Mexico’s Federal Telecommunications Institute (IFT) on Thursday gave the green light for wireless carriers AT&T and Telefonica to proceed with a proposed spectrum swap in the country.

The deal will allow AT&T to operate on spectrum in the 1.7 and 2.1 GHz bands, while Telefonica will take over AT&T’s airwaves in the 1.9 GHz band.

The IFT said it was able to approve the deal under Article 106 of federal telecommunications law, which allows for service providers to exchange frequency bands provided the swap doesn’t affect competition and will make efficient use of the spectrum to the benefit of users.

The exchange comes as both AT&T and Telefonica have sought to expand their wireless networks in Mexico.

Last November, AT&T made a major move into the Mexican carrier space with the $2.5 billion acquisition of Mexican wireless provider Iusacell. The purchase netted AT&T Iusacell’s licenses, network assets, retail stores as well as its approximately 8.6 million subscribers.

The carrier followed up with the acquisition of Nextel Mexico in May  and in June announced plans invest $3 billion to expand its network in Mexico to cover 100 million people by the end of 2018. The company has also announced the start of a rebranding effort south of the border.

In September, reports indicated that Telefonica had opened itself to exploring agreements with rival carriers - including AT&T - in order to expand its own network in Mexico.

The approval also comes as the IFT looks to loosen dominant carrier America Movil’s grip on the country.