,000 14.40 80,000,000 2,519,753,255
December 2020
106,282,651 14.48 106,282,651 989,494,709
Total L Shares
365,607,651

365,607,651

PERIOD
TOTAL NUMBER
OF A SHARES
PURCHASED⁽¹⁾ AVERAGE PRICE
PER A SHARES TOTAL NUMBER OF A SHARES
PURCHASED AS PART OF
PUBLICLY ANNOUNCED
PLANS OR PROGRAMS APPROXIMATE MEXICAN PESO
VALUE OF A SHARES THAT MAY
YET BE PURCHASED UNDER THE
PLANS OR PROGRAMS⁽²⁾

January 2018
130,382 Ps.      17.07 130,382 Ps.       2,186,861,427

February 2018
74,987 16.22 74,987 2,162,900,627

March 2018
— — — 2,162,900,627

April 2018
— — — 2,162,900,627

May 2018
— — — 2,958,688,268

June 2018
— — — 2,926,474,720

July 2018
— — — 2,874,640,889

August 2018
— — — 2,832,132,042

September 2018
— — — 2,799,978,412

October 2018
— — — 2,686,010,961

November 2018
20,248 13.65 20,248 2,620,438,367

December 2018
— — — 2,579,763,369
Total
225,617 225,617

⁽¹⁾ This includes purchases by us and our affiliated purchasers in 2018.
⁽²⁾ This is the approximate peso amount available at the end of the period for purchases of both L Shares and A Shares pursuant to our share repurchase program.

67

(1)

This includes purchases by us and our affiliated purchasers in 2020.

(2)

~~TAXATION OF SHARES AND ADS~~S

This is the approximate peso amount available at the end of the period for purchases of both L Shares and A Shares pursuant to our share repurchase program.

The following summary contains a description of certain Mexican federal and U.S. federal income tax consequences of the acquisition, ownership and disposition of L Shares, A Shares, L Share ADSs or A Share ADSs, but it does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a decision to purchase, hold or sell shares or ADSs.

This discussion does not constitute, and should not be considered as, legal or tax advice to holders. The discussion is for general information purposes only and is based upon the federal tax laws of Mexico (including the Mexican Income Tax Law ((Ley del Impuesto sobre la Renta) and the United States in effect on the date of this annual report, including the Convention for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion and the protocols thereto between the United States and Mexico currently in force (together, the “Tax Treaty”) and the agreement between the United States and Mexico concerning the exchange of information with respect to tax matters. The Tax Treaty is subject to change, and such changes may have retroactive effects. Holders of shares or ADSs should consult their own tax advisors as to the Mexican, U.S. or other tax consequences of the purchase, ownership and disposition of shares or ADSs, including, in particular, the effect of any foreign, state or local tax laws.

MEXICAN TAX CONSIDERATIONS

The following is a general summary of the principal consequences under the Mexican Income Tax Law and the rules and regulations thereunder, as currently in effect, of an investment in shares or ADSs by a holder that is not a resident of Mexico and that will not hold shares or ADSs or a beneficial interest therein in connection with the conduct of a trade or business through a permanent establishment in Mexico (a “nonresident holder”).

For purposes of Mexican taxation, the definition of residence is highly technical and residence arises in several situations. Generally, an individual is a resident of Mexico if he or she has established his or her home or center of vital interests in Mexico, and a corporation is considered a resident if it has its place of effective management in Mexico. However, any determination of residence should take into account the particular situation of each person or legal entity.

If a legal entity or an individual is deemed to have a permanent establishment in Mexico for Mexican tax purposes, all income attributable to that permanent establishment will be subject to Mexican income taxes, in accordance with applicable tax laws.

This summary does not purport to be a comprehensive description of all the Mexican tax considerations that may be relevant to a decision to purchase, own or dispose of the shares. In particular, this summary (i) does not describe any tax consequences arising under the laws of any state, locality, municipality or taxing jurisdiction other than certain federal laws of Mexico and (ii) does not address all of the Mexican tax consequences that may be applicable to specific holders of the shares, including a holder:

•

whose shares were not acquired through the Mexican Stock Exchange or other markets authorized by the Ministry of Finance and Public Credit (Secretaría de Hacienda y Crédito Público) or the Mexican Federal Tax Code;

of shares or ADSs that control us;

that holds 10.0% or more of our shares;

that is part of a group of persons for purposes of Mexican law that controls us (or holds 10.0% or more of our shares); or

that is a resident of Mexico or is a corporation resident in a tax haven (as defined by the Mexican Income Tax Law).

Tax Treaties

Provisions of the Tax Treaty that may affect the taxation of certain U.S. holders (as defined below) are summarized below.

The Mexican Income Tax Law has established procedural requirements for a nonresident holder to be entitled to benefits under any of the tax treaties to which Mexico is a party, including on dispositions and dividends. These procedural requirements include, among others, the obligation to (i) prove tax treaty residence, (ii) file tax calculations made by an authorized certified public accountant or an informational tax statement, as the case may be, and (iii) appoint representatives in Mexico for taxation purposes. Parties related to the issuer may be subject to additional procedural requirements.

Payment of Dividends

Dividends, either in cash or in kind, paid with respect to L Shares, A Shares, L Share ADSs or A Share ADSs will generally be subject to a 10.0% Mexican withholding tax (provided that no Mexican withholding tax will apply to distributions of net taxable profits generated before 2014).

Taxation of Dispositions

The tax rate on income realized by a nonresident holder from a disposition of shares through the Mexican Stock Exchange is generally 10.0%, which is applied to the net gain realized on the disposition. This tax is payable through withholding made by intermediaries. However, such withholding does not apply to a nonresident holder who certifies that the holder is resident in a country with which Mexico has entered into an income tax treaty.

The sale or other transfer or disposition of shares not carried out through the Mexican Stock Exchange and not held in the form of ADSs will be subject to a 25% tax rate in Mexico, which is applicable to the gross proceeds realized from the sale. Alternatively, a nonresident holder may, subject to certain requirements, elect to pay taxes on the net gain realized from the sale of shares at a rate of 35%.

The sale or disposition of ADSs through securities exchanges or markets recognized under the Mexican federal tax code (which includes the NYSE) by nonresidents who are residents of a country with which Mexico has entered into an income tax treaty is not subject to income tax in Mexico under the current tax rules. The tax treatment of such transfer of ADSs by nonresidents who are also not residents of a country with which Mexico has entered into an income tax treaty is not clear under the current Mexican tax rules.

Pursuant to the Tax Treaty, gains realized by a U.S. resident that is eligible to receive benefits pursuant to the Tax Treaty from the sale or other disposition of shares or ADSs, even if the sale or disposition is not carried out under the circumstances described in the preceding paragraphs, will not be subject to Mexican income tax, provided that the gains are not attributable to a permanent establishment or a fixed base in Mexico, and further provided that such U.S. holder owned less than 25% of the shares representing our capital stock (including ADSs), directly or indirectly, during

the12-month period preceding such disposition. U.S. residents should consult their own tax advisors as to their possible eligibility under the Tax Treaty.

Gains and gross proceeds realized by other nonresident holders that are eligible to receive benefits pursuant to other income tax treaties to which Mexico is a party may be exempt from Mexican income tax, in whole or in part.Non-U.S. holders should consult their own tax advisors as to their possible eligibility under such treaties.

Other Mexican Taxes

A nonresident holder generally will not be liable for estate, inheritance or similar taxes with respect to its holdings of shares or ADSs; provided, however, that gratuitous transfers of shares or ADSs may, in certain circumstances, result in the imposition of a Mexican tax upon the recipient.

There are no Mexican stamp, issue registration or similar taxes payable by a nonresident holder with respect to shares or ADSs.

U.S. FEDERAL INCOME TAX

CONSIDERATIONS

The following is a summary of certain U.S. federal income tax consequences to U.S. holders (as defined below) of the acquisition, ownership and disposition of shares or ADSs. The summary does not purport to be a comprehensive description of all of the tax consequences of the acquisition, ownership or disposition of shares or ADSs. The summary applies only to U.S. holders that will hold their shares or ADSs as capital assets and does not apply to special classes of U.S. holders, such as dealers in securities or currencies, holders with a functional currency other than the U.S. dollar, holders of 10.0% or more of our shares measured by vote or value (whether held directly or through ADSs or both),tax-exempt organizations, banks, insurance companies or other financial institutions, holders liable for the alternative minimum tax, securities traders electing to account for their investment in their shares or ADSs on amark-to-market basis, entities that are treated for U.S. federal income tax purposes as partnerships or other pass-through entities or equity holders therein and persons holding their shares or ADSs in a hedging transaction or as part of a straddle or conversion transaction.

~~TAXATION OF SHARES AND ADS~~S

For purposes of this discussion, a “U.S. holder” is a holder of shares or ADSs that is:

a citizen or resident of the United States of America,

a corporation (or other entity taxable as a corporation) organized under the laws of the United States of America or any state thereof or

otherwise subject to U.S. federal income taxation on a net income basis with respect to the shares or ADSs.

Each U.S. holder should consult such holder’s own tax advisor concerning the overall tax consequences to it of the ownership or disposition of shares or ADSs that may arise under foreign, state and local laws.

Treatment of ADSs

In general, a U.S. holder of ADSs will be treated as the owner of the shares represented by those ADSs for U.S. federal income tax purposes. Deposits or withdrawals of shares by U.S. holders in exchange for ADSs will not result in the realization of gain or loss for U.S. federal income tax purposes. U.S. holders that withdraw any shares should consult their own tax advisors regarding the treatment of any foreign currency gain or loss on any pesos received in respect of such shares.

Taxation of Distributions

In general, a U.S. holder will treat the gross amount of distributions we pay, without reduction for Mexican withholding tax, as dividend income for U.S. federal income tax purposes to the extent of our current and accumulated earnings and profits. Because we do not expect to maintain calculations of our earnings and profits under U.S. federal income tax principles, it is expected that distributions paid to U.S. holders generally will be reported as dividends. In general, the gross amount of any dividends will be includible in the gross income of a U.S. holder as ordinary income on the day on which the dividends are received by the U.S. holder, in the case of shares, or by the depositary, in the case of ADSs.

Dividends will be paid in pesos and will be includible in the income of a U.S. holder in a U.S. dollar amount calculated by reference to the exchange rate in effect on the date that they are received by the U.S. holder, in the case of shares, or

by the depositary, in the case of ADSs (regardless of whether such pesos are in fact converted into U.S. dollars on such date). If such dividends are converted into U.S. dollars on the date of such receipt, a U.S. holder generally should not be required to recognize foreign currency gain or loss in respect of the dividends. U.S. holders should consult their own tax advisors regarding the treatment of foreign currency gain or loss, if any, on any pesos received by a U.S. holder or depositary that are converted into U.S. dollars on a date subsequent to receipt. Dividends paid by us will not be eligible for the dividends-received deduction allowed to corporations under the U.S. Internal Revenue Code of 1986, as amended (the “Code”).

The amount of Mexican tax withheld generally will give rise to a foreign tax credit or deduction for U.S. federal income tax purposes. Dividends generally will constitute “passive category income” for purposes of the foreign tax ~~credit (or, in the case of certain U.S. holders, “general category income”).~~credit. The foreign tax credit rules are complex. U.S. holders should consult their own tax advisors with respect to the implications of those rules for their investments in our shares or ADSs.

Subject to certain exceptions for short-term and hedged positions, the U.S. dollar amount of dividends received by an individual with respect to the shares or ADSs will be subject to taxation at reduced rates if the dividends are “qualified dividends.” Dividends paid on the shares or ADSs will be treated as qualified dividends if (i) (A) the shares or ADSs are readily tradable on an established securities market in the United States or (B) we are eligible for the benefits of a comprehensive tax treaty with the United States which the U.S. Treasury determines is satisfactory for purposes of this provision and which includes an exchange of information program, and (ii) we were not, in the year prior to the year in

which the dividend was paid, and are not, in the year in which the dividend is paid, a passive foreign investment company (“PFIC”). The ADSs are listed on the NYSE, and will qualify as readily tradable on an established securities market in the United States so long as they are so listed. In addition, the U.S. Treasury has determined that the Tax Treaty meets the requirements for reduced rates of taxation, and we believe we are eligible for the benefits of the Tax Treaty. Based on our audited consolidated financial statements and relevant market data, we believe that we were not treated as a PFIC for U.S. federal income tax purposes with respect to the

~~2017~~ 2019 and ~~2018~~2020 taxable ~~year.~~years. In addition, based on our audited consolidated financial statements and our current expectations regarding the value and nature of our assets, the sources and nature of our income and relevant market data, we do not anticipate becoming a PFIC for the ~~2019~~2021 taxable year. Holders of shares or ADSs should consult their own tax advisors regarding the availability of the reduced dividend tax rate in the light of their own particular circumstances.

Distributions of additional shares or ADSs to U.S. holders with respect to their shares or ADSs that are made as part of a pro rata distribution to all of our shareholders generally will not be subject to U.S. federal income tax.

Taxation of Dispositions

A U.S. holder generally will recognize capital gain or loss on the sale or other disposition of the shares or ADSs in an amount equal to the difference between the U.S. holder’s basis in such shares or ADSs (in U.S. dollars) and the amount realized on the disposition (in U.S. dollars, determined at the spot rate on the date of disposition if the amount realized is denominated in a foreign currency). Gain or loss recognized by a U.S. holder on such sale or other disposition generally will be long-term capital gain or loss if, at the time of disposition, the shares or ADSs have been held for more than one year. Long-term capital gain recognized by a U.S. holder that is an individual is taxable at reduced rates. The deductibility of a capital loss is subject to limitations.

Gain, if any, realized by a U.S. holder on the sale or other disposition of the shares or ADSs generally will be treated as U.S. source income for U.S. foreign tax credit purposes. Consequently, if a Mexican withholding tax is imposed on the sale or disposition of the shares, a U.S. holder that does not receive significant foreign source income from other sources may not be able to derive effective U.S. foreign tax credit benefits in respect of such Mexican taxes. U.S. holders should consult their own tax advisors regarding the application of the foreign tax credit rules to their investment in, and disposition of, the shares or ADSs.

Information Reporting and Backup Withholding

Dividends on, and proceeds from the sale or other disposition of, the shares or ADSs paid to a U.S. holder generally may be subject to the information reporting requirements of the Code and may be subject to backup withholding unless the holder:

establishes that it is an exempt recipient, if required, or

provides an accurate taxpayer identification number on a properly completed Internal Revenue Service FormW-9 and certifies that no loss of exemption from backup withholding has occurred.

The amount of any backup withholding from a payment to a holder will be allowed as a credit against the U.S. holder’s U.S. federal income tax liability and may entitle such holder to a refund, provided that certain required information is timely furnished to the Internal Revenue Service.

U.S. Tax Consequences forNon-U.S. holders

DISTRIBUTIONS.~~DISTRIBUTIONS.~~A holder of shares or ADSs that is, with respect to the United States, a foreign corporation or a nonresident alien individual (a“non-U.S. holder”) will generally not be subject to U.S. federal income or withholding tax on dividends received on shares or ADSs, unless such income is effectively connected with the conduct by the holder of a U.S. trade or business.

DISPOSITIONS.~~DISPOSITIONS.~~Anon-U.S. holder of shares or ADSs will not be subject to U.S. federal income or withholding tax on gain realized on the sale of shares or ADSs, unless:

~~such~~ gain is effectively connected with the conduct by the holder of a U.S. trade or business or

in the case of gain realized by an individual holder, the holder is present in the United States for 183 days or more in the taxable year of the sale and certain other conditions are met.

INFORMATION REPORTING AND BACKUP ~~WITHHOLDING~~.WITHHOLDING. Althoughnon-U.S. holders generally are exempt from backup withholding, anon-U.S. holder may be required to comply with certification and identification procedures in order to establish its exemption from information reporting and backup withholding.

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LOGO

~~MANAGEMENT~~

DIRECTORS

Our Board of Directors has broad authority to manage our company. Our bylaws provide for the Board of Directors to consist of between five and 21 directors and allow for the election of an equal number of alternate directors. Directors need not be shareholders. A majority of our directors and a majority of the alternate directors must be Mexican citizens and elected by Mexican shareholders.

A majority of the holders of the AA Shares and A Shares voting together elect a majority of the directors and alternate directors, provided that any holder or group of holders of at least 10.0% of the total AA Shares and A Shares is entitled to name one director and one alternate director. Two directors and two alternate directors, if any, are elected by a majority vote of the holders of L Shares. Each alternate director may attend meetings of the Board of Directors and vote in the absence of the corresponding director. Directors and alternate directors are elected or reelected at each annual general meeting of shareholders and each annual ordinary special meeting of holders of L ~~Shares, and each serves until a successor is elected and takes office.~~Shares. In accordance with the Mexican Securities Market Law (Ley del Mercado de ~~Valores)~~Valores), the determination as to the independence of our directors is made by our shareholders, though the CNBV may challenge this determination. Pursuant to our bylaws and the Mexican Securities Market Law, at least 25.0% of our directors must be independent. In order to have a quorum for a meeting of

the Board of Directors, a majority of those present must be Mexican nationals.

At the annual ~~general~~ shareholders’ ~~meeting~~meetings held on April ~~9, 2019,~~[26], 2021, the current members of the Board of Directors, ~~as well as all current members of~~ the Executive Committee and the Audit and Corporate Practices Committee were reelected, and the Corporate Secretary and the Corporate Pro Secretary were reappointed, with 1411 directors elected by the AA Shares and A Shares voting together and two directors elected by the L Shares. 54% of the members of the Board of Directors are independent and 8% are women.

Our bylaws provide that the members of the Board of Directors are elected for a term of one year. Pursuant to Mexican law, members of the Board continue in their positions after the expiration of their terms for up to an additional30-day period if new members are not elected. Furthermore, in certain circumstances provided under the Mexican Securities Market Law, the Board of Directors may

elect temporary directors who then may be elected or replaced at the shareholders’ meetings.

The names and positions of the members of the Board reelected or elected for the first time at the 2021 annual general shareholders’ meeting, ~~held on April 9, 2019,~~ their year of birth, and information concerning their committee membership and principal business activities outside América Móvil are set forth below:

Directors elected by holders of Series AA and Series A Shares:



CARLOS SLIM DOMIT

Chairman of the Board and the Executive Committee

Born:		1967

First elected:		2011

Term expires:		~~2011~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Chairman of the Board of ~~Telmex~~ América Móvil

Other directorships:		Chairman of the Board of Grupo Carso ~~Grupo Sanborns, S.A.B. de C.V. (“Grupo Sanborns”)~~ and ~~U.S. Commercial Corp, S.A. de C.V.~~ its affiliates

Business experience:		Business administration; Chief Executive Officer of Sanborn Hermanos ~~S.A. de C.V. (“Sanborn Hermanos”)~~



PATRICK SLIM DOMIT

Vice Chairman and Member of the Executive Committee

Born:		1969

First elected:		2004

Term expires:		~~2004~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Vice Chairman of our Board of Directors

Other directorships:		Director of Grupo Carso ~~Impulsora del Desarrollo y el Empleo en América Latina, S.A.B. de C.V. (“IDEAL”)~~ and ~~Telmex~~ its affiliates

Business experience:		Business administration; Chief Executive Officer of Grupo Carso and Vice President of Commercial Markets of Telmex



DANIEL HAJJ ABOUMRAD

Director and Member of the Executive Committee

Born:		1966

First elected:		2000

Term expires:		~~2000~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Chief Executive Officer of América Móvil

Other directorships:		Director of Grupo Carso and Telmex

Business experience:		Business ~~experience:~~		administration; Chief Executive Officer of Compañía Hulera Euzkadi ~~S.A. de C.V.~~
~~CARLOS SLIM HELÚ~~ ~~Director~~		~~Born:~~		~~1940~~
		~~First elected:~~		~~2015~~
		~~Term expires:~~		~~2020~~
		~~Principal occupation and Business experience:~~		Chairman of the Board of Minera Frisco, S.A.B. de C.V. and Carso Infraestructura y Construcción, S.A. de C.V.; Director of IDEAL, Grupo Sanborns and Inmuebles Carso, S.A. de C.V. (“Inmuebles Carso”)

7560

~~MANAGEMENT~~



LUIS ALEJANDRO SOBERÓN KURI

Director

Born:		1960

~~Born:~~ First elected:		~~1960~~ 2000

~~First elected:~~ Term expires:		~~2000~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Chief Executive Officer and Chairman of the Board of Serinem México ~~S.A. de C.V.~~ (a subsidiary of Corporación Interamericana de Entretenimiento ~~S.A.B. de C.V. (“CIE”))~~

Other directorships:		Director of CIE; Director of ~~Banco Nacional de México, S.A.~~ Grupo Financiero Citibanamex

Business experience:		Business administration; Various positions at CIE



~~CARLOS BREMER GUTIÉRREZ~~FRANCISCO MEDINA CHÁVEZ

Director ~~and Member of the Audit and Corporate Practices Committee~~

Born:		~~1960~~ 1956

First elected:		2018

Term expires:		~~2004~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		~~Chief Executive Officer of Value Grupo Financiero, S.A.B. de C.V. and Value S.A. de C.V., Casa de Bolsa~~
	~~Other directorships:~~		~~Chairman of Value Grupo Financiero, S.A.B. de C.V. and Director of Grupo GICSA, S.A.B. de C.V.~~
	~~Business experience:~~		~~Various positions at Value Grupo Financiero, S.A.B. de C.V.~~
~~FRANCISCO MEDINA CHÁVEZ~~ ~~Director~~		~~Born:~~		~~1956~~
		~~First elected:~~		~~2018~~
		~~Term expires:~~		~~2020~~
		~~Principal occupation:~~		Chief Executive Officer and Chairman of Grupo Fame, ~~S.A. de C.V.,~~ and Chairman of Grupo Altozano

	Other directorships:		Director of Banamex Citigroup México and ~~Telmex~~ Grupo Chedraui

Business experience:		Real estate; Director of Aeromexico and Mitsui Mexico



ERNESTO VEGA VELASCO

Director, Chairman of the Audit and Corporate Practices Committee

Born:		1937

First elected:		2007

Term expires:		~~2007~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Retired. Member of the board of directors and audit and corporate practices, planning and finance and evaluation and compensation committees of certain companies.

Other directorships:		Director of Kuo and its affiliates, Inmuebles Carso and its affiliates, and Industrias Peñoles

Business experience:		~~Director of Kuo, S.A.B. de C.V., Dine, S.A.B. de C.V., Inmuebles Carso, IDEAL;~~Accounting and ~~Industrias Peñoles, S.A.B. de C.V.~~
	~~Business experience:~~		business administration; Various positions in Desc Group, including Corporate Vice-President



RAFAEL MOISÉS KALACH MIZRAHI

Director and Member of the Audit and Corporate Practices Committee

Born:		1946

First elected:		2012

Term expires:		~~2012~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Chairman and Chief Executive Officer of Grupo Kaltex ~~S.A. de C.V. (“Grupo Kaltex”)~~

Other directorships:		Director of Grupo Carso and its affiliates

Business experience:		~~Director of Telmex~~Accounting and ~~Grupo Carso~~
	~~Business experience:~~		business administration; Various positions in Grupo Kaltex



ANTONIO COSÍO PANDO

Director

Born:		1968

First elected:		2015

Term expires:		~~2015~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Vice President of Grupo Hotelero las Brisas, ~~S.A. de C.V. (“Grupo Brisas”),~~ Compañía Industrial Tepeji del Río, ~~S.A. de C.V.,~~ and Bodegas de Santo Tomás ~~S.A. de C.V.~~

Other directorships:		Director of Grupo Carso and its affiliates, Corporación Actinver, and Grupo Aeromexico

Business experience:		~~Director of Grupo Financiero Inbursa, Inmuebles Carso, Grupo Carso, Grupo Sanborns, Corporación Actinver S.A.B. de C.V., Grupo Aeromexico S.A.B. de C.V., and Telmex~~
	~~Business experience:~~		Engineer; Various positions in Grupo Brisas and Compañía Industrial Tepeji del Río, S.A. de C.V.

~~MANAGEMENT~~



ARTURO ELÍAS AYUB

Director

~~ARTURO ELÍAS AYUB~~ ~~Director~~Born:		1966

~~Born:~~ First elected:		~~1966~~ 2011

~~First elected:~~ Term expires:		~~2011~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Head of Strategic Alliances, Communications and Institutional Relations of Telmex; Chief Executive Officer of Fundación Telmex

Other directorships:		Director of Grupo Carso and its affiliates, Dine and its affiliates, Grupo México Transportes and Grupo Gigante

Business experience:		~~Chairman of the Board of Publicidad y Contenido Editori- al, S.A. de C.V.; Director of Grupo Sanborns, Grupo Carso, Sears and TM&MS LLC~~
	Business ~~experience:~~		administration; Chief Executive Officer of Sociedad Comercial Cadena, President of Pastelería Francesa (~~El Globo~~)(El Globo) and President of Club Universidad Nacional, A.C.



OSCAR VON HAUSKE SOLÍS

Director

Born:		1957

~~Born:~~ First elected:		~~1957~~ 2011

~~First elected:~~ Term expires:		~~2011~~ 2022

~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Chief Fixed-line Operations Officer of América Móvil

Other directorships:		Member of Telekom Austria’s Supervisory Board

Business experience:		Accounting and business administration; Chief Executive Officer of Telmex Internacional, Chief Systems and Telecommunications Operators Officer of Telmex and member of KPN’s supervisory board



~~LOUIS C. CAMILLERI~~ ~~Director~~				~~Born:~~	~~1955~~
	~~First elected:~~		~~2011~~
	~~Term expires:~~		~~2020~~
	~~Principal occupation:~~		~~Chairman of Philip Morris International~~
	~~Other directorships:~~		~~Director of Ferrari N.V.~~
	~~Business experience:~~		~~Chairman and Chief Executive Officer of Altria and various positions in Philip Morris International~~
VANESSA HAJJ SLIM ~~Director~~		~~Born:~~		~~1997~~
		~~First elected:~~		~~2018~~
		~~Term expires:~~		~~2020~~


Director

Born:		1997

First elected:		2018

Term expires:		2022

Directors elected by holders of Series L Shares:



PABLO ROBERTO GONZÁLEZ GUAJARDO

Director and Member of the Audit and Corporate Practices Committee

Born		1967
~~Born:~~ First elected:		~~1967~~ 2007
	~~First elected:~~ Term expires:		~~2007~~ 2022
	~~Term expires:~~ Principal occupation:		~~2020~~
	~~Principal occupation:~~		Chief Executive Officer of Kimberly Clark de México
	Other directorships:		Director of Kimberly Clark de México, ~~S.A.B de C.V. (“Kimberly Clark de México”),~~ Grupo Sanborns and Grupo Lala ~~S.A.B. de C.V.~~
	Business experience:		Law and business administration; Various positions in the Kimberly Clark Corporation and Kimberly Clark de México ~~as well as Director of Acciones y Valores Banamex S.A. de C.V. Casa de Bolsa~~



DAVID IBARRA MUÑOZ

Director

~~Director~~ Born:		~~Born:~~ 1930
First elected:		~~1930~~ 2000
	~~First elected:~~ Term expires:		~~2000~~ 2022
	~~Term expires:~~ Principal occupation:		~~2020~~ Retired
	~~Principal occupation:~~ Other directorships:		~~Retired~~ Director of Grupo Carso and its affiliates, and Grupo Mexicano de Desarrollo
	~~Other directorships:~~ Business experience:		~~Director of Grupo Financiero Inbursa, IDEAL and Grupo Carso~~
	~~Business experience:~~		Economist; Chief Executive Officer of Nacional Financiera, S.N.C., and served ~~in the Mexican Ministry~~as minister of Finance and Public Credit of Mexico

~~The~~Our 2021 annual ordinary general shareholders’ meeting ~~held on April 9, 2019,~~ determined that the following directors are independent: Messrs. Ernesto Vega Velasco, ~~Carlos Bremer Gutiérrez,~~ Pablo Roberto González Guajardo, David Ibarra Muñoz, Antonio Cosío Pando, ~~Louis C. Camilleri,~~ Rafael Moisés Kalach Mizrahi, Luis Alejandro Soberón Kuri and Francisco Medina Chávez.

Alejandro Cantú Jiménez, our General Counsel, serves as Corporate Secretary and Rafael Robles Miaja as CorporatePro-Secretary.

Patrick Slim Domit and Carlos Slim Domit are brothers. Daniel Hajj Aboumrad and Arturo Elías Ayub are brothers- ~~sons-in-law~~ ~~of Carlos Slim Helú andbrothers-in-law~~in-law of Patrick Slim Domit and Carlos Slim Domit. ~~Patrick Slim Domit and Carlos Slim Domit are sons of Carlos Slim Helú.~~ Vanessa Hajj Slim is the daughter of Daniel Hajj ~~Aboumrad and the granddaughter of Carlos Slim Helú.~~Aboumrad.

EXECUTIVE COMMITTEE

Our bylaws provide that the Executive Committee may generally exercise the powers of the Board of Directors, with certain exceptions. In addition, the Board of Directors is required to consult the Executive Committee before deciding on certain matters set forth in the bylaws, and the Executive Committee must provide its views ~~within 10 calendar days~~ following a request from the Board of Directors, the Chief Executive Officer or the

Chairman of the Board of Directors. If the Executive Committee is unable to make a recommendation within ten calendar days, or if a majority of the Board of Directors or any other corporate body duly acting within its mandate determines in good faith that action cannot be deferred until the Executive Committee makes a recommendation, the Board of Directors is authorized to act without such recommendation. The Executive Committee may not delegate its powers to special delegates orattorneys-in-fact.

~~MANAGEMENT~~

The Executive Committee is elected from among the directors and alternate directors by a majority vote of the holders of common shares (AA Shares and A Shares). The majority of its members must be Mexican citizens and elected by Mexican shareholders. The current members of the Executive Committee are Messrs. Carlos Slim Domit, Patrick Slim Domit and Daniel Hajj Aboumrad. See “Major Shareholders” under Part IV of this annual report.

AUDIT AND CORPORATE PRACTICES COMMITTEE

Our Audit and Corporate Practices Committee is comprised of independent members of the Board of ~~Directors.~~Directors, as determined by our shareholders pursuant to the Mexican Securities Market Law and as defined under Rule 10A-3 under the Exchange. The Audit and Corporate Practices Committee consists of Messrs. Ernesto Vega Velasco (Chairman), Rafael Moisés Kalach Mizrahi and Pablo Roberto González ~~Guajardo and Carlos Bremer Gutiérrez.~~Guajardo. The mandate of the Audit and Corporate Practices Committee is to assist our Board of Directors in overseeing our operations and establish and monitor procedures and controls in order to ensure that the financial information we distribute is useful, appropriate and reliable and accurately reflects our financial position. In particular, the Audit and Corporate Practices Committee is required to, among other ~~things:~~

~~provide opinions~~things, (i) call shareholders’ meetings and recommend items to be included on the agenda, (ii) advise the Board of Directors on ~~certain matters as provided by~~internal control procedures, related party transactions that are outside the ~~Mexican Securities Market Law;~~

~~call shareholders’ meetings and recommend inclusion of matters it deems appropriate on the agenda;~~

~~inform the Board of Directors~~ordinary course of our ~~internal controls~~business, succession plans and ~~their adequacy;~~

compensation structures of our key executives, (iii) select and monitor our auditors, ~~review andpre-approve~~ ~~the scope and terms of their engagement and determine their compensation;~~

~~monitor the performance of~~(iv) discuss with our auditors ~~andre-evaluate~~the ~~terms of their engagement;~~

~~recommend procedures for preparing financial statements and internal controls;~~

~~monitor internal controls and accounting for specified types of matters;~~

~~propose~~ procedures for the preparation of ~~financial statements for internal use that are consistent with the published financial statements;~~

~~assist the Board of Directors in preparing reports as provided by the Mexican Securities Market Law;~~

~~discuss with our auditors~~ the annual financial statements and the accounting principles ~~being applied in~~to the annual and the interim financial statements and ~~based on such discussions, recommend their approval to the Board of Directors;~~

~~resolve disagreements between our management and auditors relating to our financial statements;~~

~~request the opinion of independent experts when deemed appropriate or when required by law;~~

~~approve services to be provided by our auditors or establish policies and procedures for thepre-approval~~ ~~of services by our auditors;~~

(v) obtain from our auditors a report that includes a discussion of the critical accounting policies used by us, any alternative accounting treatments for material items that have been discussed by management with our auditors and any other written communications between our auditors and ~~management;~~

management.

~~report to the Board of Directors on its activities;~~

develop procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls or auditing matters, including for the confidential submission of concerns regarding such matters by employees;

~~evaluate the performance of the external auditors;~~

~~review and discuss our financial statements and advise the Board of Directors of the committee’s recommendations for approval of such financial statements;~~

receive and analyze recommendations and observations to its functions from shareholders, members of the Board of Directors and senior management and receive the authority to act upon such recommendations and observations;

8062

~~recommend to the Board of Directors procedures for the selection and succession of our Chief Executive Officer and our other principal executives;~~

~~propose criteria for evaluating executive performance;~~

~~analyze the proposals of the Chief Executive Officer concerning the structure and amount of compensation for our senior executives and raise them with the Board of Directors;~~

~~review new executive compensation programs and the operations of existing programs;~~

~~establish contracting practices to avoid excessive payments to executives;~~

~~assist the Board of Directors in developing appropriate personnel policies;~~

~~participate with the Board of Directors in developing a plan for employees to invest in our L Shares and review the implementation of such plan; and~~

~~perform any other functions the Board of Directors may delegate to the Audit and Corporate Practices Committee.~~

~~Under certain circumstances specified in our bylaws, the Audit and Corporate Practices Committee is required to provide its opinion to the Board of Directors.~~ The Company is required to make public disclosure of any Board action that is inconsistent with the opinion of the Audit and Corporate Practices Committee.

In addition, pursuant to our bylaws, the Audit and Corporate Practices Committee is in charge of our corporate governance functions under the Mexican securities laws and regulations and is required to submit an annual report to the Board of Directors with respect to our corporate and audit practices. The Audit and Corporate Practices Committee must request the opinions of our executive officers for purposes of preparing this annual report. The Board of Directors must seek the opinion of the Audit and Corporate Practices Committee regarding any transaction with a related party that is outside the ordinary course of our business as defined under the Mexican Securities Market Law. Each member of the Audit and Corporate Practices Committee is independent, as determined by our shareholders pursuant to the Mexican Securities Market Law and as defined under Rule~~10A-3~~ ~~under the Exchange.~~

SENIOR MANAGEMENT

The names, responsibilities and prior business experience of our senior officers are as follows:



DANIEL HAJJ ABOUMRAD

Chief Executive Officer

~~DANIEL HAJJ ABOUMRAD~~ Appointed: ~~Chief Executive Officer~~		~~Appointed:~~		2000
	Business experience:		Director of Telmex; Chief Executive Officer of Compañía Hulera Euzkadi, S.A. de C.V.



CARLOS JOSÉ GARCÍA MORENO ELIZONDO

Chief Financial Officer

Appointed:		2001
	Business experience:		General Director of Public Credit at the Ministry of Finance and Public Credit; Managing Director of UBS Warburg; Associate Director of Financing at Petróleos Mexicanos (Pemex); Member of Telekom Austria’s Supervisory Board; Member of KPN Supervisory Board



ALEJANDRO CANTÚ JIMÉNEZ

General Counsel

Appointed:		2001
	Business experience:		Member of Telekom Austria’s Supervisory Board; Attorney at Mijares, Angoitia, Cortés y Fuentes, S.C.

~~MANAGEMENT~~




OSCAR VON HAUSKE SOLÍS

Chief Fixed-line Operations Officer

Appointed:		2010
	Business experience:		Chief Executive Officer of Telmex Internacional; Chief Systems and Telecommunications Officer of Telmex; Head of Finance at Grupo ~~Condumex, S.A. de C.V.;~~Condumex; Director of Telmex, Telmex Internacional, Empresa Brasileira de Telecomunicaçõőes S.A. (“Embratel”), and Net Serviços de Comunicaçãăo S.A. (“Net Serviços”); Member of Telekom Austria’s Supervisory Board



ANGEL ALIJA GUERRERO

Chief Wireless Operations Officer

Appointed:		2012
	Business experience:		Various positions in América Móvil

AUDIT COMMITTEE FINANCIAL EXPERT

Our Board of Directors has determined that Ernesto Vega Velasco qualifies as an “audit committee financial expert,” and Mr. Vega Velasco is independent under the definition of independence applicable to us under the rules of the NYSE.

COMPENSATION OF DIRECTORS AND SENIOR MANAGEMENT

The aggregate compensation paid to our directors (including compensation paid to members of our Audit and Corporate Practices Committee) and senior management in ~~2018~~2020 was approximately ~~Ps.5.3~~Ps.6.3 million and ~~Ps.70.1~~Ps.79.6 million, respectively. None of our directors is a party to any contract with us or any of our subsidiaries that provides for benefits upon termination of employment. We do not provide pension, retirement or similar benefits to our directors in their capacity as directors. Our executive officers are eligible for retirement and severance benefits required by Mexican law on the same terms as all other employees, and we do not separately set aside, accrue or determine the amount of our costs that is attributable to executive officers.

SHARE OWNERSHIP OF DIRECTORS AND SENIOR MANAGEMENT

Carlos Slim Domit, Chairman of our Board of Directors, holds 647 million (or 3.1%) of our AA Shares and 1,567 million (or ~~3.5%~~3.4%) of our L Shares directly. Patrick Slim Domit, Vice Chairman of our Board of Directors, holds 323 million (or 1.6%) of our AA Shares and 859 million (or 1.9%) of our L Shares directly. ~~Carlos Slim Helú, member of our Board of Directors, holds 1,879 million (or 9.1%) of our AA Shares and 3,072 million (or 6.8%) of our L shares directly.~~ In addition, according to beneficial ownership reports filed with the SEC, Patrick Slim Domit and Carlos Slim Domit are beneficiaries of a trust that owns shares of the Company. See “Major Shareholders” under Part IV ~~and “Bylaws—Shareholders’ Equity” under Part IV~~ of this annual report.

Except as described above, according to the information provided to us by our directors and members of senior management, none of our directors or executive officers is the beneficial owner of more than 1.0% of any class of our capital stock.

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LOGO

~~CORPORATE GOVERNANCE~~

Our corporate governance practices are governed by our bylaws, the Mexican Securities Market Law and the regulations issued by the CNBV. We also comply with the Mexican Code of Best Corporate Practices (Código de Mejores Prácticas Corporativas). On an annual basis, we file a report with the Mexican Banking and securities Commission and the Mexican Stock Exchange regarding our compliance with the Mexican Code of Best Corporate Practices.

The table below discloses the significant differences between our corporate governance practices and those required for U.S. companies under the NYSE listing standards.



NYSE STANDARDS		OUR CORPORATE GOVERNANCE PRACTICES

DIRECTOR INDEPENDENCE

Majority of board of directors must be independent. §303A.01. “Controlled companies” are exempt from this requirement. A controlled company is one in which more than 50.0% of the voting power is held by an individual, group or another company, rather than the public. §303A.00. As a controlled company, we would be exempt from this requirement if we were a U.S. issuer.		Pursuant to the Mexican Securities Market Law, our shareholders are required to appoint a board of directors of no more than 21 members, 25% of whom must be independent. Certain persons are per senon-independent, including insiders, control persons, major suppliers and any relatives of such persons. In accordance with the Mexican Securities Market Law, our shareholders’ meeting is required to make a determination as to the independence of our directors, though such determination may be challenged by the CNBV. There is no exemption from the independence requirement for controlled companies. Currently, the majority of our Board of Directors inis independent.


EXECUTIVE SESSIONS

Non-management directors must meet at regularly scheduled executive sessions without management. Independent directors should meet alone in an executive session at least once a year. §303A.03.		Ournon-management directors have not held executive sessions without management in the past, and they are not required to do so.


NOMINATING/CORPORATE GOVERNANCE ~~COMMITTE~~COMMITTEE

Nominating/corporate governance committee composed entirely of independent directors is required. The committee must have a charter specifying the purpose, duties and evaluation procedures of the committee. §303A.04. “Controlled companies” are exempt from these requirements. §303A.00. As a controlled company, we would be exempt from this requirement if we were a U.S. issuer.		Mexican law requires us to have one or more committees that oversee certain corporate practices, including the appointment of directors and executives. Under the Mexican Securities Market Law, committees overseeing certain corporate practices must be composed of independent directors. However, in the case of controlled companies, such as ours, only a majority of the committee members must be independent.
~~“Controlled companies” are exempt from these requirements. §303A.00. As a controlled company, we would be exempt from this requirement if we were a U.S. issuer.~~		Currently, we do not have a nominating committee, and we are not required to have one. Our Audit and Corporate Practices Committee, which is composed of independent directors, oversees our corporate practices, including the compensation and appointment of directors and executives.


~~NYSE STANDARDS~~		~~OUR CORPORATE GOVERNANCE PRACTICES~~
COMPENSATION COMMITTEE

Compensation committee composed entirely of independent directors is required, which must evaluate and approve executive officer compensation. The committee must have a charter specifying the purpose, duties and evaluation procedures of the committee. §303A.02(a)(ii) and §303A.05. “Controlled companies” are exempt from this requirement. §303A.00.	We currently do not have a compensation committee, and we are not required to have one. Our Audit and Corporate Practices Committee, which is comprised solely of independent directors, evaluates and approves the compensation of management (including our CEO) and directors.


AUDIT COMMITTEE

Audit committee satisfying the independence and other requirements of Rule10A-3 under the ~~Exchange~~Ex- change Act and the additional requirements under the NYSE standards is required. §§303A.06 and 303A.07.	We have an audit and corporate practices committee of ~~four~~three members. Each member of the Audit and Corporate Practices Committee is independent, as independence is defined under the Mexican Securities Market Law, and also meets the independence requirements of Rule10A-3 under the U.S. Securities Exchange Act of 1934, as amended. Our Audit and Corporate Practices Committee operates primarily pursuant to (1) a written charter adopted by our Board of Directors, which assigns to the Committee responsibility over those matters required by Rule10A-3, (2) our bylaws and (3) Mexican law. For a more detailed description of the duties of our ~~audit~~Audit and ~~corporate practices committee,~~Corporate Practices Committee, see “Management” under Part V of this annual report.



NYSE STANDARDS		OUR CORPORATE GOVERNANCE PRACTICES

EQUITY COMPENSATION PLANS

Equity compensation plans and all material revisions thereto require shareholder approval, subject to limited exemptions. §§303A.08 and 312.03.		Shareholder approval is expressly required under Mexican law for the adoption or amendment of an equity compensation plan. Such plans must provide for similar treatment of executives in comparable positions.


SHAREHOLDER APPROVAL FOR ISSUANCE OF SECURITIES

Issuances of securities (1) that will result in a change of control of the issuer, (2) that are to a related party or someone closely related to a related party, (3) that have voting power equal to at least 20.0% of the outstanding common stock voting power before such issuance or (4) that will increase the number of shares of common stock by at least 20.0% of the number of outstanding shares before such issuance requires shareholder approval. §§312.03(b)-(d).		Mexican law requires us to obtain shareholder approval for any issuance of equity securities. Under certain circumstances, however, we may sell treasury stock subject to the approval of our Board of Directors.


CODE OF BUSINESS CONDUCT AND ETHICS

Corporate governance guidelines and a code of business conduct and ethics are required, with disclosure of any waiver for directors or executive officers. The code must contain compliance standards and procedures that will facilitate the effective operation of the code. §303A.10.		We have adopted a code of ethics, which applies to all of our directors and executive officers and other personnel. For more information, see “Corporate Governance—Code of Ethics” under Part V of this annual report.

~~CORPORATE GOVERNANCE~~


~~NYSE STANDARDS~~		~~OUR CORPORATE GOVERNANCE PRACTICES~~
CONFLICTS OF INTEREST

Determination of how to review and oversee related party transactions is left to the listed company. The audit committee or comparable body, however, could be considered the forum for such review and oversight. §314.00. Certain issuances of common stock to a related party require shareholder approval. §312.03(b).	In accordance with Mexican law, an independent audit committee must provide an opinion to the board of directors regarding any transaction with a related party that is outside of the ordinary course of business, which must be approved by the board of directors. Pursuant to the Mexican Securities Market Law, our Board of Directors may establish certain guidelines regarding related party transactions that do not require specific board approval.


SOLICITATION OF PROXIES

Solicitation of proxies and provision of proxy materials is required for all meetings of shareholders. Copies of such proxy solicitations are to be provided to NYSE. §§402.01 and 402.04.	We are not required to solicit proxies from our shareholders. In accordance with Mexican law and our bylaws, we inform shareholders of all meetings by public notice, which states the requirements for admission to the meeting. Under the deposit agreement relating to our ADSs, holders of our ADSs receive notices of shareholders’ meetings and, where applicable, instructions on how to instruct the depositary to vote at the meeting. Under the deposit agreement relating to our ADS, we may direct the voting of any ADS as to which no voting instructions are received by the depositary, except with respect to any matter where substantial opposition exists or that materially and adversely affects the rights of holders.

8665

LOGO

~~CONTROLS AND PROCEDURES~~

~~(A)~~A) DISCLOSURE CONTROLS AND PROCEDURES

We carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of December 31, ~~2018.~~2020. Based upon our evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

~~(B)~~B) MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules13a-15(f) and15d-15(f) under the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer, Chief Financial Officer and other personnel, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control—Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.

Because of the inherent limitations in all control systems, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Based on our evaluation under the framework in Internal Control—Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, ~~2018.~~2020.

Mancera, S.C. (“Mancera”), a member practice of Ernst & Young Global Limited, an independent registered public accounting firm, our independent auditor, issued an attestation report on our internal control over financial reporting on April ~~11, 2019.~~28, 2021.

~~(C)~~C) ATTESTATION REPORT OF THE REGISTERED PUBLIC ACCOUNTING FIRM

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders of

América Móvil, S.A.B. de C.V.

Opinion on Internal Control ~~over~~Over Financial Reporting

We have audited América Móvil, S.A.B. de C.V. and subsidiaries’ internal control over financial reporting as of December 31, ~~2018,~~2020, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, América Móvil, S.A.B. de C.V. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, ~~2018,~~2020, based on the COSO criteria.

~~CONTROLS AND PROCEDURES~~

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial position of the Company as of December 31, ~~2018~~2020 and ~~2017,~~2019, the related consolidated statements of comprehensive income, changes in shareholders’ equity and cash flows for each of three years in the period ended December 31, ~~2018,~~2020, and the related notes, and our report dated April ~~11, 2019~~28, 2021 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company´ s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definitions and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future

periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ MANCERA, S.C.

Mexico City, Mexico

April 28, 2021

D) CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There has been no change in our internal control over financial reporting during 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Our Corporate Sustainability Executive Committee defines and oversees the implementation of our overall strategy to improve our performance on sustainability matters.

By incorporating sustainability in our daily decision-making, we seek to foster greater efficiencies and operate with the highest sense of social responsibility and environmental care, strengthening our market leadership while contributing to economic, social, and cultural development in the communities where we operate.

Our corporate sustainability reports are available on our website at www.americamovil.com.

Our Code of Ethics codifies the ethical principles that govern our business and promotes, among other things, honest and ethical conduct, full, fair, accurate, timely and understandable disclosure in reports and documents that we file with, or submit to, the SEC, compliance with applicable governmental laws, rules and regulations, the prompt internal reporting of violations of the Code of Ethics and accountability for adherence to the Code of Ethics. Our Code of Ethics applies to all of our officers, senior management, directors and employees.

The full text of our Code of Ethics may be found on our website at www.americamovil.com.

MEXICO

Legal Framework

The legal framework for the regulation of telecommunications and broadcasting services is based on constitutional amendments passed in June 2013, the Federal Law on Telecommunications and Broadcasting (Ley Federal de Telecomunicaciones y Radiodifusión) enacted in July 2014 as amended and the Federal Law on Economic Competition (Ley Federal de Competencia Económica) enacted in May 2014 as amended.

Under the framework, the IFT may determine whether there is a “preponderant economic agent” in the telecommunications sector, based on number of customers, traffic or network capacity. In 2014, the IFT determined that an “economic interest group” consisting of us and our Mexican operating subsidiaries (Telcel, Telmex and Telnor) as well as Grupo Carso and Grupo Financiero Inbursa, constitutes the “preponderant economic agent” in the telecommunications sector, based on a finding that we serve more than half of the customers in Mexico, as measured by the IFT on a national basis.

The IFT has authority to impose on any preponderant economic agent a special regulatory regime. The special regime is referred to as “asymmetric” regulation because it applies to one sector participant and not to the others. Pursuant to the IFT’s determination that we are part of a group constituting a preponderant economic agent, we are subject to extensive asymmetric regulations in the telecom sector, which impacts our Mexican fixed-line and wireless businesses. See “—Asymmetric Regulation of the Preponderant Economic Agent” and “—Functional Separation of Telmex and Telnor Wholesale Services” under this Part VI. This legal framework has had a substantial impact on our business and operations in Mexico.

Principal Regulatory Authorities

The IFT is an autonomous authority that regulates telecommunications and broadcasting. It is headed by seven commissioners appointed by the President, and ratified by the Senate, from among candidates nominated by an evaluation committee. The IFT has authority over the application of legislation specific to the telecommunications and broadcasting sectors, and also over competition legislation as it applies to those sectors. The Mexican Ministry of Communications and Transportation (Secretaría de Comunicaciones y Transportes) retains regulatory authority over a few specific public policy matters.

The Mexican government has certain powers in its relations with concessionaires, including the right to take over the management of an operator’s networks, facilities and personnel in cases of imminent danger to national security, public order or the national economy, natural disasters and public unrest, as well as to ensure continuity of public services.

Telecommunications operators are also subject to regulation by the Federal Consumer Bureau (Procuraduría Federal del Consumidor) under the Federal Consumer Protection Law (Ley Federal de Protección al Consumidor), which regulates publicity, quality of services and information required to be provided to consumers.

Asymmetric Regulation of the Preponderant Economic Agent

We are currently subject to extensive specific asymmetric measures based on the IFT’s determination that we, our Mexican operating subsidiaries (Telcel, Telmex and Telnor) and certain affiliates, constitute the preponderant economic agent in the telecommunications sector, and along with Telesites, Red Nacional Ultima Milla S.A.P.I. de C.V. and Red Ultima Milla Del Noroeste S.A.P.I. de C.V. are compelled to comply with such asymmetric regulation. Below is a summary of what we believe are the most important measures applicable to us.

•

Interconnection Rates. The Federal Law on Telecommunications and Broadcasting provides that we are not permitted to charge other carriers for the termination services we provide in our networks. These provisions were declared unconstitutional by the Mexican Supreme Court (Suprema Corte de Justicia de la Nación) in August 2017 with respect to wireless services and in April 2018 with respect to fixed services. As a result, the IFT ruled that, as of January 1, 2018, in the case of Telcel, and as of January 1, 2019, in the case of Telmex, we are able to charge other carriers for terminating calls to our networks at asymmetric rates established by the IFT. We continue to pay such carriers for their interconnection services in accordance with the fixed and mobile rates set by the IFT.

•

Sharing Of Wireless Infrastructure and Services. We must provide other carriers access to (i) passive infrastructure, including towers, sites, ducts and rights of way, (ii) elements of our network that allow other carriers and mobile virtual network operators (“MVNOs”) to use our network or resell those services we provide to our customers and (iii) domestic roaming services; in each case, pursuant to IFT pre-approved reference terms (ofertas públicas de referencia). If we cannot reach an agreement with other carriers or MVNOs, our rates may be determined by the IFT using a long-run average incremental costs methodology or, in the case of MVNOs, a “retail-minus” methodology.

For mobile services, the IFT has the right to verify, through a replicability test, that carriers using our regulated wholesale services can match our end user rates.

•

Sharing of Fixed Infrastructure and Services. We must provide other carriers access to (i) passive infrastructure, including towers, sites, telephone poles, ducts, manholes and rights of way, (ii) elements of our network that allow

other carriers to use our network or resell those services we provide to our customers and (iii) our dedicated links (either local or long distance). Rates for this access are determined by the IFT using a long-run average incremental cost methodology.

For fixed services, the IFT has the right to verify, through a replicability test, that carriers using our regulated wholesale services can match our end user rates.

•

Local Loop Unbundling. We must offer other carriers access to elements of our local loop network separately on terms and conditions (including rates) pre-approved by the IFT. The IFT has also ordered the legal and functional separation of the provision of wholesale regulated fixed services related to local loop unbundling, local dedicated links and shared access/use of passive infrastructure related with the local loop network. See “Functional Separation of Telmex and Telnor Wholesale Services” under this Part VI.

•

Certain Obligations Relating to Retail Services. Rates for the provision of telecommunications services to our customers are subject to the IFT’s prior authorization.

We are also subject to certain obligations and restrictions relating to the sale of our services and products; one such obligation includes unlocking mobile devices for our customers and regulations on the sale end financing at mobile devices.

•

Content. We are subject to specific limitations on acquisitions of exclusive transmission rights to “relevant” content (contenidos audiovisuales relevantes), as determined from time to time by the IFT, including the Mexican national team soccer matches, the opening and closing ceremonies and certain matches of the FIFA World Cup, the semifinal and final matches of the Liga MX soccer tournament and the Super Bowl.

•

Reference Terms. Every year we must submit, for IFT’s approval, a proposal of the reference terms for all wholesale services that are subject to asymmetric regulation for the following year. Once approved, we must publish and offer the regulated wholesale services, in the terms approved by IFT.

IFT’s Biannual Review of Asymmetric Regulation

The IFT reviewed the measures in 2020 and determined, among other things, to modify and add new asymmetrical regulations for mobile and fixed services.

The measures are transitory and may be amended by the IFT, or terminated if the IFT determines effective competition conditions exist in the telecommunications sector or if we cease to be considered a preponderant economic agent. The IFT reviews the impact of the asymmetrical measures every

two years and may modify or eliminate measures or set forth new measures. In March 2017, the IFT issued a resolution that modified and added asymmetrical regulations for mobile and fixed services, including the legal and functional separation of Telmex and Telnor wholesale services, among other measures.

We have challenged the determination that we are a preponderant economic agent and the asymmetric regulations in court. These challenges were denied. We have also challenged further resolutions by IFT concerning the review of certain asymmetrical regulations. However, IFT’s determinations are not suspended while legal challenges against them are resolved.

Functional Separation of Telmex and Telnor Wholesale Services

In March 2018, we received notice of an IFT resolution directed to the Company setting forth the terms under which we are required to separate the provision of wholesale regulated fixed services by Telmex and Telnor (the “Separation Plan”). As of the date of this annual report, we have complied with all milestones of the Separation Plan including the following:

•

New Companies. Telmex and Telnor established new subsidiaries, Red Nacional Ultima Mila and Red Ultima Mila Del Noroeste (the “New Companies”), to provide local wholesale services related to the elements of the access network, including local access dedicated links, as well as those services related to passive infrastructure associated with the access network, such as ducts, poles and rights ofway. The main features of the New Companies are as follows:

•

Price of Services. The prices and terms of the services provided by the New Companies are subject to IFT regulation, which could affect the viability and financial requirements of the New Companies.

•

Corporate Governance. The New Companies have their own corporate governance, including: (i) a board of directors with at least seven members, of which a majority (including the Chairman) is independent; (ii) a Chief Executive Officer and senior officers appointed by the boards of directors, different and independent from those of our Mexican concessionaire subsidiaries; (iii) an independent external auditor; (iv) an Audit Committee chaired by an independent member of the board of directors; and (v) a Regulatory Compliance Committee entirely composed of independent members. The bylaws of the New Companies were approved by the IFT. Independence for these purposes is used as defined under Mexican Securities Market Law.

•

Personnel. Subject to the discussion under “Services Through Union Employees” below, the New Companies have personnel necessary to provide wholesale services required by the Separation Plan.

•

Assets. The New Companies have the resources necessary to comply with their obligations and provide services.

•

Systems and Procedures. The New Companies have their own procedures, operating and management systems that are independent from those of Telmex and Telnor.

•

Branding. The New Companies have their own branding distinct from América Móvil’s concessionaire subsidiaries. The brands must be dissociated from those of Telmex and Telnor by March 2022.

•

Principal Offices. The New Companies have their own principal offices distinct from those of América Móvil’s concessionaire subsidiaries.

•

Services Through Union Employees. Certain employees that are members of a labor union provide services to the New Companies. These employees are functionally independent from Telmex and Telnor, and are under the operational control of the New Companies, however, their labor contracts remain with Telmex and Telnor.

•

Wholesale Unit. Telmex and Telnor established a business unit to provide the remaining wholesale services to other concessionaires, including interconnection, co-location for interconnection, inter-city and international long-distance dedicated links, resale of telephone lines, broadband and bundles, as well as certain passive infrastructure services, including shared use of towers.

The implementation of the Separation Plan has been complex, and some features (including those related with the recent IFT revision of Asymmetrical Regulation resolutions) remain uncertain and may require further development. As a result, we are not yet able to identify all the possible consequences, but some of the consequences could have a material adverse impact on us.

We have challenged the resolution in the Mexican courts. However, legal challenges will not suspend the implementation of the Separation Plan and final determinations are pending.

Substantial Market Power Investigations

In 2007, the Federal Antitrust Commission (Comisión Federal de CompetenciaEconómica, or “Cofeco”) initiated two substantial market power investigations against Telcel and determined that Telcel had substantial market power in the mobile termination services market and in the nationwide

wireless voice and data services market. Telcel filed challenges against both decisions, and a final resolution of these challenges is still pending. If upheld, these decisions would allow the IFT to impose additional requirements as to rates, quality of service and information, among other matters. The Preponderance regime has regulated all of these matters.

In 2007, Cofeco initiated various investigations to evaluate whether Telmex and its subsidiary Telnor have substantial power in the markets for termination, origination, transit and wholesale dedicated-link circuits. Cofeco issued final resolutions concluding that Telmex and Telnor have substantial power in all four markets, which were challenged by Telmex and Telnor. The challenges related to each one of these markets have been denied, effectively upholding Cofeco’s findings. Consequently, the IFT may impose specific tariff requirements or other special regulations with respect to the matters for which the challenges were denied, such as additional requirements regarding disclosure of information or quality of service. The Preponderance regime has regulated all of these matters.

In the case of the market for wholesale dedicated-link leasing, the IFT’s predecessor, Cofetel, published an agreement in the Official Gazette, establishing requirements regarding tariffs, quality of service and information for dedicated-link circuits. Telmex and Telnor have filed petitions for relief against such resolutions, which are still pending. The regulation that could arise from these investigations has been already implemented by the IFT through the special regulatory regime for preponderant agents. However, given the uncertainty of the IFT’s actions, we are not able to identify all possible consequences and as a result an adverse resolution could have an impact on the Company’s future revenues in this market.

Concessions

Under the current legal framework, a carrier of public telecommunications networks, such as Telcel or Telmex, must operate under a concession. The IFT is an autonomous federal agency that grants new or extends existing concessions, which may only be granted to a Mexican citizen or corporation that has agreed to the concession terms and may not be transferred or assigned without the approval of the IFT. There are three types of concessions:

•

NETWORK CONCESSIONS. Telcel, Telmex and its subsidiary Telnor hold network concessions, granted under the previous regulatory framework, to provide specified types of services. Their ability to migrate to the new regime of unified concessions and, consequently, to provide any and all telecommunications and broadcasting services, is subject to conditions, as described under “Migration of Concessions and Additional Services” below.

•

SPECTRUM CONCESSIONS. Telcel holds multiple concessions, granted under both the previous and current regulatory frameworks, to provide wireless services that utilize frequencies of radio-electric spectrum. These concessions have terms of 15 to 20 years and may be extended for an additional term of equal length.

•

UNIFIED CONCESSION. Each of the New Companies holds a unified concession granted to provide only wholesale telecommunications services. These concessions were issued in March 2020 and have a term of 30 years and may be extended for an additional term of equal length.

Termination of Concessions

Mexican legislation provides that under certain circumstances, some assets of a concessionaire may be acquired by the federal government upon termination of these concessions.

There is no specific guidance or precedent for applying these provisions, so the scope of assets covered, the compensation to the concessionaire and the procedures to be followed would depend on the type of concession, the type of assets and the interpretation of applicable legislation by the competent authorities at the time.

Migration of Concessions and Additional Services

The new legislative framework established the unified concession (concesión única), which allows the holder to provide all types of telecommunications and broadcasting services, and a regime under which an existing concession can be migrated to the new unified concession at the end of its term or upon request by the concession holder. A unified concession has a term of up to 30 years, extendable for up to an equal term. Also, under this new framework a current concession may be modified to add services not previously contemplated therein.

However, as a result of our preponderant economic agent status, Telcel, Telmex and Telnor are subject to additional conditions for the migration to a unified concession or the addition of a service, such as Pay TV, to a current concession, including in certain cases (i) payment of any new concession fee to be determined by the IFT, (ii) compliance with current requirements under the network concession, the 2013 constitutional amendments, the 2014 legislation and any additional measures imposed by the IFT on the preponderant economic agent and (iii) such other requirements, terms and conditions as the IFT may establish in the concession itself. We expect the process of migration or additional services to be lengthy and complex. Consequently, Telcel, Telmex and Telnor may not be able to provide certain additional services, such as Pay TV and broadcasting, in the near term.

Telcel’s Concessions

Telcel operates under several different network and spectrum concessions covering particular frequencies and regions, holding an average of 280.96 MHz of capacity in Mexico’s nine regions in the 850 MHz, 1900 MHz,1.7/2.1 GHz, 2.5 GHz and 3.5 GHz bands. The following table summarizes Telcel’s concessions.



FREQUENCY	COVERAGE AREA	INITIAL DATE	TERMINATION DATE

Band A (1900 MHz)	Nationwide	Sep. 1999	Oct. 2039
Band D (1900 MHz)	Nationwide	Oct. 1998	Oct. 2038
Band B (850 MHz)	Regions 1, 2, 3	Aug. 2011	Aug. 2026
Band B (850 MHz)	Regions 4, 5	Aug. 2010	Aug. 2025
Band B (850 MHz)	Regions 6, 7, 8	Oct. 2011	Oct. 2026
Band B (850 MHz)	Region 9	Oct. 2015	Oct. 2030
Band F (1900 MHz)	Nationwide	Apr. 2005	Apr. 2025⁽¹⁾
Bands A and B (1.7/2.1 GHz)	Nationwide	Oct. 2010	Oct. 2030
Bands H, I and J (1.7/2.1 GHz)	Nationwide	May 2016	Oct. 2030
Band 7 (2.5 GHz)	88% of the population	Jul. 2017	Sep. 2020⁽¹⁾ – Nov. 2028 – Oct. 2040 – May 2041
Band 3.5 GHz⁽²⁾	Nationwide	Oct. 2020⁽³⁾	Oct. 2038 and 2040

(1)

A request for extension has already been filed with the IFT.

(2)

On December 18, 2020, Telcel filed a formal request with the IFT to include mobile service in these concessions.

(3)

The term of this concession is currently in force and was extended by IFT in favor of Telmex until 2040 and afterwards it was assigned by Telmex to Telcel as of March 11, 2020. Concessions acquired from Axtel were extended by the IFT until 2038.

On August 21, 2020, Claro TV, S.A. de C.V. filed before the IFT a notice of merger with Claro Sat, S.A. de C.V. Likewise, on December 18, 2020, Duono, S.A de C.V., filed before the IFT a notice of merger with Integración de Servicios Empresariales y Corporativos, S.A. de C.V. (ISEC). As result of both the Claro TV, S.A. de C.V. and Duono, S.A de C.V. mergers, these corporations will be the license holders.

Concession Fees

All of Telcel’s concessions granted or renewed on or after January 1, 2003 are required to pay annual fees for the use and exploitation of radio spectrum bands. The amounts payable are set forth by the annual Federal Fees Law (Ley Federal de Derechos) and vary depending on the relevant region and radio spectrum band.

Telmex’s Concessions

Telmex’s concession was granted in 1976 and is currently set to expire in 2026. In December 2016, the IFT granted Telmex a 30-year extension of this concession, which will become effective in 2026 and will be valid until 2056. The new terms of this concession will be issued in early 2023.

Telmex’s subsidiary, Telnor, holds a separate concession, which covers one state and two municipalities in northwestern Mexico and will expire in 2026. The IFT also granted Telnor a 30-year extension of its concession, which will be effective in 2026 and will be valid until 2056. The material terms of Telnor’s concession are similar to those of Telmex’s concession.

In addition, Telmex currently holds concessions for the use of frequencies to provide point-to-point and point-to-multipoint transmission in 10.5, 15 and 23 GHz bands.

In 2018, Telmex was notified of a resolution issued by the IFT, through which the IFT imposed a fine of Ps.2.5 billion derived from an alleged breach in 2013 and 2014 of certain minimum quality of service goals for dedicated link services. Telmex has exercised all legal remedies challenging such resolution and a final resolution is pending.

Rates for Wireless Service

Wireless services concessionaires are generally free to establish the prices they charge customers for telecommunications services. Wireless rates are not subject to a price cap or any other form of price regulation. The interconnection rates concessionaires charge other operators are also generally established by agreement between the parties and, if the parties cannot agree, may be imposed by the IFT, subject to certain guidelines, cost models and criteria. The IFT publishes at the end of the year the rates they would impose in the event of a dispute, eliminating all incentives for a negotiation among the parties. The establishment of interconnection rates has resulted, and may in the future result, in disputes between carriers and with the IFT.

As a result of the preponderance determination, Telcel’s retail prices are subject to pre-approval by the IFT before they can take effect.

The IFT is also authorized to impose specific rate requirements on any carrier that is determined by the IFT to have substantial market power under the Federal Antitrust Law (Ley Federal de Competencia Económica) and the 2014 legislation. For more information on litigation related to the Federal Antitrust Law and the 2014 legislation, see “—Substantial Market Power Investigations” under this Part VI.

Rates for Fixed Service

Telmex’s concessions subject its rates for basic retail telephone services in any period, including installation, monthly rent, measured local-service and long-distance service, to a ceiling on the price of a “basket” of such services, weighted to reflect the volume of each service provided by Telmex during the preceding period. Telmex is required to file a survey with the IFT every four years with its projections of

units of operation for basic services, costs and prices. Telmex is free to determine the structure of its own rates, with the exception of domestic long-distance rates, which were eliminated in 2015 under the 2014 legislation, and of the residential fixed-line rates, which have a cap based on the long-run average incremental cost. As a result of the preponderance determination, Telmex’s retail prices are subject to pre-approval by the IFT before they can take effect.

The price ceiling varies directly with the Mexican National Consumer Price Index (Indice Nacional de Precios al Consumidor), allowing Telmex to raise nominal rates to keep pace with inflation (minus a productivity factor set for the telecommunications industry), subject to consultation with the IFT. Telmex has not raised its nominal rates for many years. Under Telmex’s concession, the price ceiling is also adjusted downward periodically to pass on the benefits of Telmex’s increased productivity to its customers. The IFT sets a periodic adjustment for every four-year period to permit Telmex to maintain an internal rate of return equal to its weighted average cost of capital.

In addition, basic retail telephone services, as well as broadband services and “calling party pays” charges, are subject to a separate price ceiling structure based on productivity indicators. In each case, Telmex is required to submit a survey on productivity indicators to the IFT every two years, including a total factor productivity. The IFT establishes the productivity factor that will apply over the next two years, and, based on this, the IFT will approve the customer prices before they can take effect.

Prices for Telmex’s wholesale services are established by the IFT based on the long-run average incremental cost model methodology.

BRAZIL

Legal Framework and Principal Regulatory Authorities

The Brazilian Telecommunications Law (Lei Geral das Telecomunicações Brasileiras) provides the framework for telecommunications regulation. The primary telecommunications regulator in Brazil is the Telecommunications Agency (Agência Nacional de Telecomunicações, or “Anatel”), which has the authority to grant concessions and licenses in connection with telecommunications services and the use of orbits, except broadcasting, and to adopt regulations that are legally binding on telecommunications services providers.

The Brazilian Congress has approved an updated legislation to modernize the current concession-based model to an authorization-based model. The updated law brings the possibility of allowing fixed-line concessionaires, such as

Claro Brasil, to provide services under an authorization rather than a concession, as long as certain investment-related obligations are met. Under the new legislation, it is possible to extend the current concessions, as well as radio frequency licenses and orbital positions, for more than one period. The legislation also permits the possibility of a secondary market for trading cellphone frequencies. The legislation will be implemented by regulations promulgated by Anatel. We are currently evaluating the potential impact of this legislation on our operations.

Licenses

In 2018, subsidiary Star One merged into Claro Brasil. As a result, all Brazilian satellite operation rights previously granted to Star One were transferred under the same terms and conditions to Claro Brasil. The satellite operation rights (AMC-12) covering regions outside of Brazil were relinquished by Star One before the merger. In 2020, the satellite operation rights were transferred to Embratel Tysat Telecomunicações S.A. (“Claro TV”), after approval by Anatel.

In December 18, 2019, AMX announced the acquisition of 100% of the shares of Nextel Brazil and Sunbird Telecomunicações Ltda. (“Sundbird”), as well as its correspondent subsidiaries in Brazil. Nextel Brazil had authorizations to provide personal mobile services, specialized mobile services, multimedia communication services, paid fixed telephony services (national and international long-distance) and radiofrequency services in Brazil that were granted by Anatel. Sunbird had authorizations to provide specialized mobile services and radiofrequency services. Derived from the acquisition of Nextel Brazil and Sunbird by AMX, Anatel provided AMX with: (i) a term of 18 months to consolidate and cancel the overlapped authorizations granted in favor of Nextel Brazil and Sunbird; and (ii) a term of 2 months to adjust the radiofrequency thresholds. In 2020, the authorizations and radiofrequencies granted in favor of Nextel Brazil and Sunbird for specialized mobile services were waived. Also in 2020, Nextel’s PS licenses were transferred to Claro.

In 2019, the subsidiary Primesys was merged into Claro Brasil. As a result, service authorizations granted to Primesys were transferred under the same terms and conditions to Claro Brasil.

Our Brazilian subsidiaries hold licenses for the telecommunications services listed below and expect to continue acquiring spectrum if Anatel conducts additional

public auctions, although Claro Brazil, like all of its peer competitors, is subject to a cap on the additional spectrum it may acquire per frequency band.



SUBSIDIARY	LICENSE	TERMINATION DATE

Claro Brasil	Fixed Local Voice Services	Indefinite

	Domestic and International Long-Distance	2025
	Domestic and International Long-Distance	2025

	Voice Services	Indefinite

	Personal Communication Services	Indefinite

	Data Services	Indefinite

	Cable TV Services	Indefinite

	Mobile Maritime Services	Indefinite

	Global Mobile Satellite Services	Indefinite

Claro TV	DTH TV Services	Indefinite

	Data Services	Indefinite

Americel S.A.	Data Services	Indefinite

Telmex do Brasil	Data Services	Indefinite

Nextel Brazil	Personal Communication Services	Indefinite

	Domestic and International Long-Distance	Indefinite
	Domestic and International Long-Distance	Indefinite

	Data Services	Indefinite

In addition, Claro TV has various orbital position authorizations for our satellite operations, which are set to expire between 2022 and 2033. Requests for extensions for 15 more years have been requested from Anatel. Claro TV also has radio frequency licenses to provide PCS, which are set to expire between 2022 and 2032. These grants were transferred from Claro Brasil to Claro TV in 2020, subsequent to Anatel’s approval.

Nextel Brazil has radio frequency licenses to provide PCS, which expire between 2026 and 2031.

Concessions

Claro Brasil holds two fixed-line concessions to provide domestic and international long-distance telephone services. The remaining telecommunications services provided by Claro Brasil are governed by a system of licenses instead of concession arrangements.

Concession Fees

Claro Brasil is required to pay a biennial fee equal to 2.0% of net revenues from wireless services, except for the final year of the 15 year term of its PCS authorizations, in which the fee equals 1.0% of net revenues from wireless services.

Claro Brasil is also required to pay a biennial fee during the term of its domestic and international long-distance concessions equal to 2.0% of the revenues from long- distance telephone services, net of taxes and social contributions, for the year preceding the payment.

Termination of Concessions

Our domestic and international long-distance fixed-line concessions provide that certain of our assets deemed “indispensable” for the provision of these services will revert to the Brazilian state upon termination of these concessions. Compensation for those assets would be their depreciated cost. See Note 17 to our audited consolidated financial statements included in this annual report.

Regulation of Rates

Anatel regulates rates (tariffs and prices) for all telecommunications services, except for fixed-line broadband services, Pay TV and satellite capacity rates, which are not regulated. In general, PCS license holders and fixed local voice services license-holders are authorized to increase basic plan rates annually. Domestic long-distance concession-holders may adjust rates annually only for inflation, provided that they give Anatel and the public advanced notice of such adjustments. Claro Brasil may set international long-distance and mobile rates freely, provided that it gives Anatel and the public advance notice.

Regulation of Wholesale Market Competition

In November 2012, Anatel approved the General Competition Plan (Plano Geral de Metas da Competição, or “PGMC”), a comprehensive regulatory framework aimed at increasing competition in the telecommunications sector. The PGMC imposes asymmetric measures upon economic groups determined by Anatel to have significant market power in any of the five wholesale markets in the telecommunications sector, on the basis of several criteria, including having over 20.0% of market share in the applicable market.

In 2012, Claro Brasil and three of its primary competitors were determined to have significant market power in the mobile wireless termination and national roaming markets. As a result, Claro Brasil was required to reduce mobile termination rates to 75.0% of the 2013 rates by February 2014, and to 50.0% of the 2013 rates by February 2015. In July 2014, Anatel established termination rates for mobile services applicable to operators with significant market power through 2019, based on a cost model, and in December 2018, Anatel established termination rates for mobile services applicable to operators with significant market power from 2020 to 2023. These termination rates were revised by Anatel in February 2020. Claro Brasil is also required to publish its reference roaming prices for voice, data and SMS on an annual basis, among other measures. These prices must be related to the Anatel reference values and need to be approved by Anatel before they can take effect. The approval of new prices by Anatel took place in January 2021.

In 2018, Anatel approved Claro Brasil’s most recent wholesale reference offers with respect to national roaming, telecommunications duct infrastructure, long-distance leased lines, high capacity transport above 34 Mbps, wireless networks interconnection, fixed network interconnection, internet network interconnection and internet links, which are reviewed and approved by Anatel on an annual basis. Anatel also reviews its determination of which operators have significant market power on a quadrennial basis. Anatel began its first review of all telecom operators in 2014 and published the most recent list of operators with significant market power for each of the relevant markets in 2018. In addition to the review, in 2018 Anatel changed some of the asymmetric measures applicable under the PGMC and added two new wholesale markets covering high capacity transport and fixed network interconnection. Anatel has determined that Claro Brasil has significant market power in eight wholesale markets.

Network Usage Fees and Fixed-Line Interconnection Rates

In July 2014, Anatel approved a resolution establishing the reference terms for fees charged by operators in connection with the use of their mobile network and leased lines and set a price cap on fees charged for fixed network usage by operators deemed to have significant market power. Such fees, based on costs of allocation services (coubicación), have been applicable since February 2016.

In December 2018, Anatel published reference values for fees network that are applicable from 2020 to 2023.

Fixed-line operators determined by Anatel to have significant market power in the local fixed-line market may freely negotiate interconnection rates, subject to a price cap established by Anatel.

Other Obligations

Under applicable law and our concessions, Claro Brasil has an obligation to (i) comply with certain coverage obligations to ensure universal access to its fixed-line voice services, (ii) contribute to the funding of the country’s transition from analogue to digital TV (due to the acquisition of the 700 MHz frequency), (iii) meet quality-of-service targets and (iv) comply with applicable telecommunications services consumer rights.

CADE Anti-Competition Proceeding

On March 9 2021, the General Superintendence at the Administrative Council for Economic Defense (“CADE”) issued a non-binding opinion recommending fines against Claro Brasil, Oi Móvel S.A. (“Oi”) and Telefônica Brasil S.A. (“Telefônica”, together Claro Brasil and Oi, the “Defendants”). The potential fines relate to a complaint filed by British

Telecom do Brasil (“BT”) against the Defendants alleging, among other things, that, in connection with a public bid, the Defendants (i) colluded to prevent competition between the leading players in the broadband internet services market in Brazil, which caused anti-competitive effects in the telecommunications sector and (ii) made it difficult for BT to participate in the bid through price discrimination tactics and by refusing to supply communication circuits (specifically, MPLS links) that were required for BT to participate in the bid. The case will be reviewed by CADE’s tribunal for a final ruling and CADE’s final decision may be challenged in judicial courts. We intend to challenge the final decision if it is not in our favor. The amount of monetary penalty recommended by the General Superintendence at CADE could be substantial, but we cannot reasonably estimate the range of possible loss related to the proceeding.

COLOMBIA

Legal Framework and Principal Regulatory Authorities

The Information and Communications Ministry (Ministerio de Tecnologías de la Información y las Comunicaciones, or “ICT Ministry”) and the Communications Regulatory Commission

(Comisión de Regulación de Comunicaciones, or “CRC”) are responsible for overseeing and regulating the telecommunications sector. The main audiovisual regulatory authorities in Colombia with respect to Pay TV services are the CRC, the ICT Ministry and the Industry and Commerce Superintendence (Superintendencia de Industria y Comercio, or “SIC”). Claro is also subject to supervision by other government entities responsible for enforcing other regulations, such as antitrust rules or those protecting consumer rights.

Concessions

Comunicación Celular S.A. (“Comcel”) is qualified to provide fixed and mobile services and was included in the registry of networks and services administered by the ICT Ministry. Such general authorization superseded all of Comcel’s former concession contracts, and, consequently, such former concessions were terminated.

