Mexico updates

Banking

Contributed by Hogan Lovells BSTL SC
What can banks expect from the new president?
  • Mexico
  • July 20 2018

Andrés Manuel López Obrador was elected president on 1 July 2018 and will take office on 1 December 2018. Not only did López Obrador obtain more than 50% of the votes (approximately 30 million), his party and coalition also won an absolute majority in both the House of Representatives and the Senate. This is the first time in 20 years that a president will govern with this level of power. But what will this mean for the banking sector?

Numerous cyberattacks breach Banxico's Interbank Electronic Payments System
  • Mexico
  • June 01 2018

The funds of some participants of the Interbank Electronic Payments System (SPEI) were recently affected by a series of unprecedented cyberattacks. The Mexican Central Bank revealed that approximately $15 million (Ps300 million) had been involved in diverse irregular transfers, subject to investigation. The cybercriminals had identified a flaw in the system that permitted receivers of SPEI transfers to withdraw cash almost immediately after receiving the transfer so that the money could not be traced.

Congress approves Financial Technology Institutions Law
  • Mexico
  • April 06 2018

The president recently enacted the Financial Technology Institutions Law. The Senate had unanimously approved the bill on the law in December 2017 and sent it to Congress, which made no changes. The law seeks to build a regulatory framework that will encourage the development of innovative financial services, increase the level of competition and financial inclusion and place Mexico at the forefront of the industry.

Recent court precedents concerning financial transactions
  • Mexico
  • February 02 2018

There were a number of court precedents in 2017 concerning financial transactions. For example, a recent non-binding collegiate court precedent broadened the scope and source of information that judges should use to analyse and determine the existence of usury, while another validated judges' authority to use the annual interest rate published by companies that engage in vehicle financing. Further, a binding Supreme Court precedent dealt with the maturity date of promissory notes.

SHCP releases first draft of Financial Technology Institutions Law
  • Mexico
  • December 08 2017

The Ministry of Finance and Public Credit recently circulated a substantially amended draft of the Financial Technology Bill, which has been renamed the Financial Technology Institutions (FTIs) Law. The law aims to regulate the financial services provided by FTIs – including those which are bound to specific regulations and offered or rendered through innovative means – as well as the organisation of such institutions and their operations.


Competition & Antitrust

Contributed by SAI Law & Economics
Legal privilege stands: FECC must guarantee its applicability
  • Mexico
  • May 10 2018

After two years of litigation, the First Collegiate Tribunal on Administrative Matters Specialised in Economic Competition, Broadcasting and Telecommunications has finally issued a final ruling acknowledging that the Federal Economic Competition Commission breached the attorney-client privilege principle during a dawn raid. The tribunal's ruling is relevant, as it demonstrates the possible outcomes of a violation of attorney-client privilege by the antitrust authorities.

FECC launches project to develop guidelines for analysis of collaboration agreements between competitors
  • Mexico
  • February 22 2018

The Federal Economic Competition Commission (FECC) recently issued its Annual Working Plan. In it, the FECC recognised that one of its strategic goals is to communicate to economic agents how anti-competitive practices will be investigated and which actions agents may adopt to prevent potential risks. In particular, the FECC declared that one of its goals for 2017 would be to launch a project to develop guidelines for the analysis of collaboration agreements between competitors.

FECC penalises individuals for commissioning absolute monopolistic practice in tortilla market
  • Mexico
  • December 14 2017

Corn tortillas are a fundamental source of nutrition for Mexican families, and artificial price increases have a significant effect on the consumer economy. Given the importance of the corn tortilla market, it has come under the scrutiny of several authorities – for example, the Federal Economic Competition Commission, which recently fined three individuals a total of Ps394,508 for the commission of an absolute monopolistic practice in the market for the production, distribution and marketing of corn tortillas.

FECC releases study on competition barriers relating to expired patent pharmaceutical products
  • Mexico
  • September 28 2017

The Federal Economic Competition Commission (FECC) recently released a study on competition in the expired patent drug market, in which it analysed the level of competition in various drug markets following the expiry of an original drug's patent. According to the FECC, several obstacles to competition exist, which ultimately discourage possible new competitors from developing generic versions of drugs and entering the market.

Specialised Competition Court annuls FECC's resolution revoking immunity under leniency programme
  • Mexico
  • June 29 2017

The Specialised Competition Court recently annulled the Federal Economic Competition Commission's decision to revoke immunity granted during an antitrust procedure. The court's decision is relevant, as it sets the criteria for determining to what extent an economic agent can challenge the application of law in a specific case.


Employment & Benefits

Constitutional reform: labour justice, freedom of association and collective bargaining
  • Mexico
  • March 15 2017

The decree amending several provisions of the Constitution with regard to labour justice, freedom of association and collective bargaining was recently published in the Federal Official Gazette. Key amendments include the abolishment of the conciliation and arbitration boards and the establishment of a new federal agency which will be responsible for the registration of collective bargaining agreements and trade union organisations, as well as all related administrative processes.

Fixed-term employment agreements under Federal Labour Law
  • Mexico
  • January 18 2017

Under the Federal Labour Law, fixed-term employment agreements can be validly entered into only when the temporary and extraordinary nature of a job requires it or an employer must temporarily replace an employee. Failure to apply fixed-term agreements in accordance with the law may result in a temporary employment relationship being classified as an employment relationship for an indefinite term and a finding that its termination was unjustified.