As a result of the termination of Comcel’s former concessions, the ICT Ministry and Comcel began discussions with respect to the liquidation of the agreements governing those concessions. In light of the decision of the Colombian Constitutional Court (Corte Constitucional de Colombia) holding that certain laws limiting the reversion of assets of telecommunications providers did not apply to concessions granted prior to 1998 and, consequently, that reversion of assets under those earlier concessions would be governed by their contractual terms, the ICT Ministry obtained a domestic award ordering Comcel to revert assets under its earlier

concessions to the Colombian government. Comcel challenged such award and the Company filed an international arbitration claim against Colombia arising from Colombia’s measures.

Licenses and Permits

Comcel holds licenses to provide mobile services in the spectrum frequency bands shown in the table below.



FREQUENCY	BANDWIDTH	TERMINATION DATE

850 MHz	25 MHz	Mar. 2024

1900 MHz	10 MHz	Dec. 2039

	5 MHz	Sept. 2021

	15 MHz	Apr. 2024

2.5 GHz	30 MHz	Aug. 2023

	10 MHz	Feb. 2021⁽¹⁾

	10 MHz	Mar. 2040

	10 MHz	Mar. 2040

	10 MHz	Mar. 2040

700 MHz	20 MHz	May 2040

(1)

Refers to a temporary license, which we renew on an annual basis.

In 2013, Telmex Colombia S.A. obtained permission to provide Pay TV services under any available technology, pursuant to the ICT Ministry’s unified licensing system. On May 31, 2019, Telmex Colombia, S.A. merged into Comcel. The permission to provide Pay TV services granted in favor of Telmex Colombia, S.A. was simultaneously transferred to Comcel without modifications in connection with the merger. On July 30, 2019, Comcel’s permission to provide Pay TV was incorporated under Comcel’s general power to provide Pay TV granted to it under Law 1978 of 2019.

In 2017, the ICT Ministry issued a decree approving a higher cap on spectrum acquisitions by operators in low and high frequency bands. This new cap allows Comcel to participate in future spectrum auctions. The ICT Ministry has released its plan to conduct spectrum auctions in the 700 MHz, 1900 MHz and 2.5 GHz bands. The final resolution containing the auctions’ terms and conditions was published by the ICT Ministry during the fourth quarter of 2019. The auction took place on December 20, 2019. A subsidiary of Novator Partners LLP, a London-based private equity firm (the “Novator Subsidiary”), participated in the auction as a new competitor in the market. The Novator Subsidiary was granted a 20MHz license to operate in the 700MHz frequency band and three blocks of 10MHz for the 2,500MHz frequency band. Colombia Telecomunicaciones (Movistar) and Colombia Movil (Tigo) also participated in the auction. Tigo was granted a 40MHz license to operate in the 700MHz frequency band. Colombia Telecomunicaciones was not granted any licenses in the auction.

Subsequently, the Novator Subsidiary resigned and refused to exercise its rights under the license to operate one block of 10MHz for the 2,500MHz frequency band. As a consequence, on February 11, 2020, the ICT Ministry initiated an administrative proceeding to evaluate and decide on the effects caused by such resignation. Comcel was notified by the ICT Ministry and was considered an interested third party in the administrative proceeding. The ICT Ministry imposed a sanction of 42 billion Colombian Pesos, approximately U.S. $12.3 million against Partners as a result of the aforementioned administrative proceeding.

Asymmetric Charges

In January 2017, the Colombian government approved symmetrical access charges among established operators like Comcel, Movistar and Tigo. However, under current regulation, new market entrants continue to receive a higher interconnection rate than incumbent operators and pay lower national roaming fees, in both cases, for a limited period.

In 2017, the CRC issued a resolution updating the list of relevant telecommunication markets by adding the mobile services market (including bundled mobile voice and data services) and by also including the mobile service market in the list of relevant markets subject to ex-ante regulation. In connection with the mobile services market, on January 28, 2021, the CRC determined that COMCEL has a dominant position in the relevant mobile services market, but did not impose particular measures. COMCEL considers that the CRC did not take into account important elements in its determination, which COMCEL has challenged. A resolution is pending.

SOUTHERN CONE

ARGENTINA

The National Communications Agency (Ente Nacional de Comunicaciones, or “Enacom”) is the main telecommunications regulatory authority in Argentina and became operational in 2016.

Fixed and mobile services providers are prohibited from providing DTH technology, which is currently the fastest way to provide Pay TV services. In 2017, the Argentine government issued a decree allowing telecommunications providers, including AMX Argentina S.A. (“AMX Argentina”), to provide Pay TV services via cable within a limited number of territories as of January 2018 and to the rest of the country as of January 2019. AMX Argentina has obtained the permissions necessary to provide Pay TV services via cable in accordance with the decree.

AMX Argentina holds licenses in the 700 MHz, 900 MHz, 1700/2100 MHz (AWS), 1900 MHz and 2600 MHz frequency bands, some of which expire in 15 years and some of which

have no expiration date. Each license also contains certain coverage parameters, reporting and service requirements and provides Enacom a revocation right upon a material breach of the license terms.

All telecommunications providers in Argentina must contribute approximately 1.0% of their monthly revenues to finance the provision of telecommunications services in underserved areas and to underserved persons. All providers must also meet certain quality-of-service requirements.

In 2020, the government of Argentina issued a decree by which it declared information and communications technology (ICT) services and access to telecommunications networks, for and between licensees of ICT services, as essential and strategic public services in competition. It also established that Enacom is the competent authority to approve prices for ICT services and to establish regulations to that effect.

CHILE

The General Telecommunications Law (Ley General de Telecomunicaciones) establishes the legal framework for telecommunications services in Chile, including the regulation of concessions, permits, rates and interconnection. The main regulatory agency of the telecommunications sector is the Chilean Transportation and Communications Ministry (Ministerio de Transportes y Telecomunicaciones), which acts primarily through the Undersecretary of Telecommunications (Subsecretaría de Telecomunicaciones, “SUBTEL”).

Claro Chile S.A. (“Claro Chile”) holds concessions to provide mobile and fixed-line services in the 700MHz, 850 MHz, 1900 MHz, 2.6 GHz, 3.4 GHz and 5.8 GHz frequency bands. Except for the concession to provide services in the 850 MHz frequency, which has an indefinite termination date, the concessions to provide services in the 700 MHz, 1900 MHz, 2.6 GHz, 3.4 GHz and 5.8 GHz frequencies have termination dates that vary from 2027 to 2045. In 2020, Claro Chile received a 10 MHz license from Movistar to operate in the 1900 MHz frequency band.

Claro Chile also holds license to provide DTH technology services until 2024 and a license with an indefinite term to provide Pay TV services. In 2018, the Chilean Supreme Court (Corte Suprema de Justicia) issued a ruling requiring Claro to return 20 MHz of spectrum acquired through a band auction because Claro supposedly exceeded the limit of spectrum any given operator is permitted to hold. The return of such spectrum is currently being implemented before the Competition Court (Tribunal de Defensa de la Libre Competencia, or the “TDLC”). In addition, pursuant to the ruling, and in order to increase the maximum limit, SUBTEL initiated a review of such limit of spectrum through a regulatory proceeding. In 2020, the Chilean Supreme Court defined a higher cap for spectrum acquisitions by operators in low, medium low, medium and high frequency bands. This

new cap allows Claro Chile to participate in the current spectrum auctions.

Some of Claro Chile’s concessions impose additional requirements, such as coverage, reporting and service quality requirements. The Chilean Transportation and Communications Ministry is authorized to terminate any concession in the event of specified breaches under the terms of such concessions. Additionally, Claro Chile’s concession in the 700 MHz band imposes certain obligations to expand mobile and data services in rural areas. In 2017, the Undersecretary of Telecommunication approved Claro Chile’s expansion project in connection with its obligations under its concession in the 700 MHz band.

PARAGUAY

AMX Paraguay, S.A. (“AMX Paraguay”) holds licenses to operate in the 1900 MHz and the 1700/2100 MHz bands. The 1700/2100 MHz band is in the process of being renewed and is expected to be renewed in February 2021. AMX Paraguay also holds a nationwide internet access and data transmission license. In addition, AMX Paraguay holds licenses to provide DTH services and cable TV services. The DTH License is in the process of being renewed for another 5 years (until 2025). Additionally, in January 2018, AMX Paraguay participated in a spectrum auction and was awarded a license to provide telecommunications services in the 700 MHz band. In November 2018, the Telecommunications Commission of Paraguay granted the renewal of spectrum license in the 1900 MHz band. These licenses are renewable, subject to regulatory approval, and contain coverage, reporting and service requirements.

In November 2019, the Telecommunications Commission of Paraguay granted AMX Paraguay a license to provide internet access and data transmission services in the 3,500 MHz frequency band, effective until January 12, 2024

URUGUAY

The Regulatory Unit of Communications Services (Unidad Reguladora de Servicios de Comunicaciones) is in charge of the regulation of the telecommunications industry in Uruguay.

AM Wireless Uruguay, S.A. holds licenses to operate in the 1900 MHz, 1700/2100 MHz and 700 MHz frequency bands that expire in 2024, 2033, 2037, 2039 and 2045. Additionally, AM Wireless Uruguay S.A. holds an authorization to do a trial for 5G in the 26, 50 GHz – 26, 85 GHz frequency band that expires on July 2021. Telstar S.A. holds licenses to provide

international long-distance communications and international and national data services that have no expiration date.

The license initially granted to Flimay S.A. (“Flimay”) to provide DTH technology services in Uruguay has been contested by the government since 2012. In 2017, the executive branch of Uruguay held under a new ruling that Flimay does not have a valid license to provide DTH services in the country. Flimay requested this ruling be voided, but in February 2018, the executive branch of Uruguay, with support from the Administrative Court (TCA), requested the process be closed. As of the date of this annual report, a decision on Flimay’s appeal is pending.

ANDEAN REGION

ECUADOR

The primary regulatory authorities for our mobile and fixed-line operations are the National Telecommunications, Regulation and Control Agency (Agencia de Regulación y Control de las Telecomunicaciones, or “Arcotel”) and the Telecommunications and Information Society Ministry (Ministerio de Telecomunicaciones y Sociedad de la Información, or “Mintel”). Arcotel is responsible for the licensing and oversight of radio-electric spectrum use and telecommunications services provisions. Mintel is responsible for the promotion of equal access to telecommunications services.

The Telecommunications Law (Ley Orgánica de Telecomunicaciones), adopted in 2015, serves as the legal framework for telecommunications services. It established regulations for operators with significant market power and penalties based on their gross incomes as well as additional fees also based on an operator’s gross income, but that can vary depending on the size of their market share. Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) has been deemed to have significant market power in the advanced wireless services market, and as a result, such fee payments are made on a quarterly basis on the dates established by Arcotel.

Conecel paid to the Ecuadorian government U.S. $26.1 million, which corresponds to 3.0% of its wireless services revenues generated in the 2020. An arbitration proceeding to partially void the payment by Conecel of such fees was conducted and a decision in favor of the government was reached. Conecel has appealed this decision and, as of the date of this annual report, a decision of the Constitutional Court is pending.

Conecel holds concessions to operate in the 850MHz, 1900 MHz and AWS bands, which include concessions for PCS that expire in 2023. The PCS concession contains quality- of-service requirements for successful call completions, SMS delivery times, customer service, geographic coverage and other service conditions.

Conecel also holds licenses to provide internet value-added services, Pay TV Services (through DTH technology) and bearer services, expiring in 2021, 2023 and 2032, respectively.

Conecel, following the acquisition of Ecuador Telecom, S.A. in 2016, also holds a concession to offer fixed-line voice, public telephone and domestic and international long-distance wholesale services, as well as a license to provide Pay TV (through HFC technology) that expires in 2032 and 2031, respectively.

Recalculation of Concession Fees

Arcotel initiated several proceedings to recalculate the variable portion of the concession fees payable under Conecel’s concessions, which, as of the date of this annual report, is equivalent to 2.93% of Conecel’s annual subscriber base revenues, in addition to its contribution for Universal Service (Servicio Universal 1%). These recalculation proceedings with Arcotel remain ongoing.

In 2018, Conecel paid Arcotel U.S.$11.9 million based on its annual revenues for the 2015 period and was required to pay U.S.$13 million based on its annual revenues for the 2016 period.

For its Universal Service contribution, Conecel was required to pay U.S.$5 million for the 2015 period and U.S.$6 million for the 2016 period. Conocel obtained a judicial order that suspended the collection process for the 2015 and 2016 periods.

These recalculation proceedings mentioned in this section were disputed with Arcotel in arbitration. On April 17, 2020, the arbitration court issued its resolution which was favorable for Conecel. Arcotel was ordered to pay Conecel U.S. $ 32.4 million plus interests.

On January 15, 2021, the Provincial Court of Justice accepted the request to nullify the resolution issued by the arbitration court, thereby declaring it null. However, the annulment of the resolution has not ended the dispute with Arcotel. A new arbitration court must issue a new resolution. At the same time Conecel will enforce its rights by presenting an Extraordinary Action for Protection before the Constitutional Court for the violation of its rights.

PERU

The Supervisory Agency for Private Investment in Telecommunication (Organismo Supervisor de la Inversión Privada en Telecomunicaciones, or “OSIPTEL”) is in charge of the regulation of the telecommunications industry in Peru. The Ministry of Transport and Communications (Ministerio de Transportes y Comunicaciones or “MTC”) grants concessions, permits and licenses. The Telecommunications Law (Decreto Supremo N° 013-93-TCC Ley de Telecomunicaciones), adopted in 1993, serves as the legal framework for telecommunications services.

América Móvil Perú, S.A.C. (“Claro Perú”) holds nationwide concessions to provide wireless, PCS, fixed-line, local wholesale, domestic and international long-distance, Pay TV services (through DTH and HFC technologies), public telephone and value-added services (including internet access). The concessions allow Claro Perú to operate on the 450 MHz, 700 MHz, 850 MHz, 1900 MHz, 3.5 GHz and 10.5 GHz bands. As part of Claro Perú’s acquisition of Olo del Perú S.A.C., TVS Wireless S.A.C. and their respective subsidiaries in 2016, Claro has a resale agreement with such companies to operate in certain regions on the 2.5 GHz band.

Spectrum reframing is the process conducted by the MTC to properly order the assignment of a frequency band in order to have continuous coverage nationwide and adequate bandwidth. The MTC issued the final decision on the spectrum reframing for the 2.5 Ghz band, granting 80 Mhz to TVS Wireless, S.A.C. (Lima and Callao) and Olo del Peru, S.A.C. (rest of the country).

Each of the concessions was awarded by the MTC and covers a 20-year period. The concessions contain coverage, reporting, service requirement and spectral efficiency goals. The MTC is authorized to cancel any of the concessions in the case of specified breaches of its terms.

EUROPE AND OTHER JURISDICTIONS

European Legal Framework and Principal Regulatory Authorities

The telecommunications regulatory framework in the EU is based on the European Electronic Communications Code (EECC) that is currently in the process of being transposed into national laws for all EU member states. Austria, Bulgaria, Croatia and Slovenia are EU member states. Macedonia and Serbia, candidates for accession to the EU, are expected to gradually harmonize their regulatory frameworks with the EU’s framework.

In each European country in which we operate, we are also subject to a domestic telecommunications regulatory framework and to oversight by one or more local regulators.

Licenses



COUNTRY	FREQUENCY	TERMINATION DATE

AUSTRIA	800 MHz	Dec. 2029

	900 MHz	Dec. 2034

	1500 Mhz	Dec. 2044

	1800 MHz	Dec. 2034

	2100 MHz	Dec. 2044

	2600 MHz	Dec. 2026

	3500 MHz	Dec 2039

BELARUS	900 MHz	Not applicable

	1800 MHz	Not applicable

	2100 MHz	Not applicable

BULGARIA	900 MHz	June 2024

	1800 MHz	June 2024

	2100 MHz	Apr. 2025

CROATIA	800 MHz	Oct. 2024

	900 MHz	Oct. 2024

	1800 MHz	Oct. 2024

	2100 MHz	Oct. 2024

MACEDONIA	800 MHz	Dec. 2033

	900 MHz	Sept. 2023

	1800 MHz	Dec. 2033

	2100 MHz	Feb. 2028

SERBIA	800 MHz	Jan. 2026

	900 MHz	Nov. 2026

	1800 MHz	Nov. 2026

	2100 MHz	Nov. 2026

SLOVENIA	800 MHz	May 2029

	900 MHz	Jan. 2031

	1800 MHz	Jan. 2031

	2100 MHz	Sept. 2021

	2600 MHz	May 2029

OTHER JURISDICTIONS



COUNTRY	PRINCIPAL REGULATORY AUTHORITIES	CONCESSION AND LICENSES

COSTA RICA	Superintendency of Telecommunications (Superintendencia de Telecomunicaciones) Ministry of Science, Technology and Tele-communications (Ministerio de Ciencia, Tecnología y Telecomunicaciones)	• Concessions in the AWS and 1800 MHz bands that expire in 2032 • Concessions in the 2100 MHz band that expire in 2026 • License to operate Pay TV services using DTH technology that will expire in 2026

EL SALVADOR	Electricity and Telecommunications Super- intendency (Superintendencia General de Electricidad y Telecomunicaciones)	• Concession of 50 MHz in the 1900 MHz band of which 30 MHz that expire in 2038, 10 MHz that expire in 2041 and 10 MHz that expire in 2028 • Concession to provide public telephone service that expires in 2027 • Licenses to provide Pay TV Services through HFC and DTH technologies have an indefinite term • Concession of 40 MHz in 1700/2100 MHz bands (AWS) that will expire in 2040

GUATEMALA	Guatemalan Telecommunications Agency (Superintendencia de Telecomunicaciones)	• Licenses to use 12 MHz in the 900 MHz band and 120 MHz in the 1900 MHz band that all expire in 2033 • Concession of 175 MHz in the 3.5 GHz band that will expire in 2033

NICARAGUA	Nicaraguan Telecommunications and Mailing Institute (Instituto Nicaragüense de Teleco-municaciones y Correos)	• Concessions in the 700 MHz, 850 MHz, 1900 MHz and 1700/2100 MHz bands that all expire in 2042 • Concession of 50 MHz in the 3.5 GHz band that will expire in 2042 • Licenses to provide DTH technology that will expire in January 2028 and Pay TV services that has an indefinite term

HONDURAS	Honduran National Telecommunications Commission (Comisión Nacional de Teleco-municaciones)	• Concessions to use 80 MHz in the 1900 MHz PCS band and 40 MHz in the LTE-4G 1700/2100 MHz band that all expire in 2033 • Licenses to operate Pay TV services through (i) HFC technology that will expire in 2027 and (ii) DTH technology that will expire in 2030

PANAMA	National Authority of Public Services (Auto-ridad Nacional de los Servicios Públicos)	• License to use 40 MHz in the 1900 MHz and 20 MHz in the 700 MHz bands that all expire in 2028 • Licenses to provide fixed local and long-distance services that expire in 2030 • License to provide internet service that expires in 2033 • Licenses to provide international long-distance, value-added services, interactive television, and Pay TV service through DTH and IPTV technologies, which expire in 2028, 2030, 2037 and 2034, respectively • License to provide Pay TV service through optical fiber that expires in 2037 • License for data transportation, Service No. 200, which expires in 2023

UNITED STATES	The FCC	• International Section 214 Authorization (Claro Enterprise Solutions)

DOMINICAN REPUBLIC	Dominican Institute of Telecommunications (Instituto Dominicano de las Telecomunica-ciones)	• Concession to provide fixed and wireless services, internet and pay TV services through DTH and IPTV technologies that expire in 2030 • Licenses to use 25 MHz in the 800 MHz band, 30 MHz in the 1900 MHz band, 80 MHz in the 2.5/2.7 GHz band, 30 MHz in the 3.5 GHz band and 40 MHz in the 1.7/2.1 GHz (AWS) band that expire in 2030

PUERTO RICO	Federal Communications Commission (FCC) and the Telecommunications Bureau of Puerto Rico	• Concessions to use the 700 MHz, 1900 MHz and the 28 GHz bands that expire in 2021, 2027 and 2029, respectively • Concessions to use the 800 MHz bands that expire in 2021, 2026, 2028 and 2030 • Concessions to use the AWS-1 and AWS-3 bands (1.7/2.1 GHz) that expire in 2026 and 2028, respectivel. • Concessions to use the 3.5 GHz band that expires in 2030 • Long-term transfer lease concessions to use 35.6 MHz of the 2.5 GHz band that expire in 2022, 2023, 2025, 2026 and 2030 • Franchise to operate Pay TV services using IPTV technology that expires in 2030

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Many of our employees are members of labor unions with which we conduct collective negotiations on wages, benefits and working conditions. We believe that we have good current relations with our workforce.

The following table sets forth the total number of employees and a breakdown of employees by main category of activity and geographic location, as of the end of each year in the three-year period ended December 31, 2020.

     DECEMBER 31,

     2018      2019      2020
NUMBER OF EMPLOYEES
     189,448      191,523      186,851
CATEGORY OF ACTIVITY:






Wireless
     77,845      83,091      73,404
Fixed
     92,429      87,034      91,460
Other businesses
     19,174      21,398      21,987
GEOGRAPHIC LOCATION:






Mexico
     88,613      89,539      88,172
South America
     62,500      61,058      59,304
Central America
     9,586      10,372      9,936
United States
     848      859      843
Caribbean
     9,195      11,351      10,647
Europe
     18,706      18,344      17,949
In each of the countries in which we operate, we are party to various legal proceedings in the ordinary course of business.
These proceedings include tax, labor, antitrust, contractual matters and administrative and judicial proceedings concerning regulatory matters such as interconnection and tariffs. We are party to a number of proceedings regarding our compliance with administrative rules and regulations and concession standards.
Our material legal proceedings are described in Note 17 to our audited consolidated financial statements included in this annual report and in “Regulation” under Part VI of this annual report.
88

AUDIT AND NON-AUDIT FEES

The following table sets forth the fees billed to us and our subsidiaries by our independent registered public accounting firm, Mancera, during the fiscal years ended December 31, 2019 and 2020:

   YEAR ENDED DECEMBER 31,

   2019    2020

   (in millions of Mexican pesos)
Audit fees⁽¹⁾
   Ps.     250    Ps.     250
Audit-related fees⁽²⁾
   17    10
Tax fees⁽³⁾
   34    19
Total fees
   Ps.     301    Ps.     279
(1)
Audit fees represent the aggregate fees billed by Mancera and its Ernst & Young Global affiliated firms in connection with the audit of our annual financial statements and statutory and regulatory audits.
(2)
Audit-related fees represent the aggregate fees billed by Mancera and its Ernst & Young Global affiliated firms for the review of reports on our operations submitted to IFT and attestation services that are not required by statute or regulation.
(3)
Tax fees represent fees billed by Mancera and its Ernst & Young Global affiliated firms for tax compliance services, tax planning services and tax advice services.

AUDIT AND CORPORATE PRACTICES COMMITTEE APPROVAL POLICIES AND PROCEDURES

Our audit and corporate practices committee has established policies and procedures for the engagement of our independent auditors for services.

Our audit and corporate practices committee expressly approves any engagement of our independent auditors for audit or non-audit services provided to us or our subsidiaries. Prior to providing any service that requires specific pre-approval, our independent auditor and our Chief Financial Officer present to the audit committee a request for approval of services in which they confirm that the request complies with the applicable rules.

We file reports, including annual reports on Form 20-F, and other information with the SEC pursuant to the rules and regulations of the SEC that apply to foreign private issuers.

Any fillings we make electronically will be available to the public over the internet at the SEC’s web site at www.sec.gov and at our website at www.americamovil.com. This URL is intended to be an inactive textual reference only. It is not intended to be an active hyperlink to our website. The information on our website, which might be accessible through a hyperlink resulting from this URL, is not incorporated into this annual report.

The following documents have been filed with the SEC as exhibits to this annual report:



1.1		Amended and Restated Bylaws (estatutos sociales) of América Móvil, S.A.B. de C.V., dated as of April 16, 2018 (together with an English translation) (incorporated by reference to Exhibit 1.1 of our annual report on Form 20-F File No. 001-16269, filed on April 26, 2018).

2.1		Description of Rights of Each Class of Securities

4.1		Stock Purchase Agreement by and among Verizon Communications Inc., América Móvil, S.A.B. de C.V., AMX USA Holding, S.A. de C.V. and Tracfone Wireless, Inc. dated as of September 13, 2020.


8.1		List of certain subsidiaries of América Móvil, S.A.B. de C.V.

12.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

12.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
13.1		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
15.1		Code of Ethics (incorporated by reference to Exhibit 14.1 of our annual report on Form 20-F, File No. 001-16269, filed on April 26, 2018).
15.2		Consent of independent registered public accounting firm.
17.1		Subsidiary Guarantors
101.INS		XBRL Instance Document.
101.SCH		XBRL Taxonomy Extension Schema Document.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB		XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF		XBRL Taxonomy Extension Definition Document.

Omitted from the exhibits filed with this annual report are certain instruments and agreements with respect to long-term debt of América Móvil, none of which authorizes securities in a total amount that exceeds 10% of the total assets of América Móvil. We hereby agree to furnish to the SEC copies of any such omitted instruments or agreements as the Comission requests.

Some of the information contained or incorporated by reference in this annual report constitutes “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Although we have based these forward-looking statements on our expectations and projections about future events, it is possible that actual events may differ materially from our expectations. In many cases, we include, together with the forward-looking statements themselves, a discussion of factors that may cause actual events to differ from our forward-looking statements.

Examples of forward-looking statements include the following:

projections of our commercial, operating or financial performance, our financing, our capital structure or our other financial items or ratios;

statements of our plans, objectives or goals, including those relating to acquisitions, competition and rates;

statements concerning regulation or regulatory developments;

the impact of COVID-19;

statements about our future economic performance or that of Mexico or other countries in which we operate;

competitive developments in the telecommunications sector;

other factors and trends affecting the telecommunications industry generally and our financial condition in particular; and

statements of assumptions underlying the foregoing statements.

We use words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “should” and other similar expressions to identify forward-looking statements, but they are not the only way we identify such statements.

Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors, some of which are discussed under “Risk Factors,” include the impact of the COVID-19 pandemic, economic and political conditions and government policies in Mexico, Brazil, Colombia, Europe and elsewhere, inflation rates, exchange rates, regulatory developments, technological improvements, customer demand and competition. We caution you that the foregoing list of factors is not exclusive and that other risks and uncertainties may cause actual results to differ materially from those in forward-looking statements. You should evaluate any statements made by us in light of these important factors.

Forward-looking statements speak only as of the date they are made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events or for any other reason.



ITEM	FORM 20-F CAPTION	LOCATION IN THIS REPORT	PAGE

1	IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS	Not applicable	-

2	OFFER STATISTICS AND EXPECTED TIMETABLE	Not applicable	-

3	KEY INFORMATION

	3A Selected financial data	Selected financial data	6

	3B Capitalization and indebtedness	Not applicable	-

	3C Reasons for the offer and use of proceeds	Not applicable	-

	3D Risk factors	Risk factors	37

4	INFORMATION ON THE COMPANY

	4A History and development of the Company	Information on the Company	9

		Note 10—Property, Plant and Equipment, Net	F-38

		Liquidity and capital resources	32

		Additional Information	87

	4B Business overview	Information on the Company	9

		Regulation	71

	4C Organizational structure	Exhibit 8.1	-

	4D Property, plant and equipment	Information on the Company	9

		Note 10—Property Plant and Equipment, Net	F-38

		Liquidity and capital resources	32

		Regulation	71

4A	Unresolved staff comments	None	-

5*	OPERATING AND FINANCIAL REVIEW AND PROSPECTS

	5A Operating results	Overview	24

		Results of operations	26

		Regulation	71

	5B Liquidity and capital resources	Liquidity and capital resources	32

		Note 14—Debt	F-51

	5C Research and development, patents and licenses, etc.	Not applicable	-

	5D Trend information	Overview	24

		Results of operations	26

	5E Critical Accounting Estimates	Not applicable	-

6	DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

	6A Directors and senior management	Management	60

	6B Compensation	Management	60

	6C Board practices	Management	60

		Management	60

	6D Employees	Employees	88

	6E Share ownership	Major shareholders	50

		Management	60

7	MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

	7A Major shareholders	Major shareholders	50

	7B Related party transactions	Related party transactions	51

	7C Interests of experts and counsel	Not applicable	-

8	FINANCIAL INFORMATION

	8A Consolidated statements and other financial information	Consolidated Financial Statements	F-1

		Dividends	51

		Note 17—Commitments and Contingencies	F-59

	8B Significant changes	Not applicable	-

*América Móvil has elected to apply the SEC rules issued on November 19, 2020 which became effective on February 10, 2021, with respect to Item 5 of this Form 20-F. Registrants, including América Móvil, are required to comply with the amended rules for their first fiscal year ending on or after April 9, 2021.

  ITEM      FORM 20-F CAPTION    LOCATION IN THIS REPORT          PAGE
9    THE OFFER AND LISTING



   9A Offer and listing details    Trading markets      52

   9B Plan of distribution    Not applicable      -

   9C Markets    Trading markets      52

   9D Selling shareholders    Not applicable      -

   9E Dilution    Not applicable      -

   9F Expenses of the issue    Not applicable      -
10    ADDITIONAL INFORMATION



   10A Shareholders’ equity    Bylaws      52

   10B Memorandum and articles of association    Bylaws      52

   10C Material contracts    Information on the Company      9



   Results of operations      26



   Related party transactions      51



   Regulation      71

   10D Exchange controls    Additional information      87

   10E Taxation    Taxation of shares and ADSs      54

   10F Dividends and paying agents    Not applicable      -

   10G Statement by experts    Not applicable      -

   10H Documents on display    Additional information      87

   10I Subsidiary information    Not applicable      -
11    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK    Risk management      35



   Note 2 a)—Basis of Preparation of the Consolidated Financial Statements and Summary of Significant Accounting Policies and Practices      F-8
12    DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES



   12A Debt securities    Not applicable      -

   12B Warrants and rights    Not applicable      -

   12C Other securities    Not applicable      -

   12D American Depositary Shares    Bylaws      52
13    DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES    Not applicable      -
14    MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS    Not applicable      -
15    CONTROLS AND PROCEDURES    Controls and procedures      66
16A    AUDIT COMMITTEE FINANCIAL EXPERT    Management      60
16B    CODE OF ETHICS    Code of ethics      69
16C    PRINCIPAL ACCOUNTANT FEES AND SERVICES    Principal accountant fees and services      87
16D    EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES    Not applicable      -
16E    PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS    Purchases of equity securities by the issuer and affiliated purchasers      53
16F    CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT    Not applicable      -
16G    CORPORATE GOVERNANCE    Corporate governance      64
16H    MINE SAFETY DISCLOSURE    Not applicable      -
17    FINANCIAL STATEMENTS    Not applicable      -
18    FINANCIAL STATEMENTS    Consolidated Financial statements      F-1
19    EXHIBITS    Additional Information      87
92

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

Dated: April 28, 2021

AMÉRICA MÓVIL, S.A.B. DE C.V.



By:		/s/ Carlos José García Moreno Elizondo
Name:		Carlos José García Moreno Elizondo
Title:		Chief Financial Officer


By:		/s/ Alejandro Cantú Jiménez
Name:		Alejandro Cantú Jiménez
Title:		General Counsel

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Financial Statements

Years Ended December 31, 2018, 2019 and 2020

with Report of Independent Registered Public Accounting Firm

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Financial Statements

Years Ended December 31, 2018, 2019 and 2020

Contents:


Report of Independent Registered Public Accounting Firm			F-2

Audited Consolidated Financial Statements:

Consolidated Statements of Financial Position			F-7

Consolidated Statements of Comprehensive Income			F-8

Consolidated Statements of Changes in Shareholders’ Equity			F-9

Consolidated Statements of Cash Flows			F-11

Notes to Consolidated Financial Statements			F-12

AMX Audit Opinion 2020

To the Board of Directors and Shareholders of

América Móvil, S.A.B. de C.V.

Opinion on the Financial Statements

We have audited the accompanying consolidated statements of financial position of América Móvil, S.A.B. de C.V. and its subsidiaries (the Company) as of December 31, 2020 and 2019, the related consolidated statements of comprehensive income, changes in shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2020, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2020 and 2019, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with International Financial Reporting Standards, as issued by the International Accounting Standards Board.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated April 28, 2021 expressed an unqualified opinion thereon.

Change in accounting policy for certain class of assets (Towers)

As discussed in Note 2, item a), i) to the consolidated financial statements, effective December 31, 2020, the Company changed prospectively its method of accounting for its towers using the revaluation model permitted by IAS 16 “Property, Plant and Equipment”. As explained below, auditing this change in accounting policy was a Critical Audit Matter.

~~Basis for Opinion~~Substantial Market Power Investigations

~~The Company´s management is responsible for maintaining effective internal control over financial reporting~~In 2007, the Federal Antitrust Commission (Comisión Federal de CompetenciaEconómica, or “Cofeco”) initiated two substantial market power investigations against Telcel and ~~for its assessment of the effectiveness of internal control over financial reporting included~~determined that Telcel had substantial market power in the ~~accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility~~mobile termination services market and in the nationwide

wireless voice and data services market. Telcel filed challenges against both decisions, and a final resolution of these challenges is still pending. If upheld, these decisions would allow the IFT to ~~express an opinion on~~impose additional requirements as to rates, quality of service and information, among other matters. The Preponderance regime has regulated all of these matters.

In 2007, Cofeco initiated various investigations to evaluate whether Telmex and its subsidiary Telnor have substantial power in the ~~Company´s internal control over financial reporting based on our audit. We are a public accounting firm registered with~~markets for termination, origination, transit and wholesale dedicated-link circuits. Cofeco issued final resolutions concluding that Telmex and Telnor have substantial power in all four markets, which were challenged by Telmex and Telnor. The challenges related to each one of these markets have been denied, effectively upholding Cofeco’s findings. Consequently, the ~~PCAOB and are required to be independent~~IFT may impose specific tariff requirements or other special regulations with respect to the ~~Company in accordance with~~matters for which the ~~U.S. federal securities laws and~~challenges were denied, such as additional requirements regarding disclosure of information or quality of service. The Preponderance regime has regulated all of these matters.

In the ~~applicable rules and regulations~~case of the ~~Securities~~market for wholesale dedicated-link leasing, the IFT’s predecessor, Cofetel, published an agreement in the Official Gazette, establishing requirements regarding tariffs, quality of service and ~~Exchange Commission~~information for dedicated-link circuits. Telmex and Telnor have filed petitions for relief against such resolutions, which are still pending. The regulation that could arise from these investigations has been already implemented by the ~~PCAOB.~~

~~We conducted our audit in accordance with~~IFT through the ~~standards~~special regulatory regime for preponderant agents. However, given the uncertainty of the ~~PCAOB. Those standards require that~~IFT’s actions, we ~~plan~~are not able to identify all possible consequences and ~~perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.~~

~~Our audit included obtaining~~as a result an ~~understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based~~adverse resolution could have an impact on the ~~assessed risk, and performing~~Company’s future revenues in this market.

Concessions

Under the current legal framework, a carrier of public telecommunications networks, such ~~other procedures~~ as ~~we considered necessary in the circumstances. We believe~~Telcel or Telmex, must operate under a concession. The IFT is an autonomous federal agency that ~~our audit provides~~grants new or extends existing concessions, which may only be granted to a ~~reasonable basis for our opinion.~~

~~Definitions and Limitations of Internal Control over Financial Reporting~~

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and proceduresMexican citizen or corporation that ~~(1) pertain~~has agreed to the ~~maintenance of records that, in reasonable detail, accurately~~concession terms and ~~fairly reflect~~may not be transferred or assigned without the ~~transactions and dispositions~~approval of the ~~assets~~IFT. There are three types of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

~~/s/ MANCERA, S.C.~~

~~Mexico City, Mexico~~

~~April 11, 2019~~

~~(D) CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING.~~

There has been no change in our internal control over financial reporting during 2018 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

~~CODE OF ETHICS~~

~~The full text of our Code of Ethics may be found on our website at www.americamovil.com.~~concessions:

•

~~CORPORATE SUSTAINABILITY REPORT~~ NETWORK CONCESSIONS.

Telcel, Telmex and its subsidiary Telnor hold network concessions, granted under the previous regulatory framework, to provide specified types of services. Their ability to migrate to the new regime of unified concessions and, consequently, to provide any and all telecommunications and broadcasting services, is subject to conditions, as described under “Migration of Concessions and Additional Services” below.

~~We have a corporate sustainability committee that seeks to foster greater operational efficiencies, promote social responsibility and adopt environmentally friendly initiatives.~~

~~Our corporate sustainability reports are available on our website at www.americamovil.com.~~74

~~PART VI REGULATION~~

•

~~REGULATION~~ SPECTRUM CONCESSIONS.

Telcel holds multiple concessions, granted under both the previous and current regulatory frameworks, to provide wireless services that utilize frequencies of radio-electric spectrum. These concessions have terms of 15 to 20 years and may be extended for an additional term of equal length.

•

~~MEXICO~~Termination of Concessions

Mexican legislation provides that under certain circumstances, some assets of a concessionaire may be acquired by the federal government upon termination of these concessions.

~~Legal Framework~~Migration of Concessions and Additional Services

~~Over~~The new legislative framework established the ~~last five years, a new legal framework for~~unified concession (concesión única), which allows the ~~regulation~~holder to provide all types of telecommunications and broadcasting services, and a regime under which an existing concession can be migrated to the new unified concession at the end of its term or upon request by the concession holder. A unified concession has ~~been developed~~a term of up to 30 years, extendable for up to an equal term. Also, under this new framework a current concession may be modified to add services not previously contemplated therein.

However, as a result of our preponderant economic agent status, Telcel, Telmex and Telnor are subject to additional conditions for the migration to a unified concession or the addition of a service, such as Pay TV, to a current concession, including in ~~Mexico. This legal framework is based on~~certain cases (i) payment of any new concession fee to be determined by the IFT, (ii) compliance with current requirements under the network concession, the 2013 constitutional amendments, ~~passed~~the 2014 legislation and any additional measures imposed by the IFT on the preponderant economic agent and (iii) such other requirements, terms and conditions as the IFT may establish in ~~June 2013,~~ the concession itself. We expect the process of migration or additional services to be lengthy and complex. Consequently, Telcel, Telmex and Telnor may not be able to provide certain additional services, such as Pay TV and broadcasting, in the near term.

Telcel’s Concessions



FREQUENCY	COVERAGE AREA	INITIAL DATE	TERMINATION DATE

Band A (1900 MHz)	Nationwide	Sep. 1999	Oct. 2039
Band D (1900 MHz)	Nationwide	Oct. 1998	Oct. 2038
Band B (850 MHz)	Regions 1, 2, 3	Aug. 2011	Aug. 2026
Band B (850 MHz)	Regions 4, 5	Aug. 2010	Aug. 2025
Band B (850 MHz)	Regions 6, 7, 8	Oct. 2011	Oct. 2026
Band B (850 MHz)	Region 9	Oct. 2015	Oct. 2030
Band F (1900 MHz)	Nationwide	Apr. 2005	Apr. 2025⁽¹⁾
Bands A and B (1.7/2.1 GHz)	Nationwide	Oct. 2010	Oct. 2030
Bands H, I and J (1.7/2.1 GHz)	Nationwide	May 2016	Oct. 2030
Band 7 (2.5 GHz)	88% of the population	Jul. 2017	Sep. 2020⁽¹⁾ – Nov. 2028 – Oct. 2040 – May 2041
Band 3.5 GHz⁽²⁾	Nationwide	Oct. 2020⁽³⁾	Oct. 2038 and 2040

(1)

A request for extension has already been filed with the IFT.

(2)

On December 18, 2020, Telcel filed a formal request with the IFT to include mobile service in these concessions.

(3)

Concession Fees

All of Telcel’s concessions granted or renewed on or after January 1, 2003 are required to pay annual fees for the use and exploitation of radio spectrum bands. The amounts payable are set forth by the annual Federal Fees Law ~~on Telecommunications and Broadcasting~~((Ley Federal de ~~Telecomunicaciones y Radiodifusión~~Derechos) ~~enacted~~and vary depending on the relevant region and radio spectrum band.

Telmex’s Concessions

Telmex’s concession was granted in ~~July~~1976 and is currently set to expire in 2026. In December 2016, the IFT granted Telmex a 30-year extension of this concession, which will become effective in 2026 and will be valid until 2056. The new terms of this concession will be issued in early 2023.

In addition, Telmex currently holds concessions for the use of frequencies to provide point-to-point and point-to-multipoint transmission in 10.5, 15 and 23 GHz bands.

Rates for Wireless Service

As a result of the preponderance determination, Telcel’s retail prices are subject to pre-approval by the IFT before they can take effect.

The IFT is also authorized to impose specific rate requirements on any carrier that is determined by the IFT to have substantial market power under the Federal Antitrust Law ~~on Economic Competition~~ (Ley Federal de Competencia Económica) ~~enacted~~and the 2014 legislation. For more information on litigation related to the Federal Antitrust Law and the 2014 legislation, see “—Substantial Market Power Investigations” under this Part VI.

Rates for Fixed Service

Telmex’s concessions subject its rates for basic retail telephone services in ~~May 2014.~~

~~Under~~any period, including installation, monthly rent, measured local-service and long-distance service, to a ceiling on the ~~current legal framework,~~price of a “basket” of such services, weighted to reflect the volume of each service provided by Telmex during the preceding period. Telmex is required to file a survey with the IFT ~~may~~every four years with its projections of

units of operation for basic services, costs and prices. Telmex is free to determine ~~whether there is~~the structure of its own rates, with the exception of domestic long-distance rates, which were eliminated in 2015 under the 2014 legislation, and of the residential fixed-line rates, which have a ~~“preponderant economic agent” in~~cap based on the long-run average incremental cost. As a result of the preponderance determination, Telmex’s retail prices are subject to pre-approval by the IFT before they can take effect.

The price ceiling varies directly with the Mexican National Consumer Price Index (Indice Nacional de Precios al Consumidor), allowing Telmex to raise nominal rates to keep pace with inflation (minus a productivity factor set for the telecommunications ~~sector, based~~industry), subject to consultation with the IFT. Telmex has not raised its nominal rates for many years. Under Telmex’s concession, the price ceiling is also adjusted downward periodically to pass on ~~number~~the benefits of ~~customers, traffic or network capacity.~~ Telmex’s increased productivity to its customers. The IFT sets a periodic adjustment for every four-year period to permit Telmex to maintain an internal rate of return equal to its weighted average cost of capital.

In ~~2014, the IFT determined that an “economic interest group” consisting of us and our Mexican operating subsidiaries (Telcel, Telmex and~~~~Teléfonos del Noroeste, S.A. de C.V.~~ ~~(“Telnor”)),~~addition, basic retail telephone services, as well as ~~Grupo Carso~~broadband services and ~~Grupo Financiero Inbursa, constitutes the “preponderant economic agent” in the telecommunications sector,~~“calling party pays” charges, are subject to a separate price ceiling structure based on productivity indicators. In each case, Telmex is required to submit a ~~finding~~survey on productivity indicators to the IFT every two years, including a total factor productivity. The IFT establishes the productivity factor that ~~we serve more than half of~~will apply over the ~~customers in Mexico, as measured~~next two years, and, based on this, the IFT will approve the customer prices before they can take effect.

Prices for Telmex’s wholesale services are established by the IFT based on ~~a national basis.~~

BRAZIL

Legal Framework and Principal Regulatory Authorities

The ~~IFT~~Brazilian Telecommunications Law (Lei Geral das Telecomunicações Brasileiras) provides the framework for telecommunications regulation. The primary telecommunications regulator in Brazil is ~~an autonomous~~the Telecommunications Agency (Agência Nacional de Telecomunicações, or “Anatel”), which has the authority to grant concessions and licenses in connection with telecommunications services and the use of orbits, except broadcasting, and to adopt regulations that ~~regulates~~are legally binding on telecommunications ~~and broadcasting. It is headed by seven commissioners appointed by the President, and ratified by the Senate, from among candidates nominated by an evaluation committee. The IFT has authority over the~~

application of legislation specific to the telecommunications and broadcasting sectors, and also over competition legislation as it applies to those sectors. The Mexican Ministry of Communications and Transportation (~~Secretaría de Comunicaciones y Transportes~~~~) retains regulatory authority over a few specific public policy matters.~~services providers.

The ~~Mexican government~~Brazilian Congress has approved an updated legislation to modernize the current concession-based model to an authorization-based model. The updated law brings the possibility of allowing fixed-line concessionaires, such as

Claro Brasil, to provide services under an authorization rather than a concession, as long as certain ~~powers in its relations with concessionaires, including~~investment-related obligations are met. Under the ~~right~~new legislation, it is possible to ~~take over~~extend the ~~management of an operator’s networks, facilities and personnel in cases of imminent danger to national security, public order or the national economy, natural disasters and public unrest,~~current concessions, as well as ~~to ensure continuity~~radio frequency licenses and orbital positions, for more than one period. The legislation also permits the possibility of ~~public services.~~

~~Telecommunications operators are also subject to regulation~~a secondary market for trading cellphone frequencies. The legislation will be implemented by ~~the Federal Consumer Bureau (~~~~Procuraduría Federal del Consumidor~~~~) under the Federal Consumer Protection Law (~~~~Ley Federal de Protección al Consumido~~~~r), which regulates publicity, quality of services and information required to be provided to consumers.~~

~~Asymmetric Regulation of the Preponderant Economic Agent~~

regulations promulgated by Anatel. We are currently evaluating the potential impact of this legislation on our operations.

Licenses

In 2019, the subsidiary Primesys was merged into Claro Brasil. As a result, service authorizations granted to Primesys were transferred under the same terms and conditions to Claro Brasil.

Our Brazilian subsidiaries hold licenses for the telecommunications services listed below and expect to continue acquiring spectrum if Anatel conducts additional

public auctions, although Claro Brazil, like all of its peer competitors, is subject to ~~extensive specific asymmetric measures based~~a cap on the ~~IFT’s determination~~additional spectrum it may acquire per frequency band.



SUBSIDIARY	LICENSE	TERMINATION DATE

Claro Brasil	Fixed Local Voice Services	Indefinite

	Domestic and International Long-Distance	2025
	Domestic and International Long-Distance	2025

	Voice Services	Indefinite

	Personal Communication Services	Indefinite

	Data Services	Indefinite

	Cable TV Services	Indefinite

	Mobile Maritime Services	Indefinite

	Global Mobile Satellite Services	Indefinite

Claro TV	DTH TV Services	Indefinite

	Data Services	Indefinite

Americel S.A.	Data Services	Indefinite

Telmex do Brasil	Data Services	Indefinite

Nextel Brazil	Personal Communication Services	Indefinite

	Domestic and International Long-Distance	Indefinite
	Domestic and International Long-Distance	Indefinite

	Data Services	Indefinite

Nextel Brazil has radio frequency licenses to provide PCS, which expire between 2026 and 2031.

Concessions

Concession Fees

Termination of Concessions

Our domestic and international long-distance fixed-line concessions provide that ~~we,~~certain of our ~~Mexican operating subsidiaries (Telcel, Telmex~~assets deemed “indispensable” for the provision of these services will revert to the Brazilian state upon termination of these concessions. Compensation for those assets would be their depreciated cost. See Note 17 to our audited consolidated financial statements included in this annual report.

Regulation of Rates

Anatel regulates rates (tariffs and ~~Telnor)~~prices) for all telecommunications services, except for fixed-line broadband services, Pay TV and ~~certain affiliates constitute~~satellite capacity rates, which are not regulated. In general, PCS license holders and fixed local voice services license-holders are authorized to increase basic plan rates annually. Domestic long-distance concession-holders may adjust rates annually only for inflation, provided that they give Anatel and the ~~preponderant economic agent~~public advanced notice of such adjustments. Claro Brasil may set international long-distance and mobile rates freely, provided that it gives Anatel and the public advance notice.

Regulation of Wholesale Market Competition

In November 2012, Anatel approved the General Competition Plan (Plano Geral de Metas da Competição, or “PGMC”), a comprehensive regulatory framework aimed at increasing competition in the telecommunications sector. ~~Below~~The PGMC imposes asymmetric measures upon economic groups determined by Anatel to have significant market power in any of the five wholesale markets in the telecommunications sector, on the basis of several criteria, including having over 20.0% of market share in the applicable market.

In 2018, Anatel approved Claro Brasil’s most recent wholesale reference offers with respect to national roaming, telecommunications duct infrastructure, long-distance leased lines, high capacity transport above 34 Mbps, wireless networks interconnection, fixed network interconnection, internet network interconnection and internet links, which are reviewed and approved by Anatel on an annual basis. Anatel also reviews its determination of which operators have significant market power on a ~~summary~~quadrennial basis. Anatel began its first review of ~~what we believe are~~all telecom operators in 2014 and published the most ~~important measures.~~recent list of operators with significant market power for each of the relevant markets in 2018. In addition to the review, in 2018 Anatel changed some of the asymmetric measures applicable under the PGMC and added two new wholesale markets covering high capacity transport and fixed network interconnection. Anatel has determined that Claro Brasil has significant market power in eight wholesale markets.

Network Usage Fees and Fixed-Line Interconnection Rates

•

~~INTERCONNECTION RATES.~~The Federal Law on Telecommunications and Broadcasting provides that we are not permitted to charge other carriers for the termination services we provide in our networks. These provisions were declared unconstitution by the Mexican Supreme Court (~~Suprema Corte de Justicia de la Nación~~) in August 2017 with respect to wireless services and in April 2018 with respect to fixed services. As a result, the IFT ruled that, as of January 1, 2018, in the case of Telcel, and as of January 1, 2019, in the case of Telmex, we are able to charge other carriers for terminating calls to our networks at asymmetric rates established by the IFT. We continue to pay such carriers for their interconnection services in accordance with the fixed and mobile rates set by the IFT.

In December 2018, Anatel published reference values for fees network that are applicable from 2020 to 2023.

Fixed-line operators determined by Anatel to have significant market power in the local fixed-line market may freely negotiate interconnection rates, subject to a price cap established by Anatel.

Other Obligations

CADE Anti-Competition Proceeding

9278

COLOMBIA
Legal Framework and Principal Regulatory Authorities
The Information and Communications Ministry (Ministerio de Tecnologías de la Información y las Comunicaciones, or “ICT Ministry”) and the Communications Regulatory Commission
(Comisión de Regulación de Comunicaciones, or “CRC”) are responsible for overseeing and regulating the telecommunications sector. The main audiovisual regulatory authorities in Colombia with respect to Pay TV services are the CRC, the ICT Ministry and the Industry and Commerce Superintendence (Superintendencia de Industria y Comercio, or “SIC”). Claro is also subject to supervision by other government entities responsible for enforcing other regulations, such as antitrust rules or those protecting consumer rights.
Concessions
Comunicación Celular S.A. (“Comcel”) is qualified to provide fixed and mobile services and was included in the registry of networks and services administered by the ICT Ministry. Such general authorization superseded all of Comcel’s former concession contracts, and, consequently, such former concessions were terminated.
As a result of the termination of Comcel’s former concessions, the ICT Ministry and Comcel began discussions with respect to the liquidation of the agreements governing those concessions. In light of the decision of the Colombian Constitutional Court (Corte Constitucional de Colombia) holding that certain laws limiting the reversion of assets of telecommunications providers did not apply to concessions granted prior to 1998 and, consequently, that reversion of assets under those earlier concessions would be governed by their contractual terms, the ICT Ministry obtained a domestic award ordering Comcel to revert assets under its earlier

concessions to the Colombian government. Comcel challenged such award and the Company filed an international arbitration claim against Colombia arising from Colombia’s measures.

Licenses and Permits

Comcel holds licenses to provide mobile services in the spectrum frequency bands shown in the table below.



FREQUENCY	BANDWIDTH	TERMINATION DATE

850 MHz	25 MHz	Mar. 2024

1900 MHz	10 MHz	Dec. 2039

	5 MHz	Sept. 2021

	15 MHz	Apr. 2024

2.5 GHz	30 MHz	Aug. 2023

	10 MHz	Feb. 2021⁽¹⁾

	10 MHz	Mar. 2040

	10 MHz	Mar. 2040

	10 MHz	Mar. 2040

700 MHz	20 MHz	May 2040

(1)

Refers to a temporary license, which we renew on an annual basis.

•

~~SHARING OF WIRELESS INFRASTRUCTURE AND SERVICES.~~We must provide other carriers access to (i) passive infrastructure, including towers, sites, ducts and rights of way, (ii) elements of our network that allow other carriers and mobile virtual network operators (“MVNOs”) to use our network or resell those services we provide to our customers and (iii) domestic roaming services, in each case, pursuant to IFT~~pre-approved~~ ~~reference terms (~~~~ofertas públicas de referencia~~~~). If we cannot reach an agreement with other carriers or MVNOs, our rates may be determined~~

Asymmetric Charges

In 2017, the CRC issued a resolution updating the list of relevant telecommunication markets by adding the ~~IFT using along-run~~ ~~average incremental costs methodology or, in the case of MVNOs, a “retail-minus” methodology.~~

~~For~~ mobile services market (including bundled mobile voice and data services) and by also including the ~~IFT~~mobile service market in the list of relevant markets subject to ex-ante regulation. In connection with the mobile services market, on January 28, 2021, the CRC determined that COMCEL has a dominant position in the relevant mobile services market, but did not impose particular measures. COMCEL considers that the CRC did not take into account important elements in its determination, which COMCEL has challenged. A resolution is pending.

SOUTHERN CONE

ARGENTINA

The National Communications Agency (Ente Nacional de Comunicaciones, or “Enacom”) is the main telecommunications regulatory authority in Argentina and became operational in 2016.

AMX Argentina holds licenses in the 700 MHz, 900 MHz, 1700/2100 MHz (AWS), 1900 MHz and 2600 MHz frequency bands, some of which expire in 15 years and some of which

All telecommunications providers in Argentina must contribute approximately 1.0% of their monthly revenues to ~~verify, through a replicability test, that mobile virtual network operators can match our end user rates.~~

~~SHARING OF FIXED INFRASTRUCTURE AND SERVICES.~~We must provide other carriers access to (i) passive infrastructure, including towers, sites, ducts and rights of way, (ii) elements of our network that allow other carriers to use our network or resell those services we provide to our customers and (iii) our dedicated links. If we cannot reach an agreement with other carriers, our rates may be determined by the IFT using a~~long-run~~ ~~average incremental cost methodology.~~

~~For fixed services, the IFT has the right to verify, through a replicability test, that other competitors can match our end user rates.~~

•

~~ACCESS TO LOCAL LOOP.~~~~We must offer other carriers access to elements of our local network separately on terms and conditions (including rates)pre-approved~~ ~~by the IFT. The IFT has also ordered the legal and functional separation of the provision of wholesale regulated fixed services related to local loop (~~~~acceso local~~~~) and shared access and use of passive infrastructure. See “Functional Separation of Telmex and Telnor Wholesale Services” under this Part VI.~~

~~CERTAIN OBLIGATIONS RELATING TO RETAIL SERVICES.~~~~Rates for~~finance the provision of telecommunications services in underserved areas and to ~~our customers are subject to~~underserved persons. All providers must also meet certain quality-of-service requirements.
In 2020, the ~~IFT’s prior authorization.~~

~~We are also subject to certain obligations~~government of Argentina issued a decree by which it declared information and ~~restrictions relating to the sale of our~~communications technology (ICT) services and ~~products; such obligations include unlocking mobile devices~~access to telecommunications networks, for ~~our customers~~ and ~~offering individually all~~between licensees of ICT services, as essential and strategic public services in competition. It also established that ~~we previously offered under a bundled plan.~~Enacom is the competent authority to approve prices for ICT services and to establish regulations to that effect.

CHILE

•

~~CONTENT.~~~~We are subject to specific limitations on acquisitions of exclusive transmission rights to “relevant” content (~~~~contenidos audiovisuales relevantes~~), as determined from time to time by the IFT, including the Mexican national team soccer matches, the opening and closing ceremonies and certain matches of the FIFA World Cup, the semifinal and final matches of the Liga MX soccer tournament and the Super Bowl.

~~PUBLICATION OF REFERENCE TERMS.~~~~We are subject to obligations related to the publication of reference terms for all wholesale and interconnection services that are subject to asymmetric regulation.~~

The ~~measures are transitory~~General Telecommunications Law (Ley General de Telecomunicaciones) establishes the legal framework for telecommunications services in Chile, including the regulation of concessions, permits, rates and ~~may be amended or eliminated by the IFT, or terminated if it determines effective competition conditions exist in~~interconnection. The main regulatory agency of the telecommunications sector is the Chilean Transportation and Communications Ministry (Ministerio de Transportes y Telecomunicaciones), which acts primarily through the Undersecretary of Telecommunications (Subsecretaría de Telecomunicaciones, “SUBTEL”).

Claro Chile also holds license to provide DTH technology services until 2024 and a license with an indefinite term to provide Pay TV services. In 2018, the Chilean Supreme Court (Corte Suprema de Justicia) issued a ruling requiring Claro to return 20 MHz of spectrum acquired through a band auction because Claro supposedly exceeded the limit of spectrum any given operator is permitted to hold. The return of such spectrum is currently being implemented before the Competition Court (Tribunal de Defensa de la Libre Competencia,or ~~if we cease~~the “TDLC”). In addition, pursuant to ~~be considered~~the ruling, and in order to increase the maximum limit, SUBTEL initiated a ~~preponderant economic agent.~~review of such limit of spectrum through a regulatory proceeding. In 2020, the Chilean Supreme Court defined a higher cap for spectrum acquisitions by operators in low, medium low, medium and high frequency bands. This

new cap allows Claro Chile to participate in the current spectrum auctions.

Some of Claro Chile’s concessions impose additional requirements, such as coverage, reporting and service quality requirements. The ~~IFT reviews~~Chilean Transportation and Communications Ministry is authorized to terminate any concession in the ~~impact~~event of specified breaches under the terms of such concessions. Additionally, Claro Chile’s concession in the 700 MHz band imposes certain obligations to expand mobile and data services in rural areas. In 2017, the Undersecretary of Telecommunication approved Claro Chile’s expansion project in connection with its obligations under its concession in the 700 MHz band.

PARAGUAY

The National Telecommunications Commission of Paraguay (Comisión Nacional de Telecomunicaciones de Paraguay) is in charge of supervising the telecommunications industry in Paraguay. It is authorized to cancel licenses in the event of specified breaches of the ~~asymmetrical measures every two years and may modify or eliminate measures or set forth new measures. In March 2017, the IFT issued~~terms of a resolution that modified and added asymmetrical regulations for mobile and fixed services, including the legal and functional separation of Telmex and Telnor wholesale services, among other measures. The IFT will begin a new reviewlicense.

AMX Paraguay, S.A. (“AMX Paraguay”) holds licenses to operate in the ~~first quarter~~1900 MHz and the 1700/2100 MHz bands. The 1700/2100 MHz band is in the process of ~~2019, which~~being renewed and is expected to be ~~completed~~renewed in February 2021. AMX Paraguay also holds a nationwide internet access and data transmission license. In addition, AMX Paraguay holds licenses to provide DTH services and cable TV services. The DTH License is in the ~~first quarter~~process of ~~2020.~~ being renewed for another 5 years (until 2025). Additionally, in January 2018, AMX Paraguay participated in a spectrum auction and was awarded a license to provide telecommunications services in the 700 MHz band. In November 2018, the Telecommunications Commission of Paraguay granted the renewal of spectrum license in the 1900 MHz band. These licenses are renewable, subject to regulatory approval, and contain coverage, reporting and service requirements.

URUGUAY

The ~~new review may result~~Regulatory Unit of Communications Services (Unidad Reguladora de Servicios de Comunicaciones) is in ~~changes, which could include additional or reduced asymmetric regulations or the structural separation or divesture of assets~~charge of the ~~preponderant economic agent.~~regulation of the telecommunications industry in Uruguay.

~~We have challenged the determination that we are a preponderant economic agent and the asymmetric regulations in court. These challenges were denied~~AM Wireless Uruguay, S.A. holds licenses to operate in the ~~case of Telmex, Telnor~~1900 MHz, 1700/2100 MHz and ~~the Company,~~700 MHz frequency bands that expire in 2024, 2033, 2037, 2039 and 2045. Additionally, AM Wireless Uruguay S.A. holds an authorization to do a ~~final resolution is still pending~~trial for 5G in the ~~case of Telcel. However, IFT’s determinations are not suspended while legal challenges against them are resolved.~~26, 50 GHz – 26, 85 GHz frequency band that expires on July 2021. Telstar S.A. holds licenses to provide

~~REGULATION~~

~~Functional Separation of Telmex~~international long-distance communications and ~~Telnor Wholesale Services~~

~~In March 2018, we received notice of an IFT resolution directed to the Company setting forth the terms under which we are required to separate the provision of wholesale regulated fixed~~international and national data services ~~by Telmex and Telnor (the “Separation Plan”).~~that have no expiration date.

The ~~Separation Plan establishes, among other provisions, the following:~~

~~WHOLESALE UNIT.~~~~Telmex and Telnor must establish a business unit~~license initially granted to ~~provide certain wholesale services to other concessionaires, including interconnection,co-~~ location for interconnection, intercity and international long-distance dedicated links, resale of telephone lines, broadband and bundles, as well as certain passive infrastructure services, including shared use of towers.

~~NEW COMPANIES.~~~~Telmex and Telnor are required to establish separate new corporations (the “New Companies”~~Flimay S.A. (“Flimay”) to provide ~~wholesale~~DTH technology services related to the elements of the access network, including local access dedicated links, as well as those services related to passive infrastructure associated with the access network, such as ducts, poles and rights of way. The New Companies will be direct subsidiaries of Telmex. The main features of the New Companies are as follows:

~~Financial Viability.~~The Separation Plan contemplates that the New Companies will be financially viable. The implementation and consequences of this requirement are uncertain, both with respect to the initial composition of the New Companies’ assets and resources and with respect to their subsequent operations. The prices and terms of the services to be provided are generally subject to IFT regulation, which could affect the viability and financial requirements of the New Companies.

~~Corporate Governance.~~The New Companies will have their own corporate governance, including: (i) a board of directors with at least seven members, of which a majority (including the Chairman) must be independent; (ii) a Chief Executive Officer and senior officers appointedin Uruguay has been contested by the ~~boards~~government since 2012. In 2017, the executive branch of directors, different and independent from those of our Mexican concessionaire subsidiaries; (iii) an independent external auditor; (iv) an Audit Committee chaired by an independent member of the board of

~~directors; and (v)~~Uruguay held under a Regulatory Compliance Committee entirely composed of independent members. The bylaws of the New Companies must be previously approved by the IFT. Independence for these purposes is used as defined under Mexican Securities Market Law.

~~Personnel.The New Companies must~~new ruling that Flimay does not have ~~the personnel necessary to operate their assets and~~a valid license to provide ~~wholesale~~DTH services ~~required by~~in the ~~Separation Plan.~~

~~Systems and Procedures.The New Companies must have procedures, operating and management systems that are independent~~country. Flimay requested this ruling be voided, but in February 2018, the executive branch of Uruguay, with support from ~~those Telmex and Telnor.~~

~~Branding.The New Companies must have their own branding distinct from América Móvil’s concessionaire subsidiaries. The brands must~~the Administrative Court (TCA), requested the process be ~~dissociated from those of Telmex and Telnor within four years.~~

~~Principal Offices.The New Companies must have their own principal offices distinct from those of América Móvil’s concessionaire subsidiaries.~~

~~We have until March of 2020 to implement the Separation Plan.~~closed. As of the date of this annual report, ~~Telmex~~a decision on Flimay’s appeal is pending.

ANDEAN REGION

ECUADOR

The primary regulatory authorities for our mobile and ~~Telnor~~fixed-line operations are the National Telecommunications, Regulation and Control Agency (Agencia de Regulación y Control de las Telecomunicaciones, or “Arcotel”) and the Telecommunications and Information Society Ministry (Ministerio de Telecomunicaciones y Sociedad de la Información, or “Mintel”). Arcotel is responsible for the licensing and oversight of radio-electric spectrum use and telecommunications services provisions. Mintel is responsible for the promotion of equal access to telecommunications services.

The Telecommunications Law (Ley Orgánica de Telecomunicaciones), adopted in 2015, serves as the legal framework for telecommunications services. It established regulations for operators with significant market power and penalties based on their gross incomes as well as additional fees also based on an operator’s gross income, but that can vary depending on the size of their market share. Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) has been deemed to have ~~complied with all milestones~~significant market power in the advanced wireless services market, and as a result, such fee payments are made on a quarterly basis on the dates established by Arcotel.

Conecel paid to the Ecuadorian government U.S. $26.1 million, which corresponds to 3.0% of its wireless services revenues generated in the 2020. An arbitration proceeding to partially void the payment by Conecel of such fees was conducted and a decision in favor of the ~~implementation plan approved~~government was reached. Conecel has appealed this decision and, as of the date of this annual report, a decision of the Constitutional Court is pending.

Conecel also holds licenses to provide internet value-added services, Pay TV Services (through DTH technology) and bearer services, expiring in 2021, 2023 and 2032, respectively.

Recalculation of Concession Fees

In 2018, Conecel paid Arcotel U.S.$11.9 million based on its annual revenues for the 2015 period and was required to pay U.S.$13 million based on its annual revenues for the 2016 period.

On January 15, 2021, the Provincial Court of Justice accepted the request to nullify the resolution issued by the ~~IFT.~~ arbitration court, thereby declaring it null. However, the annulment of the resolution has not ended the dispute with Arcotel. A new arbitration court must issue a new resolution. At the same time Conecel will enforce its rights by presenting an Extraordinary Action for Protection before the Constitutional Court for the violation of its rights.

PERU

The ~~implementation~~Supervisory Agency for Private Investment in Telecommunication (Organismo Supervisor de la Inversión Privada en Telecomunicaciones, or “OSIPTEL”) is in charge of the regulation of the telecommunications industry in Peru. The Ministry of Transport and Communications (Ministerio de Transportes y Comunicaciones or “MTC”) grants concessions, permits and licenses. The Telecommunications Law (Decreto Supremo N° 013-93-TCC Ley de Telecomunicaciones), adopted in 1993, serves as the legal framework for telecommunications services.

EUROPE AND OTHER JURISDICTIONS

European Legal Framework and Principal Regulatory Authorities

In each European country in which we operate, we are also subject to a domestic telecommunications regulatory framework and to oversight by one or more local regulators.

Licenses



COUNTRY	FREQUENCY	TERMINATION DATE

AUSTRIA	800 MHz	Dec. 2029

	900 MHz	Dec. 2034

	1500 Mhz	Dec. 2044

	1800 MHz	Dec. 2034

	2100 MHz	Dec. 2044

	2600 MHz	Dec. 2026

	3500 MHz	Dec 2039

BELARUS	900 MHz	Not applicable

	1800 MHz	Not applicable

	2100 MHz	Not applicable

BULGARIA	900 MHz	June 2024

	1800 MHz	June 2024

	2100 MHz	Apr. 2025

CROATIA	800 MHz	Oct. 2024

	900 MHz	Oct. 2024

	1800 MHz	Oct. 2024

	2100 MHz	Oct. 2024

MACEDONIA	800 MHz	Dec. 2033

	900 MHz	Sept. 2023

	1800 MHz	Dec. 2033

	2100 MHz	Feb. 2028

SERBIA	800 MHz	Jan. 2026

	900 MHz	Nov. 2026

	1800 MHz	Nov. 2026

	2100 MHz	Nov. 2026

SLOVENIA	800 MHz	May 2029

	900 MHz	Jan. 2031

	1800 MHz	Jan. 2031

	2100 MHz	Sept. 2021

	2600 MHz	May 2029

OTHER JURISDICTIONS



COUNTRY	PRINCIPAL REGULATORY AUTHORITIES	CONCESSION AND LICENSES

COSTA RICA	Superintendency of Telecommunications (Superintendencia de Telecomunicaciones) Ministry of Science, Technology and Tele-communications (Ministerio de Ciencia, Tecnología y Telecomunicaciones)	• Concessions in the AWS and 1800 MHz bands that expire in 2032 • Concessions in the 2100 MHz band that expire in 2026 • License to operate Pay TV services using DTH technology that will expire in 2026

EL SALVADOR	Electricity and Telecommunications Super- intendency (Superintendencia General de Electricidad y Telecomunicaciones)	• Concession of 50 MHz in the 1900 MHz band of which 30 MHz that expire in 2038, 10 MHz that expire in 2041 and 10 MHz that expire in 2028 • Concession to provide public telephone service that expires in 2027 • Licenses to provide Pay TV Services through HFC and DTH technologies have an indefinite term • Concession of 40 MHz in 1700/2100 MHz bands (AWS) that will expire in 2040

GUATEMALA	Guatemalan Telecommunications Agency (Superintendencia de Telecomunicaciones)	• Licenses to use 12 MHz in the 900 MHz band and 120 MHz in the 1900 MHz band that all expire in 2033 • Concession of 175 MHz in the 3.5 GHz band that will expire in 2033

NICARAGUA	Nicaraguan Telecommunications and Mailing Institute (Instituto Nicaragüense de Teleco-municaciones y Correos)	• Concessions in the 700 MHz, 850 MHz, 1900 MHz and 1700/2100 MHz bands that all expire in 2042 • Concession of 50 MHz in the 3.5 GHz band that will expire in 2042 • Licenses to provide DTH technology that will expire in January 2028 and Pay TV services that has an indefinite term

HONDURAS	Honduran National Telecommunications Commission (Comisión Nacional de Teleco-municaciones)	• Concessions to use 80 MHz in the 1900 MHz PCS band and 40 MHz in the LTE-4G 1700/2100 MHz band that all expire in 2033 • Licenses to operate Pay TV services through (i) HFC technology that will expire in 2027 and (ii) DTH technology that will expire in 2030

PANAMA	National Authority of Public Services (Auto-ridad Nacional de los Servicios Públicos)	• License to use 40 MHz in the 1900 MHz and 20 MHz in the 700 MHz bands that all expire in 2028 • Licenses to provide fixed local and long-distance services that expire in 2030 • License to provide internet service that expires in 2033 • Licenses to provide international long-distance, value-added services, interactive television, and Pay TV service through DTH and IPTV technologies, which expire in 2028, 2030, 2037 and 2034, respectively • License to provide Pay TV service through optical fiber that expires in 2037 • License for data transportation, Service No. 200, which expires in 2023

UNITED STATES	The FCC	• International Section 214 Authorization (Claro Enterprise Solutions)

DOMINICAN REPUBLIC	Dominican Institute of Telecommunications (Instituto Dominicano de las Telecomunica-ciones)	• Concession to provide fixed and wireless services, internet and pay TV services through DTH and IPTV technologies that expire in 2030 • Licenses to use 25 MHz in the 800 MHz band, 30 MHz in the 1900 MHz band, 80 MHz in the 2.5/2.7 GHz band, 30 MHz in the 3.5 GHz band and 40 MHz in the 1.7/2.1 GHz (AWS) band that expire in 2030

PUERTO RICO	Federal Communications Commission (FCC) and the Telecommunications Bureau of Puerto Rico	• Concessions to use the 700 MHz, 1900 MHz and the 28 GHz bands that expire in 2021, 2027 and 2029, respectively • Concessions to use the 800 MHz bands that expire in 2021, 2026, 2028 and 2030 • Concessions to use the AWS-1 and AWS-3 bands (1.7/2.1 GHz) that expire in 2026 and 2028, respectivel. • Concessions to use the 3.5 GHz band that expires in 2030 • Long-term transfer lease concessions to use 35.6 MHz of the 2.5 GHz band that expire in 2022, 2023, 2025, 2026 and 2030 • Franchise to operate Pay TV services using IPTV technology that expires in 2030

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AUDIT AND NON-AUDIT FEES

The following table sets forth the fees billed to us and our subsidiaries by our independent registered public accounting firm, Mancera, during the fiscal years ended December 31, 2019 and 2020:

AUDIT AND CORPORATE PRACTICES COMMITTEE APPROVAL POLICIES AND PROCEDURES

Our audit and corporate practices committee has established policies and procedures for the engagement of our independent auditors for services.

We file reports, including annual reports on Form 20-F, and other information with the SEC pursuant to the rules and regulations of the SEC that apply to foreign private issuers.

Any fillings we make electronically will be ~~complex,~~available to the public over the internet at the SEC’s web site at www.sec.gov and ~~many features remain uncertain and will require further development in consultation~~at our website at www.americamovil.com. This URL is intended to be an inactive textual reference only. It is not intended to be an active hyperlink to our website. The information on our website, which might be accessible through a hyperlink resulting from this URL, is not incorporated into this annual report.

The following documents have been filed with the ~~IFT. As~~SEC as exhibits to this annual report:



1.1		Amended and Restated Bylaws (estatutos sociales) of América Móvil, S.A.B. de C.V., dated as of April 16, 2018 (together with an English translation) (incorporated by reference to Exhibit 1.1 of our annual report on Form 20-F File No. 001-16269, filed on April 26, 2018).

2.1		Description of Rights of Each Class of Securities

4.1		Stock Purchase Agreement by and among Verizon Communications Inc., América Móvil, S.A.B. de C.V., AMX USA Holding, S.A. de C.V. and Tracfone Wireless, Inc. dated as of September 13, 2020.


8.1		List of certain subsidiaries of América Móvil, S.A.B. de C.V.

12.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

12.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
13.1		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
15.1		Code of Ethics (incorporated by reference to Exhibit 14.1 of our annual report on Form 20-F, File No. 001-16269, filed on April 26, 2018).
15.2		Consent of independent registered public accounting firm.
17.1		Subsidiary Guarantors
101.INS		XBRL Instance Document.
101.SCH		XBRL Taxonomy Extension Schema Document.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB		XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF		XBRL Taxonomy Extension Definition Document.

Examples of forward-looking statements include the following:

projections of our commercial, operating or financial performance, our financing, our capital structure or our other financial items or ratios;

statements of our plans, objectives or goals, including those relating to acquisitions, competition and rates;

statements concerning regulation or regulatory developments;

the impact of COVID-19;

statements about our future economic performance or that of Mexico or other countries in which we operate;

competitive developments in the telecommunications sector;

other factors and trends affecting the telecommunications industry generally and our financial condition in particular; and

statements of assumptions underlying the foregoing statements.

Forward-looking statements speak only as of the date they are made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result weof new information or future events or for any other reason.



ITEM	FORM 20-F CAPTION	LOCATION IN THIS REPORT	PAGE

1	IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS	Not applicable	-

2	OFFER STATISTICS AND EXPECTED TIMETABLE	Not applicable	-

3	KEY INFORMATION

	3A Selected financial data	Selected financial data	6

	3B Capitalization and indebtedness	Not applicable	-

	3C Reasons for the offer and use of proceeds	Not applicable	-

	3D Risk factors	Risk factors	37

4	INFORMATION ON THE COMPANY

	4A History and development of the Company	Information on the Company	9

		Note 10—Property, Plant and Equipment, Net	F-38

		Liquidity and capital resources	32

		Additional Information	87

	4B Business overview	Information on the Company	9

		Regulation	71

	4C Organizational structure	Exhibit 8.1	-

	4D Property, plant and equipment	Information on the Company	9

		Note 10—Property Plant and Equipment, Net	F-38

		Liquidity and capital resources	32

		Regulation	71

4A	Unresolved staff comments	None	-

5*	OPERATING AND FINANCIAL REVIEW AND PROSPECTS

	5A Operating results	Overview	24

		Results of operations	26

		Regulation	71

	5B Liquidity and capital resources	Liquidity and capital resources	32

		Note 14—Debt	F-51

	5C Research and development, patents and licenses, etc.	Not applicable	-

	5D Trend information	Overview	24

		Results of operations	26

	5E Critical Accounting Estimates	Not applicable	-

6	DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

	6A Directors and senior management	Management	60

	6B Compensation	Management	60

	6C Board practices	Management	60

		Management	60

	6D Employees	Employees	88

	6E Share ownership	Major shareholders	50

		Management	60

7	MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

	7A Major shareholders	Major shareholders	50

	7B Related party transactions	Related party transactions	51

	7C Interests of experts and counsel	Not applicable	-

8	FINANCIAL INFORMATION

	8A Consolidated statements and other financial information	Consolidated Financial Statements	F-1

		Dividends	51

		Note 17—Commitments and Contingencies	F-59

	8B Significant changes	Not applicable	-

*América Móvil has elected to apply the SEC rules issued on November 19, 2020 which became effective on February 10, 2021, with respect to Item 5 of this Form 20-F. Registrants, including América Móvil, are ~~not yet able~~required to ~~identify~~comply with the amended rules for their first fiscal year ending on or after April 9, 2021.

The registrant hereby certifies that it meets all ~~the possible consequences, but some~~ of the ~~consequences could have a material adverse impact~~requirements for filing on ~~us.~~Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

Dated: April 28, 2021

AMÉRICA MÓVIL, S.A.B. DE C.V.



By:		/s/ Carlos José García Moreno Elizondo
Name:		Carlos José García Moreno Elizondo
Title:		Chief Financial Officer


By:		/s/ Alejandro Cantú Jiménez
Name:		Alejandro Cantú Jiménez
Title:		General Counsel

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Financial Statements

Years Ended December 31, 2018, 2019 and 2020

with Report of Independent Registered Public Accounting Firm

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Financial Statements

Years Ended December 31, 2018, 2019 and 2020

Contents:


Report of Independent Registered Public Accounting Firm			F-2

Audited Consolidated Financial Statements:

Consolidated Statements of Financial Position			F-7

Consolidated Statements of Comprehensive Income			F-8

Consolidated Statements of Changes in Shareholders’ Equity			F-9

Consolidated Statements of Cash Flows			F-11

Notes to Consolidated Financial Statements			F-12

AMX Audit Opinion 2020

To the Board of Directors and Shareholders of

América Móvil, S.A.B. de C.V.

Opinion on the Financial Statements

We have ~~challenged~~audited the ~~resolution~~accompanying consolidated statements of financial position of América Móvil, S.A.B. de C.V. and its subsidiaries (the Company) as of December 31, 2020 and 2019, the related consolidated statements of comprehensive income, changes in ~~Mexican courts. However, legal challenges will not suspend the implementation~~shareholders’ equity and cash flows for each of the ~~Separation Plan~~three years in the period ended December 31, 2020, and ~~may not be finally determined before~~ the ~~Separation Plan is fully implemented.~~related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2020 and 2019, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with International Financial Reporting Standards, as issued by the International Accounting Standards Board.

Change in accounting policy for certain class of assets (Towers)

Substantial Market Power Investigations

wireless voice and data services market. Telcel filed challenges against both decisions, and a final resolution of these challenges is still pending. If upheld,

these decisions would allow the IFT to impose additional requirements as to rates, quality of service and information, among other matters. The Preponderance regime has regulated all of these matters.

In the case of the market for wholesale dedicated-link leasing, the IFT’s predecessor, Cofetel, published an agreement in the Official Gazette, establishing requirements regarding tariffs, quality of service and information for dedicated-link circuits. Telmex and Telnor have filed petitions for relief against such resolutions, which are still pending. The regulation that could arise from these investigations has been already implemented by the IFT through the special regulatory regime for preponderant agents. However, given the uncertainty of the ~~IFT´s~~IFT’s actions, we are not able to identify all possible consequences and as a result an adverse resolution could have an impact on the Company’s future revenues in this market.

Concessions

without the approval of the IFT. There are ~~two~~three types of concessions:

•

~~NETWORK CONCESSIONS.~~NETWORK CONCESSIONS. Telcel, Telmex and its subsidiary Telnor hold network concessions, granted under the previous regulatory framework, to provide specified types of services. Their ability to migrate to the new regime of unified concessions and, consequently, to provide any and all telecommunications and broadcasting services, is subject to conditions,as described under “Migration of Concessions and Additional Services” below.

~~SPECTRUM CONCESSIONS.~~Telcel holds multiple concessions, granted under both the previous and current regulatory frameworks, to provide wireless services that utilize frequencies of radio-electric spectrum. These concessions have terms of 15 to 20 years and may be extended for an additional term of equal length.

~~A public telecommunications concessionaire is required by law to establish an open-network architecture that permits interconnection and interoperability.~~

•

Termination of Concessions

Mexican legislation provides that under certain circumstances, some assets of a concessionaire may be acquired by the federal government upon termination of these concessions.

Migration of Concessions and Additional Services

~~REGULATION~~

concession has a term of up to 30 years, extendable for up to an equal term. Also, under this new framework a current concession may be modified to add services not previously contemplated therein.

(ii) compliance with current requirements under the network concession, the 2013 constitutional amendments, the 2014 legislation and any additional measures imposed by the IFT on the preponderant economic agent and (iii) such other requirements, terms and conditions as the IFT may establish in the concession itself. We expect the process of migration or additional services to be lengthy and complex. Consequently, Telcel, Telmex and Telnor may not be able to provide certain additional services, such as Pay TV and broadcasting, in the near term.

Telcel’s Concessions

Telcel operates under several different network and spectrum concessions covering particular frequencies and regions, holding an average of ~~175.16~~280.96 MHz of capacity in

Mexico’s nine regions in the 850 MHz, 1900 MHz,1.7/2.1 GHz, 2.5 GHz and ~~2.5~~3.5 GHz bands. The following table summarizes Telcel’s concessions.



FREQUENCY	COVERAGE AREA	INITIAL DATE	TERMINATION DATE	~~FEE STRUCTURE~~

Band A (1900 MHz)	Nationwide	~~Sep.1999~~Sep. 1999	Oct. 2039	~~Annual~~

Band D ~~(1900MHz)~~(1900 MHz)	Nationwide	Oct. 1998	Oct. 2038	~~Annual~~

Band B (850 MHz)	Regions 1, 2, 3	Aug. 2011	Aug. 2026	~~Annual~~

Band B (850 MHz)	Regions 4, 5	Aug. 2010	Aug. 2025	~~Annual~~

Band B (850 MHz)	Regions 6, 7, 8	Oct. 2011	Oct. 2026	~~Annual~~

Band B (850 MHz)	Region 9	Oct. 2015	Oct. 2030	~~Annual~~

Band F ~~(1900MHz)~~(1900 MHz)	Nationwide	Apr. 2005	Apr. 2025	~~Annual~~⁽¹⁾

Bands A and B ~~(1.7/~~ (1.7/2.1 GHz)	Nationwide	Oct. 2010	Oct. 2030	~~Annual~~

Bands H, I and J ~~(1.7/~~ (1.7/2.1 GHz)	Nationwide	May 2016	Oct. 2030	~~Annual~~

Band 7 (2.5 GHz)	~~75%~~ 88% of the population	Jul. 2017	~~Jan. 2024~~ Sep. 2020⁽¹⁾ – Nov. 2028 – Oct. 2040 – May 2041
Band 3.5 GHz⁽²⁾	~~Annual~~Nationwide	Oct. 2020⁽³⁾	Oct. 2038 and 2040

(1)

A request for extension has already been filed with the IFT.

(2)

On December 18, 2020, Telcel filed a formal request with the IFT to include mobile service in these concessions.

(3)

Concession Fees

Telmex’s Concessions

Telmex’s concession was granted in 1976 and is currently set to expire in 2026. In December 2016, the IFT granted Telmex a30-year extension of this concession, which will become effective in 2026 and will be valid until 2056. The new terms of this concession will be issued in early 2023.

Telmex’s subsidiary, Telnor, holds a separate concession, which covers one state and two municipalities in northwestern Mexico and will expire in 2026. The IFT also granted Telnor a30-year extension of its concession, which will be effective in 2026 and will be valid until 2056. The material terms of Telnor’s concession are similar to those of Telmex’s concession.

In addition, Telmex currently holds concessions for the use of frequencies to provide ~~wireless local access, as well as~~point-to-point andpoint-to-multipoint ~~transmission. Telmex obtained these concessions for a term of up to 20 years that may be extended for additional20-year~~ ~~terms with approval from the IFT. These Telmex concessions, including the 3.5~~transmission in 10.5, 15 and 23 GHz ~~band, will expire in October 2020 and the extension process is currently under review with the IFT.~~bands.

Rates for Wireless Service

As a result of the preponderance determination, Telcel’s retail prices are subject topre-approval by the IFT before they can take effect. In addition, the 2014 legislation established that preponderant economic agents may not charge termination rates. See “— Asymmetric Regulation of the Preponderant Economic Agent” under this Part VI.

Rates for Fixed Service

provided by Telmex during the preceding period. Telmex is required to file a survey with the IFT every four years with its projections of

units of operation for basic services, costs and prices. Telmex is free to determine the structure of its own rates, with the exception of domestic long-distance rates, which were eliminated in 2015 under the 2014 legislation, and of the residential fixed-line rates, which have a cap based on thelong-run average incremental cost. As a result of the preponderance determination, Telmex’s retail prices are subject topre-approval by the IFT before they can take effect.

Prices for Telmex’s wholesale services are established by the IFT based on thelong-run average incremental cost model methodology.

BRAZIL

Legal Framework and Principal Regulatory Authorities

~~REGULATION~~

Telecommunications Agency (Agência Nacional deTelecomunicações, or “Anatel”), which has the authority to grant concessions and licenses in connection with telecommunications services and the use of orbits, except broadcasting, and to adopt regulations that are legally binding on telecommunications services providers.

~~As of the date of this annual report, the~~The Brazilian ~~congress is considering~~Congress has approved an updated legislation to modernize the current concession-based model to an authorization-based model. The ~~telecom reform bill under review would allow~~updated law brings the possibility of allowing fixed-line concessionaires, such as

Claro Brasil, to provide services under an authorization ~~instead of~~rather than a concession, as long as certain investment-related obligations are met. Under the new legislation, it is possible to extend the current concessions, as well as radio frequency licenses and orbital positions, for more than one period. The legislation also permits the possibility of a secondary market for trading cellphone frequencies. The legislation will be implemented by regulations promulgated by Anatel. We are currently ~~unable to assess~~evaluating the potential impact ~~that such~~of this legislation ~~would have in~~on our operations.

Licenses

In 2014, we simplified our corporate structure, and our subsidiaries Embratel, Embratel Participações S.A. (“Embrapar”) and Net Serviços were merged into Claro Brasil, with all licenses previously granted to our subsidiaries transferred to Claro Brasil. ~~Following its acquisition of Brasil Telecomunicações S.A. in 2016, Claro Brasil relinquished the cable TV and data services licenses it had been transferred by Embrapar and Net Serviços.~~

In 2018, subsidiary Star One merged into Claro Brasil. As a result, all ~~Brasilian~~Brazilian satellite operation rights previously granted to Star One were transferred under the same terms and conditions to Claro Brasil. The satellite operation rights(AMC-12) covering regions outside of Brazil were relinquished by Star One before the merger. In 2020, the satellite operation rights were transferred to Embratel Tysat Telecomunicações S.A. (“Claro TV”), after approval by Anatel.

In 2019, the subsidiary Primesys was merged into Claro Brasil. As a result, service authorizations granted to Primesys were transferred under the same terms and conditions to Claro Brasil.

Our Brazilian subsidiaries hold licenses for the telecommunications services listed below and expect to continue acquiring spectrum if Anatel conducts additional

public auctions, although Claro Brazil, like all of its peer competitors, is subject to a cap on the additional spectrum it may acquire per frequency band.



SUBSIDIARY	LICENSE	TERMINATION DATE

Claro Brasil	Fixed Local Voice Services	Indefinite


		Domestic and International Long-Distance	2025
			2025

	Voice Services	Indefinite

	Personal Communication Services	Indefinite

	Data Services	Indefinite

	Cable TV Services	Indefinite

	Mobile Maritime Services	Indefinite

	Global Mobile Satellite Services	Indefinite

Claro TV	DTH TV Services	Indefinite

	~~Data Services~~	~~Indefinite~~

~~Americel S.A.~~	Data Services	Indefinite

~~Primesys~~Americel S.A.	Data Services	Indefinite

Telmex do Brasil	Data Services	Indefinite

~~Telmex do Brasil~~Nextel Brazil	Personal Communication Services	Indefinite

	Domestic and International Long-Distance	Indefinite
	Domestic and International Long-Distance	Indefinite

	Data Services	Indefinite

In addition, Claro ~~Brasil~~TV has various orbital position authorizations for our satellite operations, which are set to expire between 2022 and 2033. Requests for extensions for 15 more years have been requested from Anatel. Claro TV also has radio frequency licenses to provide PCS, which are set to expire between 2022 and 2032. These grants were transferred from Claro Brasil to Claro TV in 2020, ~~and 2027, and~~subsequent to Anatel’s approval.

Nextel Brazil has radio frequency licenses to provide PCS, which expire between ~~2020~~2026 and ~~2032.~~2031.

Concessions

Concession Fees

Claro Brasil is required to pay a biennial fee equal to 2.0% of net revenues from wireless services, except for the final year of the~~15-year~~ 15 year term of its PCS authorizations, in which the fee equals 1.0% of net revenues from wireless services.

Termination of Concessions

Our domestic and international long-distance fixed-line concessions provide that certain of our assets deemed “indispensable” for the provision of these services will revert to the Brazilian state upon termination of these ~~concession.~~concessions. Compensation for those assets would be their depreciated cost. See ~~note 16~~Note 17 to our audited consolidated financial statements included in this annual report.

Regulation of Rates

Anatel regulates rates (tariffs and prices) for all telecommunications services, except for fixed-line broadband services, Pay TV and satellite capacity rates, which are not regulated. In general, PCS ~~license-holders~~license holders and fixed local voice services license-holders are authorized to increase basic plan rates annually. Domestic long-distance concession-holders may adjust rates annually only for inflation, ~~(less a factor determined by~~provided that they give Anatel ~~based on~~and the ~~productivity~~public advanced notice of ~~each operator during the year).~~such adjustments. Claro Brasil may set international long-distance and mobile rates freely, provided that it gives Anatel and the public advance notice.

Regulation of Wholesale Market Competition

In November 2012, Anatel approved the General Competition Plan (Plano Geral de Metas da Competição,, or “PGMC”), a comprehensive regulatory framework aimed at increasing competition in the telecommunications sector. The PGMC imposes asymmetric measures upon economic groups determined by Anatel to have significant market power in any of the five wholesale markets in the telecommunications sector, on the basis of several criteria, including having over 20.0% of market share in the applicable market.

2014, and to 50.0% of the 2013 rates by February 2015. In July 2014, Anatel established termination rates for mobile services applicable to operators with significant market power through ~~2019.~~2019, based on a cost model, and in December 2018, Anatel established termination rates for mobile services applicable to operators with significant market power from 2020 to 2023. These termination rates were revised by Anatel in February 2020. Claro Brasil is also required to publish ~~and Anatel must approve,~~ its reference roaming prices for voice, data and SMS on ~~a semi-annual~~an annual basis, among other measures.

~~In addition, Embratel was determined~~ These prices must be related to ~~have significant market power~~the Anatel reference values and need to be approved by Anatel before they can take effect. The approval of new prices by Anatel took place in the market for long-distance leased lines, Claro Brasil and Embratel were determined to have significant market power in the telecommunications infrastructure market, and Net Serviços was determined to have significant market power in the local coaxial transmissions market, together with several of their mobile and fixed-line competitors. Following the merger of Embratel and Net Serviços into Claro Brasil in 2014, Claro Brasil is required to publish, and Anatel must approve, its reference offers in each of these markets. Moreover, wholesale contracts entered into by operators determined to have significant market power for the sale of such operators’ services are overseen for compliance purposes by independent third-party companies.January 2021.

In 2018, Anatel approved Claro Brasil’s most recent wholesale reference offers with respect to national roaming, telecommunications duct infrastructure, ~~long- distance~~long-distance leased lines, high capacity transport above 34 Mbps, wireless ~~termination rates,~~networks interconnection, fixed network interconnection, internet network interconnection and internet links, which are reviewed and approved by Anatel on an annual basis.

Anatel also reviews its determination of which operators have significant market power on a quadrennial basis. Anatel began its first review of all telecom operators in 2014 and published the most recent list of operators with significant market power for each of the relevant markets in 2018. In addition to the review, in 2018 Anatel changed some of the asymmetric measures applicable under the PGMC and added two new wholesale markets covering high capacity transport and fixed ~~termination rates.~~network interconnection. Anatel has determined that Claro Brasil has significant market power in eight wholesale markets.

Network Usage Fees and Fixed-Line Interconnection Rates

In July 2014, Anatel approved a resolution establishing the reference terms for fees charged by operators in connection

~~REGULATION~~

with the use of their mobile network and leased lines and set a price cap on fees charged for fixed network usage by operators deemed to have significant market power. Such fees, based on costs of allocation services (coubicación), have been applicable since February 2016.

In December 2018, Anatel published reference values for fees network that are applicable from 2020 to 2023.

Fixed-line operators determined by Anatel to have significant market power in the local fixed-line market may freely negotiate interconnection rates, subject to a price cap established by Anatel.

Other Obligations

Under applicable law and our concessions, Claro Brasil has an obligation to (i) comply with certain coverage obligations to ensure universal access to its fixed-line voice services, (ii) contribute to the funding of the country’s transition from analogue to digital TV (due to the acquisition of the 700 MHz frequency), (iii) meetquality-of-service targets and (iv) comply with applicable telecommunications services consumer rights.

CADE Anti-Competition Proceeding

COLOMBIA

Legal Framework and Principal Regulatory Authorities

The Information and Communications Ministry (Ministerio de Tecnologías de la Información y las Comunicaciones, or “ICT Ministry”) and the Communications Regulatory Commission

(Comisión de Regulación de Comunicaciones,, or “CRC”) are responsible for overseeing and regulating the telecommunications sector. The main audiovisual regulatory ~~authority~~authorities in Colombia with respect to Pay TV services isare the ~~National Television Authority~~CRC, the ICT Ministry and the Industry and Commerce Superintendence (~~Autoridad Nacional~~Superintendencia de ~~Televisión~~Industria y Comercio,, or ~~“ANTV”~~“SIC”). Claro is also subject to supervision by other government entities responsible for enforcing other regulations, such as antitrust rules or those protecting consumer rights.

Concessions

As a result of the termination of Comcel’s former concessions, the ICT Ministry and Comcel began

discussions with respect to the liquidation of the agreements governing those concessions. In light of the decision of the Colombian Constitutional Court (Corte Constitucional de Colombia) holding that certain laws limiting the reversion of assets of telecommunications providers did not apply to concessions granted prior to 1998 and, consequently, that reversion of assets under those earlier concessions would be governed by their contractual terms, the ICT Ministry obtained a domestic award ordering Comcel to revert assets under its earlier

concessions to the Colombian government. Comcel challenged such award and the Company filed an international arbitration claim against Colombia arising from Colombia’s measures. ~~For further information on these proceedings, see note 16 to our audited consolidated financial statements included in this annual report.~~

Licenses and Permits

Comcel holds licenses to provide mobile services in the spectrum frequency bands shown in the table below.



FREQUENCY	BANDWIDTH		TERMINATION DATE

850 MHz	25 MHz		Mar. 2024

1900 MHz	10 MHz		Dec. ~~2019~~2039

	5 MHz		Sept. 2021

	15 MHz		Apr. 2024
		~~5 MHz~~		~~June 2019~~⁽¹⁾
2.5 GHz	30 MHz		Aug. 2023

	10 MHz		Feb. 2021⁽¹⁾

	10 MHz		Mar. 2040

	10 MHz		Mar. 2040

	10 MHz		Mar. 2040

700 MHz	20 MHz		May 2040

(1)

Refers to a temporary license, which we renew on an annual basis.

In 2013, Telmex Colombia S.A. obtained permission to provide Pay TV services under any available technology, pursuant to ~~ANTV’s~~the ICT Ministry’s unified licensing system. On May 31, 2019, Telmex Colombia, S.A. merged into Comcel. The permission ~~will expire~~to provide Pay TV services granted in ~~2020 and may be renewed at~~favor of Telmex Colombia, S.A. was simultaneously transferred to Comcel without modifications in connection with the ~~appropriate time for another10-year~~ ~~term.~~merger. On July 30, 2019, Comcel’s permission to provide Pay TV was incorporated under Comcel’s general power to provide Pay TV granted to it under Law 1978 of 2019.

In 2017, the ICT Ministry issued a decree approving a higher cap on spectrum acquisitions by operators in low and high frequency bands. This new cap allows Comcel to participate in future spectrum auctions. The ICT Ministry has released its plan to conduct spectrum auctions in the 700 MHz, ~~and~~ 1900 MHz and 2.5 GHz bands. ~~Further specifications on the auctions will be published by the ICT Ministry during the third quarter of 2019, while the~~The final resolution containing the auctions’ terms and conditions ~~will be~~was published by the ICT Ministry during the fourth quarter of 2019. The auction took place on December 20, 2019. A subsidiary of Novator Partners LLP, a London-based private equity firm (the “Novator Subsidiary”), participated in the auction as a new competitor in the market. The Novator Subsidiary was granted a 20MHz license to operate in the 700MHz frequency band and three blocks of 10MHz for the 2,500MHz frequency band. Colombia Telecomunicaciones (Movistar) and Colombia Movil (Tigo) also participated in the auction. Tigo was granted a 40MHz license to operate in the 700MHz frequency band. Colombia Telecomunicaciones was not granted any licenses in the auction.

~~100~~79

Asymmetric Charges

In 2012, the CRC issued resolutions seeking to correct an alleged market failure and imposing the following measures on Comcel: (i) asymmetric charges for mobile and incoming long-distance call terminations by other operators on Comcel’s wireless network, with access rates lower than the rates we pay our competitors, and (ii) restrictions on the rates we charge our users for calls outside our network~~(off-net~~ ~~calls), which must not exceed the rates we charge for calls within our network(on-net~~ ~~calls). These asymmetric access charges ended in December 2016.~~

In 2017, the CRC issued a resolution updating the list of relevant telecommunication markets by adding the mobile services market (including bundled mobile voice and data services) and by also including the mobile service market in the list of relevant markets subject toex-ante regulation. In connection with the mobile services market, on January 28, 2021, the CRC ~~initiated~~determined that COMCEL has a ~~proceeding to evaluate Comcel’s substantial~~dominant position in the relevant mobile services market, ~~power~~but did not impose particular measures. COMCEL considers that the CRC did not take into account important elements in ~~this new market and, if applicable, the imposition of asymmetric regulatory measures that could affect Comcel. As of the date of this annual report, a~~its determination, which COMCEL has challenged. A resolution is pending.

SOUTHERN CONE

ARGENTINA

~~Following the election of President Mauricio Macri in 2015, the Argentine government issued a Decree of Necessity and Urgency (~~~~Decreto de Necesidad y Urgencia~~~~, or “DNU”) to create a new communications ministry and regulator to oversee the telecommunications and media sectors.~~ The National Communications Agency (Ente Nacional de Comunicaciones,, or “Enacom”) is ~~now~~ the main telecommunications regulatory authority in Argentina and became operational in 2016.

~~As part of the measures passed under the DNU, fixed~~Fixed and mobile services providers are prohibited from providing DTH technology, which is currently the fastest way to provide Pay TV services. In 2017, the Argentine government issued a

decree allowing telecommunications providers, including AMX Argentina S.A. (“AMX Argentina”), to provide Pay TV services via cable within a limited number of territories as of January 2018 and to the rest of the country as of January 2019. AMX Argentina has obtained the permissions necessary to provide Pay TV services via cable in accordance with the ~~decree to the territories approved by Enacom.~~decree.

AMX Argentina holds licenses in the 700 MHz, 900 MHz, 1700/2100 MHz (AWS), 1900 MHz and 2600 MHz frequency bands, some of which expire in 15 years and some of which

CHILE

Claro Chile also holds license to provide DTH technology services until 2024 and a license with an indefinite term to provide Pay TV services. In 2018, the Chilean Supreme Court (Corte

~~101~~

~~REGULATION~~

Suprema de Justicia) issued a ruling requiring Claro to return 20 MHz of spectrum acquired through a band auction because Claro supposedly exceeded the limit of spectrum any given operator is permitted to hold. The return of such spectrum ~~including if and how such return should be implemented,~~ is currently ~~under discussion~~being implemented before the Competition Court (Tribunal de Defensa de laLibre Competencia,, or the “TDLC”). In addition, pursuant to the ruling, and in order to increase the maximum limit, SUBTEL initiated a review of such limit of spectrum through a regulatory ~~proceeding initiated before~~proceeding. In 2020, the ~~TDLC which is~~Chilean Supreme Court defined a higher cap for spectrum acquisitions by operators in ~~progress.~~low, medium low, medium and high frequency bands. This

In 2018, SUBTEL issued a ruling to freeze Claro Chile´s use of 50 MHz in the 3.5 MHz band for the provision of wireless fixed services. Claro Chile has challenged such ruling. SUBTEL subsequently issued a 80

new ~~ruling unfreezing 30 MHz, allowing~~cap allows Claro Chile to ~~provide wireless fixed services. Claro Chile has withdrawn its challenge, while~~participate in the ~~other 20 MHz remains temporarity frozen.~~current spectrum auctions.

PARAGUAY

The DTH License is in the process of being renewed for another 5 years (until 2025). Additionally, in January 2018, AMX Paraguay participated in a spectrum auction and was awarded a license to provide telecommunications services in the 700 MHz band. In November 2018, the Telecommunications Commission of Paraguay granted the renewal of spectrum license in the 1900 MHz band. These licenses are renewable, subject to regulatory approval, and contain coverage, reporting and service requirements.

URUGUAY

The Regulatory Unit of Communications Services ((Unidad Reguladora de Servicios de Comunicaciones) is in charge of the regulation of the telecommunications industry in Uruguay.

AM Wireless Uruguay, S.A. holds licenses to operate in the 1900 MHz, 1700/2100 MHz and 700 MHz frequency bands that expire in 2024, 2033, 2037, 2039 and ~~2037, respectively, and~~2045. Additionally, AM Wireless Uruguay S.A. holds an authorization to do a trial for 5G in the 26, 50 GHz – 26, 85 GHz frequency band that expires on July 2021. Telstar S.A. holds licenses to provide

international long-distance communications and ~~mobile~~international and national data services that have no expiration ~~date~~date.

ANDEAN REGION

ECUADOR

The primary regulatory authorities for our mobile and fixed-line operations are the National Telecommunications, Regulation and Control Agency (Agencia de Regulación y Control de las Telecomunicaciones,, or “Arcotel”) and the Telecommunications and Information Society Ministry ((Ministerio de Telecomunicaciones y Sociedad de la Información,, or “Mintel”). Arcotel is responsible for the licensing and oversight of radio-electric spectrum use and telecommunications services provisions. Mintel is responsible for the promotion of equal access to telecommunications services.

~~102~~

The Telecommunications Law (Ley Orgánica de Telecomunicaciones), adopted in 2015, serves as the legal framework for telecommunications services. It established ~~new~~ regulations for operators with significant market power ~~new~~and penalties based on their gross incomes as well as additional fees also based on an operator’s gross income, but that can vary depending on the size of their market share. Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) has been deemed to have significant market power in the advanced wireless services market, and as a result, such fee payments are made on a quarterly basis on the dates established by Arcotel.

~~For fiscal year 2018,~~ Conecel ~~has an obligation~~paid to ~~pay~~ the Ecuadorian government U.S. $26.1 million, which corresponds to 3.0% of its wireless services for 2018, which represents approximately Ps.1.0 billion (U.S.$29.9 million). As of the date of this annual report, Conecel has paid the Ecuadorian government Ps.0.8 billion (U.S.$22.4 million), which represents 3.0% of such revenues generated in the first three quarters of 2018. Conecel has made a provision for Ps.0.3 billion (U.S.$7.5 million), which corresponds to the approximate amount owed for the fourth quarter of 2018 and will be paid in due course.2020. An arbitration proceeding to partially void the payment by Conecel of such fees was conducted and a decision in favor of the government was reached. Conecel has ~~appeal~~appealed this decision and, as of the date of this annual report, a decision ~~on Conecel’s appeal~~of the Constitutional Court is pending.

Conecel holds concessions to operate in the 850MHz, 1900 MHz and AWS bands, which include concessions for PCS that expire in 2023. The PCS concession contains quality- ~~quality-of-~~of-service ~~service~~ requirements for successful call completions, SMS delivery times, customer service, geographic coverage and other service conditions.

Conecel also holds licenses to provide internet ~~value- added~~value-added services, Pay TV Services (through DTH technology) and bearer services, expiring in 2021, 2023 and 2032, respectively.

Conecel, following the acquisition of Ecuador Telecom, S.A. in 2016, also holds a concession to offer fixed-line voice, public telephone and domestic and international ~~long- distance~~long-distance wholesale services, as well as a license to provide Pay TV (through HFC technology) that expires in ~~2031.~~2032 and 2031, respectively.

Recalculation of Concession Fees

In 2018, Conecel paid Arcotel U.S.$11.9 million based on its annual revenues for the 2015 period and iswas required to pay U.S.$13 million based on its annual revenues for the 2016 period. ~~However, Conecel obtained a judicial order that suspended the collection process for the 2016 period.~~

For its Universal Service contribution, Conecel iswas required to pay U.S.$5 million for the 2015 period and U.S.$6 million for the 2016 period. ~~However,~~ Conocel obtained a judicial order that suspended the collection process for the 2015 and 2016 periods.

PERU

The Supervisory Agency for Private Investment in Telecommunication (Organismo Supervisor de la Inversión Privada en Telecomunicaciones, or “OSIPTEL”) is in charge of the regulation of the telecommunications industry in Peru. The Ministry of Transport and Communications (Ministerio de Transportes y Comunicaciones or “MTC”) grants concessions, permits and licenses. The Telecommunications Law (Decreto Supremo N°N° 013-93-TCC Ley de Telecomunicaciones), adopted in 1993, serves as the legal framework for telecommunications services.

~~103~~

~~REGULATION~~

Each of the concessions was awarded by the MTC and covers a20-year period. The concessions contain coverage, reporting, service requirement and spectral efficiency goals. The MTC is authorized to cancel any of the concessions in the case of specified breaches of its terms.

The MTC has drafted a spectrum refarming proposal on the 2.5 Ghz band considering a new band distribution that grants 80 Mhz nationwide to Olo del Peru S.A.C. and TVS Wireless S.A.C. Currently, the spectrum refarming process is subject to comments from the public. A final decision on the proposal will be issue in July 2019.

EUROPE AND OTHER JURISDICTIONS

European Legal Framework and Principal Regulatory Authorities

The telecommunications regulatory framework in the EU is based on ~~five Directives (“Framework”, “Access and Interconnection”, “Authorization”, “Universal Service and Users’ Rights” and “Privacy and Data Protection”)~~the European Electronic Communications Code (EECC) that ~~apply to~~is currently in the process of being transposed into national laws for all EU member ~~countries and regulate all forms of fixed and wireless services, internet, broadcasting and transmission services.~~states. Austria, Bulgaria, Croatia and Slovenia are EU member ~~countries.~~states. Macedonia and Serbia, candidates for accession to the EU, are expected to gradually harmonize their regulatory frameworks with the EU’s framework.

In each European country in which we operate, we are also subject to a domestic telecommunications regulatory framework and to oversight by one or more local regulators.

Licenses



COUNTRY	FREQUENCY	TERMINATION DATE

AUSTRIA		800 MHz			Dec. 2029


	900 MHz			Dec. 2034


	1500 Mhz	Dec. 2044

	1800 MHz			Dec. 2034


	2100 MHz			Dec. ~~2020~~
			2044

	2600 MHz			Dec. 2026

	3500 MHz	Dec 2039

~~BULGARIA~~BELARUS		900 MHz			~~June 2024~~
			Not applicable

	1800 MHz			~~June 2024~~
			Not applicable

	2100 MHz	Not applicable

BULGARIA	900 MHz	June 2024

	1800 MHz	June 2024

	2100 MHz	Apr. 2025


CROATIA		800 MHz			Oct. 2024


	900 MHz			Oct. 2024


	1800 MHz			Oct. 2024


	2100 MHz			Oct. 2024

MACEDONIA	800 MHz	Dec. 2033

~~BELARUS~~		900 MHz			~~Dec. 2020~~
			Sept. 2023

	1800 MHz			Dec. ~~2020~~
			2033

	2100 MHz	Feb. 2028
		~~Dec. 2020~~

~~SLOVENIA~~SERBIA		800 MHz			~~May 2029~~
			Jan. 2026

	900 MHz			~~Jan. 2031~~
			Nov. 2026

	1800 MHz	Nov. 2026

	2100 MHz	Nov. 2026

SLOVENIA	800 MHz	May 2029

	900 MHz	Jan. 2031

	1800 MHz	Jan. 2031

	2100 MHz	Sept. 2021

	2600 MHz			May 2029

		~~2100 MHz~~			~~Sept. 2021~~

~~SERBIA~~		~~800 MHz~~			~~Jan. 2026~~

		~~900 MHz~~			~~Nov. 2026~~

		~~1800 MHz~~			~~Nov. 2026~~

		~~2100 MHz~~			~~Nov. 2026~~

~~MACEDONIA~~		~~800 MHz~~			~~Dec. 2033~~

		~~1800 MHz~~			~~Dec. 2033~~

		~~900 MHz~~			~~Sept. 2023~~

		~~2100 MHz~~			~~Feb. 2028~~

~~104~~

OTHER JURISDICTIONS



COUNTRY	PRINCIPAL REGULATORY AUTHORITIES	CONCESSION AND LICENSES

COSTA RICA	Superintendency of Telecommunications (Superintendencia de Telecomunicaciones) Ministry of Science, Technology and ~~Telecommunications~~Tele-communications (Ministerio de Ciencia, Tecnología y Telecomunicaciones)	• Concessions in the AWS and 1800 MHz bands that expire in 2032 • Concessions in the 2100 MHz band that expire in 2026 • License to operate Pay TV services using DTH technology that will expire in ~~2027~~2026

EL SALVADOR	Electricity and Telecommunications ~~Superintendency~~Super- intendency (Superintendencia General de Electricidad y Telecomunicaciones)	• Concession of 50 MHz in the 1900 MHz band of which 30 MHz that expire in 2038, 10 MHz that expire in 2041 and 10 MHz that expire in 2028 • Concession to provide public telephone service that expires in 2027 • Licenses to provide Pay TV Services through HFC and DTH technologies have an indefinite term • Concession of 40 MHz in 1700/2100 MHz bands (AWS) that will expire in 2040

GUATEMALA	Guatemalan Telecommunications Agency (Superintendencia de Telecomunicaciones)	• Licenses to use 12 MHz in the 900 MHz band and 40120 MHz in the 1900 MHz band that all expire in 2033 • Concession of 50175 MHz in the 3.5 GHz band that will expire in 2033

NICARAGUA	Nicaraguan Telecommunications and Mailing Institute (Instituto Nicaragüense de ~~Telecomunicaciones~~Teleco-municaciones y Correos)	• Concessions in the 700 MHz, 850 MHz, 1900 MHz and 1700/2100 MHz bands that all expire in ~~2032~~2042 • Concession of 50 MHz in the 3.5 GHz band that will expire in 2042 • Licenses to provide DTH technology that will expire in January 2028~~(re-~~ ~~newal granted in 2018)~~ and Pay TV services that has an indefinite term

HONDURAS	Honduran National Telecommunications Commission (Comisión Nacional de ~~Telecomunicaciones~~Teleco-municaciones)	• Concessions to use 80 MHz in the 1900 MHz PCS band and 40 MHz in theLTE-4G 1700/2100 MHz band that all expire in 2033 • Licenses to operate Pay TV services through (i) HFC technology that will expire in 2027 and (ii) DTH technology that will expire in ~~2020~~2030

PANAMA	National Authority of Public Services (~~Autoridad~~Auto-ridad Nacional de los Servicios Públicos)	• License to use 40 MHz in the 1900 MHz and 20 MHz in the 700 MHz bands that all expire in 2028 • Licenses to provide fixed local and long-distance services that expire in 2030

~~105~~

~~REGULATION~~


~~COUNTRY~~	~~PRINCIPAL REGULATORY AUTHORITIES~~	~~CONCESSION AND LICENSES~~
		• License to provide ~~Internet~~internet service that expires in 2033 • Licenses to provide international long-distance, value-added services, interactive television, and Pay TV service through DTH and IPTV ~~tech- nologies,~~technologies, which expire in 2028, 2030, 2037 and 2034, respectively • License to provide Pay TV service through optical fiber that expires in 2037 • License for data transportation, Service No. 200, which expires in 2023

UNITED STATES	The FCC	• International Section 214 Authorization (Claro Enterprise Solutions).

DOMINICAN REPUBLIC	Dominican Institute of Telecommunications (Instituto Dominicano de las ~~Telecomunicaciones~~Telecomunica-ciones)	• ~~Concessions~~ Concession to provide fixed and wireless services, internet and pay TV services through DTH and IPTV technologies that expire in 2030 • Licenses to use 25 MHz in the 800 MHz band, 30 MHz in the 1900 MHz band, 80 MHz in the 2.5/2.7 GHz band, 30 MHz in the 3.5 GHz band and 40 MHz in the 1.7/2.1 GHz (AWS) band that expire in 2030 • ~~Licenses to provide Pay TV Services through DTH and IPTV technologies that expire in 2030~~

PUERTO RICO	~~FCC~~Federal Communications Commission (FCC) and the Telecommunications ~~Regulatory Board~~Bureau of Puerto Rico	• Concessions to use the 700 MHz, 1900 MHz and the 3028 GHz bands that expire in 2021, 2027 and ~~2019,~~2029, respectively • Concessions to use the 800 MHz bands that expire in ~~March 2018 (for which an application for renewal has been submitted), 2020,~~ 2021, 2026, 2028 and ~~2026~~2030 • Concessions to use the ~~1.7/~~AWS-1 and AWS-3 bands (1.7/2.1 ~~GHz bands~~GHz) that expire in 2026 and 2028, respectivel. • Concessions to use the 3.5 GHz band that expires in 2030 • Long-term transfer lease concessions to use 35.6 MHz of the 2.5 GHz ~~EBS~~ band that expire in ~~2020,~~ 2022, 2023, 2025, 2026 and ~~2026~~2030 • Franchise to operate Pay TV ~~Services~~services using IPTV technology that expires in 2030

~~106~~84

[THIS PAGE INTENTIONALLY ~~BLANK~~LEFT BLANK]

~~PART VII ADDITIONAL INFORMATION~~

LOGO

~~EMPLOYEES~~


									DECEMBER 31,

	DECEMBER 31,						2018		2019		2020
	2016		2017		2018
NUMBER OF EMPLOYEES		194,431		191,851		189,448		189,448		191,523		186,851

CATEGORY OF ACTIVITY:

Wireless		78,887		78,910		77,845		77,845		83,091		73,404

Fixed		97,104		94,496		92,429		92,429		87,034		91,460

Other businesses		18,440		18,445		19,174		19,174		21,398		21,987

GEOGRAPHIC LOCATION:

Mexico		90,306		88,417		88,613		88,613		89,539		88,172

South America		65,817		64,619		62,500		62,500		61,058		59,304

Central America		9,767		9,694		9,586		9,586		10,372		9,936

United States		848		852		848		848		859		843

Caribbean		9,488		9,311		9,195		9,195		11,351		10,647

Europe		18,205		18,958		18,706		18,706		18,344		17,949

LOGO

~~LEGAL PROCEEDINGS~~

In each of the countries in which we operate, we are party to various legal proceedings in the ordinary course of business.

These proceedings include tax, labor, antitrust, contractual matters and administrative and judicial proceedings concerning regulatory matters such as interconnection and tariffs. We are party to a number of proceedings regarding our compliance with administrative rules and regulations and concession standards.

Our material legal proceedings are described in ~~note 16~~Note 17 to our audited consolidated financial statements included in this annual report and in “Regulation” under Part VI of this annual report.

~~110~~88

~~PRINCIPAL ACCOUNTANT FEES AND SERVICES~~

AUDIT ANDNON-AUDIT FEES

The following table sets forth the fees billed to us and our subsidiaries by our independent registered public accounting firm, Mancera, during the fiscal years ended December 31, ~~2017~~2019 and ~~2018:~~2020:

YEAR ENDED DECEMBER 31,

2019

2020

2017

2018

(in millions of Mexican pesos)

Audit fees⁽¹⁾

Ps. 245

Ps. 248

Ps.

250

Ps.

250

Audit-related fees⁽²⁾

Tax fees⁽³⁾

Total fees

Ps. 310

Ps 301

Ps.

301

Ps.

279

(1)

⁽¹⁾Audit fees represent the aggregate fees billed by Mancera and its Ernst & Young Global affiliated firms in connection with the audit of our annual financial statements and statutory and regulatory audits.

(2)

⁽²⁾Audit-related fees represent the aggregate fees billed by Mancera and its Ernst & Young Global affiliated firms for the review of reports on our operations submitted to IFT and attestation services that are not required by statute or regulation.

(3)

⁽³⁾Tax fees represent fees billed by Mancera and its Ernst & Young Global affiliated firms for tax compliance services, tax planning services and tax advice services.

AUDIT AND CORPORATE PRACTICES COMMITTEE APPROVAL POLICIES AND PROCEDURES

Our audit and corporate practices committee has established policies and procedures for the engagement of our independent auditors for services.

Our audit and corporate practices committee expressly approves any engagement of our independent auditors for audit ornon-audit services provided to us or our subsidiaries. Prior to providing any service that requires specificpre-approval, our independent auditor and our Chief Financial Officer present to the audit committee a request for approval of services in which they confirm that the request complies with the applicable rules.

~~111~~

~~ADDITIONAL INFORMATION~~

We file reports, including annual reports on Form20-F, and other information with the SEC pursuant to the rules and regulations of the SEC that apply to foreign private issuers.

Any ~~filings~~fillings we make electronically will be available to the public over the internet at the SEC’s web site at www.sec.gov and at our website at www.americamovil.com. This URL is intended to be an inactive textual reference only. It is not intended to be an active hyperlink to our website. The information on our website, which might be accessible through a hyperlink resulting from this URL, is not incorporated into this annual report.

The following documents have been filed with the SEC as exhibits to this annual report:



1.1		Amended and Restated Bylaws (estatutos sociales) of América Móvil, S.A.B. de C.V., dated as of April 16, 2018 (together with an English translation) (incorporated by reference to Exhibit 1.1 of our annual report on Form20-F FileNo. 001-16269, filed on April 26, 2018).

2.1		Description of Rights of Each Class of Securities

4.1		Stock Purchase Agreement by and among Verizon Communications Inc., América Móvil, S.A.B. de C.V., AMX USA Holding, S.A. de C.V. and Tracfone Wireless, Inc. dated as of September 13, 2020.


8.1		List of certain subsidiaries of América Móvil, S.A.B. de C.V.

12.1		Certification of Chief Executive Officer pursuant to Section 302 of the ~~Sarbanes- Oxley~~Sarbanes-Oxley Act of 2002.

12.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
13.1		Certification pursuant to Section 906 of the ~~Sarbanes- Oxley~~Sarbanes-Oxley Act of 2002.
15.1		Code of Ethics (incorporated by reference to Exhibit 14.1 of our annual report on Form20-F, FileNo. 001-16269, filed on April 26, 2018).
15.2		Consent of independent registered public accounting firm.
17.1		Subsidiary Guarantors
101.INS		XBRL Instance Document.
101.SCH		XBRL Taxonomy Extension Schema Document.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB		XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF		XBRL Taxonomy Extension Definition Document.

~~112~~

~~FORWARD-LOOKING STATEMENTS~~

Examples of forward-looking statements include the following:

projections of our commercial, operating or financial performance, our financing, our capital structure or our other financial items or ratios;

statements of our plans, objectives or goals, including those relating to acquisitions, competition and rates;

statements concerning regulation

or regulatory developments;

the impact of COVID-19;

statements about our future economic performance or that of Mexico or other countries in which we operate;

competitive developments in the telecommunications sector;

other factors and trends affecting the telecommunications industry generally and our financial condition in particular; and

statements of assumptions underlying the foregoing statements.

~~113~~

~~FORM20-F~~ ~~CROSS REFERENCE GUIDE~~



ITEM	FORM20-F CAPTION		LOCATION IN THIS REPORT	PAGE

1	IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS		Not applicable	—-

2	OFFER STATISTICS AND EXPECTED TIMETABLE		Not applicable	—-

3	KEY INFORMATION

	3A Selected financial data		Selected financial data	26

	3B Capitalization and indebtedness		Not applicable	—-

	3C Reasons for the offer and use of proceeds		Not applicable	—-

	3D Risk factors		Risk factors	4737

4	INFORMATION ON THE COMPANY

	4A History and development of the Company		Information on the Company	59

			Note 10—Property, Plant and Equipment, Net	~~F-42~~F-38

			Liquidity and capital resources	3732

			Additional Information	~~112~~87

	4B Business overview		Information on the Company	59

			Regulation	9171

	4C Organizational structure		Exhibit 8.1	—-

	4D Property, plant and equipment		Information on the Company	59

			Note 10—Property Plant and Equipment, Net	~~F-42~~F-38

			Liquidity and capital resources	3732

			Regulation	9171

4A	Unresolved staff comments		None	—-

55*	OPERATING AND FINANCIAL REVIEW AND PROSPECTS

	5A Operating results		Overview	2024

			Results of operations	2226

			Regulation	9171
		~~Liquidity and capital resources~~			37

	5B Liquidity and capital resources		Liquidity and capital resources	32

			Note 14—Debt	~~F-53~~F-51

	5C Research and development, patents and licenses, etc.		Not applicable	—-

	5D Trend information		Overview	2024


			Results of operations	2226

	5E~~Off-balance~~ ~~sheet arrangements~~ Critical Accounting Estimates		~~Off-balance~~ ~~sheet arrangement~~Not applicable	37-

	~~5F Tabular disclosure of contractual obligations~~		~~Contractual obligations~~	38

6	DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

	6A Directors and senior management		Management	7460

	6B Compensation		Management	8360

	6C Board practices		Management	7460

			Management	8360

	6D Employees		Employees	~~110~~88

~~114~~

6E Share ownership

Major shareholders

ITEM
   FORM20-F CAPTION    LOCATION IN THIS REPORT    PAGE

   6E Share ownership    Major shareholders    60
   Management    83

7    MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

   7A Major shareholders    Major shareholders    60

   7B Related party transactions    Related party transactions    61

   7C Interests of experts and counsel    Not applicable    —

8    FINANCIAL INFORMATION

   8A Consolidated statements and other financial information    Consolidated Financial Statements    119
   Dividends    62
   Note 16—Commitments and Contingencies    F-60

   8B Significant changes    Not applicable    —

9    THE OFFER AND LISTING
   9A Offer and listing details    Trading markets    62
   9B Plan of distribution    Not applicable    —
   9C Markets    Trading markets    62
   9D Selling shareholders    Not applicable    —
   9E Dilution    Not applicable    —
   9F Expenses of the issue    Not applicable    —

10    ADDITIONAL INFORMATION
   10A Shareholders’ equity    Bylaws    63
   10B Memorandum and articles of association    Bylaws    63
   10C Material contracts    Information on the Company    5
      Results of operations    22
      Related party transactions    61
      Regulation    91

   10D Exchange controls    Additional information    112

   10E Taxation    Taxation of shares and ADSs    68

   10F Dividends and paying agents    Not applicable    —

   10G Statement by experts    Not applicable    —

   10H Documents on display    Additional information    112

   10I Subsidiary information    Not applicable    —

11    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK    Risk management    42
      Note 2 a)—Basis of Preparation of the Consolidated Financial Statements and Summary of Significant Accounting Policies and Practices    F-7
~~115~~

Management 60
7 MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
     ~~FORM 20-F CROSS REFERENCE GUIDE~~

ITEM
   FORM20-F CAPTION    LOCATION IN THIS REPORT    PAGE

12    DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
   12A Debt securities    Not applicable    —

   12B Warrants and rights    Not applicable    —

   12C Other securities    Not applicable    —

   12D American Depositary Shares    Depositary shares    66

13    DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES    Not applicable    —

14    MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY

   HOLDERS AND USE OF PROCEEDS    Not applicable    —

15    CONTROLS AND PROCEDURES    Controls and procedures    87

16A    AUDIT COMMITTEE FINANCIAL EXPERT    Management    74

16B    CODE OF ETHICS    Code of ethics    89

16C    PRINCIPAL ACCOUNTANT FEES AND SERVICES    Principal accountant fees and services    111

16D
EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT
COMMITTEES
   Not applicable    —

16E    PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFIIATED PURCHASERS    Purchases of equity securities by the issuer and affiliated purchasers    67

16F    CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT    Not applicable    —

16G    CORPORATE GOVERNANCE    Corporate governance    73

16H    MINE SAFETY DISCLOSURE    Not applicable    —

17    FINANCIAL STATEMENTS    Not applicable    —

18    FINANCIAL STATEMENTS    Consolidated Financial statements    119

19    EXHIBITS    Additional Information    112
~~116~~

7A Major shareholders Major shareholders 50

7B Related party transactions Related party transactions 51
7C Interests of experts and counsel Not applicable -
~~SIGNATURES~~       8 FINANCIAL INFORMATION

8A Consolidated statements and other financial informationConsolidated Financial StatementsF-1
Dividends51
Note 17—Commitments and Contingencies
F-59
8B Significant changesNot applicable-
*América Móvil has elected to apply the SEC rules issued on November 19, 2020 which became effective on February 10, 2021, with respect to Item 5 of this Form 20-F. Registrants, including América Móvil, are required to comply with the amended rules for their first fiscal year ending on or after April 9, 2021.
91

The registrant hereby certifies that it meets all of the requirements for filing on Form20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

Dated: April ~~11, 2019~~28, 2021

AMÉRICA MÓVIL, S.A.B. DE C.V.



By:		/s/ Carlos José García Moreno Elizondo
Name:		Carlos José García Moreno Elizondo
Title:		Chief Financial Officer



By:		/s/ Alejandro Cantú Jiménez
Name:		Alejandro Cantú Jiménez
Title:		General Counsel

~~117~~

~~PART VIII CONSOLIDATED FINANCIAL STATEMENTS~~

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Financial Statements

Years Ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020

with Report of Independent Registered Public Accounting Firm

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Financial Statements

Years Ended December 31, ~~2016, 2017,~~2018, 2019 and ~~2018~~2020

Contents:


Report of Independent Registered Public Accounting Firm			F-2

Audited Consolidated Financial Statements:

Consolidated Statements of Financial Position			~~F-3~~F-7

Consolidated Statements of Comprehensive Income			~~F-4~~F-8

Consolidated Statements of Changes in Shareholders’ Equity			~~F-5~~F-9

Consolidated Statements of Cash Flows			~~F-6~~F-11

Notes to Consolidated Financial Statements			~~F-7~~F-12

~~REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM~~AMX Audit Opinion 2020

~~The~~To the Board of Directors and Shareholders of

América Móvil, S.A.B. de C.V.

Opinion on the Financial Statements

We have audited the accompanying consolidated statements of financial position of América Móvil, S.A.B. de C.V. and its subsidiaries (the Company) as of December 31, ~~2018~~2020 and ~~2017,~~2019, the related consolidated statements of comprehensive income, changes in shareholders’ equity and cash flows for each of the three years in the period ended December 31, ~~2018,~~2020, and the related notes (collectively referred to as the ~~“financial~~“consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the ~~consolidated~~ financial position of the Company ~~as of~~at December 31, ~~2018~~2020 and ~~2017,~~2019, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, ~~2018,~~2020, in conformity with International Financial Reporting Standards, as issued by the International Accounting Standards Board.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the ~~Company´s~~Company’s internal control over financial reporting as of December 31, ~~2018,~~2020, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 ~~Framework)~~framework) and our report dated April ~~11, 2019~~28, 2021 expressed an unqualified opinion thereon.

Change in accounting policy for certain class of assets (Towers)

Basis for Opinion

These financial statements are the responsibility of the ~~Company´s~~Company’s management. Our responsibility is to express an opinion on the ~~Company´s~~Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.


		*Deferred tax assets, realizability of Net Operating Loss Carryforwards*

Description of the Matter		As discussed in Note 13 to the consolidated financial statements, as of December 31, 2020, the net balance of deferred tax assets was Ps.66,303,077 thousand. The Company has recognized deferred tax assets arising from net operating loss carryforwards (NOLs) of approximately Ps.25,121,933 thousand. The NOLs were generated primarily by its subsidiary in Brazil. Auditing management’s assessment of the realizability of the deferred tax assets arising from NOLs involved complex auditor judgement because management´s estimate of realizability was based on assessing the probability, timing and sufficiency of expected reversals of taxable temporary differences, future taxable profits and available tax planning opportunities. These projections are sensitive because they can be affected by future operating results and future market and economic conditions.

How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design and tested the operating effectiveness of controls that address the risks of material misstatement related to the realizability of the deferred tax assets. We tested controls over management’s analyses of future reversal of existing taxable temporary differences, their projections of future taxable income and related assumptions used in developing the projected financial information and their identification of available tax planning opportunities. Our audit also included the evaluation of controls that address the completeness and accuracy of the data utilized in the valuation models. To test the realizability of the deferred tax assets arising from NOLs our audit procedures included, among other things, the review of management´s estimates of future taxable income in Brazil, the methodology used, the significant assumptions and the underlying data used by the Company in developing the projected financial information, such as the weighted average cost of capital, customer attrition rates, growth rates, and other key assumptions by comparing them with historical, economic and industry trends and evaluating whether changes to the Company´s business model and other factors would significantly affect the projected financial information. We also involved our internal specialists to evaluate the methodologies and assumptions used, and to test the calculations used by the Company. In addition, with the assistance of our tax professionals, we assessed the application of relevant tax laws, including assessing the Company’s future tax planning opportunities and tested the Company´s scheduling of the timing and amounts of expected reversals of taxable temporary differences. We also assessed the adequacy of the related financial statement disclosures.

		*Impairment of goodwill*

Description of the Matter		As discussed in Note 2 item iii) i) and in Note 11 to the consolidated financial statements, as of December 31, 2020, the Company’s goodwill balance was Ps.143,052,859 thousand. The Company tests goodwill at least annually at the Cash Generating Unit (CGU) level. Impairment exists when the carrying value of a CGU exceeds its recoverable amount, which is the higher of its fair value less cost to sell and its value-in-use. Auditing management´s annual assessment of impairment of goodwill involved complex auditor judgement because the estimations required to determine the fair value and value-in-use of the CGUs, including revenue growth rates, operating margins and weighted average cost of capital, are sensitive to, and affected by, expected economic factors, technological changes and market conditions, among other factors.



How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design and tested the operating effectiveness of controls that address the risks of material misstatement related to the determination of the impairment of goodwill, including controls over management’s review of the significant assumptions described above, projected financial information and the valuation model used to develop such estimates. To test the impairment of goodwill our audit procedures included, among others, evaluating the methodology used, testing the significant assumptions mentioned above and the underlying data used by the Company. We assessed the historical accuracy of management’s estimates and projections by comparing them to actual results and obtaining appropriate explanations for the variances; examined management’s support for the current estimates and projections by comparing them to industry and economic trends, including market participant data; evaluated management’s methodology on the estimation of the weighted average cost of capital reflecting the economic conditions for each CGU; tested the completeness and accuracy of the underlying data, and evaluated other factors that would significantly affect the projected financial information and thus the fair value and value-in-use of the CGUs. In addition, we involved our valuation specialist to evaluate the methodologies and assumptions used and to test the calculations made by the Company. We also assessed the adequacy of the related financial statement disclosures.

		*Discount rates used in determining pension and postretirement benefit obligations in Mexico*

Description of the Matter		As discussed in Note 2, item iii), q) and in Note 18 to the consolidated financial statements, as of December 31, 2020, the defined benefit pension obligation balance was Ps.168,230,202 thousand. The Company assessed and updated its estimates and assumptions used to actuarially measure and value the defined benefit pension obligation as of December 31, 2020, using the assistance of independent actuarial specialists. Auditing the defined benefit pension obligation which the majority of it arises from one of its subsidiaries in Mexico and for which this matter is related, involved complex auditor judgement and required the involvement of actuarial specialists because of the highly judgmental nature of the actuarial assumptions, primarily the discount rate used in the Company’s measurement process. This assumption was complex because it required a valuation of the credit quality of the corporate bonds used to develop the discount rate and the correlation of those bonds’ cash inflows to the timing and amount of future expected benefit payments.

How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design and tested the operating effectiveness of controls that address the risks of material misstatement relating to the determination of the discount rate used in the defined benefit pension and postretirement benefit obligations calculations. We tested controls over management’s determination and review of the discount rate provided to the independent actuaries. To test the determination of the discount rate of the defined benefit pension obligation we involved our valuation and actuarial specialists to assist us in evaluating the methodology used to select the yield curve applied on the calculation, assessing the credit quality of the corporate bonds that comprise the yield curve, the timing and amount of cash flows at maturity with the expected amounts and duration of the related benefit payments. In addition, we compared the Company’s current projections to historical projected defined benefit pension and postretirement benefit obligations cash flows and compared the current-year benefits paid to the prior-year projected cash flows.


		We also evaluated the objectivity and competence of the independent actuaries used by management and management´s qualified persons responsible for overseeing the preparation of the discount rate by the independent actuaries specialists through the consideration of their professional qualifications, experience and their use of accepted methodology. We also assessed the adequacy of the related financial statement disclosures.

		*Revaluation of towers due to a change in accounting policy*

Description of the Matter		As discussed in Note 2, item a), i) and in Note 10 to the consolidated financial statements, as of December 31, 2020, the balance of the network in operation and equipment was Ps.1,057,592,243 thousand. This includes a revaluation adjustment of Ps.107,152,628 due to a change in the accounting policy adopted by the Company on December 31, 2020 for certain class of assets (towers) from the cost model to the revaluation model. Auditing management´s revaluation model of towers involved complex auditor judgement because the estimation of the fair value of the towers required the assessment of the valuation technique and the assumptions used, as the future lease income, tenancy ratios, earnings before interest, taxes, depreciation and amortization (EBITDA) and weighted average cost of capital (WACC) that are sensitive to, and affected by, expected economic factors, technological changes and market conditions, among others.

How We Addressed the Matter in Our Audit		We obtained an understanding, evaluated the design and tested the operating effectiveness of controls that address the risks of material misstatement related to the determination of tower’s fair value, including controls over management’s review of the significant assumptions described above, the valuation model used to develop such values and the completeness and accuracy of the data utilized in the valuation model. Our audit procedures included, among others, the evaluation of the tower´s measurement change from cost to the revaluation model, considering the nature of the asset and industry. To test the revaluation model of the towers, we evaluated the methodology used and tested the significant assumptions included in the model and the underlying data used by management. In particular, we assessed the historical accuracy of significant assumptions such as, EBITDA and tenancy ratios by comparing them to actual and expected results, the industry and economic trends, including market participant data, and obtained appropriate explanations for the variances; we evaluated the future lease income by comparing it with actual lease agreements’ terms and conditions with external third party companies by geography and assessed management’s methodology for determining the WACC used in the model for each country. We involved our valuation specialists to evaluate the methodology and some assumptions, including EBITDA and WACC used in the fair value estimation and tested the calculations. In addition, we evaluated the objectivity and competence of the external valuation specialists used by management and management´s qualified persons responsible for overseeing the preparation of the determination of the fair value of the towers by the external valuation specialists through the consideration of their professional qualifications, experience and their use of accepted methodology. Furthermore, we assessed the adequacy of the related financial statement disclosures.

/s/ ~~MANCERA,~~Mancera, S.C.

We have served as the ~~Company´s~~Company’s auditor since 1993.

Mexico City, Mexico

April ~~11, 2019~~28, 2021

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Statements of Financial Position

(In thousands of Mexican pesos)


	Note		At December 31,											At December 31,
	Note		2017			2018			2018 Millions of U.S. dollars			Note		2019			2020			2020 Millions of U.S. dollars
Assets
Current assets:
Cash and cash equivalents		3	Ps.	24,270,473		Ps.	21,659,962		US$	1,100			3	Ps.	19,745,656		Ps.	35,917,907		US$	1,801
Equity investments at fair value through OCI and other short-term investments		4		59,120,676			49,015,934			2,490
Equity investments at fair value through other comprehensive income (OCI) and other short-term investments													4		47,718,025			54,636,395			2,739
Accounts receivable:
Subscribers, distributors, recoverable taxes, contract assets and other, net		5		193,776,144			216,226,920			10,986			5		204,706,296			207,977,954			10,426
Related parties		6		868,230			1,263,605			64			6		1,273,140			1,391,300			70
Derivative financial instruments		7		8,037,384			5,287,548			269			7		6,825,760			20,928,335			1,049
Inventories, net		8		38,809,565			40,305,362			2,048			8		41,102,012			30,377,439			1,523
Other current assets, net		9		17,352,746			15,296,193			777			9		9,473,434			8,993,907			451

Total current assets			Ps.	342,235,218		Ps.	349,055,524		US$	17,734				Ps.	330,844,323		Ps.	360,223,237		US$	18,059
Non-current assets:
Property, plant and equipment, net		10	Ps.	676,343,198		Ps.	640,000,720		US$	32,516			10	Ps.	639,343,370		Ps.	722,929,631		US$	36,239
Intangibles, net		11		143,539,626			122,137,703			6,205			11		125,169,389			133,456,967			6,690
Goodwill		11		151,463,232			145,566,497			7,396			11		152,899,801			143,052,859			7,171
Investments in associated companies				3,735,172			3,132,707			159					2,474,193			1,829,760			92
Deferred income taxes		13		116,571,349			111,186,768			5,649			13		106,167,897			115,370,240			5,783
Accounts receivable, subscriber, distributors and contract assets, net		5		9,786,581			15,681,872			797			5		15,139,442			7,792,863			391
Other assets, net		9		42,537,476			42,461,601			2,157			9		41,892,019			38,415,826			1,926
Right-of-use assets													15		118,003,223			101,976,844			5,112

Total assets			Ps.	1,486,211,852		Ps.	1,429,223,392		US$	72,613				Ps.	1,531,933,657		Ps.	1,625,048,227		US$	81,463

Liabilities and equity
Current liabilities:
Short-term debt and current portion of long-term debt		14	Ps.	51,745,841		Ps.	96,230,634		US$	4,889			14	Ps.	129,172,033		Ps.	148,083,184		US$	7,423
Short-term liability related to right-of-use of assets													15		25,894,711			25,067,905			1,257
Accounts payable		15a		212,673,407			221,957,267			11,277			16a		216,112,824			186,995,472			9,374
Accrued liabilities		15b		67,752,758			56,433,691			2,867			16b		52,371,252			50,291,851			2,521
Income tax				9,362,009			19,232,191			977			13		33,026,606			14,644,979			734
Other taxes payable				24,387,484			23,979,334			1,218					24,373,400			27,969,739			1,402
Derivative financial instruments		7		10,602,539			13,539,716			688			7		9,596,751			14,230,249			713
Related parties		6		2,540,412			2,974,213			151			6		3,460,419			3,999,916			201
Deferred revenues				34,272,047			32,743,843			1,664					31,391,749			36,027,383			1,806

Total current liabilities			Ps.	413,336,497		Ps.	467,090,889		US$	23,731				Ps.	525,399,745		Ps.	507,310,678		US$	25,431
Non-current-liabilities:
Non-current liabilities:
Long-term debt		14	Ps.	646,139,058		Ps.	542,691,819		US$	27,572			14	Ps.	495,082,444		Ps.	480,299,772		US$	24,077
Long-term liability related to right-of-use of assets													15		94,702,022			84,259,336			4,224
Deferred income taxes		13		11,997,364			24,573,441			1,248			13		18,093,041			49,067,163			2,460
Income tax				8,622,500			7,891,042			401
Deferred revenues				3,183,727			3,239,301			165					3,425,738			2,875,467			144
Derivative financial instruments		7		3,756,921			3,567,863			181
Asset retirement obligations		15c		18,245,129			15,971,601			811			16c		15,816,744			17,887,991			897
Employee benefits		17		120,297,139			118,325,014			6,012			18		152,507,058			168,230,202			8,433

Totalnon-current liabilities			Ps.	812,241,838		Ps.	716,260,081		US$	36,390				Ps.	779,627,047		Ps.	802,619,931		US$	40,235

Total liabilities			Ps.	1,225,578,335		Ps.	1,183,350,970		US$	60,121				Ps.	1,305,026,792		Ps.	1,309,930,609		US$	65,666

Equity:
Capital stock		19	Ps.	96,338,508		Ps.	96,338,378		US$	4,895			20	Ps.	96,338,262		Ps.	96,341,695		US$	4,829
Retained earnings:
Prior years				141,761,677			184,689,288			9,383					213,719,236			267,865,420			13,428
Profit for the year				29,325,921			52,566,197			2,670					67,730,891			46,852,605			2,349

Total retained earnings				171,087,598			237,255,485			12,053					281,450,127			314,718,025			15,777
Other comprehensive loss items				(73,261,794	)		(137,598,218	)		(6,990	)				(199,878,430	)		(160,580,917	)		(8,049	)

Equity attributable to equity holders of the parent				194,164,312			195,995,645			9,958					177,909,959			250,478,803			12,557
Non-controlling interests				66,469,205			49,876,777			2,534					48,996,906			64,638,815			3,240

Total equity				260,633,517			245,872,422			12,492					226,906,865			315,117,618			15,797

Total liabilities and equity			Ps.	1,486,211,852		Ps.	1,429,223,392		US$	72,613				Ps.	1,531,933,657		Ps.	1,625,048,227		US$	81,463

The accompanying notes are an integral part of these consolidated financial statements.

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

(In thousands of Mexican pesos, except for earnings per share)

Note For the year ended December 31
2016 2017 2018 2018
Millions of U.S.
dollars, except
for earnings
per share
Operating revenues:

Revenues services
Ps. 831,885,365 Ps. 878,411,323 Ps. 863,647,642 US$ 43,878
Sales of equipment
143,527,123 143,222,212 174,560,039 8,869

Ps. 975,412,488 Ps.   1,021,633,535 Ps.   1,038,207,681 US$   52,747

Operating costs and expenses:

Cost of sales and services
485,060,579 496,335,746 508,822,430 25,851
Commercial, administrative and general expenses
228,101,116 240,634,431 227,192,478 11,543
Other expenses
4,114,562 24,345,113 6,923,022 352
Depreciation and amortization
9,10 and 11 148,525,921 160,174,942 155,712,580 7,911

Ps. 865,802,178 Ps. 921,490,232 Ps. 898,650,510 US$ 45,657

Operating income
Ps. 109,610,310 Ps. 100,143,303 Ps. 139,557,171 US$ 7,090

Interest income
4,192,595 2,925,648 10,646,169 541
Interest expense
(33,862,012 ) (30,300,781 ) (31,771,433 ) (1,614 )
Foreign currency exchange loss, net
(40,427,407 ) (13,818,951 ) (7,261,956 ) (369 )
Valuation of derivatives, interest cost from labor obligations and other financial items, net
21 (16,225,841 ) (1,943,760 ) (10,176,316 ) (517 )
Equity interest in net result of associated companies
189,950 91,385 267 —

Profit before income tax
23,477,595 57,096,844 100,993,902 5,131
Income tax
13 11,398,856 24,941,511 46,477,079 2,361

Net profit for the year
Ps. 12,078,739 Ps. 32,155,333 Ps. 54,516,823 US$ 2,770

Net profit for the year attributable to:

Equity holders of the parent
Ps. 8,649,427 Ps. 29,325,921 Ps. 52,566,197 US$ 2,670
Non-controlling interests
3,429,312 2,829,412 1,950,626 100

Ps. 12,078,739 Ps. 32,155,333 Ps. 54,516,823 US$ 2,770

Basic and diluted earnings per share attributable to equity holders of the parent
Ps. 0.13 Ps. 0.44 Ps. 0.79 US$ 0.04

Other comprehensive income (loss) items:

Net other comprehensive (loss) income that may be reclassified to profit or loss in subsequent years:

Effect of translation of foreign entities
Ps. 107,498,708 Ps. (18,309,877 ) Ps. (64,314,032 ) US$ (3,268 )
Effect of fair value of derivatives, net of deferred taxes
49,129 12,292 —   —
Items that will not be reclassified to (loss) or profit in subsequent years:

Re-measurement of defined benefit plan, net of deferred taxes
14,773,399 (7,046,089 ) 757,278 38
Unrealized (loss) gain on equity investments at fair value, net of deferred taxes
(6,673,731 ) 622,424 (3,765,688 ) (191 )

Total other comprehensive income (loss) items for the year, net of deferred taxes
20 115,647,505 (24,721,250 ) (67,322,442 ) (3,421 )

Total comprehensive income (loss) for the year
Ps. 127,726,244 Ps. 7,434,083 Ps. (12,805,619 ) US$ (651 )

Comprehensive income (loss) for the year attributable to:

Equity holders of the parent
Ps. 120,974,842 Ps. 1,201,698 Ps. (11,770,227 ) US$ (598 )
Non-controlling interests
6,751,402 6,232,385 (1,035,392 ) (53 )

Ps.   127,726,244 Ps. 7,434,083 Ps. (12,805,619 ) US$ (651 )

For the years ended December 31
Note 2018 2019 2020 2020
Millions of U.S.
dollars, except
for earnings
per share
Operating revenues:

Service revenues
Ps. 863,647,642 Ps. 834,365,232 Ps. 857,860,234 US$ 43,003
Sales of equipment
174,560,039 172,982,637 159,026,296 7,972

Ps. 1,038,207,681 Ps. 1,007,347,869 Ps. 1,016,886,530 US$ 50,975

Operating costs and expenses:

Cost of sales and services
508,822,430 471,736,157 470,427,476 23,582
Commercial, administrative and general expenses
227,192,478 215,993,865 212,135,830 10,634
Other expenses
6,923,022 5,862,102 4,724,630 237
Depreciation and amortization

9,10,11 and
15
155,712,580 158,915,210 164,243,683 8,233

Ps. 898,650,510 Ps. 852,507,334 Ps. 851,531,619 US$ 42,686

Operating income
Ps. 139,557,171 Ps. 154,840,535 Ps. 165,354,911 US$ 8,289

Interest income
10,646,169 6,284,672 5,062,036 254
Interest expense
(31,771,433 ) (37,911,339 ) (38,661,740 ) (1,938 )
Foreign currency exchange (loss) gain, net
(7,261,956 ) 5,226,071 (65,366,200 ) (3,277 )
Valuation of derivatives, interest cost from labor obligations and other financial items, net
22 (10,176,316 ) (7,075,342 ) 1,291,108 65
Equity interest in net result of associated companies
267 (17,609 ) (287,006 ) (14 )

Profit before income tax
100,993,902 121,346,988 67,393,109 3,379
Income tax
13 46,477,079 51,033,533 16,366,152 820

Net profit for the year
Ps. 54,516,823 Ps. 70,313,455 Ps. 51,026,957 US$ 2,559

Net profit for the year attributable to:

Equity holders of the parent
Ps. 52,566,197 Ps. 67,730,891 Ps. 46,852,605 US$ 2,349
Non-controlling interests
1,950,626 2,582,564 4,174,352 210

Ps. 54,516,823 Ps. 70,313,455 Ps. 51,026,957 US$ 2,559

Basic and diluted earnings per share attributable to equity holders of the parent
Ps. 0.79 Ps. 1.03 Ps. 0.71 US$ 0.04

Other comprehensive income (loss) items:

Net other comprehensive loss that may be reclassified to profit or loss in subsequent years:

Effect of translation of foreign entities
Ps. (64,314,032 ) Ps. (35,536,252 ) Ps. (11,515,297 ) US$ (579 )
Items that will not be reclassified to (loss) or profit in subsequent years:

Re-measurement of defined benefit plan, net of deferred taxes
757,278 (29,535,672 ) (10,299,558 ) (516 )
Unrealized (loss) gain on equity investments at fair value, net of deferred taxes
(3,765,688 ) 883,408 (1,952,414 ) (98 )
Revaluation surplus, net of deferred taxes
—   —   77,230,031 3,871

Total other comprehensive (loss) income items for the year, net of deferred taxes
21 (67,322,442 ) (64,188,516 ) 53,462,762 2,678

Total comprehensive (loss) income for the year
Ps. (12,805,619 ) Ps. 6,124,939 Ps. 104,489,719 US$ 5,237

Comprehensive (loss) income for the year attributable to:

Equity holders of the parent
Ps. (11,770,227 ) Ps. 5,450,679 Ps. 86,150,118 US$ 4,319
Non-controlling interests
(1,035,392 ) 674,260 18,339,601 918

Ps. (12,805,619 ) Ps. 6,124,939 Ps. 104,489,719 US$ 5,237

The accompanying notes are an integral part of these consolidated financial statements.

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Statements of Changes in Shareholders’ Equity

For the ~~year~~years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020

(In thousands of Mexican pesos)


	Capital stock			Legal reserve		Retained earnings			Effect of derivative financial instruments acquired for hedging purposes			Unrealized gain (loss) on equity investment at fair value			Re-measurement of defined benefit plans			Cumulative translation adjustment			Total equity attributable to equity holders of the parent			Non- controlling interests			Total equity			Capital stock			Legal reserve		Retained earnings			Unrealized (loss) gain on equity investment at fair value			Re-measurement of defined benefit plans			Cumulative translation adjustment			Revaluation surplus		Total equity attributable to equity holders of the parent			Non- controlling interests			Total equity
Balance at December 31, 2015	Ps.	96,338,477		Ps.	358,440	Ps.	171,972,999		Ps.	(60,788)		Ps.	4,011		Ps.	(82,844,947)		Ps.	(73,490,197)		Ps.	112,277,995		Ps.	48,576,191		Ps.	160,854,186
Net profit for the year		—			—		8,649,427			—			—			—			—			8,649,427			3,429,312			12,078,739
Effect of fair value of derivatives, net of deferred taxes		—			—		—			48,496			—			—			—			48,496			633			49,129
Unrealized loss on equity investments at fair value, net of deferred taxes		—			—		—			—			(6,673,731	)		—			—			(6,673,731	)		—			(6,673,731	)
Remeasurement of defined benefit plan, net of deferred taxes		—			—		—			—			—			14,771,770			—			14,771,770			1,629			14,773,399
Effect of translation of foreign entities		—			—		—			—			—			—			104,178,880			104,178,880			3,319,828			107,498,708
As of January 1, 2018																														Ps.	96,338,508		Ps.	358,440	Ps.	170,729,158		Ps.	(6,047,296	)	Ps.	(75,080,656	)	Ps.	7,866,158		Ps.	—	Ps.	194,164,312		Ps.	66,469,205		Ps.	260,633,517
Effect of adoption of new accounting standards																															—			—		19,598,349			—			—			—			—		19,598,349			518,440			20,116,789

Comprehensive income (loss) for the year		—			—		8,649,427			48,496			(6,673,731	)		14,771,770			104,178,880			120,974,842			6,751,402			127,726,244
Dividends declared		—			—		(18,339,294)			—			—			—			—			(18,339,294	)		(652,341	)		(18,991,635	)
Stock dividend (Note 19)		1,512			—		4,606,274			—			—			—			—			4,607,786			—			4,607,786
Repurchase of shares		(2,475	)		—		(7,213,397	)		—			—			—			—			(7,215,872	)		—			(7,215,872	)
Partial sale of shares of Telekom Austria (Note 12)		—			—		—			—			—			68,127			(1,139,192	)		(1,071,065	)		7,394,401			6,323,336
Other acquisitions ofnon-controlling interests (Note 12)		—			—		(2,319,149	)		—			—			—			—			(2,319,149	)		38,871			(2,280,278	)

Balance at December 31, 2016		96,337,514			358,440		157,356,860			(12,292	)		(6,669,720)			(68,005,050	)		29,549,491			208,915,243			62,108,524			271,023,767
Net profit for the year		—			—		29,325,921			—			—			—			—			29,325,921			2,829,412			32,155,333
Effect of fair value of derivatives, net of deferred taxes		—			—		—			12,292			—			—			—			12,292			—			12,292
Unrealized gain on equity investments at fair value, net of deferred taxes		—			—		—			—			622,424			—			—			622,424			—			622,424
Remeasurement of defined benefit plan, net of deferred taxes		—			—		—			—			—			(7,075,606	)		—			(7,075,606	)		29,517			(7,046,089	)
Effect of translation of foreign entities		—			—		—			—			—			—			(21,683,333	)		(21,683,333	)		3,373,456			(18,309,877	)

Comprehensive income (loss) for the year		—			—		29,325,921			12,292			622,424			(7,075,606	)		(21,683,333	)		1,201,698			6,232,385			7,434,083
Dividends declared		—			—		(19,815,470	)		—			—			—			—			(19,815,470	)		(1,848,108	)		(21,663,578	)
Stock dividend (Note 19)		1,264			—		4,902,818			—			—			—			—			4,904,082			—			4,904,082
Repurchase of shares		(270	)		—		(1,040,686	)		—			—			—			—			(1,040,956	)		—			(1,040,956	)
Other acquisitions ofnon-controlling interests (Note 12)		—			—		(285	)		—			—			—			—			(285	)		(23,596	)		(23,881	)

As of January 1 2018		96,338,508			358,440		170,729,158			—			(6,047,296	)		(75,080,656	)		7,866,158			194,164,312			66,469,205			260,633,517
Effect of adoption of new accounting standards (Note 2i)		—			—		19,598,349			—			—			—			—			19,598,349			518,440			20,116,789

As of January 1 2018 (restated)		96,338,508			358,440		190,327,507			—			(6,047,296	)		(75,080,656	)		7,866,158			213,762,661			66,987,645			280,750,306
As of January 1, 2018 (restated)																														Ps.	96,338,508		Ps.	358,440	Ps.	190,327,507		Ps.	(6,047,296	)	Ps.	(75,080,656	)	Ps.	7,866,158		Ps.	—	Ps.	213,762,661		Ps.	66,987,645		Ps.	280,750,306

Net profit for the year		—			—		52,566,197			—			—			—			—			52,566,197			1,950,626			54,516,823			—			—		52,566,197			—			—			—			—		52,566,197			1,950,626			54,516,823
Unrealized loss on equity investments at fair value, net of deferred taxes		—			—		—			—			(3,765,688	)		—			—			(3,765,688	)		—			(3,765,688	)		—			—		—			(3,765,688	)		—			—			—		(3,765,688	)		—			(3,765,688	)
Remeasurement of defined benefit plan, net of deferred taxes		—			—		—			—			—			652,722			—			652,722			104,556			757,278			—			—		—			—			652,722			—			—		652,722			104,556			757,278
Effect of translation of foreign entities		—			—		—			—			—			—			(61,223,458	)		(61,223,458	)		(3,090,574	)		(64,314,032	)		—			—		—			—			—			(61,223,458	)		—		(61,223,458	)		(3,090,574	)		(64,314,032	)

Comprehensive income (loss) for the year		—			—		52,566,197						(3,765,688	)		652,722			(61,223,458	)		(11,770,227	)		(1,035,392	)		(12,805,619	)		—			—		52,566,197			(3,765,688	)		652,722			(61,223,458	)		—		(11,770,227	)		(1,035,392	)		(12,805,619	)
Dividends declared		—			—		(21,134,520	)		—			—			—			—			(21,134,520	)		(1,850,462	)		(22,984,982	)		—			—		(21,134,520	)		—			—			—			—		(21,134,520	)		(1,850,462	)		(22,984,982	)
Hyperinflation adjustment (Note 2i)		—			—		15,826,934			—			—			—			—			15,826,934			—			15,826,934
Hyperinflation adjustment																															—			—		15,826,934			—			—			—			—		15,826,934			—			15,826,934
Repurchase of shares		(130	)		—		(518,633	)		—			—			—			—			(518,763	)		—			(518,763	)		(130	)		—		(518,633	)		—			—			—			—		(518,763	)		—			(518,763	)
Redemption of hybrid bond (Note 19)		—			—		—			—			—			—			—			—			(13,440,120	)		(13,440,120	)
Redemption of hybrid bond																															—			—		—			—			—			—			—		—			(13,440,120	)		(13,440,120	)
Other acquisitions ofnon-controlling interests		—			—		(170,440	)		—			—			—			—			(170,440	)		(784,894	)		(955,334	)		—			—		(170,440	)		—			—			—			—		(170,440	)		(784,894	)		(955,334	)

Balance at December 31, 2018	Ps.	96,338,378		Ps.	358,440	Ps.	236,897,045		Ps.	—		Ps.	(9,812,984	)	Ps.	(74,427,934	)	Ps.	(53,357,300	)	Ps.	195,995,645		Ps.	49,876,777		Ps.	245,872,422		Ps.	96,338,378		Ps.	358,440	Ps.	236,897,045		Ps.	(9,812,984	)	Ps.	(74,427,934	)	Ps.	(53,357,300	)	Ps.	—	Ps.	195,995,645		Ps.	49,876,777		Ps.	245,872,422

Capital
stock Legal
reserve Retained
earnings Unrealized
(loss) gain on
equity
investment at
fair value Re-measurement
of defined
benefit plans Cumulative
translation
adjustment Revaluation
surplus Total equity
attributable to
equity holders
of the parent Non-
controlling
interests Total
equity
Net profit for the year
—   —   67,730,891 —   —   —   —   67,730,891 2,582,564 70,313,455
Unrealized gain on equity investments at fair value, net of deferred taxes
—   —   —   883,408 —   —   —   883,408 —   883,408
Remeasurement of defined benefit plan, net of deferred taxes
—   —   —   —   (29,153,554 ) —   —   (29,153,554 ) (382,118 ) (29,535,672 )
Effect of translation of foreign entities
—   —   —   —   —   (34,010,066 ) —   (34,010,066 ) (1,526,186 ) (35,536,252 )

Comprehensive income (loss) for the year
—   —   67,730,891 883,408 (29,153,554 ) (34,010,066 ) —   5,450,679 674,260 6,124,939
Dividends declared
—   —   (23,106,823 ) —   —   —   —   (23,106,823 ) (1,473,290 ) (24,580,113 )
Repurchase of shares
(116 ) —   (427,212 ) —   —   —   —   (427,328 ) —   (427,328 )
Other acquisitions of non-controlling interests
—   —   (2,214 ) —   —   —   —   (2,214 ) (80,841 ) (83,055 )

Balance at December 31, 2019
Ps. 96,338,262 Ps. 358,440 Ps. 281,091,687 Ps. (8,929,576 ) Ps. (103,581,488 ) Ps. (87,367,366 ) Ps. —   Ps. 177,909,959 Ps. 48,996,906 Ps. 226,906,865
Net profit for the year
—   —   46,852,605 —   —   —   —   46,852,605 4,174,352 51,026,957
Unrealized loss on equity investments at fair value, net of deferred taxes
—   —   —   (1,952,414 ) —   —   —   (1,952,414 ) —   (1,952,414 )
Remeasurement of defined benefit plan, net of deferred taxes
—   —   —   —   (10,026,454 ) —   —   (10,026,454 ) (273,104 ) (10,299,558 )
Effect of translation of foreign entities
—   —   —   —   —   (13,558,774 ) —   (13,558,774 ) 2,043,477 (11,515,297 )
Revaluation surplus, net of deferred taxes
—   —   —   —   —   —   64,835,155 64,835,155 12,394,876 77,230,031

Comprehensive income (loss) for the year
—   —   46,852,605 (1,952,414 ) (10,026,454 ) (13,558,774 ) 64,835,155 86,150,118 18,339,601 104,489,719
Dividends declared
—   —   (25,161,564 ) —   —   —   —   (25,161,564 ) (1,860,300 ) (27,021,864 )
Stock dividend
4,650 —   17,054,007 —   —   —   —   17,058,657 —   17,058,657
Repurchase of shares
(1,217 ) —   (5,209,880 ) —   —   —   —   (5,211,097 ) —   (5,211,097 )
Other acquisitions of non-controlling interests
—   —   (267,270 ) —   —   —   —   (267,270 ) (837,392 ) (1,104,662 )

Balance at December 31, 2020
Ps. 96,341,695 Ps. 358,440 Ps. 314,359,585 Ps. (10,881,990 ) Ps. (113,607,942 ) Ps. (100,926,140 ) Ps. 64,835,155 Ps. 250,478,803 Ps. 64,638,815 Ps. 315,117,618

The accompanying notes are an integral part of these consolidated financial statements.