General and professional minimum wages increased
  • Mexico
  • January 11 2017

The National Minimum Wages Commission (CONASAMI) recently published a resolution increasing general and professional minimum wages. CONASAMI first increased the general minimum wage by Ps4, resulting in a rate of Ps77.04 per day, with the objective of gradually and steadily improving the purchasing power of employees who earn the minimum wage. Immediately thereafter, it increased both general and professional minimum wages by 3.9%, resulting in a rate of Ps80.04 per day.


Energy & Natural Resources

Enel enters Mexican energy sector
  • Mexico
  • November 13 2017

Italian energy company Enel Green Power recently launched a qualified energy supplier subsidiary in Mexico, through which it intends to acquire at least 150 large customers. Enel plans to make a substantial bid to commercialise electric power, clean energy certificates and energy solutions for commercial and industrial users. This type of private investment is a clear example of how the Mexican energy reform has led to the emergence of new players that were previously unable to participate in this sector.

CNH announces tender for oil marketing services
  • Mexico
  • November 06 2017

The National Hydrocarbons Commission (CNH) recently announced the tender for the commercialisation of hydrocarbons that the state obtains as consideration in exploration and extraction contracts. The CNH indicated that the tendered services will consist of the company that wins the tender selling the hydrocarbons when they are delivered by the private company that extracted them. This action is another example of the new business opportunities that the recent energy reform has introduced.

Legal servitude of hydrocarbons
  • Mexico
  • July 17 2017

Following the latest energy reform and the enactment of the new Hydrocarbons Law in 2014, a new legal concept regarding the legal servitude of hydrocarbons has been introduced. This concept aims to replace direct expropriation by giving landlords more options when negotiating the ownership of properties used by public utilities in the acquisition of land needed for hydrocarbon activities.

Oil tender rounds consolidate Mexico as one of world's most attractive investment destinations
  • Mexico
  • May 29 2017

According to its recent press release, the Ministry of Energy, in conjunction with the National Hydrocarbons Commission, plans to increase substantially the number of areas offered in future oil tenders. This will increase national production of oil and gas, as well as future reserves. In addition, the energy secretary has stated that it will help to consolidate Mexico as one of the world's most attractive investment destinations in the hydrocarbons field.

Social management of energy projects in Mexico: international law and human rights
  • Mexico
  • May 22 2017

The execution of major energy projects has been affected by social opposition from various communities, including individual landowners and indigenous communities, among others. The magnitude of this problem is best addressed from a human rights perspective, as the complex structure of international and regional organisations of which Mexico is a member has resulted in a vast number of international treaties relating to the human rights of communities affected by energy projects.


Environment & Climate Change

Contributed by Hogan Lovells BSTL SC
New guidelines concerning recovery of expired water concessions for exploitation of national waters
  • Mexico
  • April 30 2018

The Ministry of Environment and Natural Resources recently published a decree granting administrative benefits for the issuance of new concession titles for exploiting national waters to persons that hold a title which expired after January 1 2004. Notably, the decree allows for the issuance of new concession titles even if the zone or specific aquifer from which the original concession title was authorised to extract water is now considered a restricted or banned zone or aquifer.

Draft amendments to official standard apply to wastewater discharges into national waters
  • Mexico
  • March 05 2018

The National Waters Commission recently submitted to the Federal Regulatory Betterment Commission its draft revision of the Mexican official standard which establishes the maximum permissible levels of pollutants in wastewaters discharged into national waters or properties. The draft aims to modernise the standard by including additional terms and definitions, pollutants and parameters regarding wastewater discharges into federal waters, as well as new sampling and reporting frequency obligations.

Waste management rules for hydrocarbons sector to be enacted
  • Mexico
  • November 13 2017

The National Agency for Industrial Safety and the Protection of the Environment in the Hydrocarbons Sector recently filed a draft emergency Mexican official standard before the Federal Regulatory Betterment Commission. The draft establishes the criteria for classifying types of special and hazardous waste derived from the hydrocarbons sector, determines which types of waste are subject to a waste management plan and details the procedures for formulating such a plan.

ASEA issues draft water protection guidelines applicable to shale oil projects
  • Mexico
  • June 26 2017

Following the expansion of shale oil extraction projects and the discovery of unconventional hydrocarbon deposits, the National Agency for Industrial Safety and the Protection of the Environment in the Hydrocarbons Sector recently commenced a public consultation process to enact applicable water protection guidelines. The draft guidelines provide a glimpse of the authorities' preliminary approach to shale oil projects with regard to water resources and environmental protection.

ASEA issues environmental and safety guidelines for ground transportation of oil and petrochemicals through pipelines
  • Mexico
  • May 29 2017

As part of its expansion of operational safety and environmental protection guidelines and administrative provisions, the National Agency for Industrial Safety and the Protection of the Environment in the Hydrocarbons Sector turned its attention to oil, gas and petrochemical pipeline transportation activities. Recently issued guidelines complement the environmental legal framework so that both environmental and personal safety are guaranteed during the lifetime of a pipeline project.