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(In thousands of Mexican pesos)


			For the year ended December 31														For the years ended December 31
	Note		2016			2017			2018			2018 Millions of U.S. dollars			Note		2018			2019			2020			2020 Millions of U.S. dollars
Operating activities
Profit before income tax			Ps.	23,477,595		Ps.	57,096,844		Ps.	100,993,902		US$	5,131				Ps.	100,993,902		Ps.	121,346,988		Ps.	67,393,109		US$	3,379
Items not requiring the use of cash:
Depreciation		10		127,662,344			135,206,080			129,115,727			6,560
Depreciation property, plant and equipment and right-of-use assets																10 and 15		129,115,727			138,386,952			143,691,770			7,203
Amortization of intangible and other assets		9 and 11		20,863,577			24,968,862			26,596,853			1,351			9 and 11		26,596,853			20,528,258			20,551,913			1,030
Equity interest in net income of associated companies				(189,950	)		(91,385	)		(267	)		—
Equity interest in net (loss) income of associated companies																		(267	)		17,609			287,006			14
Loss on sale of property, plant and equipment				8,059			145,225			664,777			34					664,777			119,272			257,330			13
Net period cost of labor obligations		17		14,240,271			13,636,182			13,989,100			711			18		13,989,100			16,609,565			18,085,954			907
Foreign currency exchange loss, net				34,049,726			11,699,985			6,148,612			312
Foreign currency exchange loss (income), net																		6,148,612			(7,250,635	)		59,923,928			3,005
Interest income				(4,192,595	)		(2,925,648	)		(10,646,169	)		(541	)				(10,646,169	)		(6,284,672	)		(5,062,036	)		(254	)
Interest expense				33,862,012			30,300,781			31,771,433			1,614					31,771,433			37,911,339			38,661,740			1,938
Employee profit sharing				2,235,267			1,751,312			1,500,342			76					1,500,342			1,618,695			2,066,066			105
Loss (gain) in valuation of derivative financial instruments, capitalized interest expense and other, net				85,216			(19,010,851	)		(7,518,445	)		(382	)
Loss in valuation of derivative financial instruments, capitalized interest expense and other, net																		(7,518,445	)		(9,202,167	)		(13,678,083	)		(686	)
Gain on net monetary positions		21		—			—			(4,429,145	)		(225	)		22		(4,429,145	)		(4,267,194	)		(3,262,512	)		(164	)
Working capital changes:
Subscribers, distributors, recoverable taxes, contract assets and other, net				(14,192,651	)		1,799,095			(15,420,291	)		(783	)				(15,420,291	)		6,800,942			3,129,237			157
Prepaid expenses				792,979			4,588,584			3,264,685			166					3,264,685			9,079,931			20,925			1
Related parties				829,632			(558,651	)		38,426			2					38,426			476,671			421,337			21
Inventories				3,076,159			(2,991,009	)		(3,232,136	)		(164	)				(3,232,136	)		(2,095,622	)		11,618,280			582
Other assets				(2,944,581	)		(4,763,394	)		(6,081,740	)		(309	)				(6,081,740	)		(6,597,262	)		(2,613,460	)		(131	)
Employee benefits				(5,384,944	)		(14,692,218	)		(14,235,549	)		(723	)				(14,235,549	)		(20,224,276	)		(18,795,532	)		(942	)
Accounts payable and accrued liabilities				18,196,349			5,190,137			23,997,632			1,219					23,997,632			(16,811,135	)		11,531,391			578
Employee profit sharing paid				(3,297,439	)		(1,471,946	)		(1,013,799	)		(52	)				(1,013,799	)		(2,187,316	)		(2,436,223	)		(122	)
Financial instruments and other				28,878,632			1,515,668			5,286,290			269					5,286,290			(1,774,932	)		2,606,938			131
Deferred revenues				(972,376	)		(452,913	)		38,243			2					38,243			(636,221	)		3,198,018			160
Interest received				3,239,845			819,940			1,215,800			62					1,215,800			1,008,076			3,946,110			198
Income taxes paid				(44,525,073	)		(23,988,305	)		(33,713,753	)		(1,713	)				(33,713,753	)		(42,294,398	)		(60,715,663	)		(3,044	)

Net cash flows provided by operating activities			Ps.	235,798,054		Ps.	217,772,375		Ps.	248,330,528		US$	12,617				Ps.	248,330,528		Ps.	234,278,468		Ps.	280,827,543		US$	14,079

Investing activities
Purchase of property, plant and equipment				(138,707,157	)		(119,185,137	)		(143,888,033	)		(7,310	)				(143,888,033	)		(132,884,335	)		(108,907,418	)		(5,459	)
Acquisition of intangibles				(16,316,738	)		(17,538,541	)		(7,933,647	)		(403	)				(7,933,647	)		(18,962,856	)		(20,647,571	)		(1,035	)
Dividends received		21		5,740,092			2,385,559			2,622,237			133			22		2,622,237			1,773,336			2,122,826			106
Proceeds from sale of plant, property and equipment				115,600			133,349			178,532			9					178,532			344,924			162,060			8
Acquisition of businesses, net of cash acquired				(1,823,813	)		(6,878,793	)		(310,604	)		(16	)		12		(310,604	)		(13,330,651	)		(152,896	)		(8	)
Partial sale of shares of associated company				—			340,040			548,484			28					548,484			36,478			601,509			30
Investments in associate companies				(3,487	)		—			—			—					—			(56,985	)		(64,341	)		(3	)
Short-term disinvestments																		—			—			(8,671,662	)		(435	)

Net cash flows used in investing activities			Ps.	(150,995,503	)	Ps.	(140,743,523	)	Ps.	(148,783,031	)	US$	(7,559	)			Ps.	(148,783,031	)	Ps.	(163,080,089	)	Ps.	(135,557,493	)	US$	(6,796	)

Financing activities
Loans obtained				64,281,631			143,607,726			155,263,221			7,888					155,263,221			118,082,256			277,515,598			13,911
Repayment of loans				(125,672,444	)		(171,041,215	)		(189,314,144	)		(9,618	)				(189,314,144	)		(109,808,816	)		(330,607,399	)		(16,573	)
Payment of liability related to right-of-use of assets																15		—			(26,765,075	)		(29,623,565	)		(1,485	)
Interest paid				(32,125,872	)		(31,196,441	)		(30,869,017	)		(1,568	)				(30,869,017	)		(28,046,695	)		(28,421,734	)		(1,425	)
Repurchase of shares				(7,021,247	)		(1,233,371	)		(511,421	)		(26	)				(511,421	)		(435,713	)		(5,076,119	)		(254	)
Dividends paid				(13,809,957	)		(16,091,390	)		(22,369,793	)		(1,137	)				(22,369,793	)		(24,248,145	)		(9,592,253	)		(481	)
Derivative financial instruments				(351,213	)		(71,474	)		—			—
Partial sale of shares in subsidiary				6,323,336			—			—			—
Redemption of hybrid bond				—			—			(13,440,120	)		(683	)				(13,440,120	)		—			—			—
Acquisition ofnon-controlling interests				(2,280,278	)		(11,930	)		(115,821	)		(6	)				(115,821	)		(83,055	)		(1,104,662	)		(55	)

Net cash flows used in financing activities			Ps.	(110,656,044	)	Ps.	(76,038,095	)	Ps.	(101,357,095	)	US$	(5,150	)			Ps.	(101,357,095	)	Ps.	(71,305,243	)	Ps.	(126,910,134	)	US$	(6,362	)

Net (decrease) increase in cash and cash equivalents			Ps.	(25,853,493	)	Ps.	990,757		Ps.	(1,809,598	)	US $	(92	)
Net increase (decrease) in cash and cash equivalents																	Ps.	(1,809,598	)	Ps.	(106,864	)	Ps.	18,359,916		US$	921

Adjustment to cash flows due to exchange rate fluctuations, net				3,911,844			61,333			(800,913	)		(41	)				(800,913	)		(1,807,442	)		(2,187,665	)		(110	)
Cash and cash equivalents at beginning of the year				45,160,032			23,218,383			24,270,473			1,233					24,270,473			21,659,962			19,745,656			990

Cash and cash equivalents at end of the year			Ps.	23,218,383		Ps.	24,270,473		Ps.	21,659,962		US$	1,100				Ps.	21,659,962		Ps.	19,745,656		Ps.	35,917,907		US$	1,801

Non-cash transactions related to:
Acquisitions of property, plant and equipment in accounts payable at end year			Ps.	13,497,804		Ps.	18,869,210		Ps.	19,099,066		US$	970				Ps.	19,099,066		Ps.	19,673,706		Ps.	3,063,081		US$	154
Redemption of exchangeable bond				—			—			16,446,262			836					16,446,262			—			—			—
Revaluation surplus																		—			—			107,152,628			5,371

Non-cash transactions			Ps.	13,497,804		Ps.	18,869,210		Ps.	35,545,328		US$	1,806				Ps.	35,545,328		Ps.	19,673,706		Ps.	110,215,709		US$	5,525

The accompanying notes are an integral part of these consolidated financial statements.

AMÉRICA MÓVIL, S.A.B. DE C.V. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020

(In thousands of Mexican pesos [Ps.] and thousands of

U.S. dollars [US$], unless otherwise indicated)

1. Description of the Business and Relevant Events

I. Corporate Information

América Móvil, S.A.B. de C.V. and subsidiaries (hereinafter, the “Company”, “América Móvil” or “AMX”) was incorporated under laws of Mexico on September 25, 2000. The Company provides telecommunications services in 25 countries throughout Latin America, the United States, the Caribbean and Europe. These telecommunications services include mobile and fixed-line voice services, wireless and fixed data services, internet access and Pay TV, over the top and other related services. The Company also sells equipment, accessories and computers.

Voice services provided by the Company, both wireless and fixed, mainly include the following: airtime, local, domestic and international long-distance services, and network interconnection services.

Data services include value added, corporate networks, data and Internet services.

Pay TV represents basic services, as well as pay per view and additional programming and advertising services.

AMX provides other related services to advertising in telephone directories, publishing and call center services.

The Company also provides video, audio and other media content that is delivered through the internet directly from the content provider to the end user.

In order to provide these services, América Móvil has licenses, permits and concessions (collectively referred to herein as “licenses”) to build, install, operate and exploit public and/or private telecommunications networks and provide miscellaneous telecommunications services (mostly mobile and fixed voice and data services) and to operate frequency bands in the radio-electric spectrum forpoint-to-point andpoint-to-multipoint microwave links. The Company holds licenses in the 24 countries where it has networks, and such licenses have different dates of expiration through 2056.

Certain licenses require the payment to the respective governments of a share in sales determined as a percentage of revenues from services under concession. The percentage is set as either a fixed rate or in some cases based on certain size of the infrastructure in operation.

The corporate offices of América Móvil are located in Mexico City, Mexico, at Lago Zurich 245, Colonia Ampliación Granada, Delegación Miguel Hidalgo, 11529, Mexico City, Mexico.

The accompanying consolidated financial statements were approved for their issuance by the Company’s Chief Financial Officer on April ~~9, 2019,~~26, 2021, and subsequent events have been considered through that date.

II. Relevant events in 2020

a) The Covid-19 is an infectious disease caused by a new virus, was declared a world-wide pandemic by the World Heald Organization (“WHO”) on March 11, 2020. The measures to slow the spread of Covid-19 have had

a significant impact on the global economy. Given the evolving nature of Covid-19 and the limited recent experience of the economic and financial impacts of such a pandemic, Companies around the world have had to assess the changes and effects in their financial information. These changes and effects have not presented significant challenges for the Company in the valuation, presentation and disclosure of its financial statement consolidated as of December 31, 2020, considering that the telecommunications industry has been one of the least affected by the pandemic. As part of the actions taken, the Company has evaluated the impact, mainly on the estimates related to the measurement assets and liabilities that may arise in the future, without identifying significant changes in the assumptions used.

b) During the COVID-19 crisis, the Mexican peso fell in value against the U.S dollar, Euro and Great Britain Pound (GBP) by 5.8%, 15.3% and 9.2%, respectively. Given that a significant portion of the Company’s debt is denominated in Dollars, Euros and in GBPs, the currency depreciation adversely affected the results of the Company as part of the foreign currency exchange loss, net recognized in the period, which amounted to Ps.65,366,200.

c) In September 2020 the Company announced an agreement with Verizon Communications Inc. to sell the 100% interest in TracFone Wireless, Inc., the largest mobile virtual prepaid service operator in the United States, serving 21 million subscribers. The agreed purchase price payment at the closing is US$6,250 million, of which one-half will be in cash and the other in Verizon stock. In addition, following the closing, Verizon shall pay to AMX: (i) up to US$500 million as an earn-out if Tracfone continues to achieve certain performance measures during the 24 months following the closing, calculated and paid in 4 consecutive 6-month periods, and (ii) US$150 million deferred commercial consideration payable within two years following the closing. AMX continued to benefit from EBITDA generated by Tracfone during fiscal year 2020 and until the closing date of the transaction. The closing of the transaction is subject to customary conditions for this type of transactions, including obtaining required governmental approvals.

2. Basis of Preparation of the Consolidated Financial Statements and Summary of Significant Accounting Policies and Practices

a) Basis of preparation

The accompanying consolidated financial statements have been prepared in conformity with International Financial Reporting Standards, as issued by the International Accounting Standards Board (“IASB”) (hereafter referred to as IFRS).

The consolidated financial statements have been prepared on the historical cost basis, except for the derivative financial instruments, the mobile telecommunications towers, the trust assets of post-employment and other employee benefit plans and the investments in equity at fair value through ~~OCI~~other comprehensive income (OCI), which are presented at their market value.

~~Effectively~~Effective July 1, 2018, the Argentinian economy ishas been considered to be hyperinflationary in accordance with the criteria inIAS 29~~“Financial~~ “Financial Reporting in Hyperinflationary Economies” (“IAS 29”). Accordingly, for the ~~Argentina~~Argentinian subsidiaries, we have included, adjustments for hyperinflation and reclassifications as is required by the standard for purposes of presentation of IFRS in the consolidated financial statements.

The preparation of these consolidated financial statements under IFRS requires the use of critical estimates and assumptions that affect the amounts reported for certain assets, liabilities, income and ~~expenses.~~expenses, including the main impact generated by the COVID-19 pandemic and the potential effect on the amounts disclosed in the consolidated financial statements. It also requires that management exercise judgment in the application of the Company’s accounting policies. Actual results could differ from these estimates and assumptions.

The Mexican peso is the functional currency of the Company’s Mexican operations and the consolidated reporting currency of the Company.

i) Changes in Accounting Policies and Disclosures

Amendments to IFRS 16 Covid-19 Related Rent Concessions

On 28 May 2020, the IASB issued Covid-19-Related Rent Concessions - amendment to IFRS 16 Leases. The ~~Company applied~~amendments provide relief to lessees from applying IFRS 15~~“Revenue~~16 guidance on lease modification accounting for rent concessions arising as a direct consequence of the Covid-19 pandemic. As a practical expedient, a lessee may elect not to assess whether a Covid-19 related rent concession from ~~Contracts with Customers”(IFRS 15) and IFRS 9 “~~~~Financial Instruments”~~ ~~(IFRS 9)~~a lessor is a lease modification. A lessee that makes this election accounts for any change in lease payments resulting from the Covid-19 related rent concession the same way it would account for the ~~first time effective January 1, 2018. The nature and effect of~~change under IFRS 16, if the ~~changes as~~change were not a ~~result of adoption of these new accounting standards are described below.~~lease modification.

The accounting policies applied in the preparation of the consolidated financial statements for the year ended December 31, 2018 are consistent with those used in the preparation of the Company´s consolidatedamendment applies to annual financial statements for the years ended December 31, 2017 and 2016, with the exception of the following new standards and amendments to existing standards issued by the IASB, which were mandatory for annualreporting periods beginning on or after ~~January~~ 1 ~~2018:~~

~~a) IFRS 15 Revenue from contract with customer~~

~~In May 2014, the~~~~IASB issued the new standard IFRS 15~~. The new standard for revenue recognition aims at standardizing the multitude of regulations previously included in various standards, and may require more judgment and estimates than with the revenue recognition processes that were required under the previously existing revenue recognition standards

~~IFRS 15 supersedes IAS 11~~~~Construction Contracts~~~~, IAS 18~~~~Revenue~~and related Interpretations and it applies, with limited exceptions, to all revenue arising from contracts with customers. IFRS 15 establishes a five-step model to account for revenue arising from contracts with customers and requires that revenue be recognized at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.

IFRS 15 requires entities to exercise judgment, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contracts with their customers. The standard also specifies the accounting for the incremental costs of obtaining a contract and the costs directly related to fulfilling a contract. In addition, the standard requires relevant disclosures.

~~The Company adopted IFRS 15 using the modified retrospective method of adoption with the date of initial~~June 2020. Earlier application on January 1, 2018. Under this method, the standard can be applied either to all contracts at the date of initial application or only to contracts that are not completed at this date. The Company elected to apply the standard to all contracts as of January 1, 2018.

The cumulative effect of initially applying IFRS 15 was recognized at the date of initial application as an adjustment to the opening balance of retained earnings. Therefore, the comparative information was not restated and continues to be reported under IAS 11, IAS 18 and related Interpretations. The mostis permitted. This amendment had no significant changes in the implementation of IFRS 15 are the earlier recognition of revenue from the sale of goods, and the capitalization and deferral of the incremental contracts acquisition costs over the expected period of benefit.

~~The effect of adopting IFRS 15 as of January 1, 2018 was, as follows:~~


	~~Reference~~		~~Increase~~
~~Assets:~~
~~Subscribers, distributors, recoverable taxes, contract assets and other, net~~		~~(a), (b), (c)~~	~~Ps.~~	~~31,261,436~~

~~Liabilities:~~
~~Current liabilities~~		~~(c)~~	~~Ps.~~	~~562,651~~
~~Deferred income taxes~~		~~(d)~~		~~8,725,841~~

			~~Ps.~~	~~9,288,492~~

~~Equity:~~
~~Retained earnings~~		~~(a), (b), (c), (d)~~		~~21,454,504~~
~~Non-controlling~~ ~~interests~~				~~518,440~~

~~Total equity~~				~~21,972,944~~

~~Total liabilities and equity~~			~~Ps.~~	~~31,261,436~~

~~Set out below are, the impacts of adopting IFRS 15~~impact on ~~the Company´s consolidated financial statements for the year ended December 31, 2018:~~

   Reference    As reported Figures without
adoption of IFRS 15 Adjustments
Operating revenues:

Revenues services
   (a), (b)    Ps. 863,647,642 Ps. 881,530,167 Ps.   (17,882,525 )
Sales of equipment
   (a), (b)    174,560,039 158,721,765 15,838,274


      1,038,207,681 1,040,251,932 (2,044,251 )


Operating costs and expenses:

Cost of sales and services
      Ps. 508,822,430 Ps. 509,100,174 Ps. (277,744 )
Commercial, administrative and general and other expenses
   (c)    234,115,500 240,010,631 (5,895,131 )
Depreciation and amortization
      155,712,580 155,712,580 —


      898,650,510 904,823,385 (6,172,875 )


      139,557,171 135,428,547 4,128,624
Financial items, net
      38,563,536 38,356,359 207,177
Equity interest in net result of associated companies
      267 267 �� —
Income tax
   (d)    46,477,079 45,496,698 980,381
Non-controlling interests
      (1,950,626 ) (1,950,626 ) —


Net profit for the year
      Ps. 52,566,197 Ps. 49,625,131 Ps. 2,941,066

   Reference As reported    Balances without
adoption of IFRS 15    Adjustments
Assets:

Current assets:

Cash and cash equivalents and equity investments at fair value
   Ps. 70,675,896    Ps. 70,675,896    Ps. —
Subscribers, distributors, recoverable taxes, contract assets and other, net
   (a), (b), (c) 216,226,920    185,303,634    30,923,286
Other current assets, net
   62,152,708    62,152,708    —






Total current assets
   349,055,524    318,132,238    30,923,286
Non-current assets:

Property, plant and equipment, net
   640,000,720    640,000,720    —
Intangibles and other assets, net
   424,485,276    424,485,276    —
Subscribers, distributors, recoverable taxes, contract assets and other, net
   (a), (b), (c) 15,681,872    10,244,609    5,437,263






Total assets
   Ps. 1,429,223,392    Ps. 1,392,862,843    Ps. 36,360,549






Liabilities and equity:

Current liabilities:

Short-term debt and current portion of long-term debt
   Ps. 96,230,634    Ps. 96,230,634    Ps. —
Accounts payable and other liabilities
   338,116,412    337,448,940    667,472
Deferred revenues
   32,743,843    32,315,690    428,153






Total current liabilities
   467,090,889    465,995,264    1,095,625
Non-current-liabilities:

Long-term debt
   542,691,819    542,691,819    —
Deferred income taxes
   (d) 24,573,441    15,382,500    9,190,941
Other liabilities
   148,994,821    148,994,821    —






Total liabilities
   1,183,350,970    1,173,064,404    10,286,566
Total equity
   (d) 245,872,422    219,798,439    26,073,983






Total liabilities and equity
   Ps. 1,429,223,392    Ps. 1,392,862,843    Ps. 36,360,549






~~IFRS 15 Revenues from contracts with customers~~
IFRS 15 establishes a comprehensive framework for determining when to recognize revenue and how much revenue to recognize. The principle core is that an entity should recognize revenue to depict the transfer of promised goods or services to the customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The most significant changes in the implementation of IFRS 15 are as follows:
a.
The Company provides fixed and mobile services. These services are offered independently in contracts with customers or together with the sale of handsets (mobile) under the postpaid model. In accordance with IFRS 15, the transaction price should be assigned to the different performance obligations based on their relative standalone selling price.
The Company concluded that regarding the provided services, it has market observable information, to determine the standalone selling price of the services. On the other hand, in the case of the sale of bundled mobile phones sold (including service and handset) by the Company, the allocation of the sales is done

based on their relative standalone selling price of each individual component related to the total bundled price. The result is that more equipment revenue is recognized at the moment of a sale and, therefore, less service revenue from the monthly fee are being recognized under the new standard.

The Company concluded as well that the provided services are satisfied over the time of the contract period, given that the customer simultaneously receives and consumes the benefits provided by the Company.

Such service bundles, voice and data, accomplish the criteria mentioned in IFRS 15 of being substantially similar and of having the same transfer pattern which is why the Company concluded that the revenue from these different services offered to its customers are considered as a single performance obligation with revenue being recognized over time, except for sales of equipment.

Under IFRS 15, for those contracts with customers in which generally the sale of equipment and other electronic equipment is a single performance obligation, the Company recognizes the revenue at the moment when it transfers control to the customer which generally occurs when such goods are delivered. The latter is consistent with the previous accounting policy.

The Company pays commissions to its distributors for obtaining new customers; such commissions were expensed as incurred under the previous accounting. Under IFRS 15, commissions are considered incremental contract acquisition costs that are capitalized and are amortized over the expected period of benefit, during the average duration of customer contracts.

d.	~~In addition to the adjustments described above, other items such as deferred taxes andnon-controlling~~ ~~interests were adjusted to retained earnings as necessary upon adoption of IFRS 15 as of January 1, 2018.~~

~~b) IFRS 9, Financial Instruments~~

~~IFRS 9 was issued in July 2014 and replaced IAS 39~~~~Financial Instruments~~ ~~and relates to the classification and measurement of financial instruments, impairment; and hedge accounting.~~

~~The Company applied IFRS 9 prospectively, with an initial application date of January 1, 2018. The Company has not restated the comparative information, which continues to be reported under IAS 39.~~

~~The effect of adopting IFRS 9 as of January 1, 2018 was, as follows:~~


	~~Adjustments~~		~~January 1, 2018~~
~~Assets~~
~~Trade receivables~~		~~(a)~~	~~Ps.~~	~~(2,400,783~~	)
~~Deferred tax assets~~		~~(b)~~		~~544,628~~

~~Total assets~~			~~Ps.~~	~~(1,856,155~~	)

~~Equity~~
~~Retained earnings~~		~~(a), (b)~~	~~Ps.~~	~~(1,856,155~~	)

~~Total adjustment on equity~~			~~Ps.~~	~~(1,856,155~~	)

~~IFRS 9 sets out the requirements for recognizing and measuring financial assets and financial liabilities. This new standard includes:~~

~~a) Impairment~~

The adoption of IFRS 9 has fundamentally changed the Company´s accounting for impairment losses for financial assets by replacing IAS 39’s incurred loss approach with a forward-looking expected credit loss approach. IFRS 9 requires the Company to recognize an allowance for expected credit loss for all debt instruments not held at fair value through profit or loss and contract assets.

Upon adoption of IFRS 9 the Company recognized an impairment on the Company´s trade receivables at fair value Ps 2,400,783 as of January 1, 2018, which resulted in a decrease in Retained earnings. There were no impairment losses that impacted the carrying amount of debt instruments at fair value through OCI in the statements of financial position, which remains at fair value.

~~b) Other adjustments~~

~~In addition to the adjustments described above, other items such as deferred taxes andnon-controlling~~ ~~interests were adjusted to retained earnings as necessary upon adoption of IFRS 9 as of January 1, 2018.~~

The new requirements of IFRS 9 regarding hedge accounting do not have an effect on the consolidated financial statements as hedge accounting is not applied. The Company continues to consider the hedges to be under IAS 39 as allowed by IFRS 9.

~~Compared to IAS 39, the application of IFRS 9 had an immaterial effect on the consolidated financial statements in 2018, including classification of financial assets and liabilities.~~

~~c) Impact of the application for hyperinflation in Argentina~~

In the recent years, the Argentina economy has shown high rates of inflation. Although inflation data has not been consistent in recent years and several indexes have coexisted, inflation in Argentina indicates that the~~three-year~~ cumulative inflation rate recently exceeded 100%, which is the quantitative reference established by IAS 29. As a result, Argentina is considered a hyperinflationary economy in 2018 and the Company applies hyper-inflation accounting to its subsidiary whose functional currency is the Argentine peso for financial information for periods ending on or after July 1, 2018, however the calculation of the accumulative impact was measured as of January 1, 2019.

In order to restate for hyperinflation its financial statements, the subsidiary used the series of indices defined by resolution JG No. 539/18 issued by the “Federación Argentina de Consejos Profesionales de Ciencias Económicas” (FACPCE), based on the National Consumer Price Index (IPC) published by the Instituto Nacional de Estadística y Censos (INDEC) of the Argentine Republic and the Wholesale Internal Price Index (IPIM) published by FACPCE. The cumulative index December 31, 2018 is 184.255, while on an annual inflation for 2018 is 48%.

~~The main implications are as follows:~~

~~Adjustment of the historical cost ofnon-monetary~~ assets and liabilities and equity items from their date of acquisition, or the date of inclusion in the consolidated statements of financial position, to the end of the year, in order to reflect changes in the currency’s purchasing power caused by inflation.

•

~~The gain on the net monetary position caused by the impact of inflation in the year is included in the consolidated statements of comprehensive income as part of the caption “~~~~Valuation of derivatives, interest cost from labor obligations and other financial items, net~~. Items in the income statements and in the statements of cash flows are adjusted by the inflation index since their origination, with a balancing entry, and a reconciling item in the statements of cash flows, respectively.

~~All items in the financial statements of the Argentine company are translated at the closing exchange rate, which at December 31, 2018 was 0.5221 argentine pesos per mexican peso.~~

~~Financial information for financial years prior to 2018 are not restated.~~

~~The main impact in~~ the consolidated financial statements of the Company (See Note 15).

Revaluation of telecommunications towers (plant, property and equipment)

As of December 31, 2020, the company changed its accounting policy to record the value of the passive infrastructure (towers) of its subsidiaries. With the change, this passive infrastructure was no longer recognized at historical cost and it began to be recognized under the revaluation model (market value). The company considers that the revaluation model represents the actual conditions of the industry of this class of assets and improves its financial position, this allows its shareholders and stakeholders to have the necessary financial information associated with market expectations about this class of assets. The incremental effect on passive infrastructure is Ps.107,152,628.

The first time application of an asset revaluation policy is a change in ~~2018~~accounting policy that must be treated as a revaluation in accordance with IAS 16, this implies that it is not necessary to restructure the book value of ~~applying hyperinflationary accounting under IAS 29 are shown below:~~previous periods, therefore, the adoption of this method will be carried out prospectively.


	~~Impact of the~~ ~~application of~~ ~~hyperinflation~~ ~~adjustments in~~ ~~2018~~
~~Impact in:~~
~~Operating revenues~~		~~Ps. 6,286,140~~
~~Operating loss~~		~~(1,423,252~~	)
~~Financial loss~~		~~(1,289,317~~	)
~~Gain on net monetary positions~~		~~4,429,145~~
~~Income tax~~		~~(770,928~~	)
~~Net profit for the year~~		~~945,647~~
~~Current assets~~		~~1,866,674~~
~~Non-current~~ ~~assets~~		~~19,796,073~~
~~Total liabilities~~		~~4,890,166~~
~~Total equity~~⁽ⁱ⁾		~~16,772,581~~

~~(i)~~

~~This total includes the initial effect of hyperinflation of Ps. 15,826,934 and the net effect on results due to the hyperinflation of the year of Ps. 945,647.~~

ii) Basis of consolidation

The consolidated financial statements include the accounts of América Móvil, S.A.B. de C.V. and those subsidiaries over which the Company exercises control. The consolidated financial statements for the subsidiaries were prepared for the same period as the Company´s and applying consistent accounting policies. All of the subsidiary companies operate in the telecommunications sector or related.

Subsidiaries are entities over which the Company has control. Control is achieved when the Company has power over the investee, when it is exposed to, or has rights to, variable returns from its involvement with the investee, and has the ability to use its power over the investee to affect the amount of the investor’s returns. Subsidiaries are consolidated on a line by line basis from the date which control is achieved by the Company. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the elements of control.

On March 6, 2020, in accordance with a resolution of the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones or IFT), the subsidiaries Teléfonos de México, S.A.B. de C.V. and Teléfonos del Noroeste, S.A. de C.V. created separate companies related to the wholesale services named Red Nacional Última Milla S.A.P.I. de C.V., Servicios de Telecomunicaciones Ultima Milla, S.A. de C.V. and Red Última Milla del Noroeste S.A.P.I. de C.V. The restructuring of Telmex has no impact in the consolidated financial information of the Company.

Changes in the Company’s ownership interests in a subsidiary that do not result in the Company losing control over the subsidiary are accounted for as equity transactions. The carrying amounts of the equity attributable to

owners of the parent andnon-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the carrying amount of thenon-controlling interests and the fair value of the consideration paid or received in the transaction is recognized directly in the equity attributable to the owners.

Subsidiaries are deconsolidated from the date which control ceases. When the Company ceases to have control over a subsidiary, it derecognizes the assets (including any goodwill) and liabilities of the subsidiary at their carrying amounts, derecognizes the carrying amount ofnon-controlling interests in the former subsidiary and recognizes the fair value of any consideration received from the transaction. Any retained interest in the former subsidiary is then remeasured to its fair value.

All intra-Company balances and transactions, and any unrealized gains and losses arising from intra-Company transactions, are eliminated in preparing the consolidated financial statements.

Non-controlling interests represent the portion of profits or losses and net assets not held by the Company.Non-controlling interests are presented separately in the consolidated statements of comprehensive income and in equity in the consolidated statements of financial position separately from Company’s own equity.

Associates:

An associate is an entity over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but does not have control or joint control over those decisions.

The Company’s investment in associates includes goodwill identified on acquisition, net of any accumulated impairment losses.

The investments in associated companies in which the Company exercises significant influence are accounted for using the equity method, whereby Company recognizes its share in the net profit (losses) and equity of the associate.

The results of operations of the subsidiaries and associates are included in the Company’s consolidated financial statements beginning as of the month following their acquisition and its share of other comprehensive income after acquisition is recognized directly in other comprehensive income.

The Company assesses at each reporting date whether there is objective evidence that investment in associates is impaired. If so, the Company calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value.

The equity interest in the most significant subsidiaries at December 31, ~~2017~~2019 and ~~2018~~2020 is as follows:

Company name
Country Equity
interest at
December 31
2017 2018
Subsidiaries:

América Móvil B.V.^a)
Netherlands 100.0 % 100.0 %
Compañía Dominicana de Teléfonos, S.A. (“Codetel”)^b)
Dominican Republic 100.0 % 100.0 %
Sercotel, S.A. de C.V.^a)
Mexico 100.0 % 100.0 %
Radiomóvil Dipsa, S.A. de C.V. and subsidiaries (“Telcel”)^b)
Mexico 100.0 % 100.0 %
Puerto Rico Telephone Company, Inc.^b)
Puerto Rico 100.0 % 100.0 %
Servicios de Comunicaciones de Honduras, S.A. de C.V. (“Sercom Honduras”)^b)
Honduras 100.0 % 100.0 %
TracFone Wireless, Inc. (“TracFone”)^b)
USA 100.0 % 100.0 %
Claro S.A. (Claro Brasil)^b)
Brazil 97.7 % 98.2 %
Telecomunicaciones de Guatemala, S.A. (“Telgua”)^b)
Guatemala 99.3 % 99.3 %
Empresa Nicaragüense de Telecomunicaciones, S.A. (“Enitel”) ^b)
Nicaragua 99.6 % 99.6 %
Compañía de Telecomunicaciones de El Salvador, S.A. de C.V. (“CTE”)^b)
El Salvador 95.8 % 95.8 %
Comunicación Celular, S.A. (“Comcel”)^b)
Colombia 99.4 % 99.4 %
Telmex Colombia, S.A.^b)
Colombia 99.3 % 99.3 %
Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) ^b)
Ecuador 100.0 % 100.0 %
AMX Argentina, S.A.^b)
Argentina 100.0 % 100.0 %
AMX Paraguay, S.A.^b)
Paraguay 100.0 % 100.0 %
AM Wireless Uruguay, S.A.^b)
Uruguay 100.0 % 100.0 %
Claro Chile, S.A.^b)
Chile 100.0 % 100.0 %
América Móvil Perú, S.A.C^b)
Peru 100.0 % 100.0 %
Claro Panamá, S.A.^b)
Panamá 100.0 % 100.0 %
Teléfonos de México, S.A.B. de C.V.^b)
Mexico 98.8 % 98.8 %
Telekom Austria AG^b)
Austria 51.0 % 51.0 %

Company name
   Country    Equity
interest at
December 31
   2019 2020
Subsidiaries:

América Móvil B.V. ^a)
   Netherlands    100.0 % 100.0 %
Compañía Dominicana de Teléfonos, S.A. (“Codetel”) ^b)
   Dominican Republic    100.0 % 100.0 %
Sercotel, S.A. de C.V. ^a)
   Mexico    100.0 % 100.0 %
Radiomóvil Dipsa, S.A. de C.V. and subsidiaries (“Telcel”) ^b)
   Mexico    100.0 % 100.0 %
Puerto Rico Telephone Company, Inc. ^b⁾
   Puerto Rico    100.0 % 100.0 %
Servicios de Comunicaciones de Honduras, S.A. de C.V. (“Sercom Honduras”) ^b⁾
   Honduras    100.0 % 100.0 %
TracFone Wireless, Inc. (“TracFone”) ^b)
   USA    100.0 % 100.0 %
Claro S.A. (Claro Brasil) ^b)
   Brazil    98.2 % 98.2 %
NII Brazil Holding S.A.R.L ^a)
   Luxembourg    100.0 % 100.0 %
Nextel Telecomunicações Ltda ^b)
   Brazil    100.0 % 100.0 %
Telecomunicaciones de Guatemala, S.A. (“Telgua”) ^b)
   Guatemala    99.3 % 99.3 %
Claro Guatemala, S.A. ^b)
   Guatemala    100.0 % 100.0 %
Empresa Nicaragüense de Telecomunicaciones, S.A. (“Enitel”) ^b)
   Nicaragua    99.6 % 99.6 %
Compañía de Telecomunicaciones de El Salvador, S.A. de C.V.
(“CTE”) ^b)
   El Salvador    95.8 % 95.8 %
Comunicación Celular, S.A. (“Comcel”) ^b)
   Colombia    99.4 % 99.4 %
Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) ^b)
   Ecuador    100.0 % 100.0 %
AMX Argentina, S.A. ^b)
   Argentina    100.0 % 100.0 %
AMX Paraguay, S.A. ^b)
   Paraguay    100.0 % 100.0 %
AM Wireless Uruguay, S.A. ^b)
   Uruguay    100.0 % 100.0 %
Claro Chile, S.A. ^b)
   Chile    100.0 % 100.0 %
América Móvil Perú, S.A.C ^b)
   Peru    100.0 % 100.0 %
Claro Panamá, S.A. ^b)
   Panamá    100.0 % 100.0 %
Teléfonos de México, S.A.B. de C.V. ^b)
   Mexico    98.8 % 98.8 %
Telekom Austria AG ^b)
   Austria    51.0 % 51.0 %
a)
Holding companies
b)
Operating companies of mobile and fixed services
iii) Basis of translation of financial statements of foreign subsidiaries and associated companies
The operating revenues of foreign subsidiaries jointly represent approximately ~~72%~~73%, ~~74%~~71% and ~~73%~~72% of consolidated operating revenues ~~of 2016, 2017~~for the years ended December 31, 2018, 2019 and ~~2018,~~2020, respectively, and their total assets jointly represent approximately ~~81%~~73% and ~~80%~~75% of consolidated total assets at December 31, ~~2017~~2019 and ~~2018,~~2020, respectively.
The financial statements of foreign subsidiaries have been prepared under or ~~translated~~converted to IFRS in the respective local currency (which is their functional currency) and then translated into the ~~Company´s~~Company’s reporting currency as follows:

all monetary assets and liabilities were translated at the closing exchange rate of the period;

allnon-monetary assets and liabilities at the closing exchange rate of the period;

equity accounts are translated at the exchange rate at the time the capital contributions were made and the profits were generated;
revenues, costs and expenses are translated at the average exchange rate of the period, except for the operations of the subsidiaries in ~~Argentina;~~Argentina, whose economy is considered hyperinflationary since 2018;
~~the resulting difference from the translation process is recognized in equity in the caption Cumulative translation adjustment;~~

the consolidated statements of cash flows presented using the indirect method were translated using the weighted-average exchange rate for the applicable period (except for Argentina), and the resulting difference is shown in the consolidated statements of cash flows under the heading “Adjustment to cash flows due to exchange rate fluctuations, net”.
The basis of translation for the operations of the subsidiaries in Argentina are ~~described~~described:
In recent years, the Argentina economy has shown high rates of inflation. Although inflation data has not been consistent in ~~Note 2i, c)~~recent years and several indexes have coexisted, inflation in Argentina indicates that the three-year cumulative inflation rate exceeded 100% in 2018, which is one of the quantitative references established by IAS 29. As a result, Argentina was considered a hyperinflationary economy in 2018 and the Company applies hyperinflation accounting to its subsidiary whose functional currency is the Argentine peso for financial information for periods ending on or after July 1, 2018, however the calculation of the cumulative impact was measured as of January 1, 2018.
In order to restate for hyperinflation its financial statements, the subsidiary used the series of indices defined by resolution JG No. 539/18 issued by the “Federación Argentina de Consejos Profesionales de Ciencias Económicas” (“FACPCE”), based on the National Consumer Price Index (IPC) published by the Instituto Nacional de Estadística y Censos (INDEC) of the Argentine Republic and the Wholesale Internal Price Index (IPIM) published by FACPCE. The cumulative index at December 31, 2020 is 385.8826, while on an annual inflation for 2020 is 36.1%.
The main implications are as follows:
Adjustment of the historical cost of non-monetary assets and liabilities and equity items from their date of acquisition, or the date of inclusion in the consolidated statements of financial position, to the end of the year, in order to reflect changes in the currency’s purchasing power caused by inflation.
•
The gain on the net monetary position caused by the impact of inflation in the year is included in the consolidated statements of comprehensive income as part of the caption “Valuation of derivatives, interest cost from labor obligations and other financial items, net”. Items in the statement of comprehensive income and in the statements of cash flows are adjusted by the inflation index since their origination, with a balancing entry, and a reconciling item in the statements of cash flows, respectively.
All items in the financial statements of the Argentine company are translated at the closing exchange rate, which at December 31, 2019 and 2020 were 0.3147 and 0.2371, respectively, per argentine peso per Mexican peso.
The difference resulting from the translation process is recognized in equity in the caption “Effect of translation of foreign entities”. At December 31, ~~2017~~2019 and ~~2018,~~2020, the cumulative translation adjustment was Ps. ~~7,866,158~~(87,367,366) and Ps. ~~(53,357,300)~~(100,926,140), respectively.
b) Revenue recognition
The Company revenues are derived principally from providing the following telecommunications services and products: wireless voice, wireless data and value-added services, fixed voice, fixed data, broadband and IT services, Pay TV andover-the-top (“OTT”) services.
The ~~wireless voices~~Company provides fixed and mobile services. These services are offered ~~under a variety of plans. In addition, the Company often bundle wireless data telecommunications services~~independently in contracts with customers or together with ~~voices services. Monthly rent in post- paid is billed~~the sale of handsets (mobile) under the postpaid model. In accordance with IFRS 15 “Revenues from contracts with customers”, the transaction price should be assigned to the different performance obligations based on ~~the associated plan o package rates, corresponding to when the services are provided.~~
As part the wireless data services, the Company offer value-added services that include Internet access, messaging and other wireless entertainment and corporative services, Revenue from such services are recognized at the time they are provided, on the date the installation or when the services are downloaded. In addition, the Company offer other wireless services, including wireless security services, mobile payments solutions,~~machine-to-machine~~ ~~services, mobile banking, virtual private network (“VPN”) services, video calls and Personal Communication Services (“PCS”).~~their relative standalone selling price.
The ~~fixed voices~~Company with respect to the provided services, ~~include local, domestic~~it has market observable information, to determine the standalone selling price of the services. On the other hand, in the case of the sale of bundled mobile phones sold (including service and ~~international long-distance~~handset) by the Company, the allocation of the sales is done based on their relative standalone selling price of each individual component related to the total bundled price. The result is that more equipment revenue is recognized at the moment of a sale and, ~~public telephone services, under a variety of plans, specifically tailored to our residential and corporate clients. Revenue from the local services are derived~~therefore, less service revenue from the monthly ~~rent for~~fee are being recognized under IFRS 15.
The services ~~and~~provided by the ~~long-distances revenues~~Company are ~~recognized at~~satisfied over the time ~~the service is provided.~~
The Company offer data services, including data centers, data administration and hosting services to our residential and corporate clients under a variety of plans. These revenues are recognized at the time the service is provided.
~~The residential broadband access are typically bundled with voice services and are competitively priced as a function~~ of the ~~desired or available speed. As a complement to these services,~~contract period, given that the customer simultaneously receives and consumes the benefits provided by the Company.
Such service bundles, voice and data, accomplish the criteria mentioned in IFRS 15 of being substantially similar and of having the same transfer pattern which is why the Company ~~offer a number of products such as home networking and smart home services. In addition, The Company provide~~concluded that the revenue from these different ~~IT solutions for small business and large corporations.~~
~~The Company offer Pay TV through cable and satellite TV subscriptions to both retail and corporate customers under a variety of plans. These~~ services ~~are~~ offered through individual subscription plans as well as in bundled packages of services, along with broadband, fixed voice and wireless services. In addition, the Company sell video, audio and other media content that is delivered through the internet directly from the content provider to the viewer or end user. These revenues are recognized at the time the service is provided.
~~The Company sells~~ to its customers ~~bundles~~are considered as a single performance obligation with revenue being recognized over time, except for sales of ~~different services (fixed line, mobile, broadband internet, streaming~~equipment.
Under IFRS 15, for those contracts with customers in which generally the sale of equipment and ~~pay TV, among others)~~other electronic equipment is a single performance obligation, the Company recognizes the revenue at the moment when it transfers control to the customer which ~~elements~~generally occurs when such goods are ~~evaluated to determine if it is necessary to separate the different identifiable components and apply the income recognition policy corresponding to each element.~~delivered.
~~Total package revenue is allocated among the identified elements based on their respective standalone selling prices.~~
~~Determining standalone selling prices for each identified element requires estimates~~The commissions are considered incremental contract acquisition costs that are ~~complex due to~~capitalized and are amortized over the ~~nature~~expected period of benefit, during the ~~business. A change in estimates~~average duration of ~~standalone selling prices could affect the apportionment of revenue among the elements and, as a result, the timing of recognition of revenues.~~
Transaction prices are allocated to the performance obligations by reference to the relative stand-alone selling prices of the products and services. The stand-alone selling prices of products are based on the market prices whereas the standalone selling prices of services are available separately, as services are also offered on a stand-alone basis, i.e. without hardware.customer contracts.
Some subsidiaries have loyalty programs where the Company awards credits customer credit awards referred as “points”. The customer can redeem accrued “points” for awards such as devices, accessories or airtime. The Company provides all awards. The consideration allocated to the award credits is identified as a separate performance obligation; the corresponding liability of the award credits is measured at its fair value. The consideration allocated to award credits amount is recognized as a contract liability until the points are redeemed. Revenue is recognized upon redemption of products by the customer.
c) Cost of sales
The cost of mobile equipment and computers is recognized at the time the client and distributor ~~receives~~receive the device ~~that~~which is when the control is are transferred to the customer.
d) Cost of services
The cost of services represents the costs incurred to properly deliver the services to the customers, it includes the network operating costs and licenses related costs and is accounted at the moment in which such services are provided.
e) Commissions to distributors
The Company pays commissions to its distributors different than those that acquire customers. Such commissions are recognized in ~~“commercial,~~“commercial, administrative and general expenses” in the consolidated statements of comprehensive income at the time in which the distributor either reports an activation or reaches certain number of lines activated or obtained at a certain point of time.
f) Cash and cash equivalents
Cash and cash equivalents represent bank deposits and liquid investments with maturities of less than three months. These amounts are stated at cost plus accrued interest, which is similar to their market value.
The Company also maintains restricted cash held as collateral to meet certain contractual obligations. Restricted cash is presented as part of “Other assets” within othernon-current financial assets given that the restrictions are long-term in nature (See Note 9).
g) Equity investments at fair value through OCI and other short-term investments
Equity investments at fair value through OCI and other short-term investments are primarily composed of equity investments and other short-term financial investments. Amounts are initially recorded at their estimated fair value. Fair value adjustments for equity investments are recorded through other comprehensive income, ~~while fair value adjustments for~~and other short-term ~~investments are recorded in the Consolidated Statements of Comprehensive Income as they occur.~~investment.
h) Inventories
Inventories are initially recognized at historical cost and are valued using the average cost method without exceeding their net realizable value.
The estimate of the realizable value of inventorieson-hand is based on their age and turnover.
i) Business combinations and goodwill
Business combinations are accounted for using the acquisition method, which in accordance with IFRS 3, “Business acquisitions”, consists in general terms as follows:

(i)
Identify the acquirer

(ii)
Determine the acquisition date

(iii)
Value the acquired identifiable assets and assumed liabilities

(iv)
Recognize the goodwill or a bargain purchase gain
For acquired subsidiaries, goodwill represents the difference between the purchase price and the fair value of the net assets acquired at the acquisition date. The investment in acquired associates includes goodwill identified on acquisition, net of any impairment loss.
Goodwill is reviewed annually to determine its recoverability or more often if circumstances indicate that the carrying value of the goodwill might not be fully recoverable.
The possible loss of value in goodwill is determined by analyzing the recovery value of the cash generating unit (or the group thereof) to which the goodwill is associated at the time it was originated. If this recoverable amount is lower than the carrying value, an impairment loss is charged to the results of operations. The recoverable amount is determined based on the higher of fair value less cost of disposal or value in use.
For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, no impairment losses were recognized for ~~the goodwill shown in the Company’s consolidated statements of financial position.~~goodwill.
j) Property, plant and equipment
i) Property, plant and equipment are recorded at acquisition cost, net of accumulated ~~depreciation.~~depreciation; except for the passive infrastructure of telecommunications towers, which are recognized under the revaluation model as of December 31, 2020. Depreciation is computed on the cost of ~~the~~ assets using the straight line method, based on the estimated useful lives of the related assets, beginning the month after they become available for use.
Borrowing costs that are incurred for general financing for construction in progress for periods exceeding six months are capitalized as part of the cost of the asset. During ~~2016, 2017~~the years ended December 31, 2018, 2019 and ~~2018 the~~2020, borrowing costs that were capitalized amounted to ~~Ps. 2,861,307, Ps. 2,875,034~~Ps.2,020,288, Ps.2,233,358 and ~~Ps. 2,020,288~~Ps.1,771,613, respectively.
In addition to the purchase price and costs directly attributable to preparing an asset in terms of its physical location and condition for operating as intended by management, when required, the cost also includes the estimated costs of dismantling and removal of the asset and for restoration of the site where it is located (See Note ~~15c)~~16c).
The passive infrastructure of telecommunications towers will be recorded at revalued value, which is its fair value at the time of revaluation less accumulated depreciation; if there is any loss or impairment, it must also be
considered within its value. The revaluations will be calculated with sufficient regularity to ensure that the book value, every time, does not differ significantly from that which could be determined using the fair value at the end of the reporting period.
The increase resulting from a revaluation is recorded in other comprehensive income (OCI) and is accumulated in equity as a revaluation surplus. To the extent that there is a decrease in revaluation, it will be recognized in profit or loss, except to the extent that it compensates for an existing surplus on the same asset.
An annual transfer of the asset revaluation surplus and accumulated earnings is made to the extent that the asset is used, therefore, the surplus is equal to the difference between the depreciation calculated on the revalued value and the one calculated according to its original cost. These transfers do not record in the results for the period. A total transfer of the surplus may be made when the entity disposes of the asset.
ii) The net book value of property, plant and equipment is removed from the consolidated statements of financial position at the time the asset is sold or when no future economic benefits are expected from its use or sale. Any gains or losses on the sale of property, plant and equipment represent the difference between net proceeds of the sale and the net book value of the item at the time of sale. These gains or losses are recognized as either other operating income or other operating expenses upon sale.
iii) The Company periodically assesses the residual values, useful lives and depreciation methods associated with its property, plant and equipment. If necessary, the effects of any changes in accounting estimates is recognized prospectively, at the closing of each period, in accordance with IAS 8, “Accounting Policies, Changes in Accounting Estimates and Errors”.
For property, plant and equipment made up of several components with different useful lives, the major individual components are depreciated over their individual useful lives. Maintenance costs and repairs are expensed as incurred.
Annual depreciation rates are as follows:

Network infrastructure
   5 %-33%
Buildings and leasehold improvement
   2 %-33%
Other assets
   10 %-50%
Network infrastructure
5%-33%
Buildings and leasehold improvement
2%-33%
Other assets
10%-50%
iv) The carrying value of property, plant and equipment is reviewed if there are indicators of impairment in such assets. If an asset’s recovery value is less than the asset’s net carrying value, the difference is recognized as an impairment loss.
During the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, no impairment losses were recognized.
v) Spare parts for network operation ~~is valued using the average cost method, without exceeding its net realizable value.~~are recognized at cost.
The valuation of inventory for network considered obsolete, defective or slow-moving, is reduced to their estimated net realizable value. The estimate of the recovery value of inventories is based on their age and turnover.
k) Intangibles
i) Licenses
Licenses to operate wireless telecommunications networks granted by the governments of the countries in which the Company operates are recorded at acquisition cost or at fair value at their acquisition date, net of accumulated amortization. Certain licenses require payments to the governments, such payments are recognized in the cost of service and equipment.
The licenses that in accordance with government requirements are categorized as automatically renewable, for a nominal cost and with substantially consistent terms, are considered by the Company as intangible assets with an
indefinite useful life. Accordingly, they are not amortized. Licenses are amortized when the Company does not have a basis to conclude that they are indefinite lived. Licenses are amortized using the straight-line method over a period ranging from 3 to 30 years, which represents the usage period of the assets.
The Company has conducted an internal analysis on the applicability of the International Financial Reporting Interpretation Committee (“IFRIC”) No. 12 (Service Concession Agreements) and has concluded that its concessions are outside the scope of IFRIC 12. To determine the applicability of IFRIC 12, the Company analyzes each concession or group of similar concessions in a given jurisdiction. As a threshold matter, the Company identifies those government concessions that provide for the development, financing, operation or maintenance of infrastructure used to render a public service, and that set out performance standards, mechanisms for adjusting prices and arrangements for arbitrating disputes.
With respect to those services, the Company evaluates whether the grantor controls or regulates (i) what services the operator must provide, (ii) to whom it must provide them and (iii) the applicable price (the “Services Criterion”). In evaluating whether the applicable government, as grantor, controls the price at which the Company provides its services, the Company looks at the terms of the concession agreement according to all applicable regulations. If the Company determines that the concession under analysis meets the Services Criterion, then the Company evaluates whether the grantor would hold a significant residual interest in the concession’s infrastructure at the end of the term of the arrangement.
ii) Trademarks
Trademarks acquired are ~~recorded~~measured on initial recognition at cost. The cost of trademarks acquired in a business combination is their fair value at the ~~valuation~~ date ~~when acquired.~~of acquisition. The useful lives of trademarks are assessed as either definite or indefinite. Trademarks with finite useful lives are amortized using the straight-line method over a period ranging from 1 to 10 years. Trademarks with indefinite useful lives are not amortized but are tested for impairment annually at the cash generating unit level. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable, if not, the change in useful life from indefinite to definite is made on a prospective basis.
iii) Irrevocable rights of use
Irrevocable rights of use are recognized according to the amount paid for the right and are amortized over the period in which they are granted.
The carrying values of the Company’s licenses and trademarks are reviewed annually and whenever there are indicators of impairment in the value of such assets. When an asset’s recoverable amount, which is the higher of the asset’s fair value, less disposal costs and its value in use (the present value of future cash flows), is less than the asset’s carrying value, the difference is recognized as an impairment loss.
iv) Customer relationships
The value of customer relations is determined and valued at the time that a new subsidiary is acquired, as determined by the Company with the assistance of independent appraisers and is amortized onover a ~~5 year~~5-year period.
During the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, no significant impairment losses were recognized for licenses, trademarks, irrevocable rights of use or customer relationships.
l) Impairment in the value of long-lived assets
The Company assesses the existence of indicators of impairment in the carrying value of long-lived assets, investments in associates, goodwill and intangible assets according to IAS 36 “Impairment of assets”. When
there are such indicators, or in the case of assets whose nature requires an annual impairment analysis (goodwill and intangible assets with indefinite useful lives), the Company estimates the recoverable amount of the asset, which is the higher of its fair value, less disposal costs, and its value in use. Value in use is determined by discounting estimated future cash flows, applying apre-tax discount rate that reflects the time value of money and taking into consideration the specific risks associated with the asset. When the recoverable amount of an asset is below its carrying value, impairment is considered to exist. In this case, the carrying value of the asset is reduced to the asset’s recoverable amount, recognizing the loss in results of operations for the respective period. Depreciation and/or amortization expense of future periods is adjusted based on the new carrying value determined for the asset over the asset’s remaining useful life. Impairment is computed individually for each asset. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or group of assets.
In the estimation of impairments, the Company uses the strategic plans established for the separate cash-generating units to which the assets are assigned. Such strategic plans generally cover a period from 3 to 5 years. For longer periods, beginning in the fifth year, projections are based on such strategic plans while applying a constant or declining expected perpetual growth rate.
Key assumptions used in value in use calculations
The forecasts are made in real terms (net of inflation) and in the functional currency of the subsidiary as of December 31, ~~2018.~~2020. Financial forecasts, premises and assumptions are similar to what any other market participant in similar conditions would ~~consider.~~consider, including impacts from the COVID-19 pandemic.
Local synergies, that any other market participant would not have taken into consideration to prepare similar forecasted financial information, have not been included.
The assumptions used to develop the financial forecasts were validated for each of the cash generating units (“CGUs”), typically identified by country and by service (in the case of Mexico) taking into consideration the following:

Current subscribers and expected growth.

Type of subscribers (prepaid, postpaid, fixed line, multiple services)

Market environment and penetration expectations

New products and services

Economic environment of each country

Expenses for maintaining the current assets

Investments in technology for expanding the current assets

Market consolidation and synergies
The foregoing forecasts could differ from the results obtained through time; however, the Company prepares its estimates based on the current situation of each of the CGUs.
The recoverable amounts are based on value in use. The value in use is determined based on the method of discounted cash flows. The key assumptions used in projecting cash flows are:

Margin on EBITDA is determined by dividing EBITDA (operating income plus depreciation and amortization) by total revenues.

Margin on CAPEX is determined by dividing capital expenditures (“CAPEX”) by total revenues.

Pre-tax weighted average cost of capital (“WACC”) is used to discount the projected cash flows.
As discount rate, the Company uses the WACC which was determined for each of the cash generating units and is described in the following paragraphs.
The estimated discount rates to perform the IAS 36 “Impairment of assets”, impairment test for each CGU consider market participants assumptions. Market participants were selected taking into consideration size, operations and characteristics of the business that were similar to those of Company. These discount rates do not include inflation.
The discount rates represent the current market assessment of the risks specific to each CGU, taking into consideration the time value of money and individual risks of the underlying assets that have not been incorporated in the cash flow estimates. The discount rate calculation is based on the specific circumstances of the Company and its operating segments. The WACC takes into account both debt and equity costs. The cost of equity is derived from the expected return on investment for each GCU. The cost of debt is based on the interest-bearing borrowings the Company is obliged to service. Segment-specific risk is incorporated by applying individual beta factors.
The beta factors are evaluated annually based on publicly available market data.
Market participant assumptions are important because, not only do they include industry data for growth rates, but also management assesses how the CGU’s position, relative to its competitors, might change over the forecasted period.
The most significant forward-looking estimates used for the ~~2017~~2019 and ~~2018~~2020 impairment evaluations are shown below:

   Average margin on
EBITDA Average margin on
CAPEX Averagepre-tax
discount rate
(WACC)    Average margin on
EBIDTA Average margin on
CAPEX Average pre-tax
discount rate
(WACC)
2017:

2019:

Europe (7 countries)
   25.59% - 52.46% 7.34% - 14.97% 9.06% - 19.04%    29.40% - 44.50% 10.90% - 19.30% 5.77% - 14.96%
Brazil (fixed line, wireless and TV)
   35.28% 22.13% 11.71%    40.43% 23.50% 11.00%
Puerto Rico
   23.31% 8.31% 4.42%    21.94% 17.94% 4.39%
Dominican Republic
   45.79% 15.55% 19.23%    47.23% 16.17% 13.84%
Mexico (fixed line and wireless)
   35.48% 8.72% 16.13%    38.81% 9.84% 6.94%
Ecuador
   37.83% 10.07% 23.57%    44.98% 11.65% 19.85%
Peru
   29.64% 16.75% 13.61%    32.51% 18.51% 8.86%
El Salvador
   40.36% 17.99% 25.14%    44.04% 25.03% 16.05%
Chile
   22.04% 12.45% 6.15%    26.85% 18.00% 4.16%
Colombia
   41.93% 19.88% 19.06%    45.58% 19.25% 17.27%
Other countries
   9.16% - 48.18% 0.43% - 23.43% 7.89% - 24.28%    7.40% - 52.40% 0.57% - 31.0% 6.41% - 34.75%
2020:

Europe (7 countries)
   32.20% - 40.76% 7.04% - 19.39% 3.88% - 12.02%
Brazil (fixed line, wireless and TV)
   40.67% 25.36% 9.50%
Puerto Rico
   23.06% 14.57% 3.53%
Dominican Republic
   47.57% 13.71% 8.27%
Mexico (fixed line and wireless)
   32.69% 11.01% 6.03%
Ecuador
   49.23% 11.14% 17.50%
Peru
   38.72% 15.43% 4.76%
El Salvador
   45.92% 21.19% 14.63%
Chile
   26.34% 13.18% 3.37%
Colombia
   43.45% 18.19% 6.44%
Other countries
   10.07% - 47.23% 0.48% - 31.67% 3.42% - 21.85%

   Average margin on
EBIDTA Average margin on
CAPEX Average pre-tax
discount rate
(WACC)las
2018:

Europe (7 countries)
   22.13% - 41.51% 8.13% - 19.40% 8.36% - 22.08%
Brazil (fixed line, wireless and TV)
   36.43% 21.88% 10.38%
Puerto Rico
   23.86% 9.89% 4.81%
Dominican Republic
   48.64% 18.43% 17.66%
Mexico (fixed line and wireless)
   36.33% 7.93% 16.30%
Ecuador
   39.83% 11.26% 24.45%
Peru
   30.29% 19.95% 11.52%
El Salvador
   45.36% 22.61% 18.01%
Chile
   25.91% 14.99% 6.62%
Colombia
   45.01% 17.14% 20.29%
Other countries
   7.90% - 45.91% 0.61% - 23.96% 9.97% - 31.63%
Sensitivity to changes in assumptions:
The implications of the key assumptions for the recoverable amount are discussed below:
Margin on CAPEX- The Company performed a sensitivity analysis by increasing its CAPEX by 5% and maintaining all other assumptions the same. The sensitivity analysis would require the Company to adjust the amount of its long-lived assets in its CGUs with potential impairment of approximately ~~Ps. 1,558,823~~Ps.62,548.
WACC- Additionally, should the Company increase by 50 base points in WACC per CGU and maintain all other assumptions the same, results without impairment.
m) Right-of-use assets
The Company applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognizes lease liabilities to make lease payments and right-of-use assets representing the ~~carrying~~right to use the underlying assets.
i)
Right-of-use assets
The Company recognizes right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the ~~long-lived~~commencement date less any lease incentives received. Right-of-use assets ~~would be impaired by approximately Ps. 1,135,854.~~
~~m) Leases~~
The determination of whether an agreement is, or contains, a lease is based on the substance of the agreement and requires the Company to assess if performance of the agreement is dependent on the use of a specific asset and whether the agreement transfers the right of use of the asset to the Company.
~~Operating leases~~
~~Leases under which the lessor retains a significant portion of the risks and benefits inherent to the ownership of the leased asset~~ are ~~considered operating leases. Payments made under operating lease agreements are charged to results of operations~~depreciated on a straight-line basis over the ~~rental period.~~
~~Finance leases~~
~~Lease agreements that substantially transfer all the risks and benefits of ownership~~shorter of the ~~leased~~lease term and the estimated useful lives of the assets, as follows:
Assets Useful life
Towers and sites
5 to 12 years
Property
10 to 25 years
Other equipment
5 to 15 years
The right-of-use assets are also subject to impairment test.
ii)
Lease liabilities.
At the ~~Company are accounted for as finance leases. Accordingly, upon~~ commencement date of the lease, the ~~asset, which is classified based on its nature, and its associated debt are recorded~~Company recognizes the lease liabilities measured at ~~the lower of the fair value of the leased asset or~~ the present value of the lease ~~payments. Finance~~payments to be made over the lease term. Lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or rate, and amounts expected to be paid under residual value guarantees. The lease payments also include payments of penalties for early termination of the lease, if the term of the lease reflects that the Company exercises the option to terminate early. The variable lease payments that do not depend on an index or a rate are ~~apportioned between~~recognized as an expense in the ~~reduction~~period on which the event or condition that triggers the payment occurs.
In calculating the present value of the lease payments, the Company uses an incremental borrowing rate at the lease commencement date, if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease ~~liability~~liabilities is increased to reflect the accretion of interest and reduced for the ~~finance cost so~~lease payments made. In addition, the carrying amount of the lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed payments or change in the assessment to purchase the underlying asset.
iii)
Short-term leases and leases of low value assets.
The Company applies the short-term lease recognition exemption for its leases of machinery and equipment (i.e., those leases that have a ~~constant interest rate~~lease term of 12 months or less from the commencement date and do not contain a
purchase option). It also applies the recognition exemption lease of low-value assets (that is, ~~determined~~below US$5,000). Short-term lease payments and leases of low-value assets are recognized as expenses on ~~the outstanding liability balance. Finance costs are charged to results of operations~~straight-line basis over the ~~life of the agreement.~~lease term.
n) Financial assets and liabilities
Financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortized cost, fair value through other comprehensive income (OCI), and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Company’s business model for managing them, with the exception of trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient, the Company initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs.
– Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:

Financial assets at amortized cost (debt instruments)

Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments)

Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments)

Financial assets at fair value through profit or loss
Financial assets at amortized cost (debt instruments)
The Company measures financial assets at amortized cost if both of the following conditions are met:

The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows, and

The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding
Financial assets at amortized cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired.
The Company’s financial assets at amortized cost includes cash ~~and cash~~ equivalents, loans and receivables.
Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments)
The Company measures debt instruments at fair value through OCI if both of the following conditions are met:

The financial asset is held within a business model with the objective of both holding to collect contractual cash flows and selling, and

The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding
For debt instruments at fair value through OCI, interest income, foreign exchange revaluation and impairment losses or reversals are recognized in the statements of profit or loss and computed in the same manner as for financial assets measured at amortized cost. The remaining fair value changes are recognized in OCI. Upon derecognition, the cumulative fair value change recognized in OCI is recycled to profit or loss.
Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments)
Upon initial recognition, the Company can elect to classify irrevocably its equity investments as equity instruments designated at fair value through OCI when they meet the definition of equity under IAS 32 Financial Instruments: Presentation and are not held for trading. The classification is determined on an instrument by instrument basis.
Gains and losses on these financial assets are never recycled to profit or loss. Dividends are recognized as other income in the statements of profit or loss when the right of payment has been established, except when the Company benefits from such proceeds as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated at fair value through OCI are not subject to impairment assessment.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for trading, financial assets designated upon initial recognition at fair value through profit or loss, or financial assets mandatorily required to be measured at fair value. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging instruments. Financial assets with cash flows that are not solely payments of principal and interest are classified and measured at fair value through profit or loss, irrespective of the business model. Notwithstanding the criteria for debt instruments to be classified at amortized cost or at fair value through OCI, as described above, debt instruments may be designated at fair value through profit or loss on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch.
Financial assets at fair value through profit or loss are carried in the statements of financial position at fair value with net changes in fair value recognized in the consolidated statements of comprehensive income within “Valuation of derivatives, interest cost from labor obligations and other financial items”.
Derecognition of financial assets
A financial asset is primarily derecognized when:

The rights to receive cash flows from the asset have expired, or

The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset
When the Company has transferred its rights to receive cash flows from an asset or has entered into a passthrough arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of its continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Impairment of financial assets
The Company recognizes an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Company expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.
ECLs are recognized in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next12-months (a12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
Forsome trade receivables and contract assetsbased on available information, the Company applies the simplified approach in calculating ECLs. Therefore, the Company does not track changes in credit risk, but instead recognizes a loss allowance based on lifetime ECLs at each reporting date. The Company has established aloss rate approach that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic ~~environment.~~environment, including the impact by the COVID-19 pandemic.
Financial liabilities
Initial recognition
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.
All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.
The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, and derivative financial instruments.
— Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. ~~IFRS~~
Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by IFRS 9. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.
Gains or losses on liabilities held for trading are recognized in the statements of profit or loss.
Financial liabilities designated upon initial recognition at fair value through profit or loss are designated at the initial date of recognition, and only if the criteria in IFRS 9 are satisfied. The Company has not designated any financial liability as at fair value through profit or loss.
Loans and borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process.
Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statements of profit or loss.
Derecognition of financial liabilities
A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms,
or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the consolidated statements of ~~profit or loss.~~comprehensive income.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statements of financial position if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.
o) Transactions in foreign currency
Transactions in foreign currency are initially recorded at the prevailing exchange rate at the time of the related transactions. Foreign currency denominated assets and liabilities are subsequently translated at the prevailing exchange rate at the financial statements reporting date. Exchange differences determined from the transaction date to the time foreign currency denominated assets and liabilities are settled or translated at the financial statements reporting date are charged or credited to the results of operations.
In determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or part of it) on the derecognition of anon-monetary asset ornon-monetary liability relating to advance consideration, the date of the transaction is the date on which the Company initially recognizes thenon-monetary asset ornon-monetary liability arising from the advance consideration. If there are multiple payments or receipts in advance, the Company determines the transaction date for each payment or receipt of advance consideration.
The exchange rates used for the translation of foreign currencies against the Mexican peso are as follows:

      Average exchange rate    Closing exchange rate
at December 31,       Average exchange rate
Closing exchange rate
at December 31,

Country or Zone

Currency
   2016    2017    2018        2017            2018
Currency
   2018    2019    2020    2019    2020
Argentina⁽¹⁾
   Argentine Peso (AR$)    1.2632    1.1489    0.7311    1.0610    0.5221    Argentine Peso (AR$)    0.7311    0.4110    0.3070    0.3147    0.2371
Brazil
   Real (R$)    5.3868    5.9346    5.2937    5.9815    5.0797    Real (R$)    5.2937    4.8907    4.1850    4.6754    3.8387
Colombia
   Colombian Peso (COP$)    0.0061    0.0064    0.0065    0.0066    0.0061    Colombian Peso (COP$)    0.0065    0.0059    0.0058    0.0058    0.0058
Guatemala
   Quetzal    2.4548    2.5755    2.5591    2.6940    2.5440    Quetzal    2.5591    2.5023    2.7826    2.4478    2.5596
U.S.A.⁽²⁾
   US Dollar    18.6529    18.9400    19.2397    19.7867    19.6829    US Dollar    19.2397    19.2641    21.4860    18.8452    19.9487
Uruguay
   Uruguay Peso    0.6206    0.6606    0.6274    0.6869    0.6074    Uruguay Peso    0.6274    0.5479    0.5110    0.5051    0.4712
Nicaragua
   Cordoba    0.6515    0.6307    0.6097    0.6428    0.6088    Cordoba    0.6097    0.5817    0.6257    0.5569    0.5728
Honduras
   Lempira    0.8109    0.8007    0.7994    0.8330    0.8031    Lempira    0.7994    0.7806    0.8678    0.7597    0.8215
Chile
   Chilean Peso    0.0276    0.0292    0.0300    0.0322    0.0283    Chilean Peso    0.0300    0.0275    0.0271    0.0252    0.0281
Paraguay
   Guaraní    0.0033    0.0034    0.0034    0.0035    0.0033    Guaraní    0.0034    0.0031    0.0032    0.0029    0.0029
Peru
   Sol (PEN$)    5.5232    5.8054    5.8517    6.0976    5.8406    Sol (PEN$)    5.8517    5.7708    6.1483    5.6814    5.5046
Dominican Republic
   Dominican Peso    0.4048    0.3983    0.3876    0.4095    0.3898    Dominican Peso    0.3876    0.3737    0.3766    0.3542    0.3416
Costa Rica
   Colon    0.0338    0.0331    0.0332    0.0346    0.0322    Colon    0.0332    0.0326    0.0366    0.0327    0.0323
European Union
   Euro    20.6334    21.3649    22.7101    23.7539    22.5586    Euro    22.7101    21.5642    24.5080    21.1311    24.3693
Bulgaria
   Lev    10.5483    10.9223    11.6110    12.1406    11.5327    Lev    11.6110    11.0257    12.5284    10.8076    12.4594
Belarus
   New Belarusian Ruble    9.3929    9.8087    9.4451    9.9882    9.1319    New Belarusian Ruble    9.4451    9.2159    8.8172    8.9420    7.5721
Croatia
   Croatian Kuna    2.7392    2.8619    3.0613    3.1954    3.0435    Croatian Kuna    3.0613    2.9069    3.2498    2.8406    3.2279
Macedonia
   Macedonian Denar    0.3350    0.3471    0.3688    0.3861    0.3667    Macedonian Denar    0.3688    0.3504    0.3975    0.3431    0.3950
Serbia
   Serbian Denar    0.1676    0.1762    0.1920    0.2009    0.1907    Serbian Denar    0.1920    0.1830    0.2083    0.1795    0.2071

(1)
Year-end rates are used for the translation of revenues and expenses if IAS 29 “Financial Reporting in Hyperinflationary Economies” is applied.
Financial reporting in hyperinflationary economies
Financial statements of Argentina subsidiaries are restated before translation to the reporting currency of the Company and before consolidation in order to reflect the same value of money for all items. Items recognized in the statements of financial position which are not measured at the applicableyear-end measuring unit are restated based on the general price index. Allnon-monetary items measured at cost or amortized cost is restated for the changes in the general price index from the date of transaction or the last hyperinflationary calculation to the reporting date. Monetary items are not restated. All items of shareholders’ equity are restated for the changes in the general price index since their addition or the last hyperinflationary calculation until the end of the reporting period. All items of comprehensive income are restated for the change in a general price index from the date of initial recognition to the reporting date. Gains and losses resulting from thenet-position of monetary items are reported in the consolidated statements of operations in financial result in exchange differences. In accordance with IFRS, prior year financial statements were not restated.

(2)
Includes U.S.A., Ecuador, El Salvador, Puerto Rico and Panama.
As of April ~~9, 2019,~~26, 2021, the exchange rate between the US dollar and the Mexican Peso was ~~$18.9701.~~Ps.19.8695. The appreciation of the Mexican peso against the US dollar represent 0.4% with respect to the year-end value.
p) Accounts payable, accrued liabilities and provisions
Liabilities are recognized whenever (i) the Company has current obligations (legal or assumed) resulting from a past event, (ii) when it is probable the obligation will give rise to a future cash disbursement for its settlement, and (iii) the amount of the obligation can be reasonably estimated.
When the effect of the time value of money is significant, the amount of the liability is determined as the present value of the expected disbursements to settle the obligation. The discount rate is determined on apre-tax basis
and reflects current market conditions at the financial ~~statements´~~statements reporting date and, where appropriate, the risks specific to the liability. Where discounting is used, an increase in the liability is recognized as finance expense.
Contingent liabilities are recognized only when it is probable, they will give rise to a future cash disbursement for their settlement.
~~Also, contingencies are only recognized when they will generate a loss.~~
q) Employee benefits
The Company has defined benefit pension plans for its subsidiaries Puerto Rico Telephone Company, Teléfonos de Mexico, Claro Brasil, and Telekom Austria. Claro Brasil also has medical plans and defined contribution plans and Telekom Austria provides retirement benefits to its employees under a defined contribution plan. The Company recognizes the costs of these plans based upon independent actuarial computations and are determined using the projected unit credit method. The latest actuarial computations were prepared as of December 31, ~~2018.~~2020.
Mexico
Mexican subsidiaries have the obligation to pay seniority premiums to personnel based on the Mexican Federal ~~labor law~~Labor Law which also establishes the obligation to make certain payments to personnel who cease to provide services under certain circumstances. Pensions (for Telmex) and seniority premiums are determined based on the salary of employees in their final year of service, the number of years worked at and their age at the moment of retirement.
The costs of pensions, seniority premiums and severance benefits, are recognized based on calculations by independent actuaries using the projected unit credit method using financial hypotheses, net of inflation.
Telmex has established an irrevocable trust fund and makes annual contributions to that fund.
Puerto Rico
In Puerto Rico, the Company has noncontributing pension plans for full-time employees, which are tax qualified as they meet Employee Retirement Income Security Act of 1974 requirements.
The pension benefit is composed of two elements:
(i) An employee receives an annuity at retirement if they meet the rule of 85 (age at retirement plus accumulated years of service). The annuity is calculated by applying a percentage times ~~years~~year of services to the last three years of salary.
(ii) The second element is alump-sum benefit based on years of service ranging from 9 to 12 months of salary. Health care and life insurance benefits are also provided to retirees under a separate plan (post-retirement benefits).
Brazil
Claro Brasil provides a defined benefit plan and post-retirement medical assistance plan, and a defined contribution plan, through a pension fund that supplements the government retirement benefit for certain employees.
Under the defined benefit plan, the Company makes monthly contributions to the pension fund equal to 17.5% of the employee’s aggregate salary. In addition, the Company contributes a percentage of the aggregate salary base for funding the post-retirement medical assistance plan for the employees who remain in the defined benefit plan. Each employee makes contributions to the pension fund based on age and salary. All newly hired employees automatically adhere to the defined contribution plan and no further admittance to the defined benefit plan is allowed. For the defined contribution plan, see Note ~~17.~~18.
Austria
Telekom Austria provides retirement benefits to its employees under defined contribution and defined benefit plans.
The Company pays contributions to publicly or privately administered pension or severance insurance plans on mandatory or contractual basis. Once the contributions have been paid, the Company has no further payment obligations. The regular contributions are recognized as employee expenses in the year in which they are due.
All other employee benefit obligations provided in Austria are unfunded defined benefit plans for which the Company records provisions which are calculated using the projected unit credit method. The future benefit obligations are measured using actuarial methods on the basis of an appropriate assessment of the discount rate, rate of employee turnover, rate of compensation increase and rate of increase in pensions.
For severance and pensions, the subsidiary recognizes actuarial gains and losses in other comprehensive income. There-measurement of defined benefit plans relates to actuarial gains and losses only as Telekom Austria holds no plan assets. Interest expense related to employee benefit obligations is reported in~~“Valuation~~ “Valuation of derivatives, interests cost from labor obligation and other financial items, net” in the statements of comprehensive income.
Other subsidiaries
For the rest of the Company’s subsidiaries, there are no defined benefit plans or compulsory defined contribution structures. However, certain subsidiaries make contributions to national pension, social security and severance plans in accordance with the percentages and rates established by the applicable social security and labor laws of each country. Such contributions are made to the entities designated by the countries legislation and are recorded as direct labor expenses in the consolidated statements of comprehensive income as they are incurred.
Remeasurements of defined benefit plans, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding net interest and the return on plan assets (excluding net interest), are recognized immediately in the consolidated statements of financial position with a corresponding debit or credit to retained earnings through OCI in the period in which they occur.Re-measurements are not reclassified to profit or loss in subsequent periods.
Past service costs are recognized in profit or loss on the earlier of:

(i)
The date of the plan amendment or curtailment, and

(ii)
The date that the Company recognizes restructuring-related costs
Net interest on liability for defined benefits is calculated by applying the discount rate to the net defined benefit liability or asset and it is recognized in the “valuation of derivatives, interest cost from labor obligations and other financial items” in the consolidated statements of comprehensive income. The Company recognizes the changes in the net defined benefit obligation under “Cost of sales and services” and “Commercial, administrative and general expenses” in the consolidated statements of comprehensive income.
Paid absences
The Company recognizes a provision for the cost of paid absences, such as vacation time, based on the accrual method.
r) Employee profit sharing
Employee profit sharing is paid by certain subsidiaries of the Company to its eligible employees. The Company has employee profit sharing in Mexico, Ecuador and Peru. In Mexico, employee profit sharing is computed at the rate of 10% on the individual subsidiaries taxable base adjusted for employee profit sharing purposes as provided by law.
Employee profit sharing is presented as an operating expense in the consolidated statements of comprehensive income.
s) Taxes
Income taxes
Current income tax payable is presented as a short-term liability, net of prepayments made during the year.
Deferred income tax is determined using the liability method based on the temporary differences between the tax values of the assets and liabilities and their book values at the consolidated financial statements reporting date.
Deferred tax assets and liabilities are measured using the tax rates that are expected to be in effect in the period when the asset will materialize or the liability will be settled, based on the enacted tax rates (and tax legislation) that have been enacted or substantially enacted at the financial statements reporting date. The value of deferred tax assets is reviewed by the Company at each financial statements reporting date and is reduced to the extent that it is more likely that the Company will not have sufficient future tax profits to allow for the realization of all or a part of its deferred tax assets. Unrecognized deferred tax assets are revalued at each financial ~~statements~~statement reporting date and are recognized when it is more likely that there will be sufficient future tax profits to allow for the realization of these assets.
Deferred taxes relating to items recognized in Other Comprehensive Income are recognized together with the concept that generated such deferred taxes. Deferred taxes consequence on unremitted earnings from subsidiaries
and associates are considered as temporary differences, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. Taxes withheld on remitted foreign earnings are creditable against Mexican taxes, thus to the extent that a remittance is to be made, the deferred tax would be limited to the incremental difference between the Mexican tax rate and the rate of the remitting country. As of December 31, ~~2017~~2019 and ~~2018,~~2020, the Company has not provided for any deferred taxes related to unremitted foreign earnings.
The Company offsets tax assets and liabilities if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.
Sales tax
Revenues, expenses and assets are recognized net of the amount of sales tax, except:

When the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the sales tax is recognized as part of the cost of acquisition of the asset or as part of the expense item, as applicable.

Receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the tax authorities is included as part of the current receivables or payables in the consolidated statements of financial position unless they are due in more than a year in which case they are classified asnon-current.
t) Advertising
Advertising expenses are recognized as incurred. For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, advertising expenses were ~~Ps. 28,180,538, Ps. 28,718,563~~Ps.26,255,952, Ps.22,810,211 and ~~Ps. 26,255,952 ,~~Ps.19,894,607 respectively, and are presented in the consolidated statements of comprehensive income in the caption “Commercial, administrative and general expenses”.
u) Earnings per share
Basic and diluted earnings per share are determined by dividing net profit of the year by the weighted-average number of shares outstanding during the year. In determining the weighted average number of outstanding shares, shares repurchased by the Company have been excluded.
v) Financial risks
The main risks associated with the Company’s financial instruments are: (i) liquidity risk, (ii) market risk (foreign currency exchange risk and interest rate risk) and (iii) credit risk and counterparty risk. The Board of Directors approves the policies submitted by management to mitigate these risks.
i) Liquidity risk
Liquidity risk is the risk that the Company may not meet its financial obligations associated with financial instruments when they are due. The Company’s financial obligations and commitments are included in Notes 14 and ~~16.~~17.
ii) Market risk
The Company is exposed to certain market risks derived from changes in interest rates and fluctuations in exchange rates of foreign currencies. The Company’s debt is denominated in foreign currencies, mainly in US
dollars and euros, other than its functional currency. In order to reduce the risks related to fluctuations in the exchange rate of foreign currency, the Company uses derivative financial instruments such as cross-currency swaps and forwards to adjust exposures resulting from foreign exchange currency. The Company does not use derivatives to hedge the exchange risk arising from having operations in different countries.
Additionally, the Company occasionally uses interest rate swaps to adjust its exposure to the variability of the interest rates or to reduce their financing costs. The Company’s practices vary from time to time depending on judgments about the level of risk, expectations of change in the movements of interest rates and the costs of using derivatives. The Company may terminate or modify a derivative financial instrument at any time. See Note 7 for disclosure of the fair value of derivatives as of December 31, ~~2017~~2019 and ~~2018.~~2020.
iii) Credit risk
Credit risk represents the loss that could be recognized in case the counterparties fail to comply with their contractual obligations.
The financial instruments that potentially represent concentrations of credit risk are cash and short-term deposits, trade accounts receivable and financial instruments related to debt and derivatives. The Company’s policy is designed in order to limit its exposure to any one financial institution; therefore, the Company’s financial instruments are contracted with several different financial institutions located in different geographic regions.
The credit risk in accounts receivable is diversified because the Company has a broad customer base that is geographically dispersed. The Company continuously evaluates the credit conditions of its customers and generally does not require collateral to guarantee collection of its accounts receivable. The Company monitors on a monthly basis its collection cycle to avoid deterioration of its results of operations.
A portion of the Company’s cash surplus is invested in short- term deposits with financial institutions with high credit ratings.
iv) Sensitivity analysis for market risks
The Company uses sensitivity ~~analyses~~analysis to measure the potential losses based on a theoretical increase of 100 basis points in interest rates and a 5% fluctuation in exchange rates:
Interest rate
In the event that the Company’s agreed-upon interest rates at December 31, ~~2018 increased/(decreased)~~2020 increase/(decrease) by 100 basis points and a 5% fluctuation in exchange rates, the ~~increase in~~ net interest expense would increase/(decrease) by ~~Ps. 32,136,984~~Ps.1,476,660 and Ps. ~~(31,773,439)~~(13,417,231), respectively.
Exchange rate fluctuations
Should the Company’s debt at December 31, ~~2018~~2020 of ~~Ps. 638,922,453,~~Ps.628,382,956, suffer a 5% increase/(decrease) in exchange rates, the debt would increase/(decrease) by ~~Ps. 3,165,958~~Ps.31,429,089 and Ps. ~~(10,940,798)~~(31,429,089), respectively.
w) Derivative financial instruments
Derivative financial instruments are recognized in the consolidated statements of financial position at fair value. Valuations obtained by the Company are compared against those of the financial institutions with which the agreements are entered into, and it is the Company’s policy to compare such fair value to a valuation provided by an independent pricing provider in case of discrepancies. Changes in the fair value of derivatives that do not qualify as hedging instruments are recognized immediately in the line “Valuation of derivatives, interest cost from labor obligations and other financial items, net”.
The Company is exposed to interest rate and foreign currency risks, which tries to mitigate through a controlled risk management program that includes the use of derivative financial instruments. The Company principally uses to offset the risk of exchange rate and interest rate fluctuations. Additionally, for the years ended December 31, ~~2017~~2018, 2019 and 2020 certain of the Company’s derivative financial instruments had been designated, and had qualified, as cash flow hedges. The effective portion of gains or losses on the cash flow derivatives is recognized in equity under the heading “Effect for fair value of derivatives”, and the ineffective portion is charged to results of operations of the period.
x) Current versusnon-current classification
The Company presents assets and liabilities in its consolidated statements of financial position based oncurrent/non-current classification.
An asset is current when it is either:

(i)
Expected to be realized or intended to be sold or consumed in the normal operating cycle.

(ii)
Held primarily for the purpose of trading.

(iii)
Expected to be realized within twelve months after the reporting period.

(iv)
Cash and cash equivalents unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
A liability is current when:

It is expected to be settled in the normal operating cycle.

It is held primarily for the purpose of trading.

It is due to be settled within twelve months after the reporting period.

There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other assets and liabilities, including deferred income tax assets and liabilities, asnon-current.
y) Presentation of consolidated statements of comprehensive income
The costs and expenses shown in the consolidated statements of comprehensive income are presented in combined manner (based on both their function and nature), which allows a better understanding of the components of the Company’s operating income. This classification allows a comparison to the telecommunications industry.
The Company presents operating income in its consolidated statements of comprehensive income since it is a key indicator of the Company’s performance. Operating income represents operating revenues less operating costs and expenses.
The employee benefits expense recognized for the years ended December 31, 2016, 2017 and 2018 of Ps. 46,759,415, Ps. 48,696,331 and Ps. 47,671,143, respectively is presented as “Cost of sales and services” and of Ps. 63,691,855, Ps. 66,920,537 and Ps. 67,936,876, respectively is presented in “Commercial, administrative and general expenses”.
z) Operating segments
Segment information is presented based on information used by management in its decision-making processes. Segment information is presented based on the geographic areas in which the Company operates.
The management of the Company is responsible for making decisions regarding the resources to be allocated to the Company’s different segments, as well as evaluating the performance of each segment. Intersegment revenues and costs, intercompany balances as well as investments in shares in consolidated entities are eliminated upon consolidation and reflected in the “eliminations” column in Note ~~22.~~23.
None of the segments records revenue from transactions with a single external customer amounting to 10% or more of the revenues.
Aa) Convenience translation
~~At December 31, 2018, amounts in U.S. dollars have been included in the~~The consolidated financial statements are stated in thousands of Mexican pesos (“Ps.”); however, solely for the convenience of the ~~reader and amounts this translation is not accordance with IFRS have been translated from Mexican pesos at~~readers, the consolidated statement of financial position as of December 31, ~~2018~~2020 and the consolidated statement of comprehensive income and consolidated statement of cash flows for the year ended December 31, 2020 were converted into U.S. dollars at anthe exchange rate of ~~Ps. 19.6829~~Ps.19.9487 per U.S. dollar, which was the exchange rate at that date. ~~Such translation~~This arithmetic conversion should not be construed as ~~a representation~~representations that the amounts expressed in Mexican ~~peso can~~pesos may be converted tointo U.S. dollars at ~~the exchange rate in effect on December 31, 2018~~that or any other exchange rate.
Ab) Significant accounting judgments, estimates and assumptions
In preparing its consolidated financial statements, the Company makes estimates concerning a variety of matters. Some of these matters are highly uncertain, and its estimates involve judgments it makes based on the available information. In the discussion below, the Company has identified several of these matters for which its financial statements would be materially affected if either (1) the Company uses different estimates that it could have reasonably used or (2) in the future América Móvil changes its estimates in response to changes that are reasonably likely to occur.
The following discussion addresses only those estimates that the Company considers most important based on the degree of uncertainty and the likelihood of a material impact had it used a different estimate. There are many other areas in which the Company uses estimates about uncertain matters, but the reasonably likely effect of changed or different estimates is not material to the financial presentation for those other areas.
Estimated useful lives of plant, property and equipment
The Company currently depreciates most of its network infrastructure based on an estimated useful life determined upon the expected particular conditions of operation and maintenance in each of the countries in which it operates. The estimates are based on AMX’s historical experience with similar assets, anticipated
technological changes and other factors, taking into account the practices of other telecommunications companies. The Company reviews estimated useful lives each year to determine, for each particular class of assets, whether they should be changed. The Company may shorten/extend the estimated useful life of an asset class in response to technological changes, changes in the market or other developments. This results in increased/decreased depreciation ~~expense. See Notes 2j) and 10.~~expense (See Note 10).
Revaluation of passive infrastructure of telecommunications towers
The Company recognizes the passive structure of the telecommunication towers at fair value, recognizing the changes in OCI. The discounted cash flow model was used. The Company hired a valuation specialist with industry experience to measure fair values as of December 31, 2020.
Impairment of Long-Lived Assets
The Company has large amounts of long-lived assets, including property, plant and equipment, intangible assets, investments in affiliates and goodwill on its consolidated statements of financial position. The Company is required to test long-lived assets for impairment when circumstances indicate a potential impairment or, in some cases, at least on an annual basis. The impairment analysis for long-lived assets requires the Company to estimate the recoverable amount of the asset, which is the higher of its fair value (minus any disposal costs) and its value in use. To estimate the fair value of a long-lived asset, the Company typically takes into account recent market transactions or, if no such transactions can be identified, the Company uses a valuation model that requires making certain assumptions and estimates. Similarly, to estimate the value in use of long-lived assets, the
Company typically makes various assumptions about the future prospects for the business to which the asset relates, considers market factors specific to that business and estimates future cash flows to be generated by that business. Based on this impairment analysis, including all assumptions and estimates related thereto, as well as guidance provided by IFRS relating to the impairment of long-lived assets different assumptions and estimates could materially impact the Company’s reported financial results. More conservative assumptions of the anticipated future benefits from these businesses could result in impairment charges, which would decrease net income and result in lower asset values on the consolidated statements of financial position. Conversely, less conservative assumptions could result in smaller or no impairment charges, higher net income and higher asset values. The key assumptions used to determine the recoverable amount for the Company’s CGUs, are further explained in Notes ~~2l),~~23, 10 and 11.
Deferred Income Taxes
The Company is required to estimate its income taxes in each of the jurisdictions in which it operates. This process involves thejurisdiction-by-jurisdiction estimation of actual current tax exposure and the assessment of temporary differences resulting from the differing treatment of certain items, such as accruals and amortization, for tax and financial reporting purposes, as well as net operating loss carry-forwards and other tax credits. These items result in deferred tax assets and liabilities as discussed in Note 2 s). The analysis is based on estimates of taxable income in the jurisdictions in which the Company operates and the period on which the deferred tax assets and liabilities will be recovered or settled. If actual results differ from these estimates, or the Company adjusts these estimates in future periods, its financial position and results of operations may be materially affected.
In assessing the future realization of deferred tax assets, the Company considers future taxable income, ongoing planning strategies and future results in its operations. In the event that the estimates of projected future taxable income are lowered, or changes in current tax regulations are enacted that would impose restrictions on the timing or extent of the ability to utilize the tax benefits of net operating loss carry-forwards in the future, an adjustment to the recorded amount of deferred tax assets would be made, with a related charge to income. See Note 13.
Accruals
Accruals are recorded when, at the end of the period, the Company has a present obligation as a result of past events, whose settlement requires an outflow of resources that is considered probable and can be measured reliably. This obligation may be legal or constructive, arising from, but not limited to, regulation, contracts, common practice or public commitments, which have created a valid expectation for third parties that the Company will assume certain responsibilities. The amount recorded is the best estimation performed by the Company’s management in respect of the disbursement that will be required to settle the obligations, considering all the information available at the date of the financial statements, including the opinion of external experts, such as legal advisors or consultants. Accruals are adjusted to account for changes in circumstances for ongoing matters and the establishment of additional accruals for new matters.
If the Company is unable to reliably measure the obligation, no accrual is recorded, and information is then presented in the notes to its consolidated financial statements. Because of the inherent uncertainties in these estimations, actual expenditures may be different from the originally estimated amount recognized. See Note ~~15.~~16.
The Company is subject to various claims and contingencies related to tax, labor and legal proceedings as described in Note ~~16c)~~17b).
Labor Obligations
The Company recognizes liabilities on its consolidated statements of financial position and expenses in its statements of comprehensive income to reflect its obligations related to its post-retirement seniority premiums, pension and retirement plans in the countries in which it operates and offer defined contribution and benefit pension plans. The amounts the Company recognizes are determined on an actuarial basis that involves estimations and accounts for post-retirement and termination benefits.
The Company uses estimates in four specific areas that have a significant effect on these amounts: (i) the rate of return the Company assumes its pension plans will earn on its investments, (ii) the salaries increase rate that the Company assumes it will observe in future years, (iii) the discount rates that the Company uses to calculate the present value of its future obligations and (iv) the expected inflation rate. The assumptions applied are further disclosed in Note ~~17.~~18. These estimates are determined based on actuarial studies performed by independent experts using the projected unit-credit method.
~~ac) Retrospective adjustment~~
The following amounts in the consolidated statements of comprehensive income for the years ended December 31, 2016 and 2017, have been retrospectively reclassified to conform to the presentation for the year ended December 31, 2018.
~~In the Consolidated Statements of Comprehensive Income:~~

   As reported
2016    Retrospective
reclassification    2016
As adjustments
Operating revenues:

Mobile voice services
   Ps. 242,302,380    Ps. (242,302,380 )    Ps. —
Fixed voice services
   95,299,154    (95,299,154 )    —
Mobile data services
   256,936,895    (256,936,895 )    —
Fixed data services
   126,278,206    (126,278,206 )    —
Pay television
   78,268,778    (78,268,778 )    —
Other related services
   32,799,952    (32,799,952 )    —
Revenues services
   —      831,885,365    831,885,365






   Ps. 831,885,365    Ps. —      Ps. 831,885,365






   As reported
2017    Retrospective
reclassification    2017
As adjustments
Operating revenues:

Mobile voice services
   Ps. 221,751,600    Ps. (221,751,600 )    Ps. —
Fixed voice services
   89,856,743    (89,856,743 )    —
Mobile data services
   308,526,994    (308,526,994 )    —
Fixed data services
   139,277,613    (139,277,613 )    —
Pay television
   86,882,606    (86,882,606 )    —
Other related services
   32,115,767    (32,115,767 )    —
Revenues services
   —      878,411,323    878,411,323






   Ps. 878,411,323    Ps. —      Ps. 878,411,323






3. Cash and Cash Equivalents
Cash and cash equivalents are comprised of short-term deposits with different financial institutions. Cash equivalents only include instruments with purchased maturity of less than three months. The amount includes the amount deposited, plus any interest earned.
4. Equity investments at fair value through OCI and other short-term investments
As of December 31, ~~2017~~2019 and ~~2018,~~2020, equity investments at fair value through OCI and other short-term investments includes an equity ~~investments~~investment in KPN for ~~Ps. 46,682,657~~Ps.37,572,410 and ~~Ps. 39,028,083,~~Ps.50,033,111, respectively, and other short-term investments for ~~Ps. 12,438,019~~Ps.10,145,615 and ~~Ps. 9,987,851, respectively.~~
The investment in KPN is carried at fair value with changes in fair value being recognized through other comprehensive (loss) items (equity) in the Company’s consolidated statements of financial position. As of December 31, 2017 and 2018, the Company has recognized in equity changes in fair value of the investment of Ps. 622,424 and Ps. (3,765,688),Ps.4,603,284, respectively, ~~net of deferred taxes, through other comprehensive (loss) gain items in equity.~~
~~During the years ended December 31, 2016, 2017 and 2018, the Company received dividends from KPN for an amount of Ps. 5,740,092, Ps. 2,370,559 and Ps. 2,605,333, respectively;~~ which are included within “Valuation of derivatives, interest cost from labor obligations, and other financial items, net” in the consolidated statements of comprehensive income. Another short-term investment item of Ps. 9,987,851, as of December 31, 2018 (Ps. 12,438,019 in 2017) represents a cash deposit used to guarantee a short-term obligation for one of the Company’s foreign subsidiaries and are presented at their carrying value, which approximates fair value.
The investment in KPN is carried at fair value with changes in fair value being recognized through other comprehensive (loss) gain items (equity) in the Company’s consolidated statements of financial position. As of December 31, 2019 and 2020, the Company has recognized in equity changes in fair value of the investment of Ps.883,408 and Ps.(1,952,414), respectively, net of deferred taxes, through other comprehensive (loss) gain items in equity.
During the years ended December 31, 2018, 2019 and 2020, the Company received dividends from KPN for an amount of Ps.2,605,333, Ps.1,742,242 and Ps.2,119,668, respectively; which are included within “Valuation of derivatives, interest cost from labor obligations, and other financial items, net” in the consolidated statements of comprehensive income.
5. Accounts receivable from subscribers, distributors, recoverable taxes contractual assets and other, net
a)An analysis of accounts receivable by component at December 31, ~~2017~~2019 and ~~2018~~2020 is as follows:

   At December 31,
   2017 2018
Subscribers and distributors
   Ps. 178,722,706 Ps. 173,053,226
Telecommunications carriers for network interconnection and other
services
   8,671,416 5,543,263
Recoverable taxes⁽ⁱ⁾
   40,477,188 46,706,298
Sundry debtors
   14,736,340 12,685,281
Contractual assets (Note 2i, a)
   —   34,718,749
Impairment of trade receivables
   (39,044,925 ) (40,798,025 )


Total net
   Ps. 203,562,725 Ps. 231,908,792


Non-current subscribers, distributors and contractual assets
   9,786,581 15,681,872


Total current subscribers, distributors and contractual assets
   Ps. 193,776,144 Ps. 216,226,920


~~(i)~~
In accordance with the favorable resolution obtained from the authorities, in 2018 the subsidiary Claro Brasil recognized a benefit for the exclusion of the Tax on the Circulation of Goods and the Provision of Services (Imposto sobre a Circulação de Mercadorias e Prestação de Serviços, or “ICMS “) in the calculation bases of the Social Integration Program (Social Integration Program, or” PIS “) and the Contribution for the Financing of Social Security (Contribution to or Financing of Social Security, or” COFINS “) in the amount total of Ps. 12,295,869, that includes interest of Ps. 6,127,656. The asset was recognized based on the certainty of obtaining the economic benefit.
At December 31,
2019 2020
Subscribers and distributors
Ps.184,260,099 Ps.168,758,386
Telecommunications carriers for network interconnection and other services
5,079,763 4,914,094
Recoverable taxes
23,628,728 44,557,402
Sundry debtors
12,084,050 12,504,566
Contract assets
34,274,007 29,588,104
Impairment of trade receivables
(39,480,909 ) (44,551,735 )

Total net
Ps.219,845,738 Ps.215,770,817

Non-current subscribers, distributors and contractual assets
Ps.  15,139,442 Ps.    7,792,863

Total current subscribers, distributors and contractual assets
Ps.204,706,296 Ps.207,977,954

b) Changes in the ~~allowance for expected credit losses~~impairment of trade receivables is as follows:

   For the years ended December 31,    For the years ended December 31,
   2016    2017    2018    2018    2019    2020
Balance at beginning of year
   Ps. (27,495,158 )    Ps. (37,351,677 )    Ps. (39,044,925 )    Ps.(39,044,925 )    Ps.(40,798,025 )    Ps.(39,480,909 )
Increases recorded in expenses
   (16,987,769 )    (20,766,362 )    (19,535,707 )    (19,535,707 )    (16,346,395 )    (19,112,635 )
Adjustment on initial application of IFRS 9 (Note 2i, b)
   —      —      (2,400,783 )
Adjustment on initial application of IFRS 9
   (2,400,783 )    —      —
Write-offs
   12,587,567    17,713,992    15,497,254    15,497,254    17,839,957    11,953,227
Business combination
      (3,265,490 )    (2,066 )
Translation effect
   (5,456,317 )    1,359,122    4,686,136    4,686,136    3,089,044    2,090,648












Balance at end of year
   Ps. (37,351,677 )    Ps. (39,044,925 )    Ps. (40,798,025 )    Ps.(40,798,025 )    Ps.(39,480,909 )    Ps.(44,551,735 )












c) The following table shows the aging of accounts receivable at December 31, ~~2017~~2019 and ~~2018,~~2020, for subscribers and distributors:

~~Past due~~
~~Total~~ ~~Unbilled services~~
~~provided~~ ~~a-30 days~~ ~~31-60~~ ~~days~~ ~~61-90~~ ~~days~~ ~~Greater than~~
~~90 days~~
~~December 31, 2017~~
~~Ps. 178,722,706~~ ~~Ps. 78,384,174~~ ~~Ps. 46,758,825~~ ~~Ps. 6,780,671~~ ~~Ps. 4,375,188~~ ~~Ps. 42,423,848~~
~~December 31, 2018~~
~~Ps. 173,053,226~~ ~~Ps. 62,623,654~~ ~~Ps. 46,816,302~~ ~~Ps. 6,315,277~~ ~~Ps. 4,168,952~~ ~~Ps. 53,129,041~~
Past due
Total Unbilled services
provided a-30 days 31-60 days 61-90 days Greater than
90 days
December 31, 2019
Ps. 184,260,099 Ps. 76,223,243 Ps. 46,083,644 Ps. 6,076,281 Ps. 4,121,929 Ps. 51,755,002
December 31, 2020
Ps. 168,758,386 Ps. 75,972,811 Ps. 37,439,995 Ps. 5,325,264 Ps. 3,313,835 Ps. 46,706,481
d) The following table shows the accounts receivable from subscribers and distributors included in the impairments of trade receivables, as of December 31, ~~2017~~2019 and ~~2018:~~2020:

~~Total~~ ~~1-90~~ ~~days~~ ~~Greater than~~
~~90 days~~
~~December 31, 2017~~
~~Ps. 39,044,925~~ ~~Ps. 3,807,945~~ ~~Ps. 35,236,980~~
~~December 31, 2018~~
~~Ps. 40,798,025~~ ~~Ps. 4,079,803~~ ~~Ps. 36,718,222~~
   Total    1-90 days    Greater than
90 days
December 31, 2019
   Ps. 39,480,909    Ps. 3,948,091    Ps. 35,532,818
December 31, 2020
   Ps. 44,551,735    Ps. 4,455,174    Ps. 40,096,561
e) An analysis of contract assets and liabilities at December 31, ~~2018~~2019 and 2020 is as follows:

~~2018~~
~~Contract Assets:~~
~~Balance at the beginning of the year~~
~~Ps.~~ ~~29,640,953~~
~~Additions~~
~~32,029,279~~
~~Disposals~~
~~(25,243,487~~ )
~~Translation effect~~
~~(1,707,996~~ )
~~Balance at the end of the year~~
~~Ps.~~ ~~34,718,749~~
~~Non-current~~ ~~contract assets~~
~~Ps.~~ ~~5,437,263~~
~~Current portion contracts assets~~
~~Ps.~~ ~~29,281,486~~
   2019    2020
Contract Assets:

Balance at the beginning of the year
   Ps. 34,718,749    Ps. 34,274,007
Additions
   34,877,851    27,242,031
Disposals
   (2,658,641 )    (1,397,714 )
Business Combination
   576,463    —
Amortization
   (30,501,315 )    (29,002,995 )
Translation effect
   (2,739,100 )    (1,527,225 )




Balance at the end of the year
   Ps. 34,274,007    Ps. 29,588,104
Non-current contract assets
   Ps. 1,786,560    Ps. 817,740




Current portion contracts assets
   Ps. 32,487,447    Ps. 28,770,364




6. Related Parties
a) The following is an analysis of the balances with related parties as of December 31, ~~2017~~2019 and ~~2018.~~2020. All of the companies were considered affiliates of América Móvil since the Company’s principal shareholders are either direct or indirect shareholders in the related parties.

   2017    2018    2019    2020
Accounts receivable:

Sears Roebuck de México, S.A. de C.V.
   Ps. 211,491    Ps. 264,976
Hubard y Bourlon, S.A. de C.V.
   Ps.   172,952    Ps.   437,231
Patrimonial Inbursa, S.A.
   386,194    327,985
Sears Roebuck de México, S.A. de C.V. and Subsidiaries.
   228,523    233,402
Sanborns Hermanos, S.A.
   91,233    312,706    229,964    160,116
Patrimonial Inbursa, S.A.
   246,874    214,180
Claroshop.com, S.A.P.I de C.V.
   91,874    100,075
Grupo Condumex, S.A. de C.V. and Subsidiaries
   12,018    10,038
Carso Infraestructura y Construcción, S.A. de C.V. and Subsidiaries
   89,585    179,852    41,204    7,679
Grupo Condumex, S.A. de C.V. and Subsidiaries
   47,269    35,007
Operadora de Sites Mexicanos, S.A. de C.V.
   14,252    16,634
Other
   167,526    240,250    110,411    114,774








Total
   Ps. 868,230    Ps. 1,263,605    Ps.1,273,140    Ps.1,391,300








   2017    2018    2019    2020
Accounts payable:

Carso Infraestructura y Construcción, S.A. de C.V. and Subsidiaries
   Ps. 947,761    Ps. 1,403,414    Ps.1,656,123    Ps.2,192,405
Grupo Condumex, S.A. de C.V. and Subsidiaries
   812,427    784,678    905,776    1,054,526
Fianzas Guardiana Inbursa, S.A. de C.V.
   241,305    241,898
Grupo Financiero Inbursa, S.A.B. de C.V.
   38,847    235,745    246,804    234,954
Fianzas Guardiana Inbursa, S.A. de C.V.
   276,633    227,014
Seguros Inbursa, S.A. de C.V.
   100,155    92,173
PC Industrial, S.A. de C.V. and Subsidiaries
   136,859    83,502    68,189    44,198
Enesa, S.A. de C.V. and Subsidiaries
   50,609    22,630    25,076    22,014
Other
   277,276    217,230    216,991    117,748








Total
   Ps. 2,540,412    Ps. 2,974,213    Ps.3,460,419    Ps.3,999,916








For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, the Company has not recorded any impairment of receivables in connection with amounts owed by related parties.
b) For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, the Company conducted the following transactions with related parties:

   2016    2017    2018    2018    2019    2020
Investments and expenses:

Construction services, purchases of materials, inventories and property, plant and equipment ⁽ⁱ⁾
   Ps. 9,917,280    Ps. 11,030,944    Ps. 7,211,960    Ps. 7,211,960    Ps. 8,573,894    Ps. 7,130,769
Rent of towers
   4,748,503    5,326,366    6,168,592
Insurance premiums, fees paid for administrative and operating services, brokerage services and others⁽ⁱⁱ⁾
   4,118,469    4,135,578    4,134,380    4,134,380    4,590,620    4,375,113
Rent of towers ⁽ⁱⁱⁱ⁾
   6,168,592    —      —
Other services
   1,899,818    2,802,667    1,864,017    1,864,017    1,277,404    1,101,528












   Ps. 20,684,070    Ps. 23,295,555    Ps. 19,378,949    Ps. 19,378,949    Ps. 14,441,918    Ps. 12,607,410












Revenues:

Revenues services
   Ps. 411,076    Ps. 416,047    Ps. 679,220
Service revenues
   Ps. 679,220    Ps. 538,110    Ps. 608,248
Sales of equipment
   2,679,591    2,313,840    1,296,204    1,296,204    944,697    656,801












   Ps. 3,090,667    Ps. 2,729,887    Ps. 1,975,424    Ps. 1,975,424    Ps. 1,482,807    Ps. 1,265,049












i)
In ~~2018,~~2020, this amount includes Ps.5,312,845 (Ps.6,809,244 in 2019 and Ps.5,622,791 ~~(Ps. 9,829,991~~ in ~~2017 and Ps. 9,547,530 in 2016)~~2018) for network construction services and construction materials purchased from subsidiaries of Grupo Carso, S.A.B. de C.V. (Grupo Carso).
ii)
In ~~2018,~~2020, this amount includes ~~Ps. 778,191 (Ps. 789,253~~Ps.203,013 (Ps.956,132 in ~~2017~~2019 and ~~Ps. 812,247~~Ps.778,191 in ~~2016)~~2018) for network maintenance services performed by Grupo Carso subsidiaries; ~~Ps. 13,784~~Ps.13,490 in ~~2018 (Ps. 15,695~~2020 (Ps.16,161 in ~~2017,~~2019, and ~~Ps. 705,074~~Ps.13,784 in ~~2016)~~2018) for software services provided by an associate; ~~Ps. 2,541,703~~Ps.2,713,370 in ~~2018 (Ps. 3,330,038~~2020 (Ps.2,623,795 in ~~2017~~2019 and ~~Ps. 2,406,058~~Ps.2,541,703 in ~~2016)~~2018) for insurance premiums with Seguros Inbursa S.A. and Fianzas Guardiana Inbursa, S.A., which, in turn, places most of such insurance with reinsurers.
iii)
Due to the implementation of IFRS 16 amounts related to payments for tower leases are no longer considered rental expenses.
c) The aggregate compensation paid to the Company’s, directors (including compensation paid to members of the Audit and Corporate Practices Committee), and senior management in ~~2018~~2020 was approximately ~~Ps. 5,300~~Ps.6,300 and ~~Ps. 70,100,~~Ps.79,600, respectively. None of the Company’s directors is a party to any contract with the Company or any of its subsidiaries that provides for benefits upon termination of employment. The Company does not provide pension, retirement or similar benefits to its directors in their capacity as directors. The Company’s executive officers are eligible for retirement and severance benefits required by Mexican law on the same terms as all other employees.
d) Österreichische Bundes- und Industriebeteiligungen GmbH (ÖBIB) is considered a related party due to it is a significantnon-controlling shareholder in Telekom Austria. Through Telekom Austria, América Móvil is related to the Republic of Austria and its subsidiaries, which are mainly ÖBB Group, ASFINAG Group and Post Group as well as Rundfunk und Telekom Reguliegungs-GmbH, all of which these are related parties. In ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, none of the individual transactions associated with government agencies or government-owned entities of Austria were considered significant to América Móvil.
7. Derivative Financial Instruments
To mitigate the risks of future increases in interest rates and foreign exchange rates for the servicing of its debt, the Company has entered into derivative contracts inover-the-counter transactions carried out with financial institutions. In ~~2018~~2020 the weighted-average interest rate of the total debt including the impact of interest rate derivatives held by the Company is 3.5% (3.8% and 4.1% ~~(4.0%~~in 2019 and ~~3.7% in 2017 and 2016,~~2018, respectively).
An analysis of the derivative financial instruments contracted by the Company at December 31, ~~2017~~2019 and ~~2018~~2020 is as follows:

   At December 31,
   2017    2018
Instrument
   Notional amount in
millions    Fair Value    Notional amount in
millions    Fair Value
Assets:

Swaps US Dollar-Mexican peso
   US$ 2,800    Ps.4,766,102    US$ 3,490    Ps. 2,058,831
Swaps Euro-Mexican peso
   € —      —      —      —
SwapsYen-US Dollar
   ¥ 13,000    521,270    ¥ 13,000    581,948
Forwards US Dollar-Mexican peso
   US$ 1,744    1,600,666    —      —
Forwards USDollar-Brazilian real
   US$ 100    44,280    US$ 150    126,287
Swaps SwissFranc-US Dollar
   CHF 475    178,710    —      —
SwapsEuro-Brazilian real
   € 450    359,671    € 300    1,080,552
Interest rate swap
   Ps.200    916    —      —
Forwards Brazilian Real-US Dollar
   —      —      BRL $ 2,823    1,107,630
ForwardsEuro-Brazilian real
   € 400    330,427    € 150    123,005
Forwards US Dollar-Swiss franc
   CHF 75    121,981    —      —
ForwardsEuro-US Dollar
   € 204    113,361    € 710    209,295




Total Assets
      Ps. 8,037,384       Ps. 5,287,548




At December 31,
2019 2020
Instrument
Notional amount in
millions Fair Value Notional amount in
millions Fair Value
Assets:

Swaps US Dollar-Mexican peso
US$ 3,290 Ps. 4,420,433 US$ 3,490 Ps.16,806,937
Swaps US Dollar – Euro
US$ 150 96,967 US$ 150 117,726
Swaps Yen-US Dollar
¥ 6,500 262,993 ¥ 9,750 269,215
Swaps Pound sterling – US Dollar
£ 100 2,988 £ 1,010 2,237,919
Forwards US Dollar – Mexican Peso
US$ 100 18 US$ 240 39,607
Forwards US Dollar-Brazilian real
US$ 83 90,429 —   —
Forwards Brazilian Real-US Dollar
BRL 5,803 1,620,605 BRL$ 4,193 1,190,292
Forwards Euro-Brazilian real
€ 50 4,255 —   —
Forwards Euro-US Dollar
€ 1,506 204,241 € 915 266,639
Forwards Argentinean Peso – US Dollar
ARS$ 1,388 122,831 —   —

Total Assets
Ps.6,825,760 Ps.20,928,335

   At December 31, At December 31,
   2017    2018 2019 2020
Instrument
   Notional amount in
millions    Fair Value    Notional amount in
millions    Fair Value Notional amount in
millions Fair Value Notional amount in
millions Fair Value
Liabilities:

Swaps US Dollar-Mexican peso
US$ 200 Ps.     (33,253 ) —   Ps.             —
Swaps US Dollar-Euro
   US$ 2,092    Ps. (8,340,970)    US$ 2,025    Ps. (5,114,863) US$ 800 (2,228,287 ) US$ 800 (4,811,031 )
Swaps Yen-US Dollar
—   —   ¥ 3,250 (14,802 )
Swaps Pound sterling-Euro
   £ 740    (3,376,091)    £ 740    (4,027,312) £ 640 (2,201,997 ) £ 640 (3,122,492 )
Swap Poundsterling-US Dollar
   £ 2,010    (1,676,636)    £ 2,010    (5,836,607) £ 2,010 (3,019,255 ) £ 550 (457,559 )
Forwards US Dollar-Mexican Peso
   —      —      US$ 977    (772,704) US$ 2,343 (1,398,247 ) US$ 3,494 (4,052,852 )
Forwards Brazilian Real-US Dollar
—   —   BRL$ 1,762 (425,249 )
Forwards Euro – Mexican Peso
—   —   € 200 (272,274 )
Forwards Euro-US Dollar
   —      —      € 950    (333,586) € 1,094 (554,278 ) —   —
Call spread option
   € 750    (48,422)    —      —
Forwards US Dollar – Euro
US$ 20 (3,787 ) —   —
Forwards Euro – Brazilian Real
€ 140 (10,196 ) —   —
Forwards Yen – US Dollar
¥ 6,500 (18,769 ) —   —
Put option
   € 374    (482,645)    € 374    (988,669) € 374 (126,569 ) € 374 (1,073,990 )
Call spread option
   € 3,000    (434,696)    € 3,000    (33,838)
Call option
€ 3,000 (2,113 ) —   —




Total Liabilities
      Ps. (14,359,460)       Ps. (17,107,579) Ps.(9,596,751 ) Ps.(14,230,249 )




Non-current liability
      Ps. (3,756,921)       Ps. (3,567,863)




Total current liability
      Ps. (10,602,539)       Ps. (13,539,716)




The changes in the fair value of these derivative financial instruments for the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 amounted to a (loss) gain ~~(loss)~~ of Ps. ~~(9,622,233)~~(4,686,407), ~~Ps. 8,192,567~~Ps.4,432,023 and ~~Ps. (4,686,407).~~Ps.12,378,193. Such amounts are included in the consolidated statements of comprehensive income as part of the caption “Valuation of derivatives interest cost from labor obligations and other financial items, net”.
The maturities of the notional amount of the derivatives are as follows:

Instrument
   Notional
amount in
millions    2019    2020    2021    2022    2023 Thereafter    Notional
amount in
millions    2021    2022    2023    2024    2025 Thereafter
Assets

Swaps US Dollar-Mexican peso
   US$    —      —      —      1,600    1,890    US$       1,600          1,890
SwapsYen-US Dollar
   ¥    —      —      —      —      13,000    ¥                9,750
SwapsEuro-Brazilian real
   €    300    —      —      —      —
Swaps US Dollar – Euro
   US$                150
Swaps Pound sterling – US Dollar
   £                1,010
Forwards US Dollar-Mexican Peso
   US$    240
Forwards Brazilian Real-US Dollar
   BRL    1,680    —      1,143    —      —      BRL             4,193
Forwards Euro-Brazilian Real
   €    150    —      —      —      —
Forwards US Dollar-Brazilian Real
   US$    150    —      —      —      —
Forwards Euro-US Dollar
   €    710    —      —      —      —      €    915
Liabilities

Swaps US Dollar-Euro
   US$    25    —      —      —      2,000    US$                800
Swaps Yen-US Dollar
   ¥                3,250
Swaps Pound sterling-Euro
   £    —      —      —      —      740    £                640
Swap Poundsterling-US Dollar
   £    —      550    —      —      1,460    £                550
Forwards US Dollar-Mexican Peso
   US$    977    —      —      —      —
Forwards Euro-US Dollar
   €    950    —      —      —      —
Forwards US Dollar – Mexican Peso
   US$    3,494
Forwards Brazilian Real-US Dollar
   BRL             1,762
Forwards Euro – Mexican Peso
   €    200
Put option
   €    —      —      —      —      374    €          374
Call spread option
   €    —      3,000    —      —      —
8. Inventories, net
An analysis of inventories at December 31, ~~2017~~2019 and ~~2018~~2020 is as follows:

   2017    2018    2019 2020
Mobile phones, accessories, computers, TVs, cards and other materials
   Ps. 42,262,511    Ps. 43,723,492    Ps.43,954,616 Ps.33,763,086
Less: Reserve for obsolete and slow-moving inventories
   (3,452,946 )    (3,418,130 )    (2,852,604 ) (3,385,647 )






Total
   Ps. 38,809,565    Ps. 40,305,362    Ps.41,102,012 Ps.30,377,439






For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, the cost of inventories recognized in cost of sales was ~~Ps. 172,495,376, Ps. 170,154,336~~Ps.180,013,986, Ps.174,543,602 and ~~Ps. 180,013,986~~Ps.167,546,288, respectively.
9. Other assets, net
An analysis of other assets at December 31, ~~2017~~2019 and ~~2018~~2020 is as follows:

   2017    2018    2019    2020
Current portion:

Advances to suppliers (different from PP&E and inventories)
   Ps. 9,536,654    Ps. 12,931,247    Ps. 7,718,343    Ps. 7,600,644
Prepaid insurance
   683,091    949,590    978,927    1,300,019
Costs of mobile equipment and computers associated with deferred revenues
   6,182,010    599,628
Other
   950,991    815,728    776,164    93,244








   Ps. 17,352,746    Ps.15,296,193    Ps. 9,473,434    Ps. 8,993,907








Non-current portion:

Recoverable taxes
   Ps. 12,249,372    Ps. 11,514,455    Ps.14,647,726    Ps.11,559,961
Prepayments for the use of fiber optics
   4,361,668    3,985,216    2,095,556    2,709,358
Prepaid expenses and judicial deposits⁽¹⁾
   25,926,436    26,961,930
Judicial Deposits⁽¹⁾
   19,506,147    15,402,840
Prepaid expenses
   5,642,590    8,743,667








Total
   Ps. 42,537,476    Ps. 42,461,601    Ps.41,892,019    Ps.38,415,826








For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, amortization expense for other assets was ~~Ps. 1,340,609, Ps. 620,680~~Ps.798,243, Ps.318,824 and ~~Ps. 798,243,~~Ps.213,833, respectively.

(1)
Judicial deposits represent cash and cash equivalents pledged in order to fulfill the collateral requirements for tax contingencies mainly in Brazil. At December 31, ~~2017~~2019 and ~~2018,~~2020, the amount for these deposits is ~~Ps. 20,288,382~~Ps.19,506,147 and ~~Ps. 18,172,342, respectively.~~Ps.15,402,840, respectively for Brazil. Based on its evaluation of the underlying contingencies, the Company believes that such amounts are recoverable.
10. Property, Plant and Equipment, net
a)An analysis of activity in property, plant and equipment, net atfor the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 is as follows:

At December 31,
2015 Additions Retirements Business
combinations Translation
effect of Foreign
Subsidiaries Depreciation
for
the year At December 31,
2016 At December 31,
2017 Additions Retirements Business
combinations Effect of
translation of
foreign
subsidiaries and
hyperinflation
adjustment Depreciation
for
the year At December 31,
2018
Cost

Network in operation and equipment
Ps. 641,384,702 Ps. 101,794,197 Ps. (8,963,076 ) Ps. 1,873,445 Ps. 235,186,745 Ps. —   Ps. 971,276,013 Ps. 989,665,946 Ps. 68,900,443 Ps. (1,610,246 ) Ps.128,246 Ps. (87,888,453 ) Ps. —   Ps. 969,195,936
Land and buildings
54,794,386 2,900,511 (2,845,298 ) 3,839 7,281,973 —   62,135,411 62,584,189 4,429,433 (3,987,671 ) 8,874 (5,904,499 ) —   57,130,326
Other assets
106,468,602 24,368,918 (10,717,096 ) 69,937 24,736,655 —   144,927,016 150,315,807 25,268,252 (13,377,798 ) 2,578 (12,399,702 ) —   149,809,137
Construction in process and advances plant suppliers⁽¹⁾
38,850,776 70,517,319 (70,911,593 ) 11,255 11,252,127 —   49,719,884 74,121,374 92,285,397 (76,978,798 ) 1,379 (8,336,823 ) —   81,092,529
Spare parts for operation of the network
20,342,389 34,010,751 (27,641,919 ) 5,520 1,566,307 —   28,283,048 26,591,598 49,380,349 (44,626,488 ) 1,939 (2,902,869 ) —   28,444,529

Total
861,840,855 233,591,696 (121,078,982 ) 1,963,996 280,023,807 —   1,256,341,372 1,303,278,914 240,263,874 (140,581,001 ) 143,016 (117,432,346 ) —   1,285,672,457

Accumulated depreciation

Network in operation and equipment
236,731,728 —   (1,968,376 ) —   153,147,349 107,976,385 495,887,086 552,345,509 —   (28,712,096 ) —   (67,907,227 ) 104,279,361 560,005,547
Buildings
4,567,588 —   (975,284 ) —   3,709,952 3,179,066 10,481,322 10,655,285 —   (2,311,442 ) —   (2,157,996 ) 2,625,102 8,810,949
Other assets
47,057,084 —   (25,099,710 ) —   10,396,438 16,105,885 48,459,697 63,359,529 —   (2,418,837 ) —   (6,579,983 ) 22,172,785 76,533,494
Spare parts for operation of the network
(44,423 ) —   (54,280 ) —   20,896 401,008 323,201 575,393 —   (160,696 ) —   (131,429 ) 38,479 321,747

Total
Ps. 288,311,977 Ps. —   Ps. (28,097,650 ) Ps. —   Ps. 167,274,635 Ps. 127,662,344 Ps. 555,151,306 Ps. 626,935,716 Ps. —   Ps. (33,603,071 ) Ps.       —   Ps. (76,776,635 ) Ps. 129,115,727 Ps. 645,671,737

Net Cost
Ps. 573,528,878 Ps. 233,591,696 Ps. (92,981,332 ) Ps. 1,963,996 Ps. 112,749,172 Ps. (127,662,344 ) Ps. 701,190,066 Ps. 676,343,198 Ps. 240,263,874 Ps. (106,977,930 ) Ps.143,016 Ps. (40,655,711 ) Ps. (129,115,727 ) Ps. 640,000,720

At December 31,
2016 Additions Retirements Business
combinations Effect of
translation
of foreign
subsidiaries Depreciation
for
the year At December 31,
2017 At December 31,
2018 Additions Retirements Business
combinations Effect of
translation of
foreign
subsidiaries and
hyperinflation
adjustment Depreciation
for
the year At December 31,
2019
Cost

Network in operation and equipment
Ps. 971,276,013 Ps.  78,272,882 Ps. (21,657,715 ) Ps. 599,306 Ps.(38,824,540 ) Ps.            —   Ps.  989,665,946 Ps. 969,195,936 Ps. 82,992,062 Ps. (13,417,360 ) Ps. 9,572,805 Ps.(57,669,840 ) Ps. —   Ps. 990,673,603
Land and buildings
62,135,411 2,858,996 (415,219 ) 27,686 (2,022,685 ) —   62,584,189 57,130,326 1,530,677 (4,025,222 ) 115,935 (3,950,463 ) —   50,801,253
Other assets
144,927,016 19,287,525 (8,112,571 ) 80,734 (5,866,897 ) —   150,315,807 149,809,137 26,881,611 (7,594,735 ) 1,021,051 (7,776,500 ) —   162,340,564
Construction in process and advances plant suppliers⁽¹⁾
49,719,884 66,383,381 (41,279,573 ) 34,705 (737,023 ) —   74,121,374 81,092,529 82,640,305 (76,892,011 ) 209,790 (5,511,439 ) —   81,539,174
Spare parts for operation of the network
28,283,048 27,013,148 (27,979,816 ) 3,576 (728,358 ) —   26,591,598 28,444,529 44,776,904 (36,525,735 ) —   (2,462,605 ) —   34,233,093

Total
1,256,341,372 193,815,932 (99,444,894 ) 746,007 (48,179,503 ) —   1,303,278,914 1,285,672,457 238,821,559 (138,455,063 ) 10,919,581 (77,370,847 ) —   1,319,587,687

Accumulated depreciation

Network in operation and equipment
495,887,086 —   (21,214,724 ) —   (32,860,339 ) 110,533,486 552,345,509 560,005,547 —   (24,954,514 ) —   (47,778,627 ) 93,097,695 580,370,101
Buildings
10,481,322 —   (1,568,542 ) —   (940,054 ) 2,682,559 10,655,285 8,810,949 —   (287,072 ) —   (1,386,974 ) 2,330,405 9,467,308
Other assets
48,459,697 —   (4,572,509 ) —   (2,251,958 ) 21,724,299 63,359,529 76,533,494 —   (695,425 ) —   (4,754,982 ) 19,249,104 90,332,191
Spare parts for operation of the network
323,201 —   (9,205 ) —   (4,339 ) 265,736 575,393 321,747 —   (283,986 ) —   (79,226 ) 116,182 74,717

Total
Ps. 555,151,306 Ps.              —   Ps. (27,364,980 ) Ps. —   Ps.(36,056,690 ) Ps. 135,206,080 Ps. 626,935,716 Ps. 645,671,737 Ps. —   Ps. (26,220,997 ) Ps. —   Ps.(53,999,809 ) Ps. 114,793,386 Ps. 680,244,317

Net Cost
Ps. 701,190,066 Ps. 193,815,932 Ps. (72,079,914 ) Ps. 746,007 Ps. (12,122,813 ) Ps. (135,206,080 ) Ps. 676,343,198 Ps. 640,000,720 Ps. 238,821,559 Ps. (112,234,066 ) Ps. 10,919,581 Ps.(23,371,038 ) Ps. (114,793,386 ) Ps. 639,343,370

At December 31,
2017 Additions Retirements Business
combinations Effect of
translation of
foreign
subsidiaries and
hyperinflation
adjustment
Depreciation
for
the year At December 31,
2018 At
December 31,
2019 Additions Retirements Business
combinations Revaluation
adjustments Transfers Effect of
translation of
foreign
subsidiaries
and
hyperinflation
adjustment Depreciation
for
the year At
December 31,
2020
Cost

Network in operation and equipment
Ps. 989,665,946 Ps.   68,900,443 Ps. (1,610,246 ) Ps. 128,246 Ps. (87,888,453 ) —   Ps. 969,195,936 Ps. 990,673,603 Ps. 90,387,449 Ps. (19,574,391 ) Ps. 996,974 Ps. 107,152,628 Ps. (62,050,212 ) Ps. (49,993,808 ) Ps. —   Ps. 1,057,592,243
Land and buildings
62,584,189 4,429,433 (3,987,671 ) 8,874 (5,904,499 ) —   57,130,326 50,801,253 570,062 (2,853,037 ) —   —   —   369,300 —   48,887,578
Other assets
150,315,807 25,268,252 (13,377,798 ) 2,578 (12,399,702 ) —   149,809,137 162,340,564 17,474,218 (14,454,598 ) 55,848 —   —   (8,393,187 ) —   157,022,845
Construction in process and advances plant suppliers⁽¹⁾
74,121,374 92,285,397 (76,978,798 ) 1,379 (8,336,823 ) —   81,092,529 81,539,174 59,635,316 (68,661,847 ) 1,099 —   —   (5,011,829 ) —   67,501,913
Spare parts for operation of the network
26,591,598 49,380,349 (44,626,488 ) 1,939 (2,902,869 ) —   28,444,529 34,233,093 30,721,413 (37,829,818 ) —   —   —   (2,328,430 ) —   24,796,258

Total
1,303,278,914 240,263,874 (140,581,001 ) 143,016 (117,432,346 ) —   1,285,672,457 1,319,587,687 198,788,458 (143,373,691 ) 1,053,921 107,152,628 (62,050,212 ) (65,357,954 ) —   1,355,800,837

Accumulated depreciation

Network in operation and equipment
552,345,509 —   (28,712,096 ) —   (67,907,227 ) 104,279,361 560,005,547 580,370,101 —   (25,726,856 ) —   —   (62,050,212 )⁽²⁾ (58,055,450 ) 96,729,723 531,267,306
Buildings
10,655,285 —   (2,311,442 ) —   (2,157,996 ) 2,625,102 8,810,949 9,467,308 —   (1,663,796 ) —   —   —   (622,253 ) 1,906,140 9,087,399
Other assets
63,359,529 —   (2,418,837 ) —   (6,579,983 ) 22,172,785 76,533,494 90,332,191 —   (9,317,821 ) —   —   —   (5,120,175 ) 16,549,822 92,444,017
Spare parts for operation of the network
575,393 —   (160,696 ) —   (131,429 ) 38,479 321,747 74,717 —   (176,131 ) —   —   —   38,898 135,000 72,484

Total
Ps. 626,935,716 Ps.                 —   Ps.  (33,603,071 ) Ps.        —   Ps. (76,776,635 ) Ps.   129,115,727 Ps. 645,671,737 Ps. 680,244,317 Ps. —   Ps. (36,884,604 ) Ps. —   Ps. —   Ps. (62,050,212 ) Ps. (63,758,980 ) Ps. 115,320,685 Ps. 632,871,206

Net Cost
Ps. 676,343,198 Ps.240,263,874 Ps. (106,977,930 ) Ps. 143,016 Ps. (40,655,711 ) Ps. (129,115,727 ) Ps. 640,000,720 Ps. 639,343,370 Ps. 198,788,458 Ps. (106,489,087 ) Ps. 1,053,921 Ps. 107,152,628 Ps. —   Ps. (1,598,974 ) Ps. (115,320,685 ) Ps. 722,929,631

⁽¹⁾
Construction in progress includes fixed and mobile network facilities as well as satellite developments and fiber optic which is in the process of being installed.
⁽²⁾
This transfer relates to the accumulated depreciation as at the revaluation date that was eliminated against the gross carrying amount of the revalued asset.
The completion period of construction in progress is variable and depends upon the type of plant and equipment under construction.
b) ~~At December 31, 2017 and 2018, property, plant and equipment include the following assets under capital leases:~~Revaluation of telecommunications towers

   2017    2018
Assets under capital leases
   Ps.  8,116,532    Ps.7,770,681
Accumulated depreciation
   (3,475,014 )    (3,530,241 )




   Ps.  4,641,518    Ps.  4,240,440




~~c) At~~The Fair value of the passive infrastructure of telecommunications towers was determined using the ”income approach” method through a discounted flow model (DFC) where, among others, inputs such as average rents per tower were used, contract term and discount rates considering market information.
As of December 31, ~~2018 and 2017, Claro Brasil has land and buildings and other equipment that are pledged in guarantee~~2020, date of ~~legal proceedings~~the revaluation, the fair values of the passive infrastructure of the telecommunications towers were determinated by a valuation specialist with experience in the ~~amount~~industry. The complement for the revaluation of ~~Ps.3,166,882~~the passive infrastructure of the telecommunications towers amounted to Ps.107,152,628 and ~~Ps. 3,521,082, respectively.~~was recognized in OCI, the change in revaluation did not have an impact on the results of the year due to depreciation effects since the change occurred on effective date 31 December 2020.
d)The information to be disclosed on the fair value measurement for the revalued telecommunications towers is provided in Note 19.
2020
Book value as of December 31, 2020 (cost model)
Ps.615,777,003
Supplement for change in accounting policy
107,152,628
Book value and fair value as of December 31, 2020 (revaluation model)
722,929,631
c) Relevant information related to the computation of the capitalized borrowing costs is as follows:

   Year ended December 31,    Year ended December 31,
   2016    2017    2018    2018 2019 2020
Amount invested in the acquisition of qualifying assets
   Ps. 52,974,400        Ps. 49,642,370        Ps. 45,456,630        Ps. 45,456,630 Ps. 50,783,957 Ps. 46,528,232
Capitalized interest
   2,861,307        2,875,034        2,020,288        2,020,288 2,233,358 1,771,613
Capitalization rate
   5.4%    5.8%    4.4%    4.4% 4.4% 3.8%
Capitalized interest is being amortized over a period of estimated useful life of the related assets.
e) On October 20, 2017, our subsidiary Star One signed a contract with SSL — Space Systems Loral for construction of the Star One D2 satellite, which will be equipped with transponders 52 in the C and Ku bands, 20 Gbps of capacity in Band Ka and a certain capacity in~~X-band.~~ The cost of this Project is estimated to be approximately Ps. 6,391,104 (US$ 323,000) and the launch will take place at the end of 2019. At December 31, 2018 and 2017 the amount recorded in Construction in progress amounts to Ps. 2,896,399 (R$551,528) and Ps. 916,240 (R$153,179), respectively.
11. Intangible assets, net and goodwill
a)An analysis of intangible assets at December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 is as follows:

For the year ended December 31, 2016 For the year ended December 31, 2018
Balance at
beginning of
year Acquisitions Acquisitions
in business
combinations Disposals and
other Amortization
of the year Effect of
translation of
foreign
subsidiaries Balance at end
of year Balance at
beginning of
year Acquisitions Acquisitions
in business
combinations Disposals and
other Amortization
of the year Effect of
translation of
foreign
subsidiaries
and
Hyperinflation
adjustment Balance at end
of year
Licenses and rights of use
Ps. 175,295,775 Ps. 9,129,949 Ps. 360,144 Ps. 1,269,478 Ps. —   Ps. 56,684,016 Ps. 242,739,362 Ps. 247,413,824 Ps. 4,227,244 Ps. —   Ps. 1,508,274 Ps. —   Ps. (19,670,368 ) Ps. 233,478,974
Accumulated amortization
(84,846,524 ) —   —   —   (10,255,271 ) (31,606,303 ) (126,708,098 ) (134,109,438 ) —   —   (1,005,877 ) (11,347,089 ) 16,281,825 (130,180,579 )

Net
90,449,251 9,129,949 360,144 1,269,478 (10,255,271 ) 25,077,713 116,031,264 113,304,386 4,227,244 —   502,397 (11,347,089 ) (3,388,543 ) 103,298,395

Trademarks
22,824,013 —   101,655 (13,820 ) —   4,877,302 27,789,150 28,779,212 159,958 6,631 —   —   (738,635 ) 28,207,166
Accumulated amortization
(11,523,707 ) —   —   —   (330,576 ) (3,367,974 ) (15,222,257 ) (18,841,405 ) —   —   —   (4,973,602 ) 275,046 (23,539,961 )

Net
11,300,306 —   101,655 (13,820 ) (330,576 ) 1,509,328 12,566,893 9,937,807 159,958 6,631 —   (4,973,602 ) (463,589 ) 4,667,205

Customer relationships
18,394,407 —   1,904,503 —   —   5,946,598 26,245,508 26,985,714 74,637 15,556 —   —   (1,532,839 ) 25,543,068
Accumulated amortization
(3,962,875 ) —   —   —   (3,231,518 ) (5,240,681 ) (12,435,074 ) (16,129,495 ) —   —   —   (3,754,312 ) 1,122,270 (18,761,537 )

Net
14,431,532 —   1,904,503 —   (3,231,518 ) 705,917 13,810,434 10,856,219 74,637 15,556 —   (3,754,312 ) (410,569 ) 6,781,531

Software licenses
8,782,768 3,854,066 26,871 (829,680 ) —   1,040,771 12,874,796 15,055,598 2,004,550 3,006 (905,610 ) —   (1,848,286 ) 14,309,258
Accumulated amortization
(2,424,598 ) (41,185 ) (8,367 ) 829,680 (3,469,461 ) (9,809 ) (5,123,740 ) (7,815,161 ) —   —   2,677,848 (3,491,629 ) 924,139 (7,704,803 )

Net
6,358,170 3,812,881 18,504 —   (3,469,461 ) 1,030,962 7,751,056 7,240,437 2,004,550 3,006 1,772,238 (3,491,629 ) (924,147 ) 6,604,455

Content rights
2,634,527 2,242,556 —   (217,057 ) —   216,272 4,876,298 6,717,442 850,779 —   —   —   (18,512 ) 7,549,709
Accumulated amortization
(428,746 ) —   —   (1,612 ) (2,236,141 ) —   (2,666,499 ) (4,516,665 ) —   —   —   (2,231,978 ) (14,949 ) (6,763,592 )

Net
2,205,781 2,242,556 —   (218,669 ) (2,236,141 ) 216,272 2,209,799 2,200,777 850,779 —   —   (2,231,978 ) (33,461 ) 786,117

Total of intangibles, net
Ps. 124,745,040 Ps. 15,185,386 Ps. 2,384,806 Ps. 1,036,989 Ps. (19,522,967 ) Ps. 28,540,192 Ps. 152,369,446 Ps. 143,539,626 Ps. 7,317,168 Ps. 25,193 Ps. 2,274,635 Ps. (25,798,610 ) Ps. (5,220,309 ) Ps. 122,137,703

Goodwill (Note 12)
Ps. 137,113,716 Ps. —   Ps. 3,953,023 Ps. (356,832 ) Ps. —   Ps. 11,922,728 Ps. 152,632,635
Goodwill
Ps. 151,463,232 Ps. —   Ps. 334,739 Ps. (1,094,861 ) —   Ps. (5,136,613 ) Ps. 145,566,497

For the year ended December 31, 2019
Balance at
beginning of
year Acquisitions Acquisitions
in business
combinations Disposals and
other Amortization
of the year Effect of
translation of
foreign
subsidiaries
and
Hyperinflation
adjustment Balance at end
of year
Licenses and rights of use
Ps. 233,478,974 Ps. 13,206,877 Ps. 7,844,339 Ps. 7,286,114 Ps. —   Ps. (15,715,442 ) Ps. 246,100,862
Accumulated amortization
(130,180,579 ) —   —   (2,391,624 ) (11,577,160 ) 9,481,480 (134,667,883 )

Net
103,298,395 13,206,877 7,844,339 4,894,490 (11,577,160 ) (6,233,962 ) 111,432,979

Trademarks
28,207,166 53,467 —   (6,012 ) —   (835,613 ) 27,419,008
Accumulated amortization
(23,539,961 ) —   —   —   (1,008,483 ) 618,145 (23,930,299 )

Net
4,667,205 53,467 —   (6,012 ) (1,008,483 ) (217,468 ) 3,488,709

Customer relationships
25,543,068 20,248 —   5,507 —   (2,693,812 ) 22,875,011
Accumulated amortization
(18,761,537 ) —   —   —   (3,371,924 ) 2,357,831 (19,775,630 )

Net
6,781,531 20,248 —   5,507 (3,371,924 ) (335,981 ) 3,099,381

Software licenses
14,309,258 2,729,480 —   (949,858 ) —   (2,984,770 ) 13,104,110
Accumulated amortization
(7,704,803 ) —   —   (1 ) (2,479,088 ) 2,183,149 (8,000,743 )

Net
6,604,455 2,729,480 —   (949,859 ) (2,479,088 ) (801,621 ) 5,103,367

Content rights
7,549,709 1,427,694 —   1,638,007 —   (455,228 ) 10,160,182
Accumulated amortization
(6,763,592 ) —   —   (8,720 ) (1,772,779 ) 429,862 (8,115,229 )

Net
786,117 1,427,694 —   1,629,287 (1,772,779 ) (25,366 ) 2,044,953

Total of intangibles, net
Ps. 122,137,703 Ps. 17,437,766 Ps. 7,844,339 Ps. 5,573,413 Ps. (20,209,434 ) Ps. (7,614,398 ) Ps. 125,169,389

Goodwill
Ps. 145,566,497 Ps. —   Ps. 10,869,571 Ps. (843,005 ) —   Ps. (2,693,262 ) Ps. 152,899,801

For the year ended December 31, 2017
Balance at
beginning of
year Acquisitions Acquisitions
in business
combinations Disposals and
other Amortization
of the year Effect of
translation of
foreign
subsidiaries Balance at end
of year
Licenses and rights of use
Ps. 242,739,362 Ps. 12,347,051 Ps. 53,923 Ps. (1,037,458 ) Ps. —   Ps. (6,689,054 ) Ps. 247,413,824
Accumulated amortization
(126,708,098 ) —   —   244,564 (11,879,489 ) 4,233,585 (134,109,438 )

Net
116,031,264 12,347,051 53,923 (792,894 ) (11,879,489 ) (2,455,469 ) 113,304,386

Trademarks
27,789,150 127,823 82,868 (29,804 ) —   809,175 28,779,212
Accumulated amortization
(15,222,257 ) —   —   34,464 (3,179,461 ) (474,151 ) (18,841,405 )

Net
12,566,893 127,823 82,868 4,660 (3,179,461 ) 335,024 9,937,807

Customer relationships
26,245,508 —   512,667 (882,338 ) —   1,109,877 26,985,714
Accumulated amortization
(12,435,074 ) —   —   882,338 (3,769,777 ) (806,982 ) (16,129,495 )

Net
13,810,434 —   512,667 —   (3,769,777 ) 302,895 10,856,219

Software licenses
12,874,796 3,351,200 —   (1,698,118 ) —   527,720 15,055,598
Accumulated amortization
(5,123,740 ) —   —   1,212,669 (3,699,363 ) (204,727 ) (7,815,161 )

Net
7,751,056 3,351,200 —   (485,449 ) (3,699,363 ) 322,993 7,240,437

Content rights
4,876,298 2,099,084 —   (63,137 ) —   (194,803 ) 6,717,442
Accumulated amortization
(2,666,499 ) —   —   (195,658 ) (1,820,092 ) 165,584 (4,516,665 )

Net
2,209,799 2,099,084 —   (258,795 ) (1,820,092 ) (29,219 ) 2,200,777

Total of intangibles, net
Ps. 152,369,446 Ps. 17,925,158 Ps. 649,458 Ps. (1,532,478 ) Ps. (24,348,182 ) Ps. (1,523,776 ) Ps. 143,539,626

Goodwill (Note 12)
Ps. 152,632,635 Ps. —   Ps. 951,348 Ps. (134,525 ) Ps. —   Ps. (1,986,226 ) Ps. 151,463,232

For the year ended December 31, 2018
Balance at
beginning of
year Acquisitions Acquisitions
in business
combinations Disposals and
other Amortization
of the year Effect of
translation of
foreign
subsidiaries
and
Hyperinflation
adjustment Balance at end
of year
Licenses and rights of use
Ps. 247,413,824 Ps. 4,227,244 —   Ps. 1,508,274 —   Ps. (19,670,368 ) Ps. 233,478,974
Accumulated amortization
(134,109,438 ) —   —   (1,005,877 ) (11,347,089 ) 16,281,825 (130,180,579 )

Net
113,304,386 4,227,244 502,397 (11,347,089 ) (3,388,543 ) 103,298,395

Trademarks
28,779,212 159,958 6,631 —   (738,635 ) 28,207,166
Accumulated amortization
(18,841,405 ) —   —   —   (4,973,602 ) 275,046 (23,539,961 )

Net
9,937,807 159,958 6,631 —   (4,973,602 ) (463,589 ) 4,667,205

Customer relationships
26,985,714 74,637 15,556 —   (1,532,839 ) 25,543,068
Accumulated amortization
(16,129,495 ) —   (3,754,312 ) 1,122,270 (18,761,537 )

Net
10,856,219 74,637 15,556 —   (3,754,312 ) (410,569 ) 6,781,531

Software licenses
15,055,598 2,004,550 3,006 (905,610 ) —   (1,848,286 ) 14,309,258
Accumulated amortization
(7,815,161 ) —   2,677,848 (3,491,629 ) 924,139 (7,704,803 )

Net
7,240,437 2,004,550 3,006 1,772,238 (3,491,629 ) (924,147 ) 6,604,455

Content rights
6,717,442 850,779 —   —   —   (18,512 ) 7,549,709
Accumulated amortization
(4,516,665 ) —   —   —   (2,231,978 ) (14,949 ) (6,763,592 )

Net
2,200,777 850,779 —   —   (2,231,978 ) (33,461 ) 786,117

Total of intangibles, net
Ps. 143,539,626 Ps. 7,317,168 Ps. 25,193 Ps. 2,274,635 Ps. (25,798,610 ) Ps. (5,220,309 ) Ps. 122,137,703

Goodwill
Ps. 151,463,232 Ps. 1,455 Ps. 333,284 Ps. (1,094,861 ) —   Ps. (5,136,613 ) Ps. 145,566,497

For the year ended December 31, 2020
Balance at
beginning of
year Acquisitions Acquisitions
in business
combinations Disposals and
other Amortization
of the year Effect of
translation of
foreign
subsidiaries
and
Hyperinflation
adjustment Balance at end
of year
Licenses and rights of use
Ps. 246,100,862 Ps. 15,079,714 Ps. 4,436,313 Ps. 1,502,981 Ps. —   Ps. (14,029,709 ) Ps. 253,090,161
Accumulated amortization
(134,667,883 ) —   —   105,892 (14,274,497 ) 14,227,424 (134,609,064 )

Net
111,432,979 15,079,714 4,436,313 1,608,873 (14,274,497 ) 197,715 118,481,097

Trademarks
27,419,008 162,309 12,110 4,000 —   1,534,938 29,132,365
Accumulated amortization
(23,930,299 ) —   —   (4,276 ) (300,727 ) (1,119,645 ) (25,354,947 )

Net
3,488,709 162,309 12,110 (276 ) (300,727 ) 415,293 3,777,418

Customer relationships
22,875,011 1,935 2,689,718 (5,763 ) —   4,018,365 29,579,266
Accumulated amortization
(19,775,630 ) —   —   855 (1,654,237 ) (3,996,593 ) (25,425,605 )

Net
3,099,381 1,935 2,689,718 (4,908 ) (1,654,237 ) 21,772 4,153,661

Software licenses
13,104,110 2,445,784 36 (2,485,429 ) —   4,236,645 17,301,146
Accumulated amortization
(8,000,743 ) —   —   2,013,617 (2,667,870 ) (3,578,452 ) (12,233,448 )

Net
5,103,367 2,445,784 36 (471,812 ) (2,667,870 ) 658,193 5,067,698

Content rights
10,160,182 1,570,415 —   (313,942 ) —   619,657 12,036,312
Accumulated amortization
(8,115,229 ) —   —   —   (1,440,749 ) (503,241 ) (10,059,219 )

Net
2,044,953 1,570,415 —   (313,942 ) (1,440,749 ) 116,416 1,977,093

��

Total of intangibles, net
Ps. 125,169,389 Ps. 19,260,157 Ps. 7,138,177 Ps. 817,935 Ps. (20,338,080 ) Ps. 1,409,389 Ps. 133,456,967

Goodwill
Ps. 152,899,801 Ps. —   Ps. (7,014,120 ) Ps. (537,343 ) Ps. —   Ps. (2,295,479 ) Ps. 143,052,859

b) The aggregate carrying amount of goodwill is allocated as follows:

   2017    2018    2019    2020
Europe (7 countries)
   Ps. 53,143,542    Ps. 53,066,729
Brazil (Fixed, wireless and TV)
   24,708,740    21,388,124
Europe
   Ps.   52,950,325    Ps.   53,388,139
Brazil
   28,062,398    18,730,686
Puerto Rico
   17,463,394    17,463,394    17,463,394    17,463,394
Dominican Republic
   14,186,723    14,186,723    14,186,723    14,186,723
Colombia
   13,981,033    12,770,381    12,124,685    12,253,743
México
   9,852,912    9,856,601    10,148,380    10,148,380
Peru
   3,958,110    3,086,981    2,739,947    2,710,979
Chile
   2,834,134    2,576,214    2,364,816    2,558,098
El Salvador
   2,510,577    2,510,577    2,499,552    2,499,544
United States (Tracfone)
   3,220,105    3,362,900
Ecuador
   2,155,385    2,155,385    2,155,384    2,155,384
Guatemala
   3,245,613    2,301,533
Other countries
   6,668,682    6,505,388    1,738,479    1,293,356








   Ps. 151,463,232    Ps. 145,566,497    Ps. 152,899,801    Ps. 143,052,859








c) The following is a description of the major changes in the “Licenses and rights of use” caption during the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018:~~
~~2016 Acquisitions~~
~~i) In February 2016, the Company´s subsidiary in Paraguay was granted with the use of 30 MHz of spectrum in the 1700/2100 Mhz frequency. The total cost was Ps. 830,719 (US$ 46,000).~~
~~ii) In February 2016, the Company through its subsidiary Radiomóvil Dipsa, S.A. de C.V. (Telcel), acquired through an auction a total of 20MHz in the national wideAWS-1~~ ~~band and 40 MHz in theAWS-3~~ ~~band. The concession expires in October 2030. The Company paid an amount of Ps. 2,098,060.~~
~~iii) In May 2016, Mtel, located in Bulgaria, acquired 2 x 5 MHz in the1,800-MHz~~ ~~spectrum for Ps. 135,441 (EUR 6,212). During 2016, Telekom Austria paid Ps. 410,713 (EUR 18,837) for the renewals referring to an obligation obtained from concessions granted in previous years.~~
iv) On May 26, 2016, the Company’s subsidiary in Peru acquired spectrum in a public auction of the 700 MHz band. The frequency band expires in 2036. The cost of the spectrum was Ps. 5,627,316 (PEN$. 1,002,523).
~~v) In July 2016, Ecuador Telecom acquired a license to operate TV in Ecuador for a period that ends in 2031. The amount paid was Ps. 27,700 (US$ 1,500).~~
~~2017 Acquisitions~~
~~i) In 2017, Claro Brasil increased its licenses value by Ps. 3,592,034 due to the cleaning process of the 700 MHz national frequency acquired in September 2014.~~
ii) On February 24, 2017 Radiomóvil Dipsa renewed its 8.4 MHz national license by paying Ps. 917,431, and on July 14, 2017, it acquired 43 concession titles for frequencies of 2.5 GHz in the amount of Ps. 5,305,498.
~~iii) Additionally, in 2017, the Company acquired other licenses in Chile, Europe, Uruguay and others countries in the amount of Ps. 2,532,088.~~2020:
2018 Acquisitions
i.i) In December, Dominican Republic acquired radio spectrum totaling ~~Ps 709,829~~Ps.709,829 (RD$ 1,831,427) with a useful life of 11 years.
~~ii.~~ii) Additionally, in 2018, the Company acquired other licenses in Paraguay, Puerto Rico, Europe, Argentina, Chile and others countries in the amount of ~~Ps. 3,517,415.~~Ps.3,517,415.
2019 Acquisitions
i) In 2019, Claro Brasil increased its licenses value by Ps.3,457,251 by renewal licenses Anatel and reversion of IRU of Telxus referring to ICMS.
ii) In 2019, Austria acquired licenses to operate certain frequencies for Ps.3,023,732, (3.5 GHz; EUR 64.3 mn), Belarus (2.1 GHz; EUR 9.5 mn) and Croatia (2.1 GHz; EUR 7.2 mn).
iii) In 2019, Telmex increased its licenses value by Ps.459,668 for rights to use IFETEL with a validity of 20 years, and a right to use submarine cable with a validity of 10 years.
iv) In January 2019, Telcel acquired licenses for an amount of Ps.1,649,525 for PC´s 98 concessions titles and September 30, 2019 for 400 MHZ concessions titles.
v) In December 2019, Comcel increased its licenses value by Ps.2,753,768 or (468,511,573,375 Colombian pesos) in accordance with Res.3386 of December 23, granted Claro (Comcel) the 20 years renewal of 10 MHz of spectrum in the 1900 MHz band.
vi) Additionally, in 2019, the Company acquired other licenses in Puerto Rico, Argentina, Guatemala, Panamá and other countries in the amount of Ps.1,862,934.
2020 Acquisitions
i) In February 2020, Comcel increased its licenses value by Ps.9,246,825 for an auction of the 30 Mhz spectrum in the 2,500 band for a period of 20 years in accordance with resolution. 325,326 and 327 of February 20, 2020 issued by the Ministry of Information and Communication (MINTIC)
ii) In 2020, Telcel acquired licenses for an amount Ps.1,806,875 for Axtel and Ultra Vision concession titles valid from 2020 to 2040.
iii) In January 2020, CTE acquired licenses by Ps.620,052 for 12 pairs of frequencies, advance payment of Advanced Wireless Services (AWS) band and complementary payment of AWS band of block 4.
iv) In 2020, TAG acquired licenses for the right of us for Ps.1,704,280, in Slovenia and VIP Movil 1940E.
v) Additionally, in 2020, the Company acquired other licenses in Puerto Rico, Argentina, Uruguay, Honduras, Paraguay, Brasil and other countries in the amount of Ps.1,701,682.
Amortization of intangibles for the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 amounted to ~~Ps. 19,522,968, Ps. 24,348,182and Ps. 25,798,610~~Ps.25,798,610, Ps.20,209,434 and Ps.20,338,080, respectively.
Some of the jurisdictions in which the Company operates can revoke their concessions under certain circumstances such as imminent danger to national security, national economy and natural disasters.
12. Business combinations, acquisitions ~~sale~~ andnon-controlling interest
a)The following is a description of the major acquisitions of investments in associates and subsidiaries during the years ended December 31, ~~2016~~2019 and ~~2017:~~2020:
Acquisitions ~~and sale 2016~~2019
a) InOn January ~~2016, in order to expand and strengthen its operations in Brazil,~~24, 2019, the Company ~~through~~acquired 100% of Telefónica Móviles Guatemala, S.A (“Telefónica Guatemala”) from Telefónica S.A. and certain of its ~~Brazilian subsidiary,~~affiliates. The acquired ~~a controlling interest of 99.99% in Brazil Telecomunicações S.A. (“BRTel”), a~~ company ~~operating in the market for~~provides mobile and fixed telecommunications services, including voice, data and Pay ~~TV, Internet and broadband services and serving various municipalities of Brazil under the BLUE brand.~~TV. The ~~amount~~final purchase price paid for the business acquisition was ~~Ps. 1,088,668,~~Ps.5,734,254, net of acquired cash. ~~The goodwill recognized amounted to Ps. 1,046,253.~~
~~b) In May 2016,~~For the purchase accounting, the Company ~~acquired an additionalnon-controlling~~ ~~interest~~determined the fair value of ~~1.8% in Tracfone Wireless Inc. thereby obtaining 100% of its capital stock.~~Telefónica Guatemala´s identifiable assets and liabilities based on relative fair values. The ~~amount paid was Ps. 2,300,553 (US$ 124,673). This transaction was recorded~~purchase accounting is completed as ~~an equity transaction, and therefore, no gain or loss was recognized.~~
~~c) In May 2016, the Company through his subsidiary, América Móvil Perú, S.A.C. acquired 100%~~ of the capital stock of Olo del Perú S.A.C. (“Olo”), and TVS Wireless S.A.C. (“TVS”). Olo and TVS provide telecommunications services throughout Peru and hold radio spectrum in the 2.5 GHz band. The transaction was conditioned to the obtentiondate of the ~~approval of~~financial statements and the Peruvian regulator, such approval was finally obtained in December 2016. The amount of the transaction was Ps. 1,854,379 (US$. 102,343) net of acquired cash. In May 2016 the Company paid Ps. 152,214 (US$ 7,554) and in January 2017, after the approval, Ps. 2,079,095 (US$ 94,789). The goodwill recognized amounted to Ps. 1,454,333 in December 2016, Ps. 188,452 in December 2017 and Ps. 329,366 in December 2018.
d) Based on a 2014 shareholder agreement, the Company agreed to ensure a minimal free float of Telekom Austria shares in the market. Consequently, in July 2016, the Company sold shares corresponding to 7.8% of the outstanding common stock of Telekom Austria AG. This sale reduced the overall shareholding of América Movil in Telekom Austria AG from 59.70% to 51.89%. Additionally, in August 2016, the Company sold 0.89% of the outstanding common stock of Telekom Austria AG. Following the successful completion of this transaction, AMX’s stake was reduced to 51.0%. The amount of cash received for these transactions was Ps. 6,323,336. As América Móvil still retains control over Telekom Austria AG, these transactions were recorded as equity transactions.
~~e) In September 2016, the Company, through his subsidiary Tracfone, acquired certain assets ofT-Mobile,~~ that represented a business, which included the brands known as Walmart Mobile and Go Smart. These assets were acquired in order to expand the Company’s distribution channels, add an incremental revenue stream, and assist in the growth of subscribers. There was no cash exchanged in the acquisition. The goodwill recognized amounted to Ps. 1,251,464.
f) In November 2016, Telekom Austria Group acquired 100% of the Belarusian fixed-line operator Atlant Telecom (Atlant) and its subsidiary TeleSet. After the acquisition, Atlant was renamed velcom ACS. Both
companies are the leading privately owned fixed-line operators in Belarus offering fixed-line broadband, IPTV and cable TV as well as a video and audio library. The acquisition of Atlant and TeleSet is a further step in Telekom Austria Group’s convergence strategy. The final allocation of consideration transferred will be determined once all necessary information regarding identifiable assets is available. The amount paid for the business acquisition was Ps. 582,931, net of acquired cash. The goodwill recognized amounted to Ps. 200,973.
~~Acquisitions 2017~~
a) In February 2017, Telekom Austria Group acquired 97.68% of Metronet telekomunikacije through its Croatian subsidiary Vipnet. Metronet is one of the leading alternative fixed business solutions providers in Croatia. The fair values of the assets acquired and liabilities assumed are as follows:
2019
amounts at the
acquisition date
Current assets
Ps. 1,312,906
Other non-current assets
257,853
Intangible assets (excluding goodwill)
1,354,105
Property, plant and equipment
4,144,334
Rights-of-use
864,046
Total assets acquired
7,933,244
Accounts payable
1,248,470
Other liabilities
1,705,580
Total liabilities assumed
2,954,050
Fair value of assets acquired a liabilities assumed-net
4,979,194
Acquisition Price
6,174,330
Goodwill
Ps. 1,195,136
b) On December 18, 2019, after receipt of the necessary approvals from local regulators, the Company completed the previously announced acquisition of 100% of Nextel Telecomunicações Ltda. and its subsidiaries (“Nextel Brazil”), from NII Holdings, Inc. and certain of its affiliates (“NII”) and AI Brazil Holdings B.V. Nextel Brazil provides nationwide mobile telecommunications services.
The aggregate purchase price was Ps.17,992,362, after making adjustments pursuant to the Purchase Agreement. After deducting Ps.9,325,712 of net debt, the net purchase consideration transferred at ~~the acquisition date are reported in the Europe segment. The amount paid for the business acquisition~~closing was ~~Ps. 1,550,534,~~Ps.6,905,539 net of acquired cash.
The net assets recognized in the 31 December 2019 financial statements were based on provisional amounts, the Company finished the Purchase Price allocation adjusting some values mainly for the spectrum licenses from the provisional goodwill, ~~recognized amounted to Ps. 502,574.~~as a result the final goodwill was Ps.1,912,372.
b)
The final amounts as of the date of the financial statement and the values of the assets acquired and liabilities assumed are as follows:
2019
amounts at the
acquisition date
Current assets
Ps. 6,366,943
Other non-current assets
5,970,810
Intangible assets (excluding goodwill)
12,914,175
Property, plant and equipment
5,147,093
Rights-of-use assets
8,086,655
Total assets acquired
38,485,676
Accounts payable
9,170,230
Other liabilities
22,504,097
Total liabilities assumed
31,674,327
Fair value of assets acquired a liabilities assumed-net
6,811,349
Purchase consideration transferred
8,723,721
Goodwill
Ps. 1,912,372
Acquisitions 2020
a) During ~~2017,~~2020, the Company acquired through its subsidiaries, other entities for which ifit paid ~~Ps. 3,249,164,~~Ps.152,896, net of acquired cash. ~~The identified goodwill has been allocated to the Europe segment. The goodwill recognized amounted to Ps. 260,355.~~
c)b) The Company acquired an additionalnon-controlling interest in its ~~Mexican~~ entities for an amount of ~~Ps. 23,881.~~Ps.1,104,662.
b) c) In December 2020, the offer submitted by our Brazilian subsidiary, Claro, jointly with Telefónica Brasil, S.A. and TIM, S.A. for the acquisition of the mobile business owned by Oi Group was accepted. The offer is in the amount of R$16.5 billion, of which Claro will pay 22%. In consideration of such amount, Claro will receive 32% of Oi Group’s mobile business customer base and approximately 4.7 thousand mobile access sites. The closing of the transaction is subject to customary conditions including regulatory approvals from Anatel and Conselho Administrativo de Defesa Econômica, CADE.
Consolidated subsidiaries withnon-controlling interests
The Company has control over Telekom Austria, which has a materialnon-controlling interest. Set out below is summarized information as of December 31, ~~2017~~2019 and ~~2018~~2020 of TKA’s consolidated financial statements. The amounts disclosed for this subsidiary are before inter-company eliminations and using the same accounting policies of América Móvil.
Selected financial data from the consolidated statements of financial position

   December 31,
   2017    2018
Assets:

Current assets
   Ps.   29,128,486    Ps.   29,854,542
Non-current assets
   150,225,260    131,407,408




Total assets
   Ps. 179,353,746    Ps. 161,261,950




Liabilities and equity:

Current liabilities
   Ps.   30,192,384    Ps.   36,822,034
Non-current liabilities
   89,048,150    80,023,800




Total liabilities
   119,240,534    116,845,834
Equity attributable to equity holders of the parent
   25,808,318    22,621,625
Non-controlling interest⁽¹⁾
   34,304,894    21,794,491




Total equity
   Ps.   60,113,212    Ps.   44,416,116




Total liabilities and equity
   Ps. 179,353,746    Ps. 161,261,950




~~(1)~~
~~In 2017 this amount includes Ps. 14,942,886 for the subordinated perpetual fixed rate bond (see Note 19).~~
   December 31,
   2019    2020
Assets:

Current assets
   Ps.  29,516,038    Ps.  32,775,046
Non-current assets
   137,724,390    150,747,947




Total assets
   Ps.167,240,428    Ps.183,522,993




Liabilities and equity:

Current liabilities
   Ps.  34,608,254    Ps.  49,942,415
Non-current liabilities
   89,711,288    82,293,652




Total liabilities
   124,319,542    132,236,067
Equity attributable to equity holders of the parent
   21,864,132    26,129,649
Non-controlling interest ⁽¹⁾
   21,056,754    25,157,277




Total equity
   Ps.  42,920,886    Ps.  51,286,926




Total liabilities and equity
   Ps.167,240,428    Ps.183,522,993




Summarized consolidated statements of comprehensive income

   For the year ended December 31,    For the year ended December 31,
   2016    2017    2018    2018    2019    2020
Operating revenues
   Ps. 85,185,177    Ps. 93,644,173    Ps. 100,716,444    Ps.100,716,444    Ps.98,420,289    Ps.111,472,191
Operating costs and expenses
   81,590,233    86,920,692    95,984,880    95,984,880    89,732,428    98,312,325












Operating income
   Ps. 3,594,944    Ps. 6,723,481    Ps.     4,731,564    Ps.    4,731,564    Ps.  8,687,861    Ps.  13,159,866












Net income
   Ps. 7,065,770    Ps. 5,656,132    Ps.     3,809,694    Ps.    3,809,694    Ps.  5,051,145    Ps.    7,787,388












Total comprehensive income
   Ps. 8,450,837    Ps. 7,737,797    Ps.     5,047,838    Ps.    5,047,838    Ps.  1,466,783    Ps.  12,103,406












Net income attributable to:

Equity holders of the parent
   Ps. 3,241,556    Ps. 2,884,627    Ps.     1,942,944    Ps.    1,942,944    Ps.  2,565,733    Ps.    3,986,412
Non-controlling interest
   3,824,214    2,771,505    1,866,750    1,866,750    2,485,412    3,800,976












   Ps. 7,065,770    Ps. 5,656,132    Ps.     3,809,694    Ps.    3,809,694    Ps.  5,051,145    Ps.    7,787,388












Comprehensive income attributable to:

Equity holders of the parent
   Ps. 4,311,801    Ps. 3,978,263    Ps.     2,574,397    Ps.    2,574,397    Ps.    748,059    Ps.    6,172,737
Non-controlling interest
   4,139,036    3,759,534    2,473,441    2,473,441    718,724    5,930,669












   Ps. 8,450,837    Ps. 7,737,797    Ps. 5,047,838    Ps.    5,047,838    Ps. 1,466,783    Ps.  12,103,406












13. Income Taxes
As explained previously in these consolidated financial statements, the Company is a Mexican corporation which has numerous consolidated subsidiaries operating in different countries. Presented below is a discussion of income tax matters that relates to the Company’s consolidated operations, its Mexican operations and significant foreign operations.
i)
Consolidated income tax matters
The composition of income tax expense for the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 is as follows:

   2016 2017 2018
In Mexico:

Current year income tax
   Ps. 14,316,005 Ps. 16,568,274 Ps. 28,572,414
Deferred income tax
   (12,086,232 ) 2,582,287 (2,688,727 )
Foreign:

Current year income tax
   15,367,903 13,524,729 19,898,728
Deferred income tax
   (6,198,820 ) (7,733,779 ) 694,664


   Ps. 11,398,856 Ps. 24,941,511 Ps. 46,477,079


   2018    2019    2020
In Mexico:

Current year income tax
   Ps. 28,572,414    Ps. 26,295,431    Ps. 13,407,948
Deferred income tax
   (2,688,727 )    208,658    (9,334,246 )
Foreign:

Current year income tax
   19,898,728    20,843,720    15,250,218
Deferred income tax
   694,664    3,685,724    (2,957,768 )






   Ps. 46,477,079    Ps. 51,033,533    Ps. 16,366,152






Deferred tax related to items recognized in OCI during the year:

   For the years ended December 31,    For the years ended December 31,
   2016 2017 2018    2018    2019    2020
Remeasurement of defined benefit plans
   Ps. (7,734,732 ) Ps. 3,032,403 Ps. 408,735    Ps.   408,735    Ps.9,217,320    Ps.   4,151,600
Effect of financial instruments acquired for hedging purposes
   (21,046 ) (5,337 )
Equity investments at fair value
   2,858,452     (266,753 ) 1,613,667    1,613,667    (378,606 )    (665,814 )
Other
   136,879 —   (8,922 )    (8,922 )    —      (35,670 )
Revaluation assets
   —      —      (29,922,597 )








Deferred tax benefit (expense) recognized in OCI
   Ps.     (4,760,447 ) Ps. 2,760,313 Ps.   2,013,480
Deferred tax benefit recognized in OCI
   Ps.2,013,480    Ps.8,838,714    Ps.(26,472,481 )






��


A reconciliation of the statutory income tax rate in Mexico to the consolidated effective income tax rate recognized by the Company is as follows:

   Year ended December 31,    Year ended December 31,
       2016         2017         2018        2018 2019 2020
Statutory income tax rate in Mexico
   30.0% 30.0% 30.0%    30.0 % 30.0 % 30.0 %
Impact ofnon-deductible andnon-taxable items:

Tax inflation effects
   15.9% 17.8% 7.3%    7.3 % 3.5 % 6.1 %
Derivatives
   8.0% 1.0% 0.4%    0.4 % (0.1 %) (0.7 %)
Employee benefits
   4.4% 2.2% 1.3%    1.3 % 1.8 % 3.0 %
Other
   9.8% 2.6% 6.3%    6.3 % 1.8 % (2.4 %)




Effective tax rate on Mexican operations
   68.1% 53.6% 45.3%    45.3 % 37.0 % 36.0 %
Use of unrecognized tax credits in Brazil
   (0.6% ) (0.4% ) —
Equity interest in net loss of associated companies
   (0.2% ) —   —
Dividends received from associates
   (7.9% ) (1.2% ) (0.8% )
Tax recoveries in Brazil
   —   —   (9.3 %)
Dividends received from associates Equity
   (0.8 %) (0.4 %) (0.9 %)
Foreign subsidiaries and othernon-deductible items, net
   (10.8% ) (8.3% ) 1.5%    1.5 % 5.5 % (1.5 %)




Effective tax rate
   48.6% 43.7% 46.0%    46.0 % 42.1 % 24.3 %




An analysis of temporary differences giving rise to the net deferred tax liability is as follows:

Consolidated statements of financial position Consolidated statements of comprehensive income
Consolidated statements
of financial position
Consolidated statements of net income
            2017                         2018             2016 2017 2018 2019 2020 2018 2019 2020
Provisions
Ps.26,268,666 Ps.20,781,421 Ps.1,622,132 Ps.1,579,604 Ps.1,841,705 Ps. 17,964,305 Ps. 19,312,081 Ps. 1,841,705 Ps. (257,070 ) Ps. 4,458,848
Deferred revenues
7,461,802 6,866,120 (12,128 ) (965,010 ) 3,632,051 5,820,260 6,748,101 3,632,051 (1,077,259 ) 897,762
Tax losses carry forward
38,332,408 27,881,491 12,706,245 (323,506 ) (5,833,660 ) 26,630,407 25,121,933 (5,833,660 ) (9,873 ) 2,236,244
Property, plant and equipment ⁽¹⁾
(9,929,129 ) (11,756,590 ) 2,445,783 1,974,753 453,493 (11,962,544 ) (39,459,549 ) 453,493 (461,594 ) 3,524,761
Inventories
2,003,049 2,106,976 (229,571 ) 519,046 81,270 1,787,065 (537,404 ) 81,270 (291,531 ) (2,393,979 )
Licenses and rights of use ⁽¹⁾
(2,455,877 ) (3,896,788 ) 54,182 348,201 961,402 (3,399,931 ) (5,177,924 ) 961,402 432,403 344,729
Employee benefits
33,253,071 33,673,874 3,616,952 1,225,310 1,128,209 41,743,744 45,467,827 1,128,209 (1,019,042 ) 422,473
Other
9,639,995 10,956,823 (1,918,543 ) 793,094 (270,407 ) 9,491,550 14,828,012 (270,407 ) (1,210,417 ) 2,801,176

Net deferred tax assets
Ps.104,573,985 Ps.86,613,327 Ps. 88,074,856 Ps. 66,303,077

Deferred tax expense in net profit for the year
Deferred tax expense in net profit for the year

Ps.18,285,052 Ps.5,151,492 Ps.1,994,063
Deferred tax expense in net profit for the year

Ps. 1,994,063 Ps. (3,894,383 ) Ps. 12,292,014

(1)
As of December 31, ~~2018,~~2020 the balance included the effects of ~~hyperinflation.~~hyperinflation and revaluation of telecommunications towers.
Reconciliation of deferred tax assets and liabilities, net:

   2016 2017 2018    2018 2019 2020
Opening balance as of January 1,
   Ps. 69,817,147 Ps. 98,589,818 Ps. 104,573,985    Ps. 104,573,985 Ps.  86,613,327 Ps.  88,074,856
Deferred tax benefit
   18,285,052 5,151,492 1,994,063    1,994,063 (3,894,383 ) 12,292,014
Translation effect
   15,273,228 (1,687,276 ) (8,854,010 )    (8,854,010 ) 2,047,915 375,105
Deferred tax benefit (expense) recognized in OCI
   (4,760,447 ) 2,760,313 2,013,480
Deferred tax benefit recognized in OCI
   2,013,480 8,838,714 (26,472,481 )
Deferred taxes acquired in business combinations
   (25,162 ) (240,362 ) (25,827 )    (25,827 ) (276,568 ) (2,580,552 )
Hyperinflationary effect in Argentina
   —   —   (4,907,151 )    (4,907,151 ) (5,254,149 ) (5,385,865 )
Effect of adoption of IFRS 9 (Note 2ai)
   —   —   544,628
Effect of adoption of IFRS 15 (Note 2ai)
   —   —   (8,725,841 )
Effect of adoption of IFRS 9
   544,628 —   —
Effect of adoption of IFRS 15
   (8,725,841 ) —   —




Closing balance as of December 31,
   Ps. 98,589,818 Ps. 104,573,985 Ps. 86,613,327    Ps. 86,613,327 Ps.  88,074,856 Ps. 66,303,077




Presented in the consolidated statements of financial position as follows:

Deferred income tax assets
   Ps. 112,651,699 Ps. 116,571,349 Ps. 111,186,768    Ps.111,186,768 Ps.106,167,897 Ps.115,370,240
Deferred income tax liabilities
   (14,061,881 ) (11,997,364 ) (24,573,441 )    (24,573,441 ) (18,093,041 ) (49,067,163 )




   Ps. 98,589,818 Ps. 104,573,985 Ps. 86,613,327    Ps.  86,613,327 Ps. 88,074,856 Ps. 66,303,077




The deferred tax assets are in tax jurisdictions in which the Company considers that based on financial projections of its cash flows, results of operations and synergies between subsidiaries, will generate sufficient taxable income in subsequent periods to utilize or realize such assets.
The Company does not recognize a deferred tax liability related to the undistributed earnings of its subsidiaries, because it currently does not expect these earnings to be taxable or to be repatriated in the near future. The Company’s policy has been to distribute the profits when it has paid the corresponding taxes in its home jurisdiction and the tax can be accredited in Mexico.
At December 31, ~~2017~~2019 and ~~2018,~~2020, the balance of the contributed capital account (“CUCA”) is ~~Ps. 510,832,194~~Ps.551,221,490 and ~~Ps. 536,278,717,~~Ps.573,362,949 respectively. OnEffectively, on January 1, 2014, theCuenta de Utilidad Fiscal Neta(“CUFIN”) is computed on an América Móvil’s stand-alone basis. The balance of the América Móvil’s stand-alone basis CUFIN amounted to ~~Ps. 225,105,342~~Ps.320,880,512 and ~~Ps. 276,185,284~~Ps.332,273,039 as of December 31, ~~2017~~2019 and ~~2018,~~2020, respectively.
~~Corporate tax rate~~
~~The income tax rate applicable in Mexico from 2016 through 2018 was 30%.~~
ii)
Significant foreign income tax matters

a)
Results of operations
The foreign subsidiaries determine their taxes on profits based on their individual taxable income, in accordance with the specific tax regimes of each country.
~~The combined income before taxes and the combined provision for taxes of such subsidiaries in 2016, 2017 and 2018 are as follows:~~

   2016    2017    2018
Combined income before taxes
   Ps. 45,697,258    Ps. 38,286,046    Ps. 66,314,883
Combined tax provision differences
notdeducible-not cumulative in
the foreign subsidiaries
   Ps. 9,169,083    Ps. 5,790,950    Ps. 20,593,392
The effective income tax rate for the Company’s foreign jurisdictions was ~~20% in 2016, 15% in 2017 and~~ 31% in 2018, ~~as shown~~40% in ~~the table above.~~2019 and 18% in 2020. The statutory tax rates in these jurisdictions vary, although many approximate ~~21%~~10% to ~~40%~~34%. The primary difference between the statutory rates and the effective rates in ~~2016, 2017~~2018, 2019 and ~~2018~~2020 was attributable to dividends received from KPN, ~~and~~ othernon-deductible items, ~~and~~non-taxable ~~income.~~income and tax recoveries in Brazil.
a.1) In 2020 the Claro Brasil began to use the tax benefit related to the ICMS Grant on TV based on Complementary Law 160/2017 and art. 30 of Law 12,973, as well as in recent interpretations on the subject, investment grants are not computed in determining actual profit in the amount of Ps.1,721,453 (R$411,336). The Company kicked back the application of the benefit for the years 2018 and 2019, with a total impact of Ps.2,748,084 (R$656,646).
~~iii)~~
iii)    Tax losses
a) At December 31, ~~2018,~~2020, the available tax loss carryforwards recorded in deferred tax assets are as follows on a country by country basis:

Country
   Balance of available tax
loss carryforwards at
December 31, 2018    Tax loss carryforward
benefit    Gross balance
of available tax loss
carryforwards at
December 31, 2020    Tax-effected
loss carryforward
benefit
Brazil
   Ps. 59,695,441    Ps. 20,296,450    Ps. 44,578,152    Ps. 15,156,572
Mexico
   20,523,070    6,156,920
Austria
   20,128,833    5,032,208    11,631,381    2,907,845
Mexico
   6,043,603    1,813,081
Colombia
   2,239,486    739,030
Nicaragua
   2,403    722
United States
   3,023,441    786,095
Peru
   380,770    112,327
Puerto Rico
   5,574    2,174








Total
   Ps. 88,109,766    Ps. 27,881,491    Ps. 80,142,388    Ps. 25,121,933








b) The tax loss carryforwards in the different countries in which the Company operates have the following terms and characteristics:
bi)The Company has accumulated ~~Ps. 59,695,441~~Ps.44,578,152 in net operating loss carryforwards (NOL’s) in Brazil as of December 31, ~~2018.~~2020. In Brazil, there is no expiration of the NOL’s. However, the NOL´s amount used against taxable income in each year may not exceed 30% of the taxable income for such year. Consequently, in the year in which taxable income is generated, the effective tax rate is 25% rather than the 34% corporate tax rate.
The Company believes that it is more likely than not that the accumulated balances of its net deferred tax assets are recoverable, based on the positive evidence of the Company to generate future taxable income related to the same taxation authority which will result in taxable amounts against which the available tax losses can be utilized before they expire. Positive evidence includes the Company’s recent restructure in 2017 of its operations in Brazil, resulting in an organizational structure that is anticipated to be more efficient and profitable and generated taxable income in 2018.
bii)The Company has accumulated Ps. 20,128,833 in NOL’s in Austria as of December 31, 2018. In Austria, the NOL´s have no expiration, but its annual usage is limited to 75% of the taxable income of the year. The realization of deferred tax assets is dependent upon the expected generation of future taxable income during the periods in which these temporary differences become deductible.
~~biii)~~ The Company has accumulated ~~$ 6,043,603 of~~Ps.20,523,070 in tax losses in Mexico. The Mexican Tax Law establishes an optional regime for group companies called: Of the Optional Regime for Groups of Companies. For these purposes, the integrating (controlling) company must own more than 80% of the shares with voting rights of the
integrated (controlled) companies. In general terms, the Integration regime allows to differ, for each of the companies that make up the group, and for up to three years, or sooner if certain assumptions are made, the whole of the ISR that results from considering the determination of the individual ISR to its charge is the effect derived from recognizing, indirectly, the tax losses incurred by the companies in the group for the year in question.
The company estimates that there is positive evidence that allows it to use these losses, these should be reduced to the extent that it is considered likely that there will be sufficient taxable profits to allow them to recover in full or in part, the losses will only be compensated when there is a right legally required and are approved by the tax authorities in Mexico.
biii) The Company has accumulated Ps.11,631,381 in NOL’s in Austria as of December 31, 2020. In Austria, the NOL´s have no expiration, but its annual usage is limited to 75% of the taxable income of the year. The realization of deferred tax assets is dependent upon the expected generation of future taxable income during the periods in which these temporary differences become deductible.
iv)    Optional regime
The Mexican Tax Law establishes an optional regime for group companies called: Optional Regime for Groups of Companies. For these purposes, the integrating (controlling) company must own more than 80% of the shares with voting rights of the integrated (controlled) companies. In general terms, the Integration regime allowed deferral, for each of the companies that make up the group, and for up to three years, or sooner if certain assumptions are made, the whole of the income tax that results from considering the determination of the individual income tax to its charge is the effect derived from recognizing, indirectly, the tax losses incurred by the companies in the group for the year in question.
On December 19, 2019, the integrating company submitted to the Mexican tax authorities, the notice to end to belong under the Optional Regime for Groups of Companies, which implies, pay in January 2020, the deferred income tax for the years 2016-2018. Therefore, from the year 2020, the group will be taxable under the General Regime for Legal Persons.
v)     Limiting interest deductions
The Mexican Tax Law establishes for 2020 further new rules related with the limiting interest deductions, in concordance with the action 4 of Base Erosion and Profit Shifting (BEPS) project, by Organization for Economic Co-operation and Development (OCDE), whom Mexico is member.
In general terms, each Mexican companies should calculated a Tax EBITDA, whose amount by the corporate income tax, will be the limit allow to deduct in the tax year it’s important to underline the amount that was not deductible could be carryforward in the following ten years.
vi)     Revaluation of telecommunications towers
Deferred taxes related to the revaluation of the passive infrastructure of the telecommunications towers have been calculated at the tax rate of the jurisdiction in which the subsidiaries are located.
14.
Debt
a)The Company’s ~~short- and~~short-and long-term debt consists of the following:
The Company’s short-and long-term debt consists of the following:

At December 31, 2017
(Thousands of
Mexican pesos)
At December 31, 2019
At December 31, 2019
(Thousands of
Mexican pesos)
Currency

Loan

Interest rate
Maturity Total
Loan
Interest rate    Maturity Total
Senior Notes

U.S. dollars

Fixed-rate Senior notes (i) 5.000% 2019 Ps. 14,840,025 Fixed-rate Senior notes (i) 5.000%    2020 Ps. 11,774,764
Fixed-rate Senior notes (i) 5.500% 2019 7,467,145 Fixed-rate Senior notes (i) 3.125%    2022 30,152,320
Fixed-rate Senior notes (i) 5.000% 2020 42,043,077 Fixed-rate Senior notes (i) 3.625%    2029 18,845,200
Fixed-rate Senior notes (i) 3.125% 2022 31,658,720 Fixed-rate Senior notes (i) 6.375%    2035 18,493,360
Fixed-rate Senior notes (i) 6.375% 2035 19,417,282 Fixed-rate Senior notes (i) 6.125%    2037 6,958,119
Fixed-rate Senior notes (i) 6.125% 2037 7,305,744 Fixed-rate Senior notes (i) 6.125%    2040 37,690,400
Fixed-rate Senior notes (i) 6.125% 2040 39,573,400 Fixed-rate Senior notes (i) 4.375%    2042 21,671,980
Fixed-rate Senior notes (i) 4.375% 2042 22,754,705 Fixed-rate Senior notes (i) 4.375%    2049 23,556,500



Subtotal U.S. dollars Ps. 185,060,098 Subtotal U.S. dollars    Ps.169,142,643



Mexican pesos

Domestic Senior notes (i) 8.110% 2018 Ps. 1,750,000
Domestic Senior notes (i) 8.270% 2018 1,160,110
Domestic Senior notes (i) 8.600% 2020 7,000,000
Domestic Senior notes (i) 0.000% 2025 4,409,873 Domestic Senior notes (i) 8.600%    2020

Ps.    7,000,000

Domestic Senior notes (i) 8.360% 2037 5,000,000 Fixed-rate Senior notes (i) 6.450%    2022 22,500,000
Fixed-rate Senior notes (i) 6.000% 2019 10,000,000 Fixed-rate Senior notes (i) 7.125%    2024 11,000,000
Fixed-rate Senior notes (i) 6.450% 2022 22,500,000 Domestic Senior notes (i) 0.000%    2025 4,757,592
Fixed-rate Senior notes (i) 7.125% 2024 11,000,000 Fixed-rate Senior notes (i) 8.460%    2036 7,871,700
Fixed-rate Senior notes (i) 8.460% 2036 7,871,700 Domestic Senior notes (i) 8.360%    2037 5,000,000



Subtotal Mexican pesos Ps. 70,691,683 Subtotal Mexican pesos    Ps.  58,129,292



Euros

Fixed-rate Senior notes (i) 1.000% 2018 Ps. 14,252,360 Commercial Paper (iv) -0.230%    2020

Ps.    2,599,128

Fixed-rate Senior notes (i) 4.125% 2019 23,753,933 Exchangeable Bond (i) 0.000%    2020 60,051,270
Exchangeable Bonds (i) 0.000% 2020 67,504,878 Fixed-rate Senior notes (i) 3.000%    2021 21,131,123
Fixed-rate Senior notes (i) 3.000% 2021 23,753,933 Fixed-rate Senior notes (i) 3.125%    2021 15,848,342
Fixed-rate Senior notes (i) 3.125% 2021 18,727,775 Fixed-rate Senior notes (i) 4.000%    2022 15,848,342
Fixed-rate Senior notes (i) 4.000% 2022 19,333,685 Fixed-rate Senior notes (i) 4.750%    2022 15,848,342
Fixed-rate Senior notes (i) 4.750% 2022 17,815,450 Fixed-rate Senior notes (i) 3.500%    2023 6,339,337
Fixed-rate Senior notes (i) 3.500% 2023 7,594,262 Fixed-rate Senior notes (i) 3.259%    2023 15,848,342
Fixed-rate Senior notes (i) 3.259% 2023 17,815,450 Fixed-rate Senior notes (i) 1.500%    2024 17,961,454
Fixed-rate Senior notes (i) 1.500% 2024 20,190,843 Fixed-rate Senior notes (i) 1.500%    2026 15,848,342
Fixed-rate Senior notes (i) 1.500% 2026 17,815,450 Fixed-rate Senior notes (i) 0.750%    2027 21,131,123
Fixed-rate Senior notes (i) 2.125% 2028 15,440,057 Fixed-rate Senior notes (i) 2.125%    2028 13,735,230



Subtotal Euros Ps. 263,998,076 Subtotal Euros    Ps.222,190,375



Pound Sterling

Fixed-rate Senior notes (i) 5.000%    2026 Ps.  12,491,541
Fixed-rate Senior notes (i) 5.750%    2030 16,239,003
Fixed-rate Senior notes (i) 4.948%    2033 7,494,924

Fixed-rate Senior notes (i)
4.375%    2041 18,737,311


Subtotal Pound Sterling
   Ps.  54,962,779


Brazilian reais


Debentures (i)
102.900% of CDI    2020 Ps.    7,013,124

Debentures (i)
104.000% of CDI    2021 5,142,958

Debentures (i)
104.250% of CDI    2021 7,083,256

Promissory notes (i)
CDI + 0.600%    2021 1,683,150

Promissory notes (i)
106.000% of CDI    2022 9,350,832

Promissory notes (i)
106.500% of CDI    2022 4,675,416


Subtotal Brazilian reais
   Ps. 34,948,736



Other currencies

Japanese yen


Fixed-rate Senior notes (i)
2.950%    2039 Ps.    2,255,663


Subtotal Japanese yen
   Ps.    2,255,663


At December 31, 2017
(Thousands of
Mexican pesos)
Currency

Loan

Interest rate
Maturity Total
Pounds sterling

Fixed-rate Senior notes (i) 5.000% 2026 Ps. 13,368,884
Fixed-rate Senior notes (i) 5.750% 2030 17,379,549
Fixed-rate Senior notes (i) 4.948% 2033 8,021,330
Fixed-rate Senior notes (i) 4.375% 2041 20,053,326

Subtotal Pounds sterling Ps. 58,823,089

Swiss francs

Fixed-rate Senior notes (i) 1.125% 2018 Ps. 11,169,748

Subtotal Swiss francs Ps. 11,169,748

Brazilian reais

Debenture (i) 102.900% of CDI 2020 Ps. 8,972,204
Promissory Note (i) 102.400% of CDI 2019 5,981,469
Debenture (i) 103.900% of CDI 2019 5,981,469

Subtotal Brazilian reais Ps. 20,935,142

Other currencies

Japanese yen

Fixed-rate Senior notes (i) 2.950% 2039 Ps. 2,282,608

Subtotal Japanese yen Ps. 2,282,608

Chilean pesos

Fixed-rate Senior notes (i) 3.961% 2035 Ps. 4,312,424

Subtotal Chilean pesos Ps. 4,312,424

Subtotal other currencies Ps. 6,595,032

Hybrid Notes

Euros

Euro NC5 Series A Capital Securities (iii) 5.125% 2073 Ps. 21,378,540
Euro NC10 Series B Capital Securities (iii) 6.375% 2073 13,064,663

Subtotal Euros Ps. 34,443,203

Pounds sterling

GBP NC7 Capital Securities (iii) 6.375% 2073 Ps. 14,705,772

Subtotal Pounds sterling Ps. 14,705,772

Subtotal Hybrid Notes Ps. 49,148,975

At December 31, 2019
(Thousands of
Mexican pesos)
Currency

Loan
Interest rate    Maturity Total
Chilean pesos


Fixed-rate Senior notes (i)
3.961%    2035 Ps.    3,562,695


Subtotal Chilean pesos
   Ps.    3,562,695


Subtotal other currencies
   Ps.    5,818,358



Hybrid Notes

Euros


Euro NC10 Series B Capital Securities (iii)
6.375%    2073 Ps. 11,622,118


Subtotal Euros
   Ps. 11,622,118


Pound Sterling


GBP NC7 Capital Securities (iii)
6.375%    2073 Ps. 13,740,695


Subtotal Pound Sterling
   Ps. 13,740,695


Subtotal Hybrid Notes
   Ps. 25,362,813



Lines of Credit and others

U.S. dollars


Lines of credit (ii)
5.500% - 9.020%    2020 - 2024 Ps.    9,359,340
Mexican pesos


Lines of credit (ii)

TIIE + 0.050% -
TIIE + 0.090%

   2020 Ps.  22,000,000
Euros


Lines of credit (ii)
0.030%    2020 Ps.    2,113,112
Peruvian Soles


Lines of credit (ii)
3.550% - 3.700%    2020 - 2021 Ps. 15,351,211
Chilean pesos


Lines of credit (ii)
TAB + 0.350%    2021 Ps.    4,821,222

Financial Leases
8.700% - 8.970%    2020 - 2027 Ps.         54,596


Subtotal Lines of Credit and others
   Ps. 53,699,481


Total debt
   Ps.624,254,477


Less: Short-term debt and current portion of long-term debt
   Ps.129,172,033


Long-term debt
   Ps.495,082,444


~~At December 31, 2017~~
~~(Thousands of~~
~~Mexican pesos)~~
~~Currency~~
~~Loan~~
~~Interest rate~~
~~Maturity~~ ~~Total~~
~~Lines of Credit and others~~
~~U.S. dollars~~
~~Lines of credit (ii)~~ ~~L + 0.200% and 1.500% - 7.250%~~ ~~2018 - 2019~~ ~~Ps.~~ ~~14,474,350~~
~~Mexican pesos~~
~~Lines of credit (ii)~~ ~~TIIE + 0.040% - TIIE + 0.175%~~ ~~2018 - 2019~~ ~~Ps.~~ ~~12,500,000~~
~~Brazilian reais~~
~~Lines of credit (ii)~~ ~~107% of CDI - TJLP + 3.500% & 3.000% - 9.500%~~ ~~2018 -2027~~ ~~Ps.~~ ~~4,389,260~~
~~Chilean pesos~~
~~Financial Leases~~ ~~8.700% - 8.970%~~ ~~2018 - 2027~~ ~~Ps.~~ ~~99,446~~
~~Subtotal Lines of Credit and others~~ ~~Ps.~~ ~~31,463,056~~
~~Total debt~~ ~~Ps.~~ ~~697,884,899~~
~~Less: Short-term debt and current portion of long-term debt~~ ~~Ps.~~ ~~51,745,841~~
~~Long-term debt~~ ~~Ps.~~ ~~646,139,058~~
At December 31, 2018
(Thousands of
Mexican pesos)
At December 31, 2020
At December 31, 2020
(Thousands of Mexican pesos)
Currency

Loan

Interest rate
Maturity Total Loan Interest rate Maturity Total
Senior Notes

U.S. dollars

Fixed-rate Senior notes (i) 5.000% 2019 Ps. 14,762,175
Fixed-rate Senior notes (i)
3.125% 2022 Ps. 31,917,920
Fixed-rate Senior notes (i) 5.500% 2019 7,427,972
Fixed-rate Senior notes (i)
3.625% 2029 19,948,700
Fixed-rate Senior notes (i) 5.000% 2020 41,822,521
Fixed-rate Senior notes (i)
2.875% 2030 19,948,700
Fixed-rate Senior notes (i) 3.125% 2022 31,492,640
Fixed-rate Senior notes (i)
6.375% 2035 19,576,258
Fixed-rate Senior notes (i) 6.375% 2035 19,315,420
Fixed-rate Senior notes (i)
6.125% 2037 7,365,559
Fixed-rate Senior notes (i) 6.125% 2037 7,267,419
Fixed-rate Senior notes (i)
6.125% 2040 39,897,400
Fixed-rate Senior notes (i) 6.125% 2040 39,365,800
Fixed-rate Senior notes (i)
4.375% 2042 22,941,005
Fixed-rate Senior notes (i) 4.375% 2042 22,635,335
Fixed-rate Senior notes (i)
4.375% 2049 24,935,875

Subtotal U.S. dollars Ps. 184,089,282
Subtotal U.S. dollars
Ps. 186,531,417

Mexican pesos

Fixed-rate Senior notes (i) 6.000% 2019 Ps. 10,000,000
Fixed-rate Senior notes (i)
6.450% 2022 Ps. 22,500,000
Domestic Senior notes (i) 8.600% 2020 7,000,000
Fixed-rate Senior notes (i)
7.125% 2024 11,000,000
Fixed-rate Senior notes (i) 6.450% 2022 22,500,000
Domestic Senior notes (i)
0.000% 2025 4,911,181
Fixed-rate Senior notes (i) 7.125% 2024 11,000,000
Fixed-rate Senior notes (i)
8.460% 2036 7,871,700
Domestic Senior notes (i) 0.000% 2025 4,629,425
Domestic Senior notes (i)
8.360% 2037 5,000,000
Fixed-rate Senior notes (i) 8.460% 2036 7,871,700

Domestic Senior notes (i) 8.360% 2037 5,000,000
Subtotal Mexican pesos
Ps. 51,282,881

Euros

Subtotal Mexican pesos Ps. 68,001,125
Fixed-rate Senior notes (i)
3.000% 2021 Ps. 24,369,332

Fixed-rate Senior notes (i)
3.125% 2021 18,276,999

Fixed-rate Senior notes (i)
4.000% 2022 18,276,999

Fixed-rate Senior notes (i)
4.750% 2022 18,276,999

Fixed-rate Senior notes (i)
3.500% 2023 7,310,800

Fixed-rate Senior notes (i)
3.259% 2023 18,276,999

Fixed-rate Senior notes (i)
1.500% 2024 20,713,932

Fixed-rate Senior notes (i)
1.500% 2026 18,276,999

Fixed-rate Senior notes (i)
0.750% 2027 24,369,332

Fixed-rate Senior notes (i)
2.125% 2028 15,840,066

Commercial Paper (iv)
-0.230% -0.310% 2021 40,940,477

Subtotal Euros
Ps. 224,928,934

Pound Sterling

Fixed-rate Senior notes (i)
5.000% 2026 Ps. 13,634,936

Fixed-rate Senior notes (i)
5.750% 2030 17,725,417

Fixed-rate Senior notes (i)
4.948% 2033 8,180,962

Fixed-rate Senior notes (i)
4.375% 2041 20,452,405

Subtotal Pound Sterling
Ps. 59,993,720

Brazilian reais

Debentures (i)
104.000% of CDI 2021 Ps. 4,222,597

Debentures (i)
104.250% of CDI 2021 5,815,668

Promissory notes (i)
CDI + 0.600% 2021 1,381,941

Debentures (i)
CDI + 0.960% 2022 9,596,811

Promissory notes (i)
106.000% of CDI 2022 7,677,449

Debentures (i)
106.500% of CDI 2022 3,838,725

Subtotal Brazilian reais
Ps. 32,533,191

Other currencies

Japanese yen

Fixed-rate Senior notes (i)
2.950% 2039 Ps. 2,511,701

Subtotal Japanese yen
Ps. 2,511,701

Chilean pesos

Fixed-rate Senior notes (i)
3.961% 2035 Ps. 4,078,453

Subtotal Chilean pesos
Ps. 4,078,453

Subtotal other currencies
Ps. 6,590,154

Hybrid Notes

Euros

Euro NC10 Series B Capital Securities (iii) 6.375% 2073 Ps. 13,403,133

Subtotal Euros
Ps. 13,403,133

Subtotal Hybrid Notes
Ps. 13,403,133

At December 31, 2018
(Thousands of
Mexican pesos)
Currency

Loan

Interest rate
Maturity Total
Euros

Fixed-rate Senior notes (i) 4.125% 2019 Ps. 22,558,572
Exchangeable Bonds (i) 0.000% 2020 64,107,851
Fixed-rate Senior notes (i) 3.000% 2021 22,558,572
Fixed-rate Senior notes (i) 3.125% 2021 17,568,739
Fixed-rate Senior notes (i) 4.000% 2022 18,028,031
Fixed-rate Senior notes (i) 4.750% 2022 16,918,929
Fixed-rate Senior notes (i) 3.500% 2023 7,132,481
Fixed-rate Senior notes (i) 3.259% 2023 16,918,929
Fixed-rate Senior notes (i) 1.500% 2024 19,174,786
Fixed-rate Senior notes (i) 1.500% 2026 16,918,929
Fixed-rate Senior notes (i) 2.125% 2028 14,663,072

Subtotal Euros Ps. 236,548,891

Pounds sterling

Fixed-rate Senior notes (i) 5.000% 2026 Ps. 12,550,801
Fixed-rate Senior notes (i) 5.750% 2030 16,316,042
Fixed-rate Senior notes (i) 4.948% 2033 7,530,481
Fixed-rate Senior notes (i) 4.375% 2041 18,826,202

Subtotal Pounds sterling Ps. 55,223,526

Brazilian reais

Debenture (i) 103.900% of CDI 2019 Ps. 5,079,720
Promissory notes (i) 102.400% of CDI 2019 5,079,720
Promissory notes (i) 103.205% of CDI 2019 1,828,699
Debenture (i) 102.900% of CDI 2020 7,619,580
Debenture (i) 104.000% of CDI 2021 5,587,692
Debenture (i) 104.250% of CDI 2021 7,695,776

Subtotal Brazilian reais Ps. 32,891,187

Other currencies

Japanese yen

Fixed-rate Senior notes (i) 2.950% 2039 Ps. 2,334,864

Subtotal Japanese yen Ps. 2,334,864

Chilean pesos

Fixed-rate Senior notes (i) 3.961% 2035 Ps. 3,904,707

Subtotal Chilean pesos Ps. 3,904,707

Subtotal other currencies Ps. 6,239,571

Hybrid Notes

Euros

Euro NC10 Series B Capital Securities (iii) 6.375% 2073 Ps. 12,407,214

Subtotal Euros Ps. 12,407,214

Pounds sterling

GBP NC7 Capital Securities (iii) 6.375% 2073 Ps. 13,805,881

Subtotal Pounds sterling Ps. 13,805,881

Subtotal Hybrid Notes 26,213,095

At December 31, 2020
(Thousands of Mexican pesos)
Currency Loan Interest rate Maturity Total
Lines of Credit and others

Mexican pesos

Lines of credit (ii)
TIIE + 0.300% -
TIIE + 1.000% 2021 Ps. 27,100,000
Peruvian Soles

Lines of credit (ii)
1.200% - 1.450% 2021 Ps. 17,094,079
Chilean pesos

Lines of credit (ii)
TAB + 0.350% and
TAB + 0.450% 2021 Ps. 8,868,181

Financial Leases
8.700% - 8.970% 2021 - 2027 Ps. 57,266

Subtotal Lines of Credit and others
Ps. 53,119,526

Total debt
Ps. 628,382,956

Less: Short-term debt and current portion of long-term debt
Ps. 148,083,184

Long-term debt
Ps. 480,299,772

At December 31, 2018
(Thousands of
Mexican pesos)
Currency

Loan

Interest rate
Maturity Total
Lines of Credit and others

U.S. dollars

Lines of credit (ii) L + 0.200% and 1.500% - 8.950% 2019 - 2021 Ps. 11,698,885
Mexican pesos

Lines of credit (ii) TIIE + 0.175% 2019 Ps. 4,500,000
Euros

Lines of credit (ii) -0.100% - 0.000% 2019 Ps. 5,526,850
Brazilian reais

Lines of credit (ii) 5.000% - 6.000% 2019 - 2027 Ps. 27,009
Peruvian Soles

Lines of credit (ii) 4.700% - 12.100% 2019 Ps. 7,898,595
Chilean pesos

Financial Leases 8.700% - 8.970% 2019 - 2027 Ps. 64,437

Subtotal Lines of Credit and others Ps. 29,715,776

Total debt Ps. 638,922,453

Less: Short-term debt and current portion of long-term debt Ps. 96,230,634

Long-term debt Ps. 542,691,819

~~L =~~L= LIBOR (London Interbank ~~Offer~~Offered Rate)
TIIE = Mexican Interbank ~~Rate~~
~~EURIBOR = Euro Interbank Offered~~ Rate
CDI = Brazil Interbank Deposit Rate
~~TJLP = Brazil Long Term Interest Rate~~TAB= Chilean weighted average funding rate
Interest rates on the Company’s debt are subject to variances in international and local rates. The Company’s weighted average cost of borrowed funds at December 31, ~~2017,~~2019, and December 31, ~~2018~~2020 was approximately ~~4.30%~~4.16% and ~~4.31%~~3.72%, respectively.
Such rates do not include commissions or the reimbursements for Mexican tax withholdings (typically a tax rate of 4.9%) that the Company must pay to international lenders.
An analysis of the Company’s short-term debt maturities as of December 31, ~~2017,~~2019, and December 31, ~~2018,~~2020, is as follows:

   2017    2018
Obligations and Senior Notes
   Ps.    28,994,496    Ps.      67,365,810
Lines of credit
   22,714,383    28,852,364
Financial Leases
   36,962    12,460




Total
   Ps.    51,745,841    Ps.      96,230,634




Weighted average interest rate
   4.0%    5.20%




   2019 2020
Obligations and Senior Notes
   Ps. 88,438,286 Ps. 95,007,014
Lines of credit
   40,722,004 53,062,260
Financial Leases
   11,743 13,910


Total
   Ps. 129,172,033 Ps. 148,083,184


Weighted average interest rate
   3.31 % 2.23 %


The Company’s long-term debt maturities as of December 31, ~~2018~~2020 are as follows:

Years
   Amount    Amount
2020
   Ps. 121,184,630
2021
   54,189,122
2022
   88,027,828    Ps. 112,091,112
2023 and thereafter
   279,290,239
2023
   25,594,561
2024
   31,721,298
2025 and thereafter
   310,892,801




Total
   Ps.     542,691,819    Ps. 480,299,772




(i) Senior Notes
The outstanding Senior Notes at December 31, ~~2017,~~2019, and December 31, ~~2018,~~2020, are as follows:

Currency*
   2017    2018    2019    2020
U.S. dollars
   Ps. 185,060,098    Ps.    184,089,282    Ps. 169,142,643    Ps. 186,531,417
Mexican pesos
   70,691,683    68,001,125    58,129,292    51,282,881
Euros**
   263,998,076    236,548,891    222,190,375    183,988,456
Pounds sterling**
   58,823,089    55,223,526    54,962,779    59,993,720
Swiss francs
   11,169,748    —
Brazilian reais
   20,935,142    32,891,187    34,948,736    32,533,191
Japanese yens
   2,282,608    2,334,864    2,255,663    2,511,701
Chilean pesos
   4,312,424    3,904,707    3,562,695    4,078,453
*
Thousands of Mexican pesos
**
Includes secured and unsecured senior notes.
(ii) Lines of credit
At December 31, ~~2017,~~2019, and December 31, ~~2018,~~2020, debt under lines of credit aggregated to Ps. ~~$31,364~~$53,645 million and Ps. ~~$29,651~~$53,062 million, respectively.
The Company has two revolving syndicated credit facilities, one for the Euro equivalent of U.S. $2,000 million and the other for U.S. $2,500 million maturing in 2021 and ~~2019,~~2024, respectively. As long as the facilities are committed, a commitment fee is paid. As of December 31, ~~2018,~~2020, these credit facilities ~~were~~are undrawn. Telekom Austria has ~~also~~ an undrawn revolving syndicated credit facility in Euros for €1,000 million that matures in ~~2019.~~2026.
(iii) Hybrid Notes
~~On September 2013, the Company issued three series of~~We currently have a Capital Securities (hybrid notes) maturing in 2073: ~~two~~a series denominated in ~~Euros~~euros for ~~€1,450 million with~~ a ~~coupon of 5.125% and 6.375% respectively, and one series denominated in pounds sterling in the~~total amount of ~~£550~~€550 million with a coupon of 6.375%. The Capital Securities are deeply subordinated, and when they were issued the principal rating agencies stated that they would treat only half of the principal amount as indebtedness for purposes of evaluating our leverage (an analysis referred to as 50.0% equity credit). The Capital Securities are subject to redemption at our option at varying dates beginning in ~~2018 and~~ 2023 ~~respectively,~~ for the euro-denominated ~~series and beginning in~~series.
(iv) Commercial Paper
In August 2020, ~~for the sterling-denominated series.~~
~~On September 2018,~~ we ~~exercised the option to call our hybrid bond with~~established a ~~maturity date in 2073~~new Euro-Commercial Paper program for a total amount of ~~€900 million euros.~~€2,000 million. At December 31, 2020, debt under this program aggregated to Ps.40,940 million.
~~KPN~~
On September 2018, América Móvil delivered 224,695,844 KPN shares, equivalent to 5% of the total outstanding shares, after the maturity of a mandatory conversion bond with a nominal outstanding amount of €750 million Euros.
~~The transaction represented the sale of those shares at an effective price of €3.3374 euros per share.~~
Restrictions
A portion of the debt is subject to certain restrictions with respect to maintaining certain financial ratios, as well as restrictions on selling a significant portion of groups of assets, among others. At December 31, ~~2018,~~2020, the Company was in compliance with all these requirements.
A portion of the debt is also subject to early maturity or repurchase at the option of the holders in the event of a change in control of the Company, as defined in each instrument. The definition of change in control varies from instrument to instrument; however, no change in control shall be considered to have occurred as long as its current shareholders continue to hold the majority of the Company’s voting shares.
~~“Covenants”~~
Covenants
In conformity with the credit agreements, the Company is obliged to comply with certain financial and operating commitments. Such covenants limit in certain cases, the ability of the Company or the guarantor to: pledge assets, carry out certain types of mergers, sell all or substantially all of its assets, and sell control of Telcel.
Such covenants do not restrict the ability of AMX’s subsidiaries to pay dividends or other payment distributions to AMX. The more restrictive financial covenants require the Company to maintain a consolidated ratio of debt to EBITDA (defined as operating income plus depreciation and amortization) that does not exceed 4 to 1, and a consolidated ratio of EBITDA to interest paid that is not below 2.5 to 1 (in accordance with the clauses included in the credit agreements).
Several of the financing instruments of the Company may be accelerated, at the option of the debt holder in the case that a change in control occurs.
At December 31, ~~2018,~~2020, the Company was in compliance with all the covenants.
15.Right-of-use assets and lease debt
The Company has lease contracts for various items of towers & sites, property and other equipment used in its operations. Towers and sites generally have lease terms between 5 and 12 years, while property and other equipment generally have lease terms between 5 and 25 years.
At December 31, 2019 and 2020 the right-of-use assets and lease liabilities are as follows:
Right-of-use assets Liability related to
right-of-use of
assets
Towers & Sites Property Other
equipment Total
As of January 1, 2019
Ps. 94,252,098 Ps. 21,075,884 Ps. 4,750,320 Ps. 120,078,302 Ps. 119,387,660
Additions and release
6,364,508 921,542 729,001 8,015,051 7,437,621
Business Combinations
9,668,507 —   —   9,668,507 10,810,111
Modifications
7,474,469 1,288,974 728,837 9,492,280 8,363,045
Depreciation
(17,286,497 ) (4,941,222 ) (1,365,847 ) (23,593,566 ) —
Interest expense
—   —   —   —   7,940,240
Payments
—   —   —   —   (26,765,075 )
Translation adjustment
(4,370,636 ) (905,808 ) (380,907 ) (5,657,351 ) (6,576,869 )

Balance at December 31, 2019
Ps. 96,102,449 Ps. 17,439,370 Ps. 4,461,404 Ps. 118,003,223 Ps. 120,596,733

Balance at the beginning of the year
Ps. 96,102,449 Ps. 17,439,370 Ps. 4,461,404 Ps. 118,003,223 Ps. 120,596,733
Additions and release
5,745,869 309,576 1,514,519 7,569,964 4,833,959
Modifications
8,559,335 (3,035,831 ) 1,048,858 6,572,362 7,769,326
Depreciation
(22,064,413 ) (3,440,428 ) (2,866,244 ) (28,371,085 ) —
Interest expense
—   —   —   —   9,134,288
Payments
—   —   —   —   (29,623,565 )
Translation adjustment
(3,124,365 ) 932,748 393,997 (1,797,620 ) (3,383,500 )

Balance at December 31, 2020
Ps. 85,218,875 Ps. 12,205,435 Ps. 4,552,534 Ps. 101,976,844 Ps. 109,327,241

At December 31, 2019 and 2020, the total of the right-of-use assets include an amount of Ps.22,878,245 and Ps.$18,499,851, corresponding to related parties, respectively and the total of lease liabilities include an amount of Ps.23,805,275 and Ps.$20,016,478 corresponding to related parties, respectively.
The implementation of IFRS 16 required a significant effort due to the fact of the need to make certain estimates, such as the lease term, based on the non-cancelable period and the periods covered by options to extend the lease. The
Company considered the extension of the lease terms beyond the non-cancelable period only when it was reasonably certain to extend it. The reasonability of the extension was affected by several factors, such as regulation, business model, and geographical business strategies.
The lease debt of the Company is integrated according to its maturities as follows:
2020
Short term
Ps. 25,067,905
Long term
84,259,336
Total
Ps. 109,327,241
The Company’s long-term debt maturities as of December 31, 2020 are as follows:
Year ended December 31,

2022
   Ps. 35,744,268
2023
   12,778,050
2024
   9,606,195
2025 and thereafter
   26,130,823


Total
   Ps. 84,259,336


During the years ended December 31 2019 and 2020, the Company recognized expenses as follows:
   2019
   Others    Related parties    Total
Depreciation expense of right-of-use assets
   Ps.18,176,521    Ps.5,417,045    Ps.23,593,566
Interest expense on lease liabilities
   5,654,721    2,285,519    7,940,240
Expense relating to short-term leases
   1,978,403    1,958    1,980,361
Expense relating to leases of low-value assets
   25,935    —      25,935
Variable lease payments
   1,299,502    —      1,299,502






Total
   Ps.27,135,082    Ps.7,704,522    Ps.34,839,604






   2020
   Others    Related parties    Total
Depreciation expense of right-of-use assets
   Ps.22,404,924    Ps.5,966,161    Ps.28,371,085
Interest expense on lease liabilities
   7,081,693    2,052,595    9,134,288
Expense relating to short-term leases
   32,238    —      32,238
Expense relating to leases of low-value assets
   2,883    —      2,883
Variable lease payments
   78,494    —      78,494






Total
   Ps.29,600,232    Ps.8,018,756    Ps.37,618,988






Impact on accounting for changes in lease payments applying the exemption.
Based on the information available for evaluation as of the date of adoption, the effect of applying this amendment to IFRS 16 in the Company’s consolidated financial statements as of December 31, 2020 was Ps.277,680, reflecting an adjustment to accrued liability for leases and recognizing a benefit in the income statement for the period.
16. Accounts payable, accrued liabilities and asset retirement obligations
a) The components of the ~~caption accounts~~captions account payable and accrued liabilities are as follows:

   At December 31,    At December 31,
   2017    2018    2019    2020
Suppliers
   Ps. 106,483,848    Ps. 118,406,380    Ps.113,370,716    Ps.74,285,881
Sundry creditors
   91,842,929    91,087,197    90,849,195    101,406,307
Interest payable
   8,930,561    8,535,519    8,057,170    7,661,762
Guarantee deposits from customers
   1,460,286    1,421,336    1,467,835    1,386,645
Dividends payable
   3,955,783    2,506,835    2,367,908    2,254,877








Total
   Ps. 212,673,407    Ps. 221,957,267    Ps.216,112,824    Ps.186,995,472








b) The balance of accrued liabilities at December 31, ~~2017~~2019 and ~~2018~~2020 are as follows:

   At December 31,
   2017    2018
Current liabilities

Direct employee benefits payable
   Ps. 16,673,627    Ps. 16,152,118
Contingencies
   51,079,131    40,281,573




Total
   Ps. 67,752,758    Ps. 56,433,691




   At December 31,
   2019    2020
Current liabilities

Direct employee benefits payable
   Ps. 17,991,283    Ps. 18,965,160
Contingencies
   34,379,969    31,326,691




Total
   Ps. 52,371,252    Ps. 50,291,851




The movements in contingencies for the years ended December 31, ~~2017~~2019 and ~~2018~~2020 are as follows:

~~Balance at~~
~~December 31,~~
~~2016~~ ~~Business~~
~~combination~~ ~~Effect of~~
~~translation~~ ~~Increase of~~
~~the year~~ ~~Applications~~ ~~Balance at~~
~~December 31,~~
~~2017~~
~~Payments~~ ~~Reversals~~
~~Contingencies~~
~~Ps. 50,766,070~~ ~~Ps. 115,971~~ ~~Ps. (648,685)~~ ~~Ps. 10,510,473~~ ~~Ps. (7,618,520)~~ ~~Ps. (2,046,178)~~ ~~Ps. 51,079,131~~
   Balance at
December 31,
2018    Business
combination    Effect of
translation Increase of
the year    Applications Reclassification
by adoption of
IFRIC 23 Balance at
December 31,
2019
   Payments Reversals
Contingencies
   Ps. 40,281,573    Ps. 1,378,611    Ps. (2,302,058 ) Ps. 6,410,975    Ps. (5,483,327 ) Ps. (1,833,518 ) Ps. (4,072,287 ) Ps. 34,379,969








~~Balance at~~
~~December 31,~~
~~2017~~ ~~Business~~
~~combination~~ ~~Effect of~~
~~translation~~ ~~Increase of~~
~~the year~~ ~~Applications~~ ~~Balance at~~
~~December 31,~~
~~2018~~
~~Payments~~ ~~Reversals~~
~~Contingencies~~
~~Ps. 51,079,131~~ ~~Ps. 7,812~~ ~~Ps. (5,729,826)~~ ~~Ps. 15,683,252~~ ~~Ps. (6,203,329)~~ ~~Ps. (14,555,467)~~ ~~Ps. 40,281,573~~
   Balance at
December 31,
2019    Business
combination    Effect of
translation Increase of
the year    Applications Balance at
December 31,
2020
   Payments Reversals
Contingencies
   Ps. 34,379,969    Ps. 292    Ps. (4,290,753 ) Ps. 7,442,292    Ps. (3,214,407 ) Ps. (2,990,702 ) Ps. 31,326,691








Contingencies include tax, labor, regulatory and other legal type contingencies. See Note ~~16 c)~~17 b) for detail of contingencies.
c) The movements in the asset retirement obligations for the years ended December 31, ~~2017~~2019 and ~~2018~~2020 are as follows:

~~Balance at~~
  ~~December 31,~~
~~2016~~ ~~Effect of~~
    ~~translation~~         ~~Increase of~~
~~the year~~ ~~Applications~~ ~~Balance at~~
    ~~December 31,~~
~~2017~~
    ~~Payments~~         ~~Reversals~~
~~Asset retirement obligations~~
~~Ps. 16,288,631~~ ~~Ps. (119,928)~~ ~~Ps. 3,160,320~~ ~~Ps. (126,088)~~ ~~Ps. (957,806)~~ ~~Ps. 18,245,129~~
~~Balance at~~
~~December 31,~~
~~2017~~ ~~Effect of~~
~~translation~~ ~~Increase of~~
~~the year~~ ~~Applications~~ ~~Balance at~~
~~December 31,~~
~~2018~~
~~Payments~~ ~~Reversals~~
~~Asset retirement obligations~~
~~Ps. 18,245,129~~ ~~Ps. (2,020,853)~~ ~~Ps. 1,062,745~~ ~~Ps. (151,364)~~ ~~Ps. (1,164,056)~~ ~~Ps. 15,971,601~~
   Balance at
December 31,
2018    Business
combination    Effect of
translation Increase of
the year    Applications Balance at
December 31,
2019
   Payments Reversals
Asset retirement obligations
   Ps. 15,971,601    Ps. 293,548    Ps. (1,339,033 ) Ps. 1,600,197    Ps. (128,842 ) Ps. (580,727 ) Ps. 15,816,744








   Balance at
December 31,
2019    Business
combination    Effect of
translation    Increase of
the year    Applications Balance at
December 31,
2020
   Payments Reversals
Asset retirement obligations
   Ps. 15,816,744    Ps.         —      Ps. 374,418    Ps. 2,412,908    Ps. (593,644 ) Ps. (122,435 ) Ps. 17,887,991










The discount rates used for the asset retirement obligation are based on market rates that are expected to be undertaken by the dismantling or restoration of cell sites and may include labor costs.
~~16.~~
17. Commitments and Contingencies
a) ~~Leases~~
At December 31, 2017 and 2018, the Company has entered into several lease agreements with related parties and third parties for the buildings where its offices are located (as a lessee), as well as with the owners of towers and or premises where the Company has installed radio bases.
~~An analysis of the minimum rental payments for the next five years is shown below. In some cases, rental amounts are increased each year based on the National Consumer Price Index (INPC).~~
~~The Company has the followingnon-cancelable~~ ~~commitments under finance leases:~~

Year ended December 31,

2019
   Ps. 22,920
2020
   13,365
2021
   12,068
2022
   10,751
2023
   9,399
2024 and thereafter
   34,011


Total
   Ps. 102,514
Less: amounts representing finance charges
   23,837


Present value of net minimum lease payments
   78,677
Less current portion
   14,240


Long-term obligations
   Ps. 64,437


~~An analysis ofnon-cancellable~~ ~~operating leases is as follows:~~

Year ended December 31,

2019
   Ps. 24,034,366
2020
   22,104,366
2021
   15,522,020
2022
   14,250,332
2023
   12,046,800
2024 and thereafter
   49,991,937


Total
   Ps. 137,949,821


~~Rent expense for the years ended December 31, 2016, 2017 and 2018 was Ps. 32,300,963, Ps. 35,571,283 and Ps. 34,421,817, respectively.~~
b) Commitments
The Company and its subsidiaries have commitments that mature on different dates, ~~referring~~related to ~~CAPEX~~committed capital expenditures and cell phone purchases.
As of December 31, ~~2018,~~2020, the total amounts equivalent to the contract period are detailed below:

Year ended December 31,

2019
   Ps. 88,233,626
2020
   68,170,083
2021
   55,358,156    Ps. 74,446,526
2022
   13,322,961    37,345,449
2023
   2,240,297
2024 and thereafter
   13,555,946




Total
   Ps. 225,084,826    Ps. 127,588,218




c)b) Contingencies
~~I. MEXICO~~In each of the countries in which we operate, we are party to legal proceedings in the ordinary course of business. These proceedings include tax, labor, antitrust, contractual matters and administrative and judicial proceedings concerning regulatory matters regarding interconnection and tariffs. The following is a description of our material legal proceedings.
(1) Mexican Tax Assessment and Fine
In 2014, the Mexican Tax Administration Service (Servicio de Administración Tributaria ~~or “SAT”~~)(“SAT”) notified the Company of a ~~Ps. 529,700~~Ps.529,700 tax assessment related to the Company’s tax return for the fiscal year ended December 31, 2005, ~~and reduced~~pursuant to which the SAT has determined a reduction of the Company’s consolidated tax loss for ~~that~~such year from ~~Ps. 8,556,000~~Ps.8,556,000 to zero. ~~The Company has challenged this assessment before the Mexican courts and a final resolution is pending. The Company has not established a provision~~Furthermore, in ~~the accompanying consolidated financial statements for a loss arising from this assessment, which it does not consider probable.~~
In 2012 the SAT notified the ~~Company and its~~Company’s subsidiary Sercotel, S.A. de C.V. ~~(“Sercotel”) of~~ a ~~fine~~tax assessment of approximately ~~Ps. 1,400,000 for alleged~~Ps.1,400,000. The Company and such subsidiary challenged these tax ~~improprieties arising from~~assessments and once all corresponding instances had been concluded, during the ~~transfer~~second half of ~~certain accounts receivable from one of~~2020, the ~~Company’s subsidiaries to Sercotel. In 2014, the Company challenged the fine and~~Federal Tax Court issued a final resolution is pending. The Company has not established a provision in the accompanying consolidated financial statements for a loss arising from this fine, which the Company does not consider probable.judgment annulling such tax assessments.
(2) Telcel Mobile Termination Rates
The mobile termination rates between Telcel and other network operators have been the subject of various legal proceedings. With respect to ~~the~~ interconnection fees for 2017, 2018, 2019, 2020 and ~~2019,~~2021, Telcel has challenged the applicable resolutions and final resolutions are pending. With respect to 2021, Telcel will challenge the applicable resolutions.
Given ~~the fact~~ that the “zero rate” that prevented Telcel from charging ~~interconnection~~termination rates in its mobile network was held unconstitutional by the Supreme Court (Suprema Corte de Justicia de la Nación ~~“SCJN”~~“SCJN”), the IFT has determined asymmetric interconnection rates for the termination of traffic in Telcel’s and other operators’ networks for 2018, 2019, 2020 and ~~2019.~~2021. The resolutions setting such rates have been challenged by Telcel, and final resolutions are pending.
The Company expects that mobile termination rates, as well as other rates applicable to mobile interconnection (such as transit), will continue to be the subject of litigation and administrative ~~proceedings in Mexico.~~proceedings. The Company cannot predict when or how these ~~matters~~disputes will be resolved or the financial effects of any such resolution.
(3) Telcel Class Action Lawsuits
~~Telcel is subject to two~~One of the three class action lawsuits ~~initiated~~that have been filed against Telcel by customers allegedly affected by Telcel’s quality of service and wireless and broadband ~~rates. The~~rates continues in process, the remaining two lawsuits
have been concluded without any adverse effect on the Company. At this stage, the Company cannot assess whether ~~these~~this class action ~~lawsuits~~lawsuit could have an adverse effect on the Company’s business and results of operations in the event that ~~they are~~it is resolved against Telcel, due to uncertainty about the ~~lack of~~ factual and legal claims underlying ~~these proceedings.~~this proceeding. Consequently, the Company has not established a provision in the accompanying consolidated financial statements for aan eventual loss arising from ~~these proceedings.~~this proceeding.
(4) IFT Proceedings Against Telmex
In 2008, Telmex entered into certain commercial agreements with Dish México Holdings, S. de R.L. de C.V. and related companies (“Dish”), involving billing, collection services, distribution and equipment leasing. In addition, Telmex had an option to purchase shares representing 51% of the capital stock of Dish México, S. de R.L. de C.V. (“Dish México”). In 2014, Telmex waived its rights under the option.
~~In 2015, the IFT imposed a fine of Ps. 14,414 on Telmex on the grounds that the IFT was not notified of an alleged merger (~~~~concentración~~~~) between Telmex and Dish in 2008. Telmex filed an appeal for relief (~~~~amparo~~~~) and a final resolution is pending.~~
In 2015, in relation with some Dish operations, the IFT initiated several proceedings in order to determine potential violations of (i) Telmex’s concession, with respect to an alleged indirect exploitation of a public television services concession, which in 2019, the appeal for relief was granted by a competent court (~~Tribunal Colegiado)~~~~; the Company cannot predict the outcome of such proceedings, and (ii) certain provisions of the Mexican Constitution (~~~~Constitución Política de los Estados Unidos Mexicanos~~~~) and the Federal Telecommunications and Broadcasting Law (~~~~Ley Federal de Telecomunicaciones y Radiodifusión~~~~) regarding the cost-free rule ofre-transmission~~ of television broadcast signals (commonly known as “must offer”), through other operators. In 2018, the IFT absolved Telmex and Dish from any responsibility in connection with the sanction procedure initiated by the IFT for the alleged violation of item (ii) above.
In 2018, the IFT imposed a fine of ~~Ps. 2,543,937~~Ps.2,543,937 on Telmex relating to a sanction procedure triggered by the alleged breach in 2013 and 2014 of certain minimum quality goals for link services. Telmex challenged this fine, and a final resolution is pending.
~~II. BRAZIL~~
a.(5) Brazilian Tax Matters
~~ICMS~~
As of December 31, ~~2018, the~~2020, certain Company’s Brazilian subsidiaries ~~Claro Brasil, Primesys Soluções Empresariais S.A. (“Primesys”), Telmex Do Brasil Ltda. (“TdB”), Americel S.A. (“Americel”), Brasil Telecomunicações S.A.~~
~~(“BrTel”) and TVSAT Telecomunicações S.A. (“TV SAT”),~~ had aggregate tax contingencies ~~related to value-added tax (“ICMS”)~~ of ~~approximately Ps. 55,455,306~~Ps.119,231,362 (R$ ~~10,917,000). As of December 31, 2018,~~31,060,349) for which the Company has established ~~a provision~~provisions of ~~Ps. 3,362,775~~Ps.17,643,740 (R$ ~~662,000)~~4,596,280) in the accompanying consolidated financial statements for ~~the~~eventual losses arising from ~~these~~ contingencies ~~which~~that the Company considers probable. ~~Such ICMS~~The most significant contingencies ~~include~~for which provisions have been established are:
•
Ps.41,974,641 (R$ 10,934,598) aggregate contingencies and Ps.3,101,862 (R$ 808,050) provisions related to value-added tax (Imposto sobre a Circulação de Mercadorias e Prestação de Serviços or “ICMS”) assessments;
•
Ps.20,151,371 (R$ 5,249,530) aggregate contingencies and Ps.3,319,251 (R$ 864,681) provisions related to social contribution on net income (Contribuição Social sobre o Lucro Líquido or “CSLL”) and corporate income tax (Imposto de Renda sobre Pessoa Jurídica or “IRPJ”) assessments;
•
Ps.14,991,233 (R$ 3,905,289) aggregate contingencies and Ps.4,993,865 (R$ 1,300,926) provisions related to the social integration program (Programa de Integração Social or “PIS”) and the contribution for social security financing (Contribuição para o Financiamento da Seguridade Social or “COFINS”) assessments;
•
Ps.11,476,895 (R$ 2,989,787) aggregate contingencies and Ps.1,428,756 (R$ 372,198) provisions mainly related to an allegedly improper exclusion of interconnection revenues and costs from the basis used to calculate Fund for Universal Telecommunication Services (Fundo de Universalização dos Serviços de Telecomunicações or “FUST”) obligations, which are being contested;
•
Ps.4,410,628 (R$ 1,148,990) aggregate contingencies and Ps.656 (R$ 171) provisions related to an alleged underpayment of obligations to the Telecommunications Technology Development Fund (Fundo para o Desenvolvimento Tecnológico das Telecomunicações or “FUNTTEL”), which are being challenged and a final resolution is pending;
•
Ps.1,688,790 (R$ 439,938) aggregate contingencies and Ps.46,947 (R$ 12,230) provisions related to the alleged nonpayment of Services Tax (Imposto Sobre Serviços or “ISS”) over several communication services, including Pay TV services, considered taxable for ISS by the Municipal Revenue Services, which are being challenged and a final resolution is pending;
Ps.4,183,953 (R$ 1,089,940) aggregate contingencies and Ps.108,877 (R$ 28,363) provisions arising, among others, from the ~~following tax assessments~~alleged underpayment of IRRF and CIDE taxes and on remittances made to foreign operators as remuneration for completing international calls abroad (outgoing traffic); and
Ps.3,848,354 (R$ 1,002,515) aggregate contingencies and Ps.3,826,631 (R$ 996,856) provisions related to the requirement to contribute to the Promotion of Public Radio Broadcasting (“EBC”).
In addition, the Company’s Brazilian subsidiaries are subject to a number of contingencies for which ~~the Company does not consider probable and therefore,~~it has not established ~~a provision in the accompanying consolidated financial statements:~~
Tax assessments against Star One, S.A. (currently Claro Brasil as surviving entity of merger) in the amount of Ps. 21,167,194 (R$ 4,167,000) based on allegations that the provision of satellite capacity is subject to ICMS. The Company is contesting these tax assessments in separate proceedings at different litigation stages and has obtained favorable judicial decisions in two proceedings.
~~Tax assessments against Claro Brasil and Americel in the amount of Ps. 5,861,997 (R$ 1,154,000), due to a decision that held certain benefits granted by the Brazilian states unconstitutional.~~
~~Tax assessment against Primesys in the amount of Ps. 3,916,464 (R$ 771,000), related to ICMS over certain activities not deemed to be part of data communication services.~~
~~CSLL/IRPJ~~
As of December 31, 2018 Claro Brasil, Americel, BrTel, and TV SAT had aggregate tax contingencies related to Social Contribution on Net income (“CSLL”) and Corporate Income Tax (“IRPJ”) in the amount of Ps. 17,779,021 (R$ 3,500,000). As of December 31, 2018, the Company has established a provision of Ps. 4,835,894 (R$ 952,000)provisions in the accompanying consolidated financial statements ~~for the losses arising from these contingencies, which the Company considers probable.~~
The aforementioned CSLL/IRPJ contingencies include a tax assessment against Claro Brasil in the amount of Ps. 10,906,159 (R$ 2,147,000) alleging the undue amortization of goodwill amounts between 2009 and 2012, and charging CSLL, IRPJ and penalties due to the late payment of taxes. Claro Brasil has challenged this assessment at the administrative level and a final resolution is pending. The Company has established a provision of Ps. 558,769 (R$ 110,000) in the accompanying consolidated financial statements for the losses arising from these contingencies, which the Company considers probable.
~~PIS/COFINS~~
As of December 31, 2018, Claro Brasil, Americel, TdB, Primesys and Brasil Center Comunicações Ltda. (“Brasil Center”) had aggregate tax assessments related to Social Integration Program (“PIS”) and Contribution for Social Security Financing (“COFINS”) in the amount of Ps. 16,488,772 (R$ 3,246,000). As of December 31, 2018, the Company has established a provision of Ps. 5,861,997 (R$ 1,154,000) in the accompanying consolidated financial statements for the losses arising from the PIS/COFINS assessments, which the Company considers probable. With respect to such PIS/COFINS assessments:
Claro Brasil and Americel have commenced lawsuits against the Brazilian Federal Revenue Service seeking a ruling on constitutional grounds to exclude interconnection fees from the base used to calculate PIS and COFINS tax obligations. Pending a final resolution and pursuant to applicable Brazilian procedure, the companies have paid the tax based on their position in the lawsuits and have established a provision for the disputed amounts. As of December 31, 2018, the total amount in dispute was approximately Ps. 5,221,952 (R$ 1,028,000).
Tax assessments against Claro Brasil and Americel related to the offset of PIS and COFINS credits recorded in the noncumulative method in an amount of Ps. 8,183,429 (approximately R$ 1,611,000) as of December 31, 2018. The Company has not established a provision in the accompanying consolidated financial statements to cover the losses arising from this contingency, whichbecause the Company does not ~~consider probable.~~
~~As of September 30, 2018, based on~~consider the potential losses related to these contingencies to be probable. These include a ~~favorable decision from the Brazilian Supreme Court concerning the exclusion of ICMS from PIS and COFINS, the Company reverted the provision of Ps. 13,034,562~~fine for Ps.12,921,410 (R$~~2,566,000).~~
~~FUST/FUNTTEL~~
Anatel has initiated administrative proceedings against Claro Brasil, Americel, Primesys, TdB, BrTel and TVSAT in an aggregate amount of Ps. 14,223,217 (R$ 2,800,000) mainly based on an allegedly improper exclusion of interconnection revenues and costs from the basis used to calculate its Fund for Universal Telecommunication Services (“FUST”) obligations. The companies are contesting these assessments. As of December 31, 2018, the Company has established a provision of Ps. 1,706,786 (R$ 336,000) in the accompanying consolidated financial statements to cover the losses arising from these assessments, which the Company considers probable.
~~In addition, the Brazilian Ministry of Communications (~~~~Ministério das Comunicações~~) has initiated administrative proceedings against Claro Brasil, Americel, Primesys, TdB, BrTel and TVSAT totaling an amount of Ps. 5,115,278 (R$ 1,007,000) as of December 31, 2018, due to an alleged underpayment of their obligations to the telecommunications Technology Development Fund (“FUNTTEL”). The companies have challenged these assessments and a final resolution is pending. As of December 31, 2018, the Company has established a provision of Ps. 5,080 (R$ 1,000) in the accompanying consolidated financial statements to cover the losses arising from these assessments, which the Company considers probable.
~~ISS~~
The Municipal Revenue Services have issued tax assessments against Claro Brasil, Brasil Center and Primesys, totaling an aggregate amount of approximately Ps. 3,637,080 (R$ 716,000) due to the alleged nonpayment of Brazilian Services tax (“ISS”) over several telecommunication services, including Pay TV services, considered as taxable for ISS by these authorities. The companies have challenged the tax assessments on the grounds that the services cited are not subject to ISS tax and a final resolution is pending. As of December 31, 2018, the Company has established a provision of Ps. 25,399 (R$ 5,000) in the accompanying financial statements for the losses arising from these assessments, which the Company considers probable.
~~TFI~~
~~As of December 31, 2018, Anatel fined Claro Brasil and Americel a total of Ps. 13,207,273 (R$ 2,600,000),~~ 3,366,090) imposed for an unpaid installation inspection fee (Taxa de Fiscalização de Instalaçãoor “TFI”) allegedly due for the renovation of radio base ~~stations. Claro Brasil and Americel have~~stations, which is being challenged on the ~~fine, arguing~~basis that there was no new equipment installation that could ~~lead~~have led to this ~~charge, and a final resolution is pending. The Company has not established a provision in the accompanying consolidated financial statements~~charge.
(6) Anatel Challenge to ~~cover losses arising from these proceedings, which the Company does not consider probable.~~
~~Other Tax Contingencies~~
There are other several tax contingencies involving Claro Brasil, Americel, TdB and Primesys in an aggregate amount of Ps. 12,394,517 (R$ 2,440,000) related to a variety of taxes and government programs. As of December 31, 2018, the Company has established a provision of Ps. 1,117,538 (R$ 220,000) in the accompanying consolidated financial statements for the losses arising from these contingencies, which the Company considers probable.
~~b. Regulatory Matters~~
~~Inflation-Related~~Inflation Adjustments
Anatel has challenged the calculation of inflation-related adjustments due under the concession agreements with Tess S.A. (“Tess”), and Algar Telecom Leste S.A. (“ATL”), two of the Company’s subsidiaries that were previously merged into Claro Brasil. Anatel rejected Tess and ATL’s calculation of the inflation-related adjustments applicable to 60% of the concessions price (which was due in three equal annual installments, subject to inflation-related adjustments and interest), claiming that the companies’ calculation of the ~~inflation-related~~inflationrelated adjustments resulted in a shortfall of the installment payments. The companies have filed declaratory and consignment actions seeking the resolution of the disputes and have obtained injunctions from a federal appeals court suspending payment until the pending appeals are resolved.
The amount of the alleged shortfall as well as the method used to calculate monetary corrections are in dispute. If other methods or assumptions are applied, the amount may increase. In ~~2018,~~2019, Anatel calculated the monetary correction in a total amount of ~~Ps. 19,302,937~~Ps.15,738,670 (R$ ~~3,800,000)~~4,100,000). As of December 31, ~~2018,~~2020, the Company has established a provision of ~~Ps. 3,419,668~~Ps.2,625,671 (R$ ~~673,200)~~684,000) in the accompanying consolidated financial statements for the losses arising from these contingencies, which the Company considers probable.
~~III. ECUADOR~~
~~In 2014, following a regulatory claim filed in 2012 by state-owned operator~~~~Corporación Nacional de Telecomunicaciones~~~~(“CNT”), the Superintendency of Control of Market Power (~~~~Superintendencia de Control del Poder del Mercado,~~or ��SCPM”), imposed a fine of Ps.2,724,113 (US$138,400), on Conecel for alleged monopolistic practices. CNT alleged that Conecel had exclusive rights to deploy its network in five locations and thereby prevented CNT from deploying its own network in the same locations. Conecel challenged the fine before the Administrative Dispute Tribunal (~~Tribunal de lo Contencioso Administrativo~~~~), denying any wrongdoing and contends that CNT had other alternative sites in the same locations where it could have deployed its network.~~
~~In 2018, the Administrative Dispute Tribunal (~~~~Tribunal de lo Contencioso~~Administrativo), issued a ruling in favor of Conecel, declaring the fine null and void. The SCPM filed an appeal before the National Court of Justice and the appeal was declared inadmissible by such Court on March 14, 2019; nevertheless, this decision may not be final.
~~17.~~18. Employee Benefits
An analysis of the net liability and net period cost for employee benefits is as follows:

   At December 31,    At December 31,
   2017    2018    2019    2020
Liability:

Mexico
   Ps. 84,821,197    Ps. 85,517,190    Ps. 116,537,660    Ps. 129,260,355
Puerto Rico
   13,962,128    13,986,596    13,228,592    14,924,874
Brazil
   9,503,738    8,913,548
Europe
   14,833,840    12,705,926    12,827,318    14,392,445
Brazil
   6,276,780    5,666,694
Ecuador
   403,194    448,608    409,750    488,161
El Salvador
      154,422
Nicaragua
      61,337
Honduras
      35,060








Total
   Ps. 120,297,139    Ps. 118,325,014    Ps. 152,507,058    Ps. 168,230,202








   For the year ended December 31
   2018    2019    2020
Mexico
   Ps. 12,046,208    Ps. 12,788,464    Ps. 14,911,208
Puerto Rico
   686,067    747,755    664,046
Brazil
   579,432    511,964    722,412
Europe
   619,039    2,526,957    1,701,424
Ecuador
   58,354    34,425    67,402
El Salvador
         15,751
Nicaragua
         3,711






   13,989,100    Ps. 16,609,565    Ps. 18,085,954






   For the year ended December 31,
   2016    2017    2018
Net period cost (benefit)

Mexico
   Ps.   12,281,154    Ps.   11,586,065    Ps.   12,046,208
Puerto Rico
   1,058,131    776,238    686,067
Europe
   226,447    385,689    619,039
Brazil
   633,159    735,855    579,432
Ecuador
   41,380    152,335    58,354






Total
   Ps. 14,240,271    Ps. 13,636,182    Ps. 13,989,100






a) Defined ~~benefit plan~~Benefit Plans
The defined benefit obligation (DBO) and plan assets for the pension and other benefit obligation plans, by country, are as follows:

At December 31
2017 2018
DBO Plan Assets Effect of asset
celling Net employee
benefit liability DBO Plan Assets Effect of asset
celling Net employee
benefit liability
Mexico
Ps.   266,304,948 Ps.   (182,539,376) Ps. —   Ps. 83,765,572 Ps.   247,997,060 Ps.   (163,404,418) Ps. —   Ps. 84,592,642
Puerto Rico
38,711,695 ( 24,749,567) —   13,962,128 35,220,889 ( 21,234,293) —   13,986,596
Brazil
19,369,664 ( 20,399,661) 6,519,560 5,489,563 18,795,315 ( 19,032,411) 5,087,543 4,850,447
Europe
4,554,912 —   —   4,554,912 4,477,042 —   —   4,477,042

Total
Ps. 328,941,219 Ps.   (227,688,604) Ps.   6,519,560 Ps. 107,772,175 Ps. 306,490,306 Ps.   (203,671,122) Ps.   5,087,543 Ps. 107,906,727

At December 31
2019 2020
DBO Plan Assets Effect of
asset celling Net employee
benefit liability DBO Plan Assets Effect of
asset celling Net employee
benefit
liability
Mexico
Ps. 280,602,176 Ps. (164,910,346 ) Ps. Ps. 115,691,830 Ps. 278,434,302 Ps. (150,090,481 ) Ps. Ps. 128,343,821
Puerto Rico
35,803,893 (22,575,301 ) 13,228,592 40,240,193 (25,315,319 ) 14,924,874
Brazil
21,412,097 (18,815,174 ) 4,428,021 7,024,944 18,568,932 (16,143,783 ) 3,393,640 5,818,789
Europe
4,538,543 4,538,543 5,490,873 5,490,873

Total
Ps. 342,356,709 Ps. (206,300,821 ) Ps. 4,428,021 Ps. 140,483,909 Ps. 342,734,300 Ps. (191,549,583 ) Ps. 3,393,640 Ps. 154,578,357

Below is a summary of the actuarial results generated for the pension and retirement plans as well as the medical services in Puerto Rico and Brazil; the pension plans and seniority premiums related to Telmex; the pension plan, the service awards plan and severance in Austria corresponding to the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018:~~2020:

   At December 31, 2016 At December 31, 2018
   DBO Plan Assets Effect of asset
celling Net employee
benefit DBO Plan Assets Effect of asset
celling Net employee
benefit liability
Balance at the beginning of the year
   Ps. 314,049,729 Ps. (212,234,440 ) Ps. 4,823,147 Ps. 106,638,436 Ps. 329,113,625 Ps. (227,688,604 ) Ps. 6,519,560 Ps. 107,944,581
Current service cost
   4,606,856 4,606,856 3,322,813 3,322,813
Interest cost on projected benefit obligation
   27,275,363 27,275,363 30,185,257 30,185,257
Expected return on plan assets
   (18,972,042 ) (18,972,042 ) (20,804,104 ) (20,804,104 )
Changes in the asset ceiling during the period and others
   875,192 875,192 587,373 587,373
Past service costs and other
   165,851 165,851 157,765 157,765
Actuarial gain for changes in experience
   (28,867 ) (28,867 ) (7,222 ) (7,222 )
Actuarial loss from changes in financial assumptions
   7,784 7,784
Actuarial loss from changes in demographic assumptions
134,625 134,625
Actuarial gain from changes in financial assumptions
(24,890 ) (24,890 )


Net period cost
   Ps. 31,861,136 Ps. (18,806,191 ) Ps. 875,192 Ps. 13,930,137 Ps. 33,610,583 Ps. (20,646,339 ) Ps. 587,373 Ps. 13,551,617
Actuarial gain for changes in experience
   (20,976,837 ) (20,976,837 ) (21,283,470 ) (21,283,470 )
Actuarial loss from changes in demographic assumptions
   397,985 397,985 68,482 68,482
Actuarial loss from changes in financial assumptions
   1,718,189 1,718,189
Actuarial gain from changes in financial assumptions
(1,246,539 ) (1,246,539 )
Changes in the asset ceiling during the period and others
   (754,535 ) (754,535 ) (1,055,409 ) (1,055,409 )
Return on plan assets greater than discount rate
   (4,724,041 ) (4,724,041 )
Return on plan assets greater than discount rate (shortfall)
23,503,296 23,503,296


Recognized in other comprehensive income
   Ps. (18,860,663 ) Ps. (4,724,041 ) Ps. (754,535 ) Ps. (24,339,239 ) Ps. (22,461,527 ) Ps. 23,503,296 Ps. (1,055,409 ) Ps. (13,640 )
Contributions made by plan participants
   255,760 (255,760 ) —   173,722 (173,722 ) —
Contributions to the pension plan made by the Company
   (2,756,519 ) (2,756,519 ) (1,565,792 ) (1,565,792 )
Benefits paid
   (25,694,301 ) 25,517,599 (176,702 ) (19,546,541 ) 19,546,541 —
Payments to employees
   (525,612 ) (525,612 ) (10,651,938 ) (10,651,938 )
Effect of translation
   12,196,546 (9,086,269 ) 2,139,414 5,249,691 (3,535,477 ) 3,353,498 (963,981 ) (1,145,960 )


Others
   Ps. (13,767,607 ) Ps. 13,419,051 Ps. 2,139,414 Ps. 1,790,858 Ps. (33,560,234 ) Ps. 21,160,525 Ps. (963,981 ) Ps. (13,363,690 )
Balance at the end of the year
   313,282,595 (222,345,621 ) 7,083,218 98,020,192 306,702,447 (203,671,122 ) 5,087,543 108,118,868
Less short-term portion
   (152,448 ) (152,448 ) (212,141 ) (212,141 )


Non-current obligation
   Ps. 313,130,147 Ps. (222,345,621) Ps. 7,083,218 Ps. 97,867,744 Ps. 306,490,306 Ps. (203,671,122 ) Ps. 5,087,543 Ps. 107,906,727


   At December 31, 2017    At December 31, 2019
   DBO Plan Assets Effect of asset
celling Net employee
benefit liability    DBO Plan Assets Effect of asset
celling Net
employee
benefit
liability
Balance at the beginning of the year
   Ps. 313,282,595 Ps. (222,345,621 ) Ps. 7,083,218 Ps. 98,020,192    Ps. 306,702,447 Ps. (203,671,122 ) 5,087,543 Ps. 108,118,868
Current service cost
   4,285,693 4,285,693    2,591,975 2,591,975
Interest cost on projected benefit obligation
   28,922,385 28,922,385    31,001,348 31,001,348
Expected return on plan assets
   (20,916,104 ) (20,916,104 )    (20,070,037 ) (20,070,037 )
Changes in the asset ceiling during the period and others
   716,330 716,330    445,743 445,743
Past service costs and other
   53,032 53,032
Past service costs and others
   144,481 144,481
Actuarial gain for changes in experience
   (35,145 ) (35,145 )    (22,599 ) (22,599 )
Actuarial gain from changes in demographic assumptions
   (85 ) (85 )    (129 ) (129 )
Actuarial gain from changes in financial assumptions
   (4,294 ) (4,294 )
Actuarial loss from changes in financial assumptions
   36,163 36,163




Net period cost
   Ps. 33,168,554 Ps. (20,863,072 ) Ps. 716,330 Ps. 13,021,812    Ps. 33,606,758 Ps. (19,925,556 ) Ps. 445,743 Ps. 14,126,945
Actuarial loss for changes in experience
   11,671,860 11,671,860    31,606,323 31,606,323
Actuarial gain from changes in demographic assumptions
   (381,172 ) (381,172 )    (339,657 ) (339,657 )
Actuarial loss from changes in financial assumptions
   2,438,078 2,438,078    7,207,072 7,207,072
Changes in the asset ceiling during the period and others
   (856,188 ) (856,188 )    (712,064 ) (712,064 )
Return on plan assets greater than discount rate
   (2,483,430 ) (2,483,430 )
Return on plan assets greater than discount rate (shortfall)
   423,514 423,514




Recognized in other comprehensive income
   Ps. 13,728,766 Ps. (2,483,430 ) Ps. (856,188 ) Ps. 10,389,148    Ps. 38,473,738 Ps. 423,514 Ps. (712,064 ) Ps. 38,185,188
Contributions made by plan participants
   198,713 (198,713 ) —      155,188 (155,188 ) —
Contributions to the pension plan made by the Company
   (2,697,621 ) (2,697,621 )    (1,337,610 ) (1,337,610 )
Benefits paid
   (18,841,754 ) 18,841,754 —      (15,836,928 ) 15,836,928 —
Payments to employees
   (9,843,743 ) (9,843,743 )    (16,996,920 ) (16,996,920 )
Effect of translation
   (2,579,506 ) 2,058,099 (423,800 ) (945,207 )    (3,534,509 ) 2,528,213 (393,201 ) (1,399,497 )




Others
   Ps. (31,066,290 ) Ps. 18,003,519 Ps. (423,800 ) Ps. (13,486,571 )    Ps. (36,213,169 ) Ps. 16,872,343 Ps. (393,201 ) Ps. (19,734,027 )
Balance at the end of the year
   329,113,625 (227,688,604 ) 6,519,560 107,944,581    342,569,774 (206,300,821 ) 4,428,021 140,696,974
Less short-term portion
   (172,406 ) (172,406 )    (213,065 ) (213,065 )




Non-current obligation
   Ps. 328,941,219 Ps. (227,688,604) Ps. 6,519,560 Ps. 107,772,175    Ps. 342,356,709 Ps. (206,300,821 ) Ps. 4,428,021 Ps. 140,483,909




   At December 31, 2018    At December 31, 2020
   DBO Plan Assests Effect of asset
celling Net employee
benefit liability    DBO Plan Assets Effect of asset
celling Net employee
benefit liability
Balance at the beginning of the year
   Ps. 329,113,625 Ps. (227,688,604 ) Ps. 6,519,560 Ps. 107,944,581    Ps. 342,569,774 Ps. (206,300,821 ) Ps. 4,428,021 Ps. 140,696,974
Current service cost
   3,322,813 3,322,813    2,810,584 2,810,584
Interest cost on projected benefit obligation
   30,185,257 30,185,257    30,482,173 30,482,173
Expected return on plan assets
   (20,804,104 ) (20,804,104 )    (17,655,119 ) (17, 655,119 )
Changes in the asset ceiling during the period and others
   587,373 587,373    278,639 278,639
Past service costs and other
   157,765 157,765    148,253 148,253
Actuarial gain for changes in experience
   (7,222 ) (7,222 )    (8,945 ) (8,945 )
Actuarial loss from changes in demographic assumptions
   134,625 134,625
Actuarial gain from changes in financial assumptions
   (24,890 ) (24,890 )
Actuarial gain from changes in demographic assumptions
   (270 ) (270 )
Actuarial loss from changes in financial assumptions
   20,219 20,219




Net period cost
   Ps. 33,610,583 Ps. (20,646,339 ) Ps. 587,373 Ps. 13,551,617    Ps. 33,303,761 Ps. (17,506,866 ) Ps. 278,639 Ps. 16,075,534
Actuarial gain for changes in experience
   (21,283,470 ) (21,283,470 )    (9,677 ) (9,677 )
Actuarial gain from changes in demographic assumptions
   (103,987 ) (103,987 )
Actuarial loss from changes in financial assumptions
   3,475,345 3,475,345
Changes in the asset ceiling during the period and others
   (542,430 ) (542,430 )
Return on plan assets greater than discount rate (shortfall)
   12,320,777 12,320,777
Actuarial loss from changes in demographic assumptions
   68,482 68,482    (924,084 ) (924,084 )
Actuarial gain from changes in financial assumptions
   (1,246,539 ) (1,246,539 )
Changes in the asset ceiling during the period and others
   (1,055,409 ) (1,055,409 )
Return on plan assets greater than discount rate
   23,503,296 23,503,296




Recognized in other comprehensive income
   Ps. (22,461,527 ) Ps. 23,503,296 Ps. (1,055,409 ) Ps. (13,640 )    Ps. 2,437,597 Ps. 12320,777 Ps. (542,430 ) Ps. 14,215,944
Contributions made by plan participants
   173,722 (173,722 ) —      137,947 (137,947 ) —
Contributions to the pension plan made by the Company
   (1,565,792 ) (1,565,792 )    (1,882,654 ) (1,882,654 )
Benefits paid
   (19,546,541 ) 19,546,541 —      (19,740,727 ) 19,740,727 —
Payments to employees
   (10,651,938 ) (10,651,938 )    (14,426,720 ) (14,426,720 )
Effect of translation
   (3,535,477 ) 3,353,498 (963,981 ) (1,145,960 )    (1,278,392 ) 2,217,201 (770,590 ) 168,219




Others
   Ps. (33,560,234 ) Ps. 21,160,525 Ps. (963,981 ) Ps. (13,363,690 )    Ps. (35,307,892 ) Ps. 19,937,327 Ps. (770,590 ) Ps. (16,141,155 )
Balance at the end of the year
   306,702,447 (203,671,122 ) 5,087,543 108,118,868    343,003,240 (191,549,583 ) 3,393,640 154,847,297
Less short-term portion
   (212,141 ) (212,141 )    (268,940 ) (268,940 )




Non-current obligation
   Ps. 306,490,306 Ps. (203,671,122 ) Ps. 5,087,543 Ps. 107,906,727    Ps. 342,734,300 Ps. (191,549,583 ) Ps. 3,393,640 Ps. 154,578,357




In the case of other subsidiaries in Mexico, the net period cost (income) of other employee benefits for the years ended December 31, 2016, 2017 and 2018 was Ps. 200,455, Ps. 165,884 and Ps. ( 16,347), respectively. The balance of employee benefits at December 31, 2017 and 2018 was Ps. 1,055,625 and Ps. 924,548, respectively.
~~In the case of other subsidiaries in Brazil,~~ the net period cost of other employee benefits for the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 was Ps. ~~65,101, Ps.93,742~~(16,347) , Ps.49,050 and ~~Ps. 98,658,~~Ps.174,994, respectively. The balance of other employee benefits at December 31, 2019 and 2020 was Ps.845,830 and Ps.916,534, respectively.
In the case of Brazil, the net period cost of other benefits for the years ended December 31, 2018, 2019 and 2020 was Ps.98,658, Ps.99,498 and Ps.268,562, respectively. The balance of employee benefits at December 31, ~~2017~~2019 and ~~2018~~2020 was ~~Ps. 650,815~~Ps.2,402,285 and ~~Ps. 724,009,~~Ps.2,111,801, respectively.
In the case of Ecuador, the net period cost of other ~~employee~~ benefits for the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 was ~~Ps. 41,380, Ps.152,335~~Ps.58,354, Ps.34,425 and ~~Ps. 58,354,~~Ps.67,402, respectively. The balance of employee benefits at December 31, ~~2017~~2019 and ~~2018~~2020 was ~~Ps. 403,194~~Ps.409,750 and ~~Ps. 448,608,~~Ps.488,161, respectively.
In the case of Central America, the net period cost of other benefits for the years ended December 31, 2020 was Ps.19,462. The balance of employee benefits at December 31, 2020 was Ps.250,819.
Plan assets are invested in:
At December 31

   At December 31
   2017    2018
   Puerto Rico    Brazil    Mexico    Puerto Rico    Brazil    Mexico
Equity instruments
   37%    6%    61%    37%    —      39%
Debt instruments
   61%    88%    39%    60%    94%    61%
Others
   2%    6%    —      3%    6%    —












           100%        100%        100%            100%        100%        100%












   2019 2020
   Puerto Rico Brazil Mexico Puerto Rico Brazil Mexico
Equity instruments
   41 % — 64 % 43 % — 68 %
Debt instruments
   58 % 94 % 36 % 22 % 95 % 32 %
Others
   1 % 6 % — 35 % 5 % —


   100 % 100 % 100 % 100 % 100 % 100 %


Included in the Telmex’s net pension plan liability are plan assets of ~~Ps. 182,539,376~~Ps.164,910,346 and ~~Ps. 163,404,418~~Ps.150,090,481 as of December 31, ~~2017~~2019 and ~~2018,~~2020, respectively, of which ~~32.0%~~31.9% and ~~30.4%~~39.6% during ~~2017~~2019 and ~~2018,~~2020, respectively, were invested in equity and debt instruments of both América Movil and also of related parties, primarily entities that are under common control of the Company’s principal shareholder. The Telmex pension plan recorded are-measurement of its defined pension plan of ~~Ps. 12,394,617~~Ps.34,782,129 and ~~Ps. (1,141,142)~~Ps.11,753,416 during ~~2017~~2019 and ~~2018,~~2020, respectively, attributable to a change in actuarial assumptions, and also a decline in the fair value of plan investments from December 31, ~~2017~~2019 to December 31, ~~2018.~~2020. The decrease in fair value of the aforementioned related party pension plan investments approximated ~~Ps. 437,663~~Ps.4,156,919 and ~~Ps. 21,279,760~~Ps.14,820,220 during the ~~year~~years ended December 31, ~~2017~~2019 and ~~2018,~~2020, respectively.
The assumptions used in determining the net period cost were as follows:

2018 2019 2020
Puerto
Rico Brazil Mexico Europe Puerto
Rico Brazil Mexico Europe Puerto
Rico Brazil Mexico Europe
2016 2017 2018 1.25%, 0.75%, 6.48% & 0.25%,
Puerto
Rico Brazil Mexico Europe Puerto
Rico Brazil Mexico Europe Puerto
Rico Brazil Mexico Europe

1.75% &

1.00% &

0.50% &
Discount rate and long- term rate return
4.16 % 10.84 % 10.70 %
1.0%, 1.5% &
1.75%

3.61% 10.18 % 10.70%
1.0%,
1.5% &
2.00%

4.45% 9.10 % 11.81%
1.25%,
1.75% &
2.00%

4.45%

9.10%

11.81%

2.00%

3.23%

7.03%

10.50%

1.25%

2.34%

7.39%

10.04%

0.75%
3.0.%, 3.00%, 3.00%,
3.5% & 3.5% & 3.5% &
Rate of future salary increases
3.50 % 4.85 % 4.50 %
3.0.%,
3.9% &
4.4%

2.75% 4.50 % 4.50%
3.0.%,
3.5% &
4.4%

2.75% 4.00 % 3.55%
3.0.%,
3.5% &
4.4%

2.75% 4.00% 3.55% 4.40% 2.75% 3.80% 3.20% 4.40% 2.75% 3.25% 2.84% 4.10%
Percentage of increase in health care costs for the coming year
4.20 % 11.35 % 3.57% 11.00 % 3.87% 10.50 % 3.87% 10.50% 3.18% 10.30% 2.28% 9.96%
Year to which this level will be maintained
N/A 2017 N/A   2028 N/A   2029 N/A 2029 N/A 2029 N/A 2031
Rate of increase of pensions
3.83 % 1.60%   3.83% 1.60%     3.47% 1.60%    1.60% 1.60% 1.60%
Employee turnover rate*
0.0%-1.88%   0.0%-1.72%     0.0%-1.51% 0.0%-1.51% 0.00%-1.38% 0.00%-1.31%
*
Depending on years of service
Biometric

Puerto Rico:
Mortality:    RP 2014, MSS ~~2018~~2020 Tables.
Disability:    1985 Pension Disability Table
Brazil:
Mortality:    2000 Basic AT Table for gender
Disability for assets:    UP 84 modified table for gender
Disability retirement:    80 CSO Code Table
Rotation:    Probability of leaving the Company other than death, Disability and retirement is zero
Europe
Life expectancy in Austria is base on “AVÖ2018-P – Rechnungsgrundlagen für die Pensionsversicherung – Pagler & Pagler” ~~(2017: “AVÖ2008-P~~ ~~– Rechnungsgrundlagen für die Pensionsversicherung – Pagler & Pagler”)~~.

Telmex
Mortality:    Mexican 2000 (CNSF) adjusted
Disability:    Mexican Social Security adjusted by Telmex experience
Turnover:    Telmex experience
Retirement:    Telmex experience
For the year ended December 31, ~~2018,~~2020, the Company conducted a sensitivity analysis on the most significant variables that affect the DBO, simulating independently, reasonable changes to roughly 100 basis points in each of these variables. The increase (decrease) would have resulted in the DBO pension and other benefits at December 31, ~~2018~~2020 are as follows:

   -100 points +100 points    -100 points    +100 points
Discount rate
   Ps. 37,185,664 Ps. (38,604,684 )    Ps. 29,012,552    Ps. (25,541,956 )
Health care cost trend rate
   Ps. (651,697 ) Ps. 761,278
Health care cost trend rat
   Ps. (665,934 )    Ps. 781,238
Telmex Plans
Part of the Telmex´s employees are covered under defined benefit pension plans and seniority premiums. Pension benefits and seniority premiums are determined on the basis ~~of compensation received by the employees~~ in their final year of employment, their seniority, and their age at the time of retirement. Telmex has set up an irrevocable trust fund to finance these employee benefits and has adopted the policy of making contributions to such fund when it is considered necessary.
Europe
Defined ~~benefits plan in Austria~~benefit pension plans
A1 Telekom Austria Group provides defined benefits for certain former employees in Austria. All ~~such~~eligible employees are retired and were employed prior to January 1, 1975. This unfunded plan provides benefits based on a percentage of salary and years employed, not exceeding 80% of the salary before retirement, and taking into consideration the pension provided by the social security system. A1 Telekom Austria Group is exposed primarily to the risk of development of life expectancy and inflation because the benefits from pension plans are lifetime benefits. Furthermore, ~~approximately 7% of the pension benefit obligations~~ at December 31, ~~2018~~2020 and 2019, approximately 10% and 10%, respectively, of the obligation for pensions relate to the employees of the company Akenes in Lausanne, which was acquired in 2017.
Service awards ~~in Austria~~
Civil servants and certain employees ~~(together ‘employees’~~(in the following “employees”) are eligible to receive service awards. ~~Under these plans,~~In accordance with the legal regulations, eligible employees receive a cash bonus of two months’ salary after 25 years of service and four months’ salary after 40 years of service. Employees with at least 35 years of service when retiring (at the age of 65) or who are retiring based on specific legal regulations are also eligible to receive the service award of four monthly salaries. The ~~compensation~~obligation is accrued ~~as earned~~ over the period of service, taking into account the employee turnover ~~rate.~~rate of employees who leave service early. The main risk that A1 Telekom Austria Group is exposed to is ~~mainly~~ the risk of development of salary increases and changes of interest rates.
Severance ~~in Austria~~
Defined contribution plans
Employees ~~starting to~~who started work for A1 Telekom Austria Group in Austria on or after January 1, ~~January~~ 2003 are covered by a defined contribution plan. A1 Telekom Austria Group paid ~~Ps. 46,084~~Ps.54,945 and ~~Ps. 53,755~~Ps.66,294 (1.53% of the ~~salary)~~salary or wage) into this defined contribution plan (BAWAG Allianz Mitarbeitervorsorgekasse AG) in ~~2017~~2019 and ~~2018,~~2020, respectively.
Defined benefit plans
Severance benefit obligations for employees hired before January 1, ~~January~~ 2003, excluding civil servants, are covered by defined benefit plans. Upon termination by A1 Telekom Austria Group or retirement, eligible employees receive severance ~~payments~~
payments. Depending on their time in service, their severance is equal to a multiple of their monthly ~~compensation which comprises fixed~~basic compensation plus variable elements such as overtime or ~~bonuses. Maximum severance is equal to~~bonuses, with a ~~multiple~~maximum of twelve ~~times the eligible~~ monthly ~~compensation.~~salaries. In case of death, the heirs of eligible employees receive 50% of the severance benefits. The primary risks to A1 Telekom Austria Group ~~is exposed to the risk of development of~~are salary increases and changes of interest rates.
b) ~~The defined contribution plans (DCP)~~Defined Contribution Plans
Brazil
Claro makes contributions to the DCP through Embratel Social Security ~~Fund—~~Fund – Telos. Contributions are computed based on the salaries of the employees, who decide on the percentage of their contributions to the plan (participants enrolled before October 31st, 2014 is from 3%1% to 8% and, for those subscribed after that date, the contribution is from 1% to 7% of their salaries). Claro contributes the same percentage as the employee, capped at 8% of the participant’s balance for the employees that are eligible to participate in this plan.
The unfunded liability represents Claro’s obligation for those participants that migrated from the DBP to the DCP. This liability is being paid over a term of 20 years as of January 1, 1999. Unpaid balances are adjusted monthly based on the yield of the asset portfolio at that date and is increased based on the General Price Index of Brazil plus 6 percentage points per year.
At December 31, ~~2017~~2019 and ~~2018,~~2020, the balance of the DCP liability was ~~Ps. 136,402~~Ps.76,509 and ~~Ps. 92,238,~~Ps, 980,014 respectively.
For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 the cost ~~(income)~~ of labor were ~~Ps. (935), Ps. 374~~Ps.2,377, Ps.3,365 and ~~Ps. 2,377,~~Ps.2,930, respectively.
Europe
In Austria, pension benefits are generally provided by the social security system for employees, and by the government for civil servants. The contributions of 12.55% that A1 Telekom Austria Group made in ~~2017~~2019 and ~~2018~~2020 to the social security system and the government in Austria, amount to ~~Ps. 1,309,157~~Ps.1,334,713 and ~~Ps.1,420,446,~~Ps.1,474,721, respectively. Contributions of the foreign subsidiaries into the respective systems range between 7% and 29% and amount to ~~Ps. 453,641~~Ps.530,888 and ~~Ps. 518,607~~Ps.601,476 in ~~2017~~2019 and ~~2018,~~2020, respectively.
Additionally, A1 Telekom Austria Group ~~sponsors~~offers a defined contribution plan for employees of some of its Austrian subsidiaries. A1 Telekom Austria Group’s contributions to this plan are based on a percentage of the compensation not exceeding 5%. The annual expenses for this plan amounted to ~~Ps. 258,891, Ps. 256,507~~Ps.281,693 and ~~Ps. 272,453~~Ps.295,567 in ~~2016, 2017~~2019 and ~~2018,~~2020, respectively.
As of December 31, ~~2017~~2019 and ~~2018~~2020 the liability related to this defined contribution plan amounted to ~~Ps. 120,892~~Ps.111,724 and ~~Ps. 116,244,~~Ps.134,034, respectively.
Other countries
For the rest of the countries where the Company operates and that do not have defined benefit plans or defined contribution plans, the Company makes contributions to the respective governmental social security agencies which are recognized in results of operations as they are incurred.
~~Long- term~~c) Long-term direct employee benefits

Balance at
December 31,
2016 Applications Balance at
December 31,
2017    Balance at
December 31,
2018    Effect of
translation Increase of
the year    Applications    Balance at
December 31,
2019
Effect of
translation Increase of
the year Payments Reversals    Payments Reversals
Long-term direct employee benefits
Ps. 11,251,499 Ps. 795,581 Ps. 771,274 Ps. (2,077,632 ) Ps. (582,686 ) Ps. 10,158,036    Ps. 8,111,778    Ps. (518,180 ) Ps.2,528,224    Ps.(1,946,055 ) Ps. —      Ps.8,175,767









Balance at
December 31,
2017 Applications Balance at
December 31,
2018    Balance at
December 31,
2019    Effect of
translation Increase of
the year    Applications    Balance at
December 31,
2020
Effect of
translation Increase of
the year Payments Reversals    Payments Reversals
Long-term direct employee benefits
Ps. 10,158,036 Ps. (493,795 ) Ps. 1,750,831 Ps. (2,079,880 ) Ps. (1,223,414 ) Ps. 8,111,778    Ps. 8,175,767    Ps. 1,256,880 Ps.1,729,392    Ps.(2,411,436 ) Ps. —      Ps.8,750,603









In 2008, a comprehensive restructuring program was initiated in the segment Austria. The provision for restructuring includes future compensation of employees who will no longer provide services for A1 Telekom Austria Group but who cannot be laid off due to their status as civil servants. These employment contracts are onerous contracts under IAS 37, as the unavoidable cost related to the contractual obligation exceeds the future economic benefit. The restructuring program also includes social plans for employees whose ~~employments~~employment will be terminated in a socially responsible way. In 2009 and every year from 2011 to ~~2018,~~2019, new social plans were initiated ~~which~~that provide for early retirement, special severance packages and golden handshake options. Due to their nature as termination benefits, these social plans are accounted for according to IAS 19.
~~18.~~19. Financial Assets and Liabilities
Set out below is the categorization of the financial instruments, excluding cash and cash equivalents, held by the Company as of December 31, ~~2017~~2019 and ~~2018:~~2020:

   December 31, 2017    December 31, 2019
   Loans and
Receivables    Fair value
through
profit or loss    Fair value
through OCI    Loans and
Receivables    Fair value
through
profit or loss    Fair value
through OCI
Financial Assets:

Equity investments at fair value through OCI and other short term investments
   Ps. 12,438,019    Ps. —      Ps. 46,682,657    Ps. 10,145,615    Ps. —      Ps. 37,572,410
Accounts receivable from subscribers, distributors, contractual assets and other
   163,085,537    —      —      196,217,010    —      —
Related parties
   868,230    —      —      1,273,140    —      —
Derivative financial instruments
   —      8,037,384    —      —      6,825,760    —












Total
   Ps. 176,391,786    Ps. 8,037,384    Ps. 46,682,657    Ps. 207,635,765    Ps. 6,825,760    Ps. 37,572,410












Financial Liabilities:

Debt
   Ps. 697,884,899    Ps. —      Ps. —      Ps. 624,254,477    Ps. —      Ps. —
Liability related to right-of-use of assets
   120,596,733    —      —
Accounts payable
   212,673,407    —      —      216,112,824    —      —
Related parties
   2,540,412    —      —      3,460,419    —      —
Derivative financial instruments
   —      14,359,460    —      —      9,596,751    —












Total
   Ps. 913,098,718    Ps. 14,359,460    Ps. —      Ps. 964,424,453    Ps. 9,596,751    Ps. —












   December 31, 2018    December 31, 2020
   Loans and
Receivables    Fair value
through
profit or loss    Fair value
through OCI    Loans and
Receivables    Fair value
through
profit or loss    Fair value
through OCI
Financial Assets:

Equity investments at fair value through OCI and other short term investments
   Ps. 9,987,851    Ps. —      Ps. 39,028,083    Ps. 4,603,284    Ps. —      Ps. 50,033,111
Accounts receivable from subscribers, distributors, contractual assets and other
   185,202,494    —      —      171,213,415    —      —
Related parties
   1,263,605    —      —      1,391,300    —      —
Derivative financial instruments
   —      5,287,548    —      —      20,928,335    —












Total
   Ps. 196,453,950    Ps. 5,287,548    Ps. 39,028,083    Ps. 177,207,999    Ps. 20,928,335    Ps. 50,033,111












Financial Liabilities:

Debt
   Ps. 638,922,453    Ps. —      Ps. —      Ps. 628,382,956    Ps. —      Ps. —
Liability related to right-of-use of assets
   109,327,241    —      —
Accounts payable
   221,957,267    —      —      186,995,472    —      —
Related parties
   2,974,213    —      —      3,999,916    —      —
Derivative financial instruments
   —      17,107,579    —      —      14,230,249    —












Total
   Ps. 863,853,933    Ps. 17,107,579    Ps. —      Ps. 928,705,585    Ps. 14,230,249    Ps. —












Fair value hierarchy
The Company’s valuation techniques used to determine and disclose the fair value of its financial instruments are based on the following hierarchy:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Variables other than quoted prices in Level 1 that are observable for the asset or liability, either directly (prices) or indirectly (derived from prices); and
Level 3: Variables used for the asset or liability that are not based on any observable market data(non-observable variables).
The fair value for the financial assets (excluding cash and cash equivalents) and financial liabilities shown in the consolidated statements of financial position at December 31, ~~2017~~2019 and ~~2018~~2020 is as follows:

   Measurement of fair value at December 31, 2017
   Level 1    Level 2    Level 3    Total
Assets:

Equity investments at fair value through OCI and other short-term investments
   Ps. 46,682,657    Ps. 12,438,019    Ps. —      Ps. 59,120,676
Derivative financial instruments
   —      8,037,384    —      8,037,384
Pension plan assets
   218,518,358    9,039,270    130,976    227,688,604








Total
   Ps. 265,201,015    Ps. 29,514,673    Ps. 130,976    Ps. 294,846,664








Liabilities:

Debt
   Ps. 691,769,785    Ps. 63,147,153    Ps. —      Ps. 754,916,938
Derivative financial instruments
   —      14,359,460    —      14,359,460








Total
   Ps. 691,769,785    Ps. 77,506,613    Ps. —      Ps. 769,276,398








   Measurement of fair value at December 31, 2018    Measurement of fair value at December 31, 2019
   Level 1    Level 2    Level 3    Total    Level 1    Level 2    Level 3    Total
Assets:

Equity investments at fair value through OCI and other short-term investments
   Ps. 39,028,083    Ps. 9,987,851    Ps. —      Ps. 49,015,934    Ps. 37,572,410    Ps. 10,145,615    Ps. —      Ps. 47,718,025
Derivative financial instruments
   —      5,287,548    —      5,287,548    —      6,825,760    —      6,825,760
Pension plan assets
   186,557,731    17,096,344    17,047    203,671,122    185,981,861    20,294,557    24,403    206,300,821
















Total
   Ps. 225,585,814    Ps. 32,371,743    Ps. 17,047    Ps. 257,974,604    Ps. 223,554,271    Ps. 37,265,932    Ps. 24,403    Ps. 260,844,606
















Liabilities:

Debt
   Ps. 594,713,342    Ps. 99,723,251    Ps. —      Ps. 694,436,593    Ps. 582,003,256    Ps. 101,667,421    Ps. —      Ps. 683,670,677
Liability related to right-of-use of assets
   120,596,733    —      —      120,596,733
Derivative financial instruments
      17,107,579    —      17,107,579    —      9,596,751    —      9,596,751
















Total
   Ps. 594,713,342    Ps. 116,830,830    Ps. —      Ps. 711,544,172    Ps. 702,599,989    Ps. 111,264,172    Ps. —      Ps. 813,864,161
















   Measurement of fair value at December 31, 2020
   Level 1    Level 2    Level 3    Total
Assets:

Equity investments at fair value through OCI and other short-term investments
   Ps. 50,033,111    Ps. 4,603,284    Ps. —      Ps. 54,636,395
Derivative financial instruments
   —      20,928,335    —      20,928,335
Revalued of assets
   —      —      107,152,628    107,152,628
Pension plan assets
   168,939,091    22,589,392    21,100    191,549,583








Total
   Ps. 218,972,202    Ps. 48,121,011    Ps. 107,173,728    Ps. 374,266,941








Liabilities:

Debt
   Ps. 578,712,562    Ps. 135,645,912    Ps. —      Ps. 714,358,474
Liability related to right-of-use of assets
   109,327,241    —      —      109,327,241
Derivative financial instruments
   —      14,230,249    —      14,230,249








Total
   Ps. 688,039,803    Ps. 149,876,161    Ps. —      Ps. 837,915,964








Fair value of derivative financial instruments is valued using valuation techniques with market observable inputs. To determine its Level 2 fair value, the Company applies different valuation techniques including forward pricing and swaps models, using present value calculations. The models incorporate various inputs including credit quality of counterparties, foreign exchange spot and forward rates and interest rate curves. Fair value of debt Level 2 has been determined using a model based on present value calculation incorporating credit quality of AMX. The Company’s investment in equity investments at fair value, specifically the investment in KPN, is valued using the quoted prices (unadjusted) in active markets for identical assets. The net realized (loss) gain related to derivative financial instruments for the years ended December 31, ~~2017~~2019 and ~~2018~~2020 was Ps. ~~1,515,668~~(1,774,932) and ~~Ps. 5,286,290,~~Ps.2,606,938 respectively.
~~For~~The fair value of the ~~years~~asset revaluation was calculated using valuation techniques, using observable market data and internal information on transactions carried out with independent third parties. To determine fair value we use level 2 and 3 information, the Company used inputs such as average rents, contract term and discount rates for discounted flow modeling techniques; in the case of discount rates, we use level 2 data where the information is public and is found in recognized databases, such as country risks, inflation, etc. In the case of average rents and contract terms, we use level 3 data, where the information is mainly internal based on lease contracts entered into with independent third parties.
During the end of the period ended December 31, ~~2016, 2017~~2019 and ~~2018,~~2020, there were no transfers ~~were made~~ between the Level 1 and Level 2 fair value measurement hierarchies.
Changes in liabilities arising from financing activities

At January 1,
2017 Cash flow Foreign currency
exchange and
other At December 31,
2017 At December 31,
2018 At January 1,
2019 Cash flow Foreign currency
exchange and
other At December 31,
2019
Debt
638,922,453 —   8,273,440 (22,941,416 ) 624,254,477
Liability related to right-of-use of assets
—   119,387,660 (26,765,075 ) 27,974,148 120,596,733

Total liabilities from financing activities
Ps. 707,801,403 Ps. (27,433,489 ) Ps. 17,516,985 Ps. 697,884,899 Ps. 638,922,453 Ps. 119,387,660 Ps. (18,491,635 ) Ps. 5,032,732 Ps. 744,851,210

At January 1,
2018 Cash flow Foreign currency
exchange and
other At December 31,
2018
Total liabilities from financing activities
Ps. 697,884,899 Ps. (34,050,923 ) Ps. (24,911,523 ) Ps. 638,922,453

~~19.~~

   At December 31,
2019    Cash flow Foreign currency
exchange and
other    At December 31,
2020
Debt
   624,254,477    (53,091,801 ) 57,220,280    628,382,956
Liability related to right-of-use of assets
   120,596,733    (29,623,565 ) 18,354,073    109,327,241






Total liabilities from
financing activities
   Ps.744,851,210    Ps.(82,715,366 ) Ps.75,574,353    Ps.737,710,197






20. Shareholders’ Equity
a) Pursuant to the Company’s bylaws, the capital stock of the Company consists of a minimum fixed portion of ~~Ps. $270,049~~Ps.270,049, (nominal amount), represented by a total of 71,063,212,170 shares (including treasury shares available for placement in accordance with the provisions of the Ley del Mercado de ~~Valores)~~Valores), of which (i) ~~20,601,632,660~~20,578,173,274 are “AA” shares (full voting rights); (ii) ~~558,677,704~~519,948,436 are “A” shares (full voting rights); and (iii) ~~49,902,901,806~~49,965,090,460 are “L” shares (limited voting rights).
b) As of December 31, ~~2018~~2020 and ~~2017,~~2019, the Company’s capital ~~structure~~stock was represented by ~~66,034,792,526~~66,862,560,649 shares (20,578,173,274 “AA” shares, 519,926,536 “A” shares and 45,764,460,839 “L” shares), and 66,004,214,830 (20,601,632,660 “AA” shares, ~~546,112,938~~530,563,378 “A” shares and ~~44,887,046,928~~44,872,018,792 “L” shares), ~~and 66,069,035,539 (20,601,632,660 “AA” shares, 566,661,526 “A” shares and 44,900,741,353 “L” shares), respectively, not including treasury shares.~~
respectively.
c) As of December 31, ~~2018~~2020 and ~~2017,~~2019, the Company’s treasury held for placement in accordance with the provisions of the Ley del Mercado de Valores and the Disposiciones de carácter general aplicables a las emisoras de valores y a otros participantes en el Mercado de valores issued by the Comisión Nacional Bancaria y de Valores, a total amount of ~~5,028,419,644~~4,200,651,521 shares ~~(5,028,399,396~~(4,200,629,621 “L” shares and ~~20,248~~21,900 “A” shares); and ~~29,420,688,657~~5,058,997,340 shares ~~(29,419,120,359~~(5,058,975,440 “L” shares and ~~1,568,298~~21,900 “A” shares), respectively, all acquired pursuant to the Company’s share repurchase program.
d) The holders of “AA” and “A” shares are entitled to full voting rights. The holders of “L” shares may only vote in limited circumstances, and they are only entitled to appoint two members of the Board of Directors and their respective alternates. The matters in which “L” shares holders are entitled to vote are the following: extension of the Company´s corporate life, dissolution of the Company, change of Company’s corporate purpose, change of nationality of the Company, transformation of the Company, a merger with another company, any transaction representing 20% or more of the Company’s consolidated assets, as well as the cancellation of the inscription of the shares issued by the Company at the Registro Nacional de Valores and any other foreign stock exchanges where they may be registered, except for quotation systems or other markets not organized as stock exchanges. Within their respective series, all shares confer the same rights to their holders.
The Company’s bylaws contain restrictions and limitations related to the subscription and acquisition of “AA” shares bynon-Mexican investors.
e) Pursuant to the Company’s bylaws, “AA” shares must at all times represent no less than 20% and no more than 51% of the Company’s capital stock, and they shall also represent at all times, no less than 51% of the common shares (entitled to full voting rights, represented by “AA” and “A” shares) representing said capital stock.
“A” shares, which may be freely subscribed, must not represent more than 19.6% of capital stock and must not exceed 49% of the common shares representing such capital. Common shares (entitled to full voting rights, represented by “AA” and “A” shares), must represent no more than 51% of the Company’s capital stock.
Lastly, “L” shares which have limited voting rights and may be freely subscribed may not exceed, along with “A” shares, 80% of the Company’s capital stock. For purposes of determining these restrictions, the percentages mentioned above refer only to the number of the Company’s shares outstanding.
Dividends
On April ~~16, 2018,~~24, 2020, the Company’s shareholders approved, among other resolutions, the payment of a dividend of Ps. ~~$0.32(thirty-two~~$0.38 (thirty-eight peso cents) per share to each of the shares series of its capital stock “AA”, “A” and “L”. ~~Such~~It was approved, that such dividend ~~was~~would be paid in two installments of Ps. ~~$0.16 (sixteen~~$0.19 (nineteen peso cents) each, on July 1620 and November ~~12, 2018~~09, 2020 respectively.
On April ~~5, 2017,~~9, 2019, the Company’s shareholders approved, among other resolutions, the payment of a dividend of Ps. ~~$0.30 (thirty~~$0.35 (thirty-five peso cents) per share to each of the shares series of its capital stock “AA”, “A” and “L”,. It was approved, that such dividend ~~was payable, at each share holders’ election, in cash, “L” series shares or a combination thereof,~~would be paid in two installments of Ps. ~~$0.15 (fifteen~~$0.18 (eighteen peso cents) ~~each,~~and Ps.$0.17 (seventeen peso cents), on July 1715 and November ~~13, 2017~~11, 2019 respectively. ~~As a result of the shareholders elections, on July 17, 2017 and November 13, 2017, AMX placed into circulation 325,264,125 and 16,905,414 series “L” shares, respectively.~~
Legal Reserve
According to the Ley General de Sociedades Mercantiles, companies must allocate from the net profit of each year, at least 5% to increase the legal reserve until it reaches 20% of its capital stock. This reserve may not be distributed to shareholders during the existence of the Company, except as a stock dividend. As of December 31, ~~2018~~2020 and ~~2017,~~2019, the legal reserve amounted ~~Ps. 358,440.~~Ps.358,440.
Restrictions on Certain Transactions
Pursuant to the Company’s bylaws any transfer of more than 10% of the full voting shares (“A” shares and “AA” shares), effected in one or more transactions by any person or group of persons acting in concert, requires prior approval by our Board of Directors. If the Board of Directors denies such approval, however, the Company bylaws require it to designate an alternate transferee, who must pay market price for the shares as quoted on the Bolsa Mexicana de Valores, S.A.B. de C.V.
Payment of Dividends
Dividends, either in cash or in kind, paid with respect to the “A” Shares, “L” Shares, “A” Share ADSs or “L” Share ADSs will generally be subject to a 10% Mexican withholding tax (provided that no Mexican withholding tax will apply to distributions of net taxable profits generated before 2015). Nonresident holders could be subject to a lower tax rate, to the extent that they are eligible for benefits under an income tax treaty to which Mexico is a party.
Earnings per Share
The following table shows the computation of the basic and diluted earnings per share:

   For the years ended December 31,
   2016    2017    2018
Net profit for the period attributable
to equity holders of the parent
   Ps. 8,649,427    Ps. 29,325,921    Ps. 52,566,197
Weighted average shares (in millions)
   65,693    65,909    66,055






Earnings per share attributable to
equity holders of the parent
   0.13    0.44    0.79






For the years ended December 31,
2018 2019 2020
Net profit for the period attributable to equity holders of the parent
Ps. 52,566,197 Ps. 67,730,891 Ps. 46,852,605
Weighted average shares (in millions)
66,055 66,016 66,265

Earnings per share attributable to equity holders of the parent
Ps. 0.79 Ps. 1.03 Ps. 0.71

~~Subordinated Perpetual Fixed Rate Bond~~
On January 3, 2018, the Company decided to call and redeem the Telekom Austria subordinated perpetual Fixed Rate Bond (hybrid bond) amounting to 600 million of Euros, according to the terms and conditions of the bond, at its nominal value plus all interest on February 1, 2018, the first call date. The Company paid an amount of Ps 13,440,120.
~~20.~~21. Components of other comprehensive ~~(loss) income~~loss
The movement on the components of the other comprehensive (loss) income for the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018~~2020 is as follows:

For the years ended December 31,
2016 2017 2018
Controlling interest:

Valuation of the derivative financial instruments, net of deferred taxes
Ps. 48,496 Ps. 12,292 Ps. —
Unrealized (loss) gain on equity investments at fair value, net of deferred taxes
(6,673,731 ) 622,424 (3,765,688 )
Translation effect of foreign entities
104,178,880 (21,683,333 ) (61,223,458 )
Remeasurement of defined benefit plan, net of deferred taxes
14,771,770 (7,075,606 ) 652,722
Non-controlling interest of the items above
3,322,090 3,402,973 (2,986,018 )

Other comprehensive (loss) income
Ps. 115,647,505 Ps. (24,721,250 ) Ps. (67,322,442 )

   For the years ended December 31,
   2018 2019 2020
Controlling interest:

Unrealized (loss) gain on equity investments at fair value, net of deferred taxes
   (3,765,688 ) 883,408 (1,952,414 )
Translation effect of foreign entities
   (61,223,458 ) (34,010,066 ) (13,558,774 )
Remeasurement of defined benefit plan, net of deferred taxes
   652,722 (29,153,554 ) (10,026,454 )
Assets revaluation surplus net of deferred taxes
   —   —   64,835,155
Non-controlling interest of the items above
   (2,986,018 ) (1,908,304 ) 14,165,249


Other comprehensive (loss) income
   Ps.(67,322,442 ) Ps.(64,188,516 ) Ps.53,462,762


~~21.~~22. Valuation of derivatives, interest cost from labor obligations and other financial items, net
For the years ended December 31, ~~2016, 2017~~2018, 2019 and ~~2018,~~2020, valuation of derivatives and other financial items are as follows:

   For the years ended December 31,    For the years ended December 31,
   2016 2017 2018    2018 2019 2020
Controlling interest:

(Loss) gain in valuation of derivatives, net
   Ps. (9,622,233 ) Ps. 8,192,567 Ps. (4,686,407 )    Ps. (4,686,407 ) Ps. 4,432,023 Ps. 12,378,193
Capitalized interest expense (Note 10 d)
   2,861,307 2,875,034 2,020,288
Capitalized interest expense (Note 10 b)
   2,020,288 2,233,358 1,771,613
Commissions
   (2,034,972 ) (1,263,701 ) (1,901,473 )    (1,901,473 ) (2,820,477 ) (1,135,082 )
Interest cost of labor obligations (Note 17)
   (9,178,513 ) (8,722,611 ) (9,968,526 )
Interest cost of labor obligations (Note 18)
   (9,968,526 ) (11,377,054 ) (13,105,693 )
Interest expense on taxes
   (245,922 ) (1,503,981 ) (555,921 )    (555,921 ) (516,522 ) (59,032 )
Dividend received (Note 4)
   5,740,092 2,385,559 2,605,333    2,605,333 1,773,336 2,122,826
Gain on net monetary positions (Note 2i, c)
   —   —   4,429,145
Gain on net monetary positions
   4,429,145 4,267,194 3,262,512
Other financial cost
   (3,745,600 ) (3,906,627 ) (2,118,755 )    (2,118,755 ) (5,067,200 ) (3,944,229 )




Total
   Ps. (16,225,841 ) Ps. (1,943,760 ) Ps.   (10,176,316 )    Ps. (10,176,316 ) Ps. (7,075,342 ) Ps. 1,291,108




~~22.~~23. Segments
América Móvil operates in different countries. As mentioned in Note 1, the Company has operations in Mexico, Guatemala, Nicaragua, Ecuador, El Salvador, Costa Rica, Brazil, Argentina, Colombia, United States, Honduras, Chile, Peru, Paraguay, Uruguay, Dominican Republic, Puerto Rico, Panama, Austria, Croatia, Bulgaria, Belarus, Macedonian, Serbia and Slovenia. The accounting policies for the segments are the same as those described in Note 2.
The Chief Executive Officer, who is the Chief Operating Decision Maker (“CODM”), analyzes the financial and operating information by operating segment. All operating segments that (i) represent more than 10% of consolidated revenues, (ii) more than the absolute amount of its reported 10% of profits before income tax or (iii) more than 10% of consolidated assets, are presented separately.
The Company presents the following reportable segments for the purposes of its consolidated financial statements: Mexico (includes Telcel and Corporate operations and assets), Telmex (Mexico), Brazil, Southern Cone (includes Argentina, Chile, Paraguay and Uruguay), Central America (includes Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica and Panama), U.S.A. (excludes Puerto Rico), Caribbean (includes Dominican Republic and Puerto Rico), and Europe (includes Austria, Bulgaria, Croatia, Belarus, Slovenia, Macedonia and Serbia).
The segment Southern Cone comprises mobile communication services in Argentina as well as Chile, Paraguay and Uruguay. InBeginning in 2018, hyperinflation accounting in accordance with IAS 29 was initially applied to Argentina, which results in the restatement ofnon-monetary assets, liabilities and all items of the ~~statements~~statement of comprehensive income for the change in a general price index and the translation of these items applying the~~year-end~~period-end exchange rate. ~~In accordance with IFRS comparative amounts for 2016 and 2017 were not restated.~~
The Company considers that the quantitative and qualitative aspects of any aggregated operating segments (that is, Central America and Caribbean reportable segments) are similar in nature for all periods presented. In evaluating the appropriateness of aggregating operating segments, the key indicators considered included but were not limited to: (i) the similarity of key financial statements measures and trends, (ii) all entities provide telecommunications services, (iii) similarities of customer base and services, (iv) the methods to distribute services are the same, based on telephone plant in both cases, wireless and fixed lines, (v) similarities of governments and regulatory entities that oversee the activities and services of telecom companies, (vi) inflation trends, and (vii) currency trends.
Mexico Telmex Brazil Southern Cone Colombia Andean Central
America U.S.A. Caribbean Europe Eliminations Consolidated
total Mexico Telmex Brazil Southern Cone Colombia Andean Central
America U.S.A. Caribbean Europe Eliminations Consolidated
total
At December 31 2016 (in Ps.):

External revenues
187,127,903 93,343,612 193,796,237 71,553,356 67,330,768 55,825,972 42,131,666 140,856,365 36,467,781 86,978,828 —   975,412,488
Intersegment revenues
16,438,858 8,872,248 3,560,388 776,719 257,767 304,834 289,465 —   30,210 —   (30,530,489 ) —

Total revenues
203,566,761 102,215,860 197,356,625 72,330,075 67,588,535 56,130,806 42,421,131 140,856,365 36,497,991 86,978,828 (30,530,489 ) 975,412,488
Depreciation and amortization
16,451,496 17,150,013 47,170,935 9,739,634 11,283,749 7,764,474 10,474,681 1,073,623 5,225,498 22,525,050 (333,232 ) 148,525,921
Operating income
48,219,505 12,275,892 6,325,323 8,317,053 11,209,959 6,086,638 3,830,974 1,220,601 6,143,183 5,388,595 592,587 109,610,310
Interest income
28,659,372 303,915 3,747,684 2,649,539 104,304 944,945 462,779 239,797 691,132 286,784 (33,897,656 ) 4,192,595
Interest expense
32,004,944 1,135,552 22,970,335 5,049,457 1,079,989 1,147,380 411,597 —   143,322 2,953,033 (33,033,597 ) 33,862,012
Income tax
2,502,242 921,803 (4,294,040 ) 2,021,090 4,456,750 1,768,066 3,291,776 767,295 2,542,080 (2,578,206 ) —   11,398,856
Equity interest in net income
(loss) of associated companies
67,472 116,368 (270 ) (23,319 ) —   —   171 —   —   29,528 —   189,950
Net profit (loss) attributable
to equity holders of the parent
378,150 902,282 (10,357,493 ) 3,765,015 4,022,633 3,621,863 538,890 987,790 3,318,960 7,065,769 (5,594,432 ) 8,649,427
Assets by segment
1,070,598,204 161,133,722 461,831,754 140,617,162 103,361,235 113,839,981 80,832,029 42,812,349 93,941,695 227,288,156 (981,214,013 ) 1,515,042,274
Plant, property and equipment, net
64,893,242 112,220,236 203,270,555 67,023,143 59,690,886 37,716,772 41,808,573 1,949,166 33,854,428 78,763,065 —   701,190,066
Goodwill
27,186,328 213,926 26,106,622 3,006,448 14,659,891 5,948,335 5,652,268 3,464,217 14,186,723 52,207,877 —   152,632,635
Trademarks, net
615,318 307,881 366,727 —   194 —   —   788,228 284,665 10,203,880 —   12,566,893
Licenses and rights, net
5,887,092 42,867 41,496,209 8,760,860 4,603,793 12,882,210 3,993,120 —   7,694,798 30,670,315 —   116,031,264
Investment in associated companies
7,605,220 2,218,824 699 81,284 470 —   17,390 —   —   1,072,778 (7,393,181 ) 3,603,484
Liabilities by segments
798,044,609 117,663,161 349,915,118 124,149,687 40,811,337 52,949,608 38,095,161 41,369,767 44,790,656 121,928,202 (485,698,799 ) 1,244,018,507
At December 31, 2017 (in Ps.):

As of and for the year ended December 31, 2018 (in Ps.):

External revenues
190,022,612 89,731,238 210,536,673 81,092,885 72,435,460 56,393,595 44,094,835 148,589,487 35,092,578 93,644,172 —   1,021,633,535 207,610,244 86,339,289 188,712,666 89,149,978 75,460,428 55,633,192 44,883,585 153,266,315 36,435,541 100,716,443 —   1,038,207,681
Intersegment revenues
16,748,428 8,753,525 4,785,601 1,250,983 304,555 177,856 187,086 44 122,656 —   (32,330,734 ) —   16,946,543 9,741,908 4,593,760 13,200,358 344,517 154,082 149,445 —   204,294 —   (45,334,907 ) —

Total revenues
206,771,040 98,484,763 215,322,274 82,343,868 72,740,015 56,571,451 44,281,921 148,589,531 35,215,234 93,644,172 (32,330,734 ) 1,021,633,535 224,556,787 96,081,197 193,306,426 102,350,336 75,804,945 55,787,274 45,033,030 153,266,315 36,639,835 100,716,443 (45,334,907 ) 1,038,207,681
Depreciation and amortization
17,030,251 18,902,238 51,486,652 10,639,591 12,373,790 8,328,705 9,668,439 1,594,727 5,349,757 25,222,962 (422,170 ) 160,174,942 17,619,342 18,358,248 42,857,751 13,526,361 13,464,867 8,516,960 8,940,655 1,545,395 5,036,831 26,838,972 (992,802 ) 155,712,580
Operating income (loss)
50,666,028 7,921,524 11,601,369 11,676,427 (4,704,165 ) 5,650,477 5,252,401 2,915,123 4,752,168 4,523,857 (111,906 ) 100,143,303 57,450,599 8,085,764 23,494,903 16,975,797 14,388,552 5,003,915 4,867,763 2,665,270 5,811,846 4,731,562 (3,918,800 ) 139,557,171
Interest income
30,083,437 619,748 3,792,242 2,884,613 211,521 1,793,974 1,064,992 394,196 1,111,980 307,021 (39,338,076 ) 2,925,648 26,578,280 420,380 11,303,888 2,251,474 1,013,839 1,666,879 1,566,086 559,548 1,458,874 122,133 (36,295,212 ) 10,646,169
Interest expense
32,185,868 1,028,593 23,578,083 4,637,989 1,955,688 1,573,929 485,684 —   377,727 2,035,716 (37,558,496 ) 30,300,781 32,526,258 1,153,913 20,377,191 4,338,941 2,913,881 1,719,663 509,081 —   561,867 1,973,431 (34,302,793 ) 31,771,433
Income tax
18,142,482 387,145 (2,991,377 ) 3,535,302 (1,874,594 ) 1,806,085 2,025,618 1,803,555 3,529,253 (1,417,358 ) (4,600 ) 24,941,511 28,842,505 643,377 4,026,444 1,390,039 2,251,877 2,498,666 2,533,600 810,898 2,774,204 707,093 (1,624 ) 46,477,079
Equity interest in net income (loss) of associated companies
99,044 16,564 (232 ) (9,801 ) —   —   —   —   —   (14,190 ) —   91,385 (5,962 ) 44,965 (152 ) (20,871 ) —   —   —   —   —   (17,713 ) —   267
Net profit (loss) attributable
to equity holders of the parent
26,321,442 184,387 (6,617,381 ) 4,421,938 (6,209,530 ) 1,595,382 3,713,301 1,793,875 1,262,073 5,656,132 (2,795,698 ) 29,325,921 23,185,029 (2,201,572 ) 3,530,653 6,065,703 9,165,801 1,730,933 2,821,733 2,820,505 3,644,697 3,809,694 (2,006,979 ) 52,566,197
Assets by segment
1,033,036,406 170,402,561 428,281,963 133,136,177 108,362,023 113,478,626 81,529,691 40,761,830 88,672,466 203,858,243 (915,308,134 ) 1,486,211,852 970,564,314 174,461,398 390,791,480 127,946,573 111,975,598 96,347,779 81,640,157 38,814,907 102,531,547 186,135,358 (851,985,719 ) 1,429,223,392
Plant, property and equipment,
net
59,137,555 109,713,770 187,459,628 69,006,093 57,060,931 35,930,966 39,050,481 1,693,642 32,173,524 85,116,608 —   676,343,198 56,056,634 103,737,293 173,197,708 62,988,635 51,422,548 35,800,477 37,146,601 1,356,237 38,011,242 80,421,642 (138,297 ) 640,000,720
Goodwill
27,102,384 213,926 24,708,739 3,073,444 13,981,033 6,113,495 5,597,990 3,341,956 14,186,723 53,143,542 —   151,463,232 27,104,632 215,381 21,388,124 2,796,759 12,770,380 5,242,365 5,466,871 3,328,533 14,186,723 53,066,729 —   145,566,497
Trademarks, net
406,723 274,786 246,557 —   —   —   —   631,024 262,641 8,116,076 —   9,937,807 227,774 243,556 124,910 —   —   —   —   507,033 249,984 3,313,948 —   4,667,205
Licenses and rights, net
11,457,720 13,175 35,662,305 8,885,086 4,197,498 11,295,202 3,376,106 —   7,276,039 31,141,255 —   113,304,386 10,573,147 —   25,873,910 12,555,496 3,400,235 9,651,582 3,605,416 —   10,294,336 27,344,273 —   103,298,395
Investment in associated
companies
469,662 546,872 640 63,110 451 —   16,999 —   —   806,950 1,830,488 3,735,172 5,621,661 563,667 543 20,697 412 —   24,262 —   —   748,674 (3,847,209 ) 3,132,707
Liabilities by segments
794,598,013 133,428,178 322,620,030 119,123,646 54,756,152 48,656,628 35,501,900 38,249,957 43,978,410 119,240,533 (484,575,112 ) 1,225,578,335 748,965,728 136,993,838 298,308,084 94,550,901 56,211,438 50,064,761 28,592,953 35,552,678 58,716,154 117,214,746 (441,820,311 ) 1,183,350,970
At December 31, 2018 (in Ps.):

Mexico Telmex Brazil Southern Cone Colombia Andean
Central
America
U.S.A. Caribbean Europe Eliminations
Consolidated
total

As of and for the year ended December 31, 2019 (in Ps.):

External revenues
207,610,244 86,339,289 188,712,666 89,149,978 75,460,428 55,633,192 44,883,585 153,266,315 36,435,541 100,716,443 —   1,038,207,681 226,164,232 84,173,980 177,596,077 54,230,682 74,274,684 55,440,675 46,602,036 155,864,392 34,580,822 98,420,289 —   1,007,347,869
Intersegment revenues
16,946,543 9,741,908 4,593,760 13,200,358 344,517 154,082 149,445 —   204,294 —   (45,334,907 ) —   11,676,015 11,863,364 4,182,248 11,041,705 361,386 92,249 132,061 —   1,136,879 —   (40,485,907 ) —

Total revenues
224,556,787 96,081,197 193,306,426 102,350,336 75,804,945 55,787,274 45,033,030 153,266,315 36,639,835 100,716,443 (45,334,907 ) 1,038,207,681 237,840,247 96,037,344 181,778,325 65,272,387 74,636,070 55,532,924 46,734,097 155,864,392 35,717,701 98,420,289 (40,485,907 ) 1,007,347,869
Depreciation and amortization
17,619,342 18,358,248 42,857,751 13,526,361 13,464,867 8,516,960 8,940,655 1,545,395 5,036,831 26,838,972 (992,802 ) 155,712,580 24,742,622 16,346,927 39,424,474 13,847,506 13,439,489 10,256,129 11,045,817 1,396,422 6,322,648 24,975,146 (2,881,970 ) 158,915,210
Operating income (loss)
57,450,599 8,085,764 23,494,903 16,975,797 14,388,552 5,003,915 4,867,763 2,665,270 5,811,846 4,731,562 (3,918,800 ) 139,557,171 67,694,409 9,731,852 28,846,565 4,007,614 15,324,977 8,023,002 5,712,068 2,968,236 5,741,368 8,687,862 (1,897,418 ) 154,840,535
Interest income
26,578,280 420,380 11,303,888 2,251,474 1,013,839 1,666,879 1,566,086 559,548 1,458,874 122,133 (36,295,212 ) 10,646,169 23,713,455 1,839,973 3,155,681 896,256 1,306,571 1,283,788 532,046 324,932 1,478,560 115,359 (28,361,949 ) 6,284,672
Interest expense
32,526,258 1,153,913 20,377,191 4,338,941 2,913,881 1,719,663 509,081 — 561,867 1,973,431 (34,302,793 ) 31,771,433 30,972,658 1,439,785 19,021,965 3,849,318 2,952,123 2,422,887 1,406,720 385 1,435,862 2,220,168 (27,810,532 ) 37,911,339
Income tax
28,842,505 643,377 4,026,444 1,390,039 2,251,877 2,498,666 2,533,600 810,898 2,774,204 707,093 (1,624 ) 46,477,079 30,000,511 1,528,229 4,251,116 2,022,336 5,405,452 1,681,159 2,355,380 1,119,478 719,774 1,946,255 3,843 51,033,533
Equity interest in net income (loss) of associated companies
(5,962 ) 44,965 (152 ) (20,871 ) —   —   —   —   —   (17,713 ) —   267 (3,732 ) 46,789 (1,538 ) (23,424 ) —   —   (28,795 ) —   —   (6,909 ) —   (17,609 )
Net profit (loss) attributable to equity holders of the parent
23,185,029 (2,201,572 ) 3,530,653 6,065,703 9,165,801 1,730,933 2,821,733 2,820,505 3,644,697 3,809,694 (2,006,979 ) 52,566,197 42,598,946 (1,705,068 ) 5,618,095 (6,984 ) 9,571,046 (2,604,646 ) 2,335,963 2,095,807 4,312,630 5,051,145 463,957 67,730,891
Assets by segment
970,564,314 174,461,398 390,791,480 127,946,573 111,975,598 96,347,779 81,640,157 38,814,907 102,531,547 186,135,358 (851,985,719 ) 1,429,223,392 915,233,048 201,283,526 382,561,753 132,722,497 115,851,227 94,021,632 77,355,732 30,775,893 100,694,650 191,744,924 (710,311,225 ) 1,531,933,657
Plant, property and equipment, net
56,056,634 103,737,293 173,197,708 62,988,635 51,422,548 35,800,477 37,146,601 1,356,237 38,011,242 80,421,642 (138,297 ) 640,000,720 54,589,459 106,869,482 174,761,167 60,537,650 50,133,642 39,068,450 38,934,747 1,405,755 38,223,641 75,707,738 (888,361 ) 639,343,370
Goodwill
27,104,632 215,381 21,388,124 2,796,759 12,770,380 5,242,365 5,466,871 3,328,533 14,186,723 53,066,729 —   145,566,497 27,396,393 215,381 25,379,805 5,241,305 12,124,685 4,895,331 7,289,748 3,220,105 14,186,723 52,950,325 —   152,899,801
Trademarks, net
227,774 243,556 124,910 —   —   —   —   507,033 249,984 3,313,948 —   4,667,205 46,476 212,324 37,207 —   —   —   —   369,950 227,156 2,595,596 —   3,488,709
Licenses and rights, net
10,573,147 —   25,873,910 12,555,496 3,400,235 9,651,582 3,605,416 —   10,294,336 27,344,273 —   103,298,395 11,087,882 452,504 29,324,718 12,103,980 5,530,422 8,064,487 4,390,547 —   7,942,670 25,951,335 —   104,848,545
Investment in associated companies
5,621,661 563,667 543 20,697 412 —   24,262 —   —   748,674 (3,847,209 ) 3,132,707 3,562,323 610,807 111,073 (7,806 ) 391 —   25,603 —   —   —   (1,828,198 ) 2,474,193
Liabilities by segments
748,965,728 136,993,838 298,308,084 94,550,901 56,211,438 50,064,761 28,592,953 35,552,678 58,716,154 117,214,746 (441,820,311 ) 1,183,350,970 718,354,229 175,774,964 297,877,328 103,330,525 55,576,253 55,463,339 37,993,180 31,557,816 54,276,868 124,319,541 (349,497,251 ) 1,305,026,792
Mexico Telmex Brazil Southern Cone Colombia Andean
Central
America
U.S.A. Caribbean Europe Eliminations
Consolidated
total

As of and for the year ended December 31, 2020 (in Ps.):

External revenues
214,578,601 77,920,910 163,865,421 55,484,744 77,282,658 53,846,358 48,073,436 177,179,369 37,182,842 111,472,191 —   1,016,886,530
Intersegment revenues
17,663,525 13,668,264 4,207,466 1,220,100 352,694 88,305 121,580 —   1,440,983 —   (38,762,917 ) —

Total revenues
232,242,126 91,589,174 168,072,887 56,704,844 77,635,352 53,934,663 48,195,016 177,179,369 38,623,825 111,472,191 (38,762,917 ) 1,016,886,530
Depreciation and amortization
24,748,756 13,341,479 41,795,397 13,095,004 14,413,760 11,447,356 14,355,899 1,561,284 7,094,331 25,593,204 (3,202,787 ) 164,243,683
Operating income (loss)
70,851,525 11,204,433 25,203,504 1,877,079 15,111,947 8,698,645 4,004,501 10,579,394 6,701,086 13,159,865 (2,037,068 ) 165,354,911
Interest income
21,322,406 1,479,021 2,904,430 980,581 822,447 1,049,261 1,130,767 77,235 1,105,420 90,746 (25,900,278 ) 5,062,036
Interest expense
30,936,195 1,306,867 17,976,227 3,334,966 2,586,708 2,223,478 1,559,917 255 1,658,619 2,546,255 (25,467,747 ) 38,661,740
Income tax
4,905,863 577,178 (4,442,598 ) 992,831 2,078,789 3,115,693 1,518,953 2,856,881 2,524,214 2,234,065 4,283 16,366,152
Equity interest in net income (loss) of associated companies
(3,820 ) 23,955 (2,972 ) (15,422 ) —   —   —   —   —   (288,747 ) —   (287,006 )
Net profit (loss) attributable to equity holders of the parent
3,613,907 (1,085,038 ) 4,963,424 1,456,062 16,579,303 4,649,047 1,919,558 7,797,723 3,294,111 7,777,426 (4,112,918 ) 46,852,605
Assets by segment
947,396,510 203,081,314 386,982,711 118,266,380 132,210,369 101,717,708 88,690,683 35,083,285 109,914,293 239,583,759 (737,878,785 ) 1,625,048,227
Plant, property and equipment, net
52,117,395 110,751,083 145,307,497 62,157,797 48,876,853 36,102,261 37,855,227 1,761,595 39,128,447 82,595,077 (876,229 ) 615,777,003
Revalued of assets
—   —   36,076,207 7,494,408 12,893,284 9,500,708 7,059,247 —   2,572,504 31,556,270 —   107,152,628
Goodwill
26,949,185 215,381 16,048,092 5,436,675 12,253,743 4,866,363 6,345,659 3,362,899 14,186,723 53,388,139 —   143,052,859
Trademarks, net
126,823 181,094 —   —   —   —   —   269,325 219,087 2,981,089 —   3,777,418
Licenses and rights, net
12,017,318 100,623 26,171,345 12,099,873 12,363,039 6,870,531 5,427,857 —   8,616,880 27,963,250 —   111,630,716
Investment in associated companies
51,645 613,449 �� 64,125 (20,970 ) 395 —   25,413 —   —   —   1,095,703 1,829,760
Liabilities by segments
725,408,198 193,840,756 263,989,566 61,786,265 63,610,642 53,379,366 34,252,511 33,141,315 60,839,340 138,747,621 (319,064,971 ) 1,309,930,609
~~23.~~24. Recently Issued Accounting Standards
New and amended standards ~~amendments~~ and interpretations ~~not yet effective~~
~~The estimated impact and evaluation of the recently issued accounting standards not yet in effect as of December 31, 2018 are as follow:~~
~~IFRS 16, Leases~~
In January 2016, the IASB issued the new accounting standard, IFRS 16 Leases. The fundamental changes in this new standard affect the lessees’ recognition of leases in the financial statements. Generally, all leases have to be recognized based on the “right of use approach”.
~~IFRS 16 replaces IAS 17 Leases, IFRIC 4 Determining whether an Arrangement contains a Lease,SIC-15~~ ~~Operating Leases- Incentives andSIC-27~~ Evaluating the Substance of Transactions Involving the Legal Form of a Lease. IFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single~~on-balance~~ ~~sheet model similar to the accounting for finance leases under IAS 17. The standard includes two recognition exemptions for lessees – leases of’low-value’~~ assets (e.g., personal computers) and short-term leases (i.e., leases with a lease term of 12 months or less). At the commencement date of a lease, a lessee will recognize a liability to make lease payments (i.e., the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e., the~~right-of-use~~ ~~asset). Lessees will be required to separately recognize the interest expense on the lease liability and the depreciation expense on theright-of-use~~ ~~asset.~~
Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognize the amount of the remeasurement of the lease liability as an adjustment to the~~right-of-use~~ ~~asset.~~
Lessor accounting under IFRS 16 is substantially unchanged from today’s accounting under IAS 17. Lessors will continue to classify all leases using the same classification principle as in IAS 17 and distinguish between two types of leases: operating and finance leases.
~~IFRS 16, which is effective for annual periods beginning on January 1, 2019, requires lessees and lessors to make more extensive disclosures than under IAS 17.~~
~~Transition to IFRS 16~~
The Company ~~will adopt~~applied for the IFRS 16 using the modified retrospectively method with the date of initial applications on January 1, 2019. Moreover, the Company will apply the new requirements regarding IFRS 16 to all contracts identified as leases under the current accounting standardfirst-time certain standards and ~~reassessed all services, in order to identify lease components or an implicit accounting lease within these contracts.~~
The Company will elect to use the exemptions applicable to the standard on lease contracts for which the lease terms ends within 12 months as of the date of initial application, and lease contracts for which the underlying asset is of low value. The Company has leases of certain office equipment (i.e., personal computers, printing and photocopying machines, mainly) that are considered low value assets.
The Company identified a significant number of lease assets such as towers, physical facilities (office buildings, stores and sites, mainly), circuits, among others. The implementation of IFRS 16 required a significant effort due to the fact of the need to make certain estimates, such as the leases term, based on the~~non-cancelable~~ ~~period and the periods covered by options to extend the lease. AMX extended the lease terms beyond thenon-cancelable~~ ~~period only when it was reasonably certain to extend it. The reasonability of the extension is affected on several factors, such as regulation, business model, and geographical business strategies.~~
AMX expects that the changes in the implementation of IFRS 16 will have a significant impact on its financial statements from the date of adoption. The Company expects that the opening balances at the date of initial application will increase in right of use assets and lease liabilities between Ps.113,000,000 and Ps.132,000,000 without a material impact in equity.
Estimated initial impact are based on the assessment conducted to date and could have a difference because of the lease borrowing rate and the volume of contracts considered in the implementation process. The new accounting policies will not be final until the Company presents its first financial statements subsequent to the effective date of IFRS 16.
~~IFRS 17 Insurance Contracts~~
~~In May 2017, the IASB issued IFRS 17~~~~Insurance Contracts~~ ~~(IFRS 17), a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. Once effective, IFRS 17 will replace IFRS 4~~~~Insurance Contracts~~ ~~(IFRS 4) that was issued in 2005. IFRS 17 applies to all types of insurance contracts (i.e., life,non-life,~~ ~~direct insurance andre-insurance),~~ regardless of the type of entities that issue them, as well as to certain guarantees and financial instruments with discretionary participation features. A few scope exceptions will apply. The overall objective of IFRS 17 is to provide an accounting model for insurance contracts that is more useful and consistent for insurers. In contrast to the requirements in IFRS 4,amendments, which are largely based on grandfathering previous local accounting policies, IFRS 17 provides a comprehensive model for insurance contracts, covering all relevant accounting aspects. The core of IFRS 17 is the general model, supplemented by:
~~A specific adaptation for contracts with direct participation features (the variable fee approach)~~
~~A simplified approach (the premium allocation approach) mainly for short-duration contracts~~
~~IFRS 17 is~~ effective for ~~reporting~~annual periods beginning on or after 1 January ~~2021, with comparative figures required.~~2020. The Company has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.
~~Early application is permitted, provided~~Amendments to IFRS 3, Definition of a Business
The amendment to IFRS 3 Business Combinations clarifies that to be considered a business, an integrated set of activities and assets must include, at a minimum, an input and a substantive process that, together, significantly contribute to the ~~entity also applies~~ability to create output. Furthermore, it clarifies that a business can exist without including all of the inputs and processes needed to create outputs. These amendments had no impact on the consolidated financial statements of the Company, but may impact future periods should the Company enter into any business combinations.
Amendments to IFRS 7, IFRS 9 and ~~IFRS 15 on or before the date it first applies IFRS 17.~~IAS 39 Interest Rate Benchmark Reform
~~The company is evaluating the effects, however, it does not expect the adoption of this standard to have a significant impact.~~
~~IFRIC Interpretation 23 Uncertainty over Income Tax Treatment~~
The Interpretation addresses the accounting for income taxes when tax treatments involve uncertainty that affects the application of IAS 12 and does not apply to taxes or levies outside the scope of IAS 12, nor does it specifically include requirements relating to interest and penalties associated with uncertain tax treatments.
~~The Interpretation specifically addresses the following:~~
~~Whether an entity considers uncertain tax treatments separately~~
~~The assumptions an entity makes about the examination of tax treatments by taxation authorities~~
~~How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates~~
~~How an entity considers changes in facts and circumstances~~
An entity has to determine whether to consider each uncertain tax treatment separately or together with one or more other uncertain tax treatments. The approach that better predicts the resolution of the uncertainty should be
followed. The interpretation is effective for annual reporting periods beginning on or after 1 January 2019, but certain transition reliefs are available. The Company will apply the interpretation from its effective date. The Company will establish the processes and procedures to obtain the necessary information to apply the Interpretation in a timely manner.
~~The company estimates that the adoption of this standard will not have a significant impact on its consolidated financial statements.~~
~~Amendments to IFRS 9: Prepayment Features with Negative Compensation~~
Under IFRS 9, a debt instrument can be measured at amortized cost or at fair value through other comprehensive income, provided that the contractual cash flows are ‘solely payments of principal and interest on the principal amount outstanding’ (the SPPI criterion) and the instrument is held within the appropriate business model for that classification. The amendments to IFRS 9 ~~clarify~~and IAS 39 Financial Instruments: Recognition and Measurement provide a number of reliefs, which apply to all hedging relationships that ~~a financial asset passes~~are directly affected by interest rate benchmark reform. A hedging relationship is affected if the ~~SPPI criterion regardless~~reform gives rise to uncertainty about the timing and/or amount of benchmark-based cash flows of the ~~event~~hedged item or ~~circumstance that causes~~ the ~~early termination of the contract and irrespective of which party pays or receives reasonable compensation for the early termination of the contract.~~
~~The amendments should be applied retrospectively and are effective from 1 January 2019, with earlier application permitted.~~hedging instrument. These amendments have no impact on the consolidated financial statements of the ~~Company.~~Company as it does not have any interest rate hedge relationships.
Amendments to ~~IFRS 10~~IAS 1 and IAS ~~28: Sale or Contribution~~8 Definition of ~~Assets between an Investor and its Associate or Joint Venture~~Material
The amendments ~~address~~provide a new definition of material that states, “information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the ~~conflict between IFRS 10 and IAS 28 in dealing with~~primary users of general purpose financial statements make on the ~~loss~~basis of ~~control of~~those financial statements, which provide financial information about a ~~subsidiary that is sold or contributed to an associate or joint venture.~~specific reporting entity.” The amendments clarify that materiality will depend on the ~~gain~~nature or ~~loss resulting from~~magnitude of information, either individually or in combination with other information, in the ~~sale or contribution~~context of ~~assets that constitute a business, as defined in IFRS 3, between an investor and its associate or joint venture,~~the financial statements. A misstatement of information is ~~recognized in full. Any gain or loss resulting from~~material if it could reasonably be expected to influence decisions made by the ~~sale or contribution~~primary users. These amendments had no impact on the consolidated financial statements of, ~~assets that do not constitute a business, however,~~nor is ~~recognized only~~there expected to be any future impact to the extent of unrelated investors’ interests in the associate or joint venture. The IASB has deferred the effective date of these amendments indefinitely, but an entity that early adopts the amendments must apply them prospectively. The Company will apply these amendments when they become effective.Company.
~~Amendments to IAS 19: Plan Amendment, Curtailment or Settlement~~Conceptual Framework for Financial Reporting issued on 29 March 2018
The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards, to help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all parties to understand and interpret the standards. This will affect those entities which developed their accounting policies based on the Conceptual Framework. The revised Conceptual Framework includes some new concepts, updated definitions and recognition criteria for assets and liabilities and clarifies some important concepts. These amendments ~~to IAS 19 address~~had no impact on the ~~accounting when a plan amendment, curtailment or settlement occurs during a reporting period. The amendments specify that when a plan amendment, curtailment or settlement occurs during~~consolidated financial statements of the ~~annual reporting period, an entity is required to:~~Company.
25. Subsequent Events

Determine current service cost for the remainder of the period after the plan amendment, curtailment or settlement, using the actuarial assumptions used to remeasure the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event.
a)
In February 2021, The Board of Directors approved a plan to spin-off our towers from América Móvil in Latin América. This spin-off will maximize the value of the infrastructure by becoming an independent entity entirely focused on development, construction and co-location of towers for wireless services and this transaction is consider to shareholders as a new entity. The Company expect to complete the reorganization of assets in 2021.
Determine net interest for the remainder of the period after the plan amendment, curtailment or settlement using: the net defined benefit liability (asset) reflecting the benefits offered under the plan and the plan assets after that event; and the discount rate used to remeasure that net defined benefit liability (asset).
The amendments also clarify that an entity first determines any past service cost, or a gain or loss on settlement, without considering the effect of the asset ceiling. This amount is recognized in profit or loss.
An entity then determines the effect of the asset ceiling after the plan amendment, curtailment or settlement. Any change in that effect, excluding amounts included in the net interest, is recognized in other comprehensive income.
b)
In February, 2021, the Company announces that its wholly-owned Dutch subsidiary América Móvil B.V. (the “Issuer”) has completed the placement of approximately EUR 2.1 billion principal amount of senior unsecured bonds (the “Bonds”) exchangeable into ordinary shares of Koninklijke KPN N.V. (the “Exchangeable Bond Offering”). The Bonds will have a maturity of 3 years, they will not bear interest (zero-coupon) and will be issued at an issue price of 104.75% of their principal amount, resulting in an annual yield-to-maturity of (1.53)%. The aggregate proceeds from the Bonds will be approximately EUR 2.2 billion. The Bonds will be exchangeable into Koninklijke KPN N.V. (“KPN”) ordinary shares and the initial exchange price has been set at EUR 3.1185, a premium of 15 per cent. above the Reference Price of EUR 2.7117 (the volume weighted average price of the KPN ordinary shares on Euronext Amsterdam on 23 February 2021). The Exchangeable Bond Offering is expected to close on 2 March 2021.
The amendments apply to plan amendments, curtailments, or settlements occurring on or after the beginning of the first annual reporting period that begins on or after 1 January 2019, with early application permitted. These amendments will apply only to any future plan amendments, curtailments, or settlements of the Company.
~~Amendments to IAS 28: Long-term interests in associates and joint ventures~~
The amendments clarify that an entity applies IFRS 9 to long-term interests in an associate or joint venture to which the equity method is not applied but that, in substance, form part of the net investment in the associate or joint venture (long-term interests). This clarification is relevant because it implies that the expected credit loss model in IFRS 9 applies to such long-term interests.
The amendments also clarified that, in applying IFRS 9, an entity does not take account of any losses of the associate or joint venture, or any impairment losses on the net investment, recognized as adjustments to the net investment in the associate or joint venture that arise from applying IAS 28 Investments in Associates and Joint Ventures.
The amendments should be applied retrospectively and are effective from 1 January 2019, with early application permitted. Since the Company does not have such long-term interests in its associate and joint venture, the amendments will not have an impact on its consolidated financial statements.
~~Annual Improvements 2015-2017 Cycle (issued in December 2017)~~
~~These improvements include:~~
~~• IFRS 3 Business Combinations~~
The amendments clarify that, when an entity obtains control of a business that is a joint operation, it applies the requirements for a business combination achieved in stages, including remeasuring previously held interests in the assets and liabilities of the joint operation at fair value. In doing so, the acquirer remeasures its entire previously held interest in the joint operation.
An entity applies those amendments to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after 1 January 2019, with early application permitted.
~~These amendments will apply on future business combinations of the Company.~~
~~• IFRS 11 Joint Arrangements~~
A party that participates in, but does not have joint control of, a joint operation might obtain joint control of the joint operation in which the activity of the joint operation constitutes a business as defined in IFRS 3. The amendments clarify that the previously held interests in that joint operation are not remeasured.
An entity applies those amendments to transactions in which it obtains joint control on or after the beginning of the first annual reporting period beginning on or after 1 January 2019, with early application permitted. These amendments are currently not applicable to the Company but may apply to future transactions.
~~• IAS 12 Income Taxes~~
The amendments clarify that the income tax consequences of dividends are linked more directly to past transactions or events that generated distributable profits than to distributions to owners. Therefore, an entity recognizes the income tax consequences of dividends in profit or loss, other comprehensive income or equity according to where the entity originally recognized those past transactions or events.
An entity applies those amendments for annual reporting periods beginning on or after 1 January 2019, with early application is permitted. When an entity first applies those amendments, it applies them to the income tax consequences of dividends recognized on or after the beginning of the earliest comparative period. Since the Company´s current practice is in line with these amendments, the Company does not expect any effect on its consolidated financial statements.
~~• IAS 23 Borrowing Costs~~
The amendments clarify that an entity treats as part of general borrowings any borrowing originally made to develop a qualifying asset when substantially all of the activities necessary to prepare that asset for its intended use or sale are complete.
An entity applies those amendments to borrowing costs incurred on or after the beginning of the annual reporting period in which the entity first applies those amendments. An entity applies those amendments for annual reporting periods beginning on or after 1 January 2019, with early application permitted. Since the Company´s current practice is in line with these amendments, the Company does not expect any effect on its consolidated financial statements.
~~24. Subsequent Events~~
(a) On January 24, 2019, the Company acquired from Telefónica S.A. and certain of its affiliates (“Telefónica”), 100% of Telefónica Móviles Guatemala, S.A. (“Telefónica Guatemala”), and has entered into an agreement to acquire 99.3% of Telefónica Móviles El Salvador, S.A. de C.V. (“Telefónica El Salvador”). The Telefónica Guatemala acquisition has been completed on this date. The completion of the acquisition of Telefónica El Salvador is subject to certain customary closing conditions, including regulatory approval. The purchase price paid for Telefónica Guatemala was Ps. 6,326,068 (US$333,000 ). The agreed upon purchase price for Telefónica El Salvador is Ps. 5,984,118 (US$315,000). The acquired companies provide mobile and fixed telecommunications services, including voice, data and Pay TV in El Salvador and Guatemala.
(b) On March 18, 2019, the Company announced that it has entered into an agreement to acquire from NII Holdings, Inc. and certain of its affiliates (“NII”) and AI Brazil Holdings B.V. 100% of Nextel Telecomunicações Ltda. (“Nextel Brazil”).
The completion of the acquisition is subject to certain customary closing conditions, including regulatory approval from Agência Nacional de Telecomunicações — Anatel and Conselho Administrativo de Defesa Econômica — CADE. The transaction is also subject to the approval at a stockholders meeting of NII shareholders holding a majority of the outstanding shares of NII. The agreed purchase price for Nextel Brazil is Ps. 17,487,578 (US$905,000) on a cash free / debt free basis.
~~Nextel Brazil provides nationwide mobile telecommunications services.~~
~~25. Supplemental Guarantor Information~~
~~Condensed Consolidating Financial Information~~
The following consolidating information presents condensed consolidating statements of financial position as of December 31, 2017 and 2018 and condensed consolidating statements of comprehensive income and cash flows for each of the three years in the period ended December 31, 2018 of the Company and Telcel (the “wholly-owned Guarantor Subsidiary”). The unconsolidated financial statements of América Móvil and Telcel reflect their investments in subsidiaries on the basis of the equity method. These unconsolidated entities are the Guarantors of most of América Móvil’s consolidated obligations. The guarantees of the Guarantor are full and unconditional.
The Company’s consolidating condensed financial information for the (i) Company; (ii) its wholly-owned guarantor subsidiary Telcel (on standalone basis), which is a wholly and unconditional guarantor under the Senior Notes; (iii) the combined~~non-guarantor~~ ~~subsidiaries; iv) eliminations and v) the Company’s consolidated financial statements are as follows:~~
~~Condensed consolidating statements of financial position~~

   As of December 31, 2017
   Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Assets:

Cash and cash equivalents
   Ps. 7,018,559 Ps. 3,553,352 Ps. 13,698,562 Ps. —   Ps. 24,270,473
Equity investments at fair value through OCI and other short-term investments
   10,303,535 —   48,817,141 —   59,120,676
Accounts receivable and derivative financial instruments
   9,874,652 24,064,936 167,873,940 —   201,813,528
Related parties
   208,240,067 957,704 503,895,549 (712,225,090 ) 868,230
Inventories, net
   264,649 16,700,837 21,844,079 —   38,809,565
Other current assets
   17,805,747 922,245 (1,375,246 ) —   17,352,746
Property, plant and equipment, Net
   1,996,721 24,287,904 650,058,573 —   676,343,198
Investments in associated companies
   747,771,790 35,569,788 3,457,152 (783,063,558 ) 3,735,172
Intangible assets and other non- current assets, net
   4,104,268 73,557,904 386,236,092 —   463,898,264


Total assets
   Ps.   1,007,379,988 Ps. 179,614,670 Ps.   1,794,505,842 Ps.   (1,495,288,648 ) Ps.   1,486,211,852


Liabilities:

Short-term debt and current portion of long-term debt
   Ps. 34,345,398 Ps. —   Ps. 17,400,443 Ps. —   Ps. 51,745,841
Current liabilities
   161,940,198 41,304,845 797,880,314 (639,534,701 ) 361,590,656
Long-term debt
   547,728,176 —   98,410,882 —   646,139,058
Othernon-current liabilities
   69,201,904 132,728,838 40,909,234 (76,737,196 ) 166,102,780


Total liabilities
   Ps.   813,215,676 Ps.   174,033,683 Ps.   954,600,873 Ps.   (716,271,897 ) Ps.   1,225,578,335


Equity attributable to equity holders of the parent
   194,164,312 5,580,987 741,988,231 (747,569,218 ) 194,164,312
Non-controlling interests
   —   —   97,916,738 (31,447,533 ) 66,469,205
Total equity
   194,164,312 5,580,987 839,904,969 (779,016,751 ) 260,633,517


Total liabilities and equity
   Ps.   1,007,379,988 Ps.   179,614,670 Ps.   1,794,505,842 Ps.   (1,495,288,648 ) Ps.   1,486,211,852


~~Condensed consolidating statements of financial position~~

As of December 31, 2018
Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Assets:

Cash and cash equivalents
Ps. 8,335,101 Ps. 1,745,895 Ps. 11,578,966 Ps. —   Ps. 21,659,962
Equity investments at fair value through OCI and other short-term investments
9,511,368 —   39,504,566 —   49,015,934
Accounts receivable and derivative financial instruments
31,462,176 35,671,582 154,380,710 —   221,514,468
Related parties
199,566,671 1,144,534 560,142,367 (759,589,967 ) 1,263,605
Inventories, net
215,055 18,495,502 21,594,805 —   40,305,362
Other current assets
—   1,218,764 14,077,429 —   15,296,193
Property, plant and equipment, Net
1,340,358 23,192,546 615,467,816 —   640,000,720
Investments in associated companies
734,944,344 88,070,845 16,926,615 (836,809,097 ) 3,132,707
Intangible assets and other non- current assets, net
4,113,902 26,176,381 406,744,158 —   437,034,441

Total assets
Ps.   989,488,975 Ps.   195,716,049 Ps.   1,840,417,432 Ps.   (1,596,399,064 ) Ps.   1,429,223,392

Liabilities:

Short-term debt and current portion of long-term debt
Ps. 52,827,411 Ps. —   Ps. 43,403,223 Ps. —   Ps. 96,230,634
Current liabilities
153,489,868 72,282,238 597,174,025 (452,085,876 ) 370,860,255
Long-term debt
456,918,590 —   85,773,229 —   542,691,819
Othernon-current liabilities
130,257,461 109,368,210 242,232,897 (308,290,306 ) 173,568,262

Total liabilities
Ps. 793,493,330 Ps. 181,650,448 Ps. 968,583,374 Ps. (760,376,182 ) Ps. 1,183,350,970

Equity attributable to equity holders of the parent
195,995,645 14,065,601 760,485,332 (774,550,933 ) 195,995,645
Non-controlling interests
—   —   111,348,726 (61,471,949 ) 49,876,777
Total equity
195,995,645 14,065,601 871,834,058 (836,022,882 ) 245,872,422

Total liabilities and equity
Ps. 989,488,975 Ps. 195,716,049 Ps. 1,840,417,432 Ps. (1,596,399,064 ) Ps. 1,429,223,392

~~Condensed consolidating statements of comprehensive income~~
~~For the year ended December 31, 2016~~

   Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Total revenues
   Ps.   137,236,301 Ps.   173,714,225 Ps.   857,137,822 Ps.   (192,675,860 ) Ps.   975,412,488
Total cost and operating expenses
   117,835,634 160,949,691 778,483,079 (191,466,226 ) 865,802,178


Operating income
   19,400,667 12,764,534 78,654,743 (1,209,634 ) 109,610,310
Interest (expense) income, net
   (12,331,095 ) 97,314 (17,207,855 ) (227,781 ) (29,669,417 )
Foreign currency exchange (loss) gain, net
   (46,625,392 ) (5,853,669 ) 12,051,654 —   (40,427,407 )
Other financing cost, net
   (10,475,673 ) (11,203,533 ) 5,453,365 —   (16,225,841 )
Income tax
   (7,712,179 ) 1,139,631 17,971,404 —   11,398,856
Equity interest in net income of associated companies
   50,968,741 (1,342,073 ) (6,677,059 ) (42,759,659 ) 189,950


Net profit (loss) for year
   Ps. 8,649,427 Ps. (6,677,058 ) Ps. 54,303,444 Ps. (44,197,074 ) Ps. 12,078,739


Distribution of the net profit (loss) to:

Equity owners of holding company
   8,649,427 (6,677,058 ) 50,049,280 (43,372,222 ) 8,649,427
Non-controlling interest
   —   —   4,254,164 (824,852 ) 3,429,312


Net profit (loss)
   Ps. 8,649,427 Ps. (6,677,058 ) Ps. 54,303,444 Ps. (44,197,074 ) Ps. 12,078,739


Other comprehensive income items:

Net other comprehensive income (loss) to be reclassified to profit or loss in subsequent years:

Effect of translation of foreign entities
   104,178,880 755,978 108,291,984 (105,728,134 ) 107,498,708
Effect of fair value of derivatives, net of deferred taxes
   48,496 —   30,206 (29,573 ) 49,129
Items not to be reclassified to profit or loss in subsequent years:

Remeasurement of defined benefit plan, net of income tax effect
   14,771,770 (12,300 ) 7,477,926 (7,463,997 ) 14,773,399
Equity investments at fair value
   (6,673,731 ) —   (6,673,731 ) 6,673,731 (6,673,731 )


Total other comprehensive income items for the period
   Ps. 112,325,415 Ps. 743,678 Ps. 109,126,385 Ps. (106,547,973 ) Ps. 115,647,505


Total comprehensive income for the period
   Ps. 120,974,842 Ps. (5,933,380 ) Ps. 163,429,829 Ps. (150,745,047 ) Ps. 127,726,244


Comprehensive income for the period attributable to:

Equity holders of the parent
   Ps. 120,974,842 Ps. (5,933,380 ) Ps. 150,900,984 Ps. (144,967,604 ) Ps. 120,974,842
Non-controlling interests
   —   —   12,528,845 (5,777,443 ) 6,751,402


   Ps. 120,974,842 Ps. (5,933,380 ) Ps. 163,429,829 Ps. (150,745,047 ) Ps. 127,726,244


~~Condensed consolidating statements of comprehensive income~~
~~For the year ended December 31, 2017~~

Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Total revenues
Ps.   160,057,511 Ps.   170,991,493 Ps.   887,951,615 Ps.   (197,367,084 ) Ps.   1,021,633,535
Total cost and operating expenses
123,548,341 163,152,868 832,429,198 (197,640,175 ) 921,490,232

Operating income
36,509,170 7,838,625 55,522,417 273,091 100,143,303
Interest (expense) income, net
(16,779,235 ) (12,365,116 ) 1,810,523 (41,305 ) (27,375,133 )
Foreign currency exchange (loss) gain, net
(15,223,111 ) 1,320,667 83,493 —   (13,818,951 )
Other financing cost, net
6,775,455 —   (8,719,215 ) —   (1,943,760 )
Income tax
14,201,399 1,386,519 9,353,593 —   24,941,511
Equity interest in net income of associated companies
32,245,041 (8,977,146 ) (13,466,845 ) (9,709,665 ) 91,385

Net profit (loss) for year
Ps. 29,325,921 Ps. (13,569,489 ) Ps. 25,876,780 Ps. (9,477,879 ) Ps. 32,155,333

Distribution of the net profit (loss) to:

Equity owners of holding company
29,325,921 (13,569,489 ) 21,417,549 (7,848,060 ) 29,325,921
Non-controlling interest
—   —   4,459,231 (1,629,819 ) 2,829,412

Net profit (loss)
Ps. 29,325,921 Ps. (13,569,489 ) Ps. 25,876,780 Ps. (9,477,879 ) Ps. 32,155,333

Other comprehensive income items:

Net other comprehensive income (loss) to be reclassified to profit or loss in subsequent years:

Effect of translation of foreign entities
(21,683,333 ) (1,897,936 ) (18,309,877 ) 23,581,269 (18,309,877 )
Effect of fair value of derivatives, net of deferred taxes
12,292 —   12,292 (12,292 ) 12,292
Items not to be reclassified to profit or loss in subsequent years:

Remeasurement of defined benefit plan, net of income tax effect
(7,075,606 ) (8,439 ) (7,046,089 ) 7,084,045 (7,046,089 )
Equity investments at fair value
622,424 —   622,424 (622,424 ) 622,424

Total other comprehensive income items for the period
Ps. (28,124,223 ) Ps. (1,906,375 ) Ps. (24,721,250 ) Ps. 30,030,598 Ps. (24,721,250 )

Total comprehensive income for the period
Ps. 1,201,698 Ps. (15,475,864 ) Ps. 1,155,530 Ps. 20,552,719 Ps. 7,434,083

Comprehensive income for the period attributable to:

Equity holders of the parent
Ps. 1,201,698 Ps. (15,475,864 ) Ps. (5,076,855 ) Ps. 20,552,719 Ps. 1,201,698
Non-controlling interests
—   —   6,232,385 —   6,232,385

Ps. 1,201,698 Ps. (15,475,864 ) Ps. 1,155,530 Ps. 20,552,719 Ps. 7,434,083

~~Condensed consolidating statements of comprehensive income~~
~~For the year ended December 31, 2018~~

Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Total revenues
Ps.   170,887,145 Ps.   190,924,413 Ps.   890,427,121 Ps.   (214,030,998 ) Ps.   1,038,207,681
Total cost and operating expenses
129,039,749 183,542,058 799,085,884 (213,017,181 ) 898,650,510

Operating income
41,847,396 7,382,355 91,341,237 (1,013,817 ) 139,557,171
Interest (expense) income, net
(24,831,538 ) (11,033,069 ) 14,757,906 (18,563 ) (21,125,264 )
Foreign currency exchange (loss) gain, net
11,805,283 626,304 (19,693,543 ) —   (7,261,956 )
Other financing cost, net
(4,443,892 ) —   (5,732,424 ) —   (10,176,316 )
Income tax
17,754,010 798,639 27,924,430 —   46,477,079
Equity interest in net income of associated companies
46,101,188 1,325,723 (2,497,059 ) (44,929,585 ) 267

Net profit (loss) for year
Ps. 52,724,427 Ps. (2,497,326 ) Ps. 50,251,687 Ps. (45,961,965 ) Ps. 54,516,823

Distribution of the net profit (loss) to:

Equity owners of holding company
52,724,427 (2,497,326 ) 46,641,696 (44,302,600 ) 52,566,197
Non-controlling interest
—   —   3,609,991 (1,659,365 ) 1,950,626

Net profit (loss)
Ps. 52,724,427 Ps. (2,497,326 ) Ps. 50,251,687 Ps. (45,961,965 ) Ps. 54,516,823

Other comprehensive income items:

Net other comprehensive income (loss) to be reclassified to profit or loss in subsequent years:

Effect of translation of foreign entities
(61,223,458 ) (724,521 ) (64,314,032 ) 61,947,979 (64,314,032 )
Items not to be reclassified to profit or loss in subsequent years:

Remeasurement of defined benefit plan, net of income tax effect
652,722 (1,603,145 ) 757,278 950,423 757,278
Equity investments at fair value
(3,765,688 ) —   (3,765,688 ) 3,765,688 (3,765,688 )

Total other comprehensive income items for the period
Ps. (64,336,424 ) Ps. (2,327,666 ) Ps. (67,322,442 ) Ps. 66,664,090 Ps. (67,322,442 )

Total comprehensive income for the period
Ps. (11,611,997 ) Ps. (4,824,992 ) Ps. (17,070,755 ) Ps. 20,702,125 Ps. (12,805,619 )

Comprehensive income for the period attributable to:

Equity holders of the parent
Ps. (11,611,997 ) Ps. (4,824,992 ) Ps. (16,035,363 ) Ps. 20,702,125 Ps. (11,770,227 )
Non-controlling interests
—   —   (1,035,392 ) —   (1,035,392 )

Ps. (11,611,997 ) Ps. (4,824,992 ) Ps. (17,070,755 ) Ps. 20,702,125 Ps. (12,805,619 )

~~Condensed consolidating statements of cash flows~~
~~For the year ended December 31, 2016~~

Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Operating activities:

Profit before taxes
Ps. 937,247 Ps. (5,537,427 ) Ps. 28,077,775 Ps. —   Ps. 23,477,595
Non-cash items
(997,587 ) 19,800,396 209,821,118 —   228,623,927
Changes in working capital:
74,520,320 9,130,768 (93,359,195 ) (6,595,361 ) (16,303,468 )

Net cash flows provided by operating activities
Ps. 74,459,980 Ps. 23,393,737 Ps. 144,539,698 Ps. (6,595,361 ) Ps. 235,798,054

Investing activities:

Purchase of property, plant and equipment
—   (7,860,232 ) (130,846,925 ) —   (138,707,157 )
Acquisition of intangibles
—   (4,947,506 ) (11,369,232 ) —   (16,316,738 )
Dividends received from associates
21,950 —   5,988,938 (270,796 ) 5,740,092
Proceeds from sale of plant, property and equipment
20,078 —   95,522 —   115,600
Acquisition of business, net of cash acquired
—   (2,796,254 ) (1,823,813 ) 2,796,254 (1,823,813 )
Partial sale of shares of associate company
756,444 —   2,796,254 (3,552,698 ) —
Investment in associates companies
—   663,203 (666,690 ) —   (3,487 )

Net cash flows provided by (used in) investing activities
Ps. 798,472 Ps.   (14,940,789 ) Ps.   (135,825,946 ) Ps.   (1,027,240 ) Ps. (150,995,503 )

Financing activities:

Bank loans, net
(39,598,698 ) —   (21,792,115 ) —   (61,390,813 )
Acquisition of no controlling interest
—   —   (2,280,278 ) —   (2,280,278 )
Interest paid
(24,826,139 ) (7,972,827 ) (5,922,267 ) 6,595,361 (32,125,872 )
Paid-In capital
—   —   (756,444 ) 756,444 —
Sale of shares of subsidiaries
—   —   6,323,336 —   6,323,336
Repurchase of shares and others
(7,092,385 ) —   71,138 —   (7,021,247 )
Payment of dividends
(13,437,168 ) —   (643,585 ) 270,796 (13,809,957 )
Derivative financial instruments
—   —   (351,213 ) —   (351,213 )

Net cash flows (used in) financing activities
Ps.   (84,954,390 ) Ps. (7,972,827 ) Ps. (25,351,428 ) Ps. 7,622,601 Ps.   (110,656,044 )

Net (decrease) increase in cash and cash equivalents
(9,695,938 ) 480,121 (16,637,676 ) —   (25,853,493 )
Adjustment to cash flow for exchange rate differences
—   —   3,911,844 —   3,911,844
Cash and cash equivalents at beginning of the period
13,803,584 1,468,036 29,888,412 —   45,160,032

Cash and cash equivalents at end of the period
Ps. 4,107,645 Ps. 1,948,159 Ps. 17,162,579 Ps. —   Ps. 23,218,383

~~Condensed consolidating statements of cash flows~~
~~For the year ended December 31, 2017~~

Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Operating activities:

Profit before taxes
Ps. 43,527,320 Ps.   (12,182,970 ) Ps. 35,230,373 Ps. (9,477,879 ) Ps. 57,096,844
Non-cash items
(17,017,287 ) 30,000,109 171,062,158 11,635,563 195,680,543
Changes in working capital:
(18,973,478 ) (9,486 ) (66,062,629 ) 50,040,581 (35,005,012 )

Net cash flows provided by operating activities
Ps. 7,536,555 Ps. 17,807,653 Ps. 140,229,902 Ps. 52,198,265 Ps. 217,772,375

Investing activities:

Purchase of property, plant and equipment
16,526 (5,571,410 ) (113,630,253 ) —   (119,185,137 )
Acquisition of intangibles
—   (3,053,345 ) (14,485,196 ) —   (17,538,541 )
Dividends received from associates
21,465,687 970,000 2,385,559 (22,435,687 ) 2,385,559
Proceeds from sale of plant, property and equipment
—   —   133,349 —   133,349
Acquisition of business, net of cash acquired
—   (3,381,505 ) (3,497,288 ) —   (6,878,793 )
Investment in associates companies
—   1,925,898 —   (1,925,898 ) —
Sale of associated company
—   —   340,040 —   340,040

Net cash flows provided by (used in) investing activities
Ps. 21,482,213 Ps. (9,110,362 ) Ps.   (128,753,789 ) Ps. (24,361,585 ) Ps.   (140,743,523 )

Financing activities:

Bank loans, net
13,548,138 —   16,382,838 (57,364,465 ) (27,433,489 )
Acquisition of no controlling interest
—   —   (11,930 ) —   (11,930 )
Interest paid
(24,009,216 ) (7,092,098 ) (7,187,225 ) 7,092,098 (31,196,441 )
Repurchase of shares and others
(1,240,028 ) —   6,657 —   (1,233,371 )
Payment of dividends
(14,406,748 ) —   (24,120,329 ) 22,435,687 (16,091,390 )
Derivative financial instruments
—   —   (71,474 ) —   (71,474 )

Net cash flows used in financing activities
Ps.   (26,107,854 ) Ps. (7,092,098 ) Ps. (15,001,463 ) Ps.   (27,836,680 ) Ps. (76,038,095 )

Net (decrease) increase in cash and cash equivalents
2,910,914 1,605,193 (3,525,350 ) —   990,757
Adjustment to cash flow for exchange rate differences
—   —   61,333 —   61,333
Cash and cash equivalents at beginning of the period
4,107,645 1,948,159 17,162,579 —   23,218,383

Cash and cash equivalents at end of the period
Ps. 7,018,559 Ps. 3,553,352 Ps. 13,698,562 Ps. —   Ps. 24,270,473

~~Condensed consolidating statements of cash flows~~
~~For the year ended December 31, 2018~~

   Parent Wholly-owned
Guarantor
Subsidiary Combined
non-guarantor
Subsidiaries Eliminations Consolidated
Total
Operating activities:

Profit before taxes
   Ps. 70,478,437 Ps. (1,698,687 ) Ps. 78,176,117 Ps. (45,961,965 ) Ps. 100,993,902
Non-cash items
   (23,099,316 ) 20,952,414 149,503,016 39,836,704 187,192,818
Changes in working capital:
   (49,040,542 ) (35,329,228 ) (61,332,380 ) 105,845,958 (39,856,192 )


Net cash flows provided by operating activities
   Ps. (1,661,421 ) Ps. (16,075,501 ) Ps. 166,346,753 Ps. 99,720,697 Ps. 248,330,528


Investing activities:

Purchase of property, plant and equipment
   (17,709 ) (4,031,228 ) (139,839,096 ) —   (143,888,033 )
Acquisition of intangibles
   —   (2,993,373 ) (4,940,274 ) —   (7,933,647 )
Dividends received from associates
   24,314,803 —   2,622,237 (24,314,803 ) 2,622,237
Proceeds from sale of plant, property and equipment
   —   —   178,532 —   178,532
Acquisition of business, net of cash acquired
   —   —   (310,604 ) —   (310,604 )
Investment in associates companies
   —   (5,092,881 ) —   5,092,881 —
Sale of associated company
   —   —   548,484 —   548,484


Net cash flows provided by (used in) investing activities
   Ps. 24,297,094 Ps.   (12,117,482 ) Ps.   (141,740,721 ) Ps. (19,221,922 ) Ps. (148,783,031 )


Financing activities:

Bank loans, net
   24,784,341 —   19,592,788 (78,428,052 ) (34,050,923 )
Acquisition of no controlling interest
   —   —   (115,821 ) —   (115,821 )
Interest paid
   (24,802,363 ) 26,385,526 (6,066,654 ) (26,385,526 ) (30,869,017 )
Repurchase of shares and others
   (514,007 ) —   2,586 —   (511,421 )
Payment of dividends
   (20,787,102 ) —   (25,897,494 ) 24,314,803 (22,369,793 )
Redemption of hybrid bond
   —   —   (13,440,120 ) —   (13,440,120 )


Net cash flows used in financing activities
   Ps.   (21,319,131 ) Ps. 26,385,526 Ps. (25,924,715 ) Ps.   (80,498,775 ) Ps.   (101,357,095 )


Net (decrease) increase in cash and cash equivalents
   1,316,542 (1,807,457 ) (1,318,683 ) —   (1,809,598 )
Adjustment to cash flow for exchange rate differences
   —   —   (800,913 ) —   (800,913 )
Cash and cash equivalents at beginning of the period
   7,018,559 3,553,352 13,698,562 —   24,270,473


Cash and cash equivalents at end of the period
   Ps. 8,335,101 Ps. 1,745,895 Ps. 11,578,966 Ps. —   Ps. 21,659,962


		FOR THE YEAR ENDED DECEMBER 31,⁽¹⁾
	2014		2015		2016		2017		2018		2018
	(in millions of Mexican pesos, except share and per share amounts)										(in millions of U.S. dollars, except share and per share amounts)

STATEMENT OF COMPREHENSIVE INCOME DATA:

Operating revenues	Ps.	848,580	Ps.	893,738	Ps.	975,412	Ps.	1,021,634	Ps.	1,038,208	U.S.$	52,747

Operating costs and expenses		692,026		752,325		865,802		921,490		898,651		45,657

Depreciation and amortization		114,994		125,715		148,526		160,175		155,713		7,911

Operating income		156,554		141,413		109,610		100,144		139,557		7,090

Net profit for the year	Ps.	47,498	Ps.	36,961	Ps.	12,079	Ps.	32,155	Ps.	54,517	U.S.$	2,770

NET PROFIT ATTRIBUTABLE FOR THE YEAR TO:

Equity holders of the parent	Ps.	46,146	Ps.	35,055	Ps.	8,650	Ps.	29,326	Ps.	52,566	U.S.$	2,670

Non-controlling interests		1,352		1,906		3,429		2,829		1,951		100

Net profit for the year	Ps.	47,498	Ps.	36,961	Ps.	12,079	Ps.	32,155	Ps.	54,517	U.S.$	2,770

EARNINGS PER SHARE:

Basic	Ps.	0.67	Ps.	0.52	Ps.	0.13	Ps.	0.44	Ps.	0.79	U.S.$	0.04

Diluted	Ps.	0.67	Ps.	0.52	Ps.	0.13	Ps.	0.44	Ps.	0.79	U.S.$	0.04

Dividends declared per share⁽²⁾	Ps.	0.24	Ps.	0.26	Ps.	0.28	Ps.	0.30	Ps.	0.32	U.S.$	0.02

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING (MILLIONS):

Basic		69,254		66,869		65,693		65,909		66,055

Diluted		69,254		66,869		65,693		65,909		66,055

BALANCE SHEET DATA:

Property, plant and equipment, net	Ps.	588,106	Ps.	573,529	Ps.	701,190	Ps.	676,343	Ps.	640,001	U.S.$	32,516

Total assets		1,278,357		1,296,487		1,515,042		1,486,212		1,429,223		72,613

Short-term debt and current portion of long-term debt		57,806		119,590		82,607		51,746		96,230		4,889

Long-term debt		545,949		563,627		625,194		646,139		542,692		27,572

Capital stock		96,383		96,338		96,338		96,339		96,338		4,895

Total equity		234,639		160,854		271,024		260,634		245,872		12,492

NUMBER OF OUTSTANDING SHARES (MILLIONS):

AA Shares		23,384		23,384		20,635		20,602		20,602

A Shares		649		625		592		567		546

L Shares		44,120		41,990		44,571		44,901		44,887

⁽¹⁾ As of December 31, 2018, we owned 51.0% of the total outstanding shares of Telekom Austria AG (“Telekom Austria” or “TKA”). We began consolidating Telekom Austria from July 1, 2014. Prior to July 1, 2014, we accounted for Telekom Austria using the equity method, which affects the comparability of our results for 2014 through 2018. ⁽²⁾ Figures for each year provided represent the annual dividend declared at the general shareholders’ meeting that year. For information on dividends paid per share trans- lated into U.S. dollars, see “Share Ownership and Trading—Dividends” under Part IV of this annual report.


GENERATION TECHNOLOGY
		GSM	UMTS	LTE
	(% of covered population)

Argentina		98	91	88

Austria		100	98	98

Belarus		99	99	—

Brazil		93	94	81

Bulgaria		100	100	99

Chile		99	97	94

Colombia		92	79	61

Costa Rica		74	80	40

Croatia		99	99	99

Dominican Republic		100	99	94

Ecuador		96	76	59

El Salvador		91	82	64

Guatemala		89	81	62

Honduras		86	81	52

Macedonia		100	100	99

Mexico		93	94	86

Nicaragua		85	80	46

Panama		84	84	67

Paraguay		76	73	53

Peru		87	80	73

Puerto Rico		80	96	86

Serbia		99	98	98

Slovenia		100	100	99

Uruguay		96	91	80



	YEAR ENDED DECEMBER 31, 2019

	OPERATING REVENUES				OPERATING INCOME

	(in millions of Mexican pesos)		(as a% of to- tal operating revenues)		(in millions of Mexican pesos)		(as a% of total operat- ing income)

Mexico Wireless	Ps.	237,840		23.6%	Ps.	67,694		43.7%

Mexico Fixed		96,037		9.5		9,732		6.3

Brazil		181,778		18.0		28,847		18.6

Colombia		74,636		7.4		15,325		9.9

Southern Cone		65,272		6.5		4,008		2.6

Andean Region		55,533		5.5		8,023		5.2

Central America		46,734		4.6		5,712		3.7

United States		155,864		15.5		2,968		1.9

Caribbean		35,718		3.5		5,741		3.7

Europe		98,420		9.8		8,688		5.6

Eliminations		(40,484)		(3.9)		(1,897)		(1.2)

Total	Ps.	1,007,348		100%	Ps.	154,841		100%


YEAR ENDED DECEMBER 31, 2017
	OPERATING REVENUES						OPERATING INCOME
	(in millions of Mexican pesos)			(as a % of total operating revenues)			(in millions of Mexican pesos)			(as a % of total operating income)

Mexico Wireless	Ps.	206,771			20.2	%	Ps.	50,666			50.6	%

Mexico Fixed		98,485			9.6			7,922			7.9

Brazil		215,322			21.1			11,601			11.6

Colombia		72,740			7.1			(4,704	)		(4.7	)

Southern Cone		82,344			8.1			11,676			11.7

Andean Region		56,571			5.5			5,650			5.6

Central America		44,282			4.3			5,252			5.2

United States		148,590			14.5			2,915			2.9

Caribbean		35,215			3.4			4,752			4.7

Europe		93,644			9.2			4,524			4.5

Eliminations		(32,330	)		(3.0	)		(111	)		(0.0	)

Total	Ps.	1,021,634			100.0	%	Ps.	100,143			100.0	%


YEAR ENDED DECEMBER 31, 2016
	OPERATING REVENUES						OPERATING INCOME
	(in millions of Mexican pesos)			(as a % of total operating revenues)			(in millions of Mexican pesos)		(as a % of total operating income)

Mexico Wireless	Ps.	203,567			20.9	%	Ps.	48,220		44.0	%

Mexico Fixed		102,216			10.5			12,276		11.2

Brazil		197,357			20.2			6,325		5.8

Colombia		67,589			6.9			11,210		10.2

Southern Cone		72,330			7.4			8,317		7.6

Andean Region		56,131			5.8			6,087		5.6

Central America		42,421			4.3			3,831		3.5

United States		140,856			14.4			1,221		1.1

Caribbean		36,498			3.7			6,143		5.6

Europe		86,979			8.9			5,389		4.9

Eliminations		(30,532	)		(3.0	)		591		0.5

Total	Ps.	975,412			100.0	%	Ps.	109,610		100.0	%


PAYMENTS DUE BY PERIOD
			LESS THAN
	Total		1 Year		1-3 Years		4-5 Years		After 5 Years
	(in millions of Mexican pesos)

CONTRACTUAL OBLIGATIONS AS OF DECEMBER 31, 2018

Equipment leases, real estate leases and mobile site rentals	Ps.	138,052	Ps.	24,057	Ps.	37,652	Ps.	26,317	Ps.	50,026

Short-term debt		96,230		96,230		—		—		—

Long-term debt		542,692		—		263,402		53,923		225,367

Purchase obligations		225,085		88,234		123,528		13,323		—

Total	Ps.	1,002,059	Ps.	208,521	Ps.	424,582	Ps.	93,563	Ps.	275,393



		DECEMBER 31, 2020

	PARENT			GUARANTOR

Current Assets	Ps.		45,320,066	Ps.	45,909,283

Total Assets			80,095,274		145,711,133

Current Liabilities			93,871,633		41,939,310

Total Liabilities			504,150,282		75,949,203

Total revenues	Ps.		72,124,718	Ps.	132,393,542

Operating Income			18,559,695		3,304,582

Net profit for the year			(37,332,145)		50,569,556


SERIES	NUMBER OF SHARES (MILLIONS)		PERCENT OF CAPITAL			COMBINED A SHARES AND AA SHARES⁽¹⁾

L Shares (no par value)		44,883		68.0	%		—

AA Shares (no par value)		20,602		31.2	%		97.5	%

A Shares (no par value)		539		0.8	%		2.5	%

Total⁽²⁾		66,024		100.0	%		100.0	%



SERIES	NUMBER OF SHARES (MILLIONS)		PERCENT OF COMBINED CAPITAL			A SHARES AND AA SHARES⁽¹⁾

L Shares		45,448		68.3	%			–
(no par value)

AA Shares		20,578		30.9	%		97.6	%
(no par value)

A Shares		515		0.8	%		2.4	%
(no par value)

Total⁽²⁾		66,541		100	%		100	%


PERIOD	TOTAL NUMBER OF L SHARES PURCHASED⁽¹⁾		AVERAGE PRICE PER L SHARES		TOTAL NUMBER OF L SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PLANS OR PROGRAMS		APPROXIMATE MEXICAN PESO VALUE OF L SHARES THAT MAY YET BE PURCHASED UNDER THE PLANS OR PROGRAMS⁽²⁾

January 2018		4,300,000		Ps. 16.82		4,300,000	Ps.	2,186,861,427

February 2018		1,318,000		17.26		1,318,000		2,162,900,627

March 2018		—		—		—		2,162,900,627

April 2018		—		—		—		2,162,900,627

May 2018		2,560,156		16.14		2,560,156		2,958,688,268

June 2018		2,080,000		15.49		2,080,000		2,926,474,720

July 2018		3,210,000		16.15		3,210,000		2,874,640,889

August 2018		2,680,000		15.86		2,680,000		2,832,132,042

September 2018		2,081,508		15.45		2,081,508		2,799,978,412

October 2018		7,880,400		14.46		7,880,400		2,686,010,961

November 2018		4,988,725		13.09		4,988,725		2,620,438,367

December 2018		2,918,607		13.94		2,918,607		2,579,763,369
Total		34,017,396				34,017,396

⁽¹⁾ This includes purchases by us and our affiliated purchasers in 2018. ⁽²⁾ This is the approximate peso amount available at the end of the period for purchases of both L Shares and A Shares pursuant to our share repurchase program.



PERIOD	TOTAL NUMBER OF SHARES PURCHASED⁽¹⁾		AVERAGE PRICE PER SHARE		TOTAL NUMBER OF SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PLANS OR PROGRAMS		APPROXIMATE MEXICAN PESO VALUE OF SHARES THAT MAY YET BE PURCHASED UNDER THE PLANS OR PROGRAMS⁽²⁾

January 2020		5,650,000		Ps. 15.34		5,650,000		Ps. 2,664,468,912

February 2020		2,200,000		16.06		2,200,000		2,629,333,277

March 2020		-		-		-		2,629,333,277

April 2020		11,000,000		13.64		11,000,000		5,930,090,256

May 2020		19,975,000		14.99		19,975,000		5,632,443,872

June 2020		22,000,000		15.26		22,000,000		5,298,718,225

July 2020		22,500,000		14.64		22,500,000		4,971,126,848

August 2020		21,000,000		14.14		21,000,000		4,675,982,377

September 2020		32,000,000		13.49		32,000,000		4,246,872,865

October 2020		43,000,000		13.60		43,000,000		3,665,445,685

November 2020		80,000,000		14.40		80,000,000		2,519,753,255

December 2020		106,282,651		14.48		106,282,651		989,494,709

Total L Shares		365,607,651				365,607,651


PERIOD	TOTAL NUMBER OF A SHARES PURCHASED⁽¹⁾		AVERAGE PRICE PER A SHARES		TOTAL NUMBER OF A SHARES PURCHASED AS PART OF PUBLICLY ANNOUNCED PLANS OR PROGRAMS		APPROXIMATE MEXICAN PESO VALUE OF A SHARES THAT MAY YET BE PURCHASED UNDER THE PLANS OR PROGRAMS⁽²⁾

January 2018		130,382		Ps. 17.07		130,382	Ps.	2,186,861,427

February 2018		74,987		16.22		74,987		2,162,900,627

March 2018		—		—		—		2,162,900,627

April 2018		—		—		—		2,162,900,627

May 2018		—		—		—		2,958,688,268

June 2018		—		—		—		2,926,474,720

July 2018		—		—		—		2,874,640,889

August 2018		—		—		—		2,832,132,042

September 2018		—		—		—		2,799,978,412

October 2018		—		—		—		2,686,010,961

November 2018		20,248		13.65		20,248		2,620,438,367

December 2018		—		—		—		2,579,763,369
Total	225,617				225,617

⁽¹⁾ This includes purchases by us and our affiliated purchasers in 2018. ⁽²⁾ This is the approximate peso amount available at the end of the period for purchases of both L Shares and A Shares pursuant to our share repurchase program.


	Reference		As reported			Figures without adoption of IFRS 15				Adjustments
Operating revenues:
Revenues services		(a), (b)	Ps.	863,647,642		Ps.	881,530,167			Ps.	(17,882,525	)
Sales of equipment		(a), (b)		174,560,039			158,721,765				15,838,274

				1,038,207,681			1,040,251,932				(2,044,251	)

Operating costs and expenses:
Cost of sales and services			Ps.	508,822,430		Ps.	509,100,174			Ps.	(277,744	)
Commercial, administrative and general and other expenses		(c)		234,115,500			240,010,631				(5,895,131	)
Depreciation and amortization				155,712,580			155,712,580				—

				898,650,510			904,823,385				(6,172,875	)

				139,557,171			135,428,547				4,128,624
Financial items, net				38,563,536			38,356,359				207,177
Equity interest in net result of associated companies				267			267		��		—
Income tax		(d)		46,477,079			45,496,698				980,381
Non-controlling interests				(1,950,626	)		(1,950,626	)			—

Net profit for the year			Ps.	52,566,197		Ps.	49,625,131			Ps.	2,941,066


	Reference		As reported		Balances without adoption of IFRS 15		Adjustments
Assets:
Current assets:
Cash and cash equivalents and equity investments at fair value			Ps.	70,675,896	Ps.	70,675,896	Ps.	—
Subscribers, distributors, recoverable taxes, contract assets and other, net		(a), (b), (c)		216,226,920		185,303,634		30,923,286
Other current assets, net				62,152,708		62,152,708		—

Total current assets				349,055,524		318,132,238		30,923,286
Non-current assets:
Property, plant and equipment, net				640,000,720		640,000,720		—
Intangibles and other assets, net				424,485,276		424,485,276		—
Subscribers, distributors, recoverable taxes, contract assets and other, net		(a), (b), (c)		15,681,872		10,244,609		5,437,263

Total assets			Ps.	1,429,223,392	Ps.	1,392,862,843	Ps.	36,360,549

Liabilities and equity:
Current liabilities:
Short-term debt and current portion of long-term debt			Ps.	96,230,634	Ps.	96,230,634	Ps.	—
Accounts payable and other liabilities				338,116,412		337,448,940		667,472
Deferred revenues				32,743,843		32,315,690		428,153

Total current liabilities				467,090,889		465,995,264		1,095,625
Non-current-liabilities:
Long-term debt				542,691,819		542,691,819		—
Deferred income taxes		(d)		24,573,441		15,382,500		9,190,941
Other liabilities				148,994,821		148,994,821		—

Total liabilities				1,183,350,970		1,173,064,404		10,286,566
Total equity		(d)		245,872,422		219,798,439		26,073,983

Total liabilities and equity			Ps.	1,429,223,392	Ps.	1,392,862,843	Ps.	36,360,549


Company name	Country		Equity interest at December 31
Company name	Country		2017			2018
Subsidiaries:
América Móvil B.V.^a)		Netherlands		100.0	%		100.0	%
Compañía Dominicana de Teléfonos, S.A. (“Codetel”)^b)		Dominican Republic		100.0	%		100.0	%
Sercotel, S.A. de C.V.^a)		Mexico		100.0	%		100.0	%
Radiomóvil Dipsa, S.A. de C.V. and subsidiaries (“Telcel”)^b)		Mexico		100.0	%		100.0	%
Puerto Rico Telephone Company, Inc.^b)		Puerto Rico		100.0	%		100.0	%
Servicios de Comunicaciones de Honduras, S.A. de C.V. (“Sercom Honduras”)^b)		Honduras		100.0	%		100.0	%
TracFone Wireless, Inc. (“TracFone”)^b)		USA		100.0	%		100.0	%
Claro S.A. (Claro Brasil)^b)		Brazil		97.7	%		98.2	%
Telecomunicaciones de Guatemala, S.A. (“Telgua”)^b)		Guatemala		99.3	%		99.3	%
Empresa Nicaragüense de Telecomunicaciones, S.A. (“Enitel”) ^b)		Nicaragua		99.6	%		99.6	%
Compañía de Telecomunicaciones de El Salvador, S.A. de C.V. (“CTE”)^b)		El Salvador		95.8	%		95.8	%
Comunicación Celular, S.A. (“Comcel”)^b)		Colombia		99.4	%		99.4	%
Telmex Colombia, S.A.^b)		Colombia		99.3	%		99.3	%
Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) ^b)		Ecuador		100.0	%		100.0	%
AMX Argentina, S.A.^b)		Argentina		100.0	%		100.0	%
AMX Paraguay, S.A.^b)		Paraguay		100.0	%		100.0	%
AM Wireless Uruguay, S.A.^b)		Uruguay		100.0	%		100.0	%
Claro Chile, S.A.^b)		Chile		100.0	%		100.0	%
América Móvil Perú, S.A.C^b)		Peru		100.0	%		100.0	%
Claro Panamá, S.A.^b)		Panamá		100.0	%		100.0	%
Teléfonos de México, S.A.B. de C.V.^b)		Mexico		98.8	%		98.8	%
Telekom Austria AG^b)		Austria		51.0	%		51.0	%


Company name	Country		Equity interest at December 31
Company name	Country		2019			2020
Subsidiaries:
América Móvil B.V. ^a)		Netherlands		100.0	%		100.0	%
Compañía Dominicana de Teléfonos, S.A. (“Codetel”) ^b)		Dominican Republic		100.0	%		100.0	%
Sercotel, S.A. de C.V. ^a)		Mexico		100.0	%		100.0	%
Radiomóvil Dipsa, S.A. de C.V. and subsidiaries (“Telcel”) ^b)		Mexico		100.0	%		100.0	%
Puerto Rico Telephone Company, Inc. ^b⁾		Puerto Rico		100.0	%		100.0	%
Servicios de Comunicaciones de Honduras, S.A. de C.V. (“Sercom Honduras”) ^b⁾		Honduras		100.0	%		100.0	%
TracFone Wireless, Inc. (“TracFone”) ^b)		USA		100.0	%		100.0	%
Claro S.A. (Claro Brasil) ^b)		Brazil		98.2	%		98.2	%
NII Brazil Holding S.A.R.L ^a)		Luxembourg		100.0	%		100.0	%
Nextel Telecomunicações Ltda ^b)		Brazil		100.0	%		100.0	%
Telecomunicaciones de Guatemala, S.A. (“Telgua”) ^b)		Guatemala		99.3	%		99.3	%
Claro Guatemala, S.A. ^b)		Guatemala		100.0	%		100.0	%
Empresa Nicaragüense de Telecomunicaciones, S.A. (“Enitel”) ^b)		Nicaragua		99.6	%		99.6	%
Compañía de Telecomunicaciones de El Salvador, S.A. de C.V. (“CTE”) ^b)		El Salvador		95.8	%		95.8	%
Comunicación Celular, S.A. (“Comcel”) ^b)		Colombia		99.4	%		99.4	%
Consorcio Ecuatoriano de Telecomunicaciones, S.A. (“Conecel”) ^b)		Ecuador		100.0	%		100.0	%
AMX Argentina, S.A. ^b)		Argentina		100.0	%		100.0	%
AMX Paraguay, S.A. ^b)		Paraguay		100.0	%		100.0	%
AM Wireless Uruguay, S.A. ^b)		Uruguay		100.0	%		100.0	%
Claro Chile, S.A. ^b)		Chile		100.0	%		100.0	%
América Móvil Perú, S.A.C ^b)		Peru		100.0	%		100.0	%
Claro Panamá, S.A. ^b)		Panamá		100.0	%		100.0	%
Teléfonos de México, S.A.B. de C.V. ^b)		Mexico		98.8	%		98.8	%
Telekom Austria AG ^b)		Austria		51.0	%		51.0	%


Network infrastructure	5	%-33%
Buildings and leasehold improvement	2	%-33%
Other assets	10	%-50%


Network infrastructure			5%-33%
Buildings and leasehold improvement			2%-33%
Other assets			10%-50%


	Average margin on EBITDA	Average margin on CAPEX	Averagepre-tax discount rate (WACC)	Average margin on EBIDTA		Average margin on CAPEX		Average pre-tax discount rate (WACC)
2017:
2019:
Europe (7 countries)	25.59% - 52.46%	7.34% - 14.97%	9.06% - 19.04%		29.40% - 44.50%		10.90% - 19.30%		5.77% - 14.96%
Brazil (fixed line, wireless and TV)	35.28%	22.13%	11.71%		40.43%		23.50%		11.00%
Puerto Rico	23.31%	8.31%	4.42%		21.94%		17.94%		4.39%
Dominican Republic	45.79%	15.55%	19.23%		47.23%		16.17%		13.84%
Mexico (fixed line and wireless)	35.48%	8.72%	16.13%		38.81%		9.84%		6.94%
Ecuador	37.83%	10.07%	23.57%		44.98%		11.65%		19.85%
Peru	29.64%	16.75%	13.61%		32.51%		18.51%		8.86%
El Salvador	40.36%	17.99%	25.14%		44.04%		25.03%		16.05%
Chile	22.04%	12.45%	6.15%		26.85%		18.00%		4.16%
Colombia	41.93%	19.88%	19.06%		45.58%		19.25%		17.27%
Other countries	9.16% - 48.18%	0.43% - 23.43%	7.89% - 24.28%		7.40% - 52.40%		0.57% - 31.0%		6.41% - 34.75%
2020:
Europe (7 countries)					32.20% - 40.76%		7.04% - 19.39%		3.88% - 12.02%
Brazil (fixed line, wireless and TV)					40.67%		25.36%		9.50%
Puerto Rico					23.06%		14.57%		3.53%
Dominican Republic					47.57%		13.71%		8.27%
Mexico (fixed line and wireless)					32.69%		11.01%		6.03%
Ecuador					49.23%		11.14%		17.50%
Peru					38.72%		15.43%		4.76%
El Salvador					45.92%		21.19%		14.63%
Chile					26.34%		13.18%		3.37%
Colombia					43.45%		18.19%		6.44%
Other countries					10.07% - 47.23%		0.48% - 31.67%		3.42% - 21.85%


	Average margin on EBIDTA		Average margin on CAPEX		Average pre-tax discount rate (WACC)las
2018:
Europe (7 countries)		22.13% - 41.51%		8.13% - 19.40%		8.36% - 22.08%
Brazil (fixed line, wireless and TV)		36.43%		21.88%		10.38%
Puerto Rico		23.86%		9.89%		4.81%
Dominican Republic		48.64%		18.43%		17.66%
Mexico (fixed line and wireless)		36.33%		7.93%		16.30%
Ecuador		39.83%		11.26%		24.45%
Peru		30.29%		19.95%		11.52%
El Salvador		45.36%		22.61%		18.01%
Chile		25.91%		14.99%		6.62%
Colombia		45.01%		17.14%		20.29%
Other countries		7.90% - 45.91%		0.61% - 23.96%		9.97% - 31.63%


Assets		Useful life
Towers and sites		5 to 12 years
Property		10 to 25 years
Other equipment		5 to 15 years


		Average exchange rate						Closing exchange rate at December 31,					Average exchange rate						Closing exchange rate at December 31,
Country or Zone	Currency	2016		2017		2018		2017		2018		Currency	2018		2019		2020		2019		2020
Argentina⁽¹⁾	Argentine Peso (AR$)		1.2632		1.1489		0.7311		1.0610		0.5221	Argentine Peso (AR$)		0.7311		0.4110		0.3070		0.3147		0.2371
Brazil	Real (R$)		5.3868		5.9346		5.2937		5.9815		5.0797	Real (R$)		5.2937		4.8907		4.1850		4.6754		3.8387
Colombia	Colombian Peso (COP$)		0.0061		0.0064		0.0065		0.0066		0.0061	Colombian Peso (COP$)		0.0065		0.0059		0.0058		0.0058		0.0058
Guatemala	Quetzal		2.4548		2.5755		2.5591		2.6940		2.5440	Quetzal		2.5591		2.5023		2.7826		2.4478		2.5596
U.S.A.⁽²⁾	US Dollar		18.6529		18.9400		19.2397		19.7867		19.6829	US Dollar		19.2397		19.2641		21.4860		18.8452		19.9487
Uruguay	Uruguay Peso		0.6206		0.6606		0.6274		0.6869		0.6074	Uruguay Peso		0.6274		0.5479		0.5110		0.5051		0.4712
Nicaragua	Cordoba		0.6515		0.6307		0.6097		0.6428		0.6088	Cordoba		0.6097		0.5817		0.6257		0.5569		0.5728
Honduras	Lempira		0.8109		0.8007		0.7994		0.8330		0.8031	Lempira		0.7994		0.7806		0.8678		0.7597		0.8215
Chile	Chilean Peso		0.0276		0.0292		0.0300		0.0322		0.0283	Chilean Peso		0.0300		0.0275		0.0271		0.0252		0.0281
Paraguay	Guaraní		0.0033		0.0034		0.0034		0.0035		0.0033	Guaraní		0.0034		0.0031		0.0032		0.0029		0.0029
Peru	Sol (PEN$)		5.5232		5.8054		5.8517		6.0976		5.8406	Sol (PEN$)		5.8517		5.7708		6.1483		5.6814		5.5046
Dominican Republic	Dominican Peso		0.4048		0.3983		0.3876		0.4095		0.3898	Dominican Peso		0.3876		0.3737		0.3766		0.3542		0.3416
Costa Rica	Colon		0.0338		0.0331		0.0332		0.0346		0.0322	Colon		0.0332		0.0326		0.0366		0.0327		0.0323
European Union	Euro		20.6334		21.3649		22.7101		23.7539		22.5586	Euro		22.7101		21.5642		24.5080		21.1311		24.3693
Bulgaria	Lev		10.5483		10.9223		11.6110		12.1406		11.5327	Lev		11.6110		11.0257		12.5284		10.8076		12.4594
Belarus	New Belarusian Ruble		9.3929		9.8087		9.4451		9.9882		9.1319	New Belarusian Ruble		9.4451		9.2159		8.8172		8.9420		7.5721
Croatia	Croatian Kuna		2.7392		2.8619		3.0613		3.1954		3.0435	Croatian Kuna		3.0613		2.9069		3.2498		2.8406		3.2279
Macedonia	Macedonian Denar		0.3350		0.3471		0.3688		0.3861		0.3667	Macedonian Denar		0.3688		0.3504		0.3975		0.3431		0.3950
Serbia	Serbian Denar		0.1676		0.1762		0.1920		0.2009		0.1907	Serbian Denar		0.1920		0.1830		0.2083		0.1795		0.2071


	As reported 2016		Retrospective reclassification			2016 As adjustments
Operating revenues:
Mobile voice services	Ps.	242,302,380	Ps.	(242,302,380	)	Ps.	—
Fixed voice services		95,299,154		(95,299,154	)		—
Mobile data services		256,936,895		(256,936,895	)		—
Fixed data services		126,278,206		(126,278,206	)		—
Pay television		78,268,778		(78,268,778	)		—
Other related services		32,799,952		(32,799,952	)		—
Revenues services		—		831,885,365			831,885,365

	Ps.	831,885,365	Ps.	—		Ps.	831,885,365


	As reported 2017		Retrospective reclassification			2017 As adjustments
Operating revenues:
Mobile voice services	Ps.	221,751,600	Ps.	(221,751,600	)	Ps.	—
Fixed voice services		89,856,743		(89,856,743	)		—
Mobile data services		308,526,994		(308,526,994	)		—
Fixed data services		139,277,613		(139,277,613	)		—
Pay television		86,882,606		(86,882,606	)		—
Other related services		32,115,767		(32,115,767	)		—
Revenues services		—		878,411,323			878,411,323

	Ps.	878,411,323	Ps.	—		Ps.	878,411,323


	For the years ended December 31,									For the years ended December 31,
	2016			2017			2018			2018			2019			2020
Balance at beginning of year	Ps.	(27,495,158	)	Ps.	(37,351,677	)	Ps.	(39,044,925	)		Ps.(39,044,925	)		Ps.(40,798,025	)		Ps.(39,480,909	)
Increases recorded in expenses		(16,987,769	)		(20,766,362	)		(19,535,707	)		(19,535,707	)		(16,346,395	)		(19,112,635	)
Adjustment on initial application of IFRS 9 (Note 2i, b)		—			—			(2,400,783	)
Adjustment on initial application of IFRS 9											(2,400,783	)		—			—
Write-offs		12,587,567			17,713,992			15,497,254			15,497,254			17,839,957			11,953,227
Business combination														(3,265,490	)		(2,066	)
Translation effect		(5,456,317	)		1,359,122			4,686,136			4,686,136			3,089,044			2,090,648

Balance at end of year	Ps.	(37,351,677	)	Ps.	(39,044,925	)	Ps.	(40,798,025	)		Ps.(40,798,025	)		Ps.(39,480,909	)		Ps.(44,551,735	)


	~~2018~~
~~Contract Assets:~~
~~Balance at the beginning of the year~~	~~Ps.~~	~~29,640,953~~
~~Additions~~		~~32,029,279~~
~~Disposals~~		~~(25,243,487~~	)
~~Translation effect~~		~~(1,707,996~~	)

~~Balance at the end of the year~~	~~Ps.~~	~~34,718,749~~
~~Non-current~~ ~~contract assets~~	~~Ps.~~	~~5,437,263~~

~~Current portion contracts assets~~	~~Ps.~~	~~29,281,486~~


	2019			2020
Contract Assets:
Balance at the beginning of the year	Ps.	34,718,749		Ps.	34,274,007
Additions		34,877,851			27,242,031
Disposals		(2,658,641	)		(1,397,714	)
Business Combination		576,463			—
Amortization		(30,501,315	)		(29,002,995	)
Translation effect		(2,739,100	)		(1,527,225	)

Balance at the end of the year	Ps.	34,274,007		Ps.	29,588,104
Non-current contract assets	Ps.	1,786,560		Ps.	817,740

Current portion contracts assets	Ps.	32,487,447		Ps.	28,770,364


Instrument	Notional amount in millions		2019		2020		2021		2022		2023 Thereafter		Notional amount in millions	2021		2022		2023		2024	2025 Thereafter
Assets
Swaps US Dollar-Mexican peso	US$			—		—		—		1,600		1,890	US$				1,600					1,890
SwapsYen-US Dollar	¥			—		—		—		—		13,000	¥									9,750
SwapsEuro-Brazilian real	€			300		—		—		—		—
Swaps US Dollar – Euro													US$									150
Swaps Pound sterling – US Dollar													£									1,010
Forwards US Dollar-Mexican Peso													US$		240
Forwards Brazilian Real-US Dollar		BRL		1,680		—		1,143		—		—	BRL		4,193
Forwards Euro-Brazilian Real	€			150		—		—		—		—
Forwards US Dollar-Brazilian Real	US$			150		—		—		—		—
Forwards Euro-US Dollar	€			710		—		—		—		—	€		915
Liabilities
Swaps US Dollar-Euro	US$			25		—		—		—		2,000	US$									800
Swaps Yen-US Dollar													¥									3,250
Swaps Pound sterling-Euro	£			—		—		—		—		740	£									640
Swap Poundsterling-US Dollar	£			—		550		—		—		1,460	£									550
Forwards US Dollar-Mexican Peso	US$			977		—		—		—		—
Forwards Euro-US Dollar	€			950		—		—		—		—
Forwards US Dollar – Mexican Peso													US$		3,494
Forwards Brazilian Real-US Dollar													BRL		1,762
Forwards Euro – Mexican Peso													€		200
Put option	€			—		—		—		—		374	€						374
Call spread option	€			—		3,000		—		—		—


	At December 31, 2015			Additions		Retirements			Business combinations		Translation effect of Foreign Subsidiaries		Depreciation for the year			At December 31, 2016		At December 31, 2017		Additions		Retirements			Business combinations		Effect of translation of foreign subsidiaries and hyperinflation adjustment			Depreciation for the year			At December 31, 2018
Cost
Network in operation and equipment	Ps.	641,384,702		Ps.	101,794,197	Ps.	(8,963,076	)	Ps.	1,873,445	Ps.	235,186,745	Ps.	—		Ps.	971,276,013	Ps.	989,665,946	Ps.	68,900,443	Ps.	(1,610,246	)		Ps.128,246	Ps.	(87,888,453	)	Ps.	—		Ps.	969,195,936
Land and buildings		54,794,386			2,900,511		(2,845,298	)		3,839		7,281,973		—			62,135,411		62,584,189		4,429,433		(3,987,671	)		8,874		(5,904,499	)		—			57,130,326
Other assets		106,468,602			24,368,918		(10,717,096	)		69,937		24,736,655		—			144,927,016		150,315,807		25,268,252		(13,377,798	)		2,578		(12,399,702	)		—			149,809,137
Construction in process and advances plant suppliers⁽¹⁾		38,850,776			70,517,319		(70,911,593	)		11,255		11,252,127		—			49,719,884		74,121,374		92,285,397		(76,978,798	)		1,379		(8,336,823	)		—			81,092,529
Spare parts for operation of the network		20,342,389			34,010,751		(27,641,919	)		5,520		1,566,307		—			28,283,048		26,591,598		49,380,349		(44,626,488	)		1,939		(2,902,869	)		—			28,444,529

Total		861,840,855			233,591,696		(121,078,982	)		1,963,996		280,023,807		—			1,256,341,372		1,303,278,914		240,263,874		(140,581,001	)		143,016		(117,432,346	)		—			1,285,672,457

Accumulated depreciation
Network in operation and equipment		236,731,728			—		(1,968,376	)		—		153,147,349		107,976,385			495,887,086		552,345,509		—		(28,712,096	)		—		(67,907,227	)		104,279,361			560,005,547
Buildings		4,567,588			—		(975,284	)		—		3,709,952		3,179,066			10,481,322		10,655,285		—		(2,311,442	)		—		(2,157,996	)		2,625,102			8,810,949
Other assets		47,057,084			—		(25,099,710	)		—		10,396,438		16,105,885			48,459,697		63,359,529		—		(2,418,837	)		—		(6,579,983	)		22,172,785			76,533,494
Spare parts for operation of the network		(44,423	)		—		(54,280	)		—		20,896		401,008			323,201		575,393		—		(160,696	)		—		(131,429	)		38,479			321,747

Total	Ps.	288,311,977		Ps.	—	Ps.	(28,097,650	)	Ps.	—	Ps.	167,274,635	Ps.	127,662,344		Ps.	555,151,306	Ps.	626,935,716	Ps.	—	Ps.	(33,603,071	)		Ps. —	Ps.	(76,776,635	)	Ps.	129,115,727		Ps.	645,671,737

Net Cost	Ps.	573,528,878		Ps.	233,591,696	Ps.	(92,981,332	)	Ps.	1,963,996	Ps.	112,749,172	Ps.	(127,662,344	)	Ps.	701,190,066	Ps.	676,343,198	Ps.	240,263,874	Ps.	(106,977,930	)		Ps.143,016	Ps.	(40,655,711	)	Ps.	(129,115,727	)	Ps.	640,000,720

Management

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

~~FORM 20-F CROSS REFERENCE GUIDE~~