Mexico: Bill Introduced to Amend the Federal Economic Competition Law, with Increased Penalties and New Regulatory authorities

On April 24^th, the Federal Executive submitted a bill to amend the Federal Economic Competition Law, thereby significantly modifying the main regulatory framework governing competition in Mexico.

Although this bill does not constitute a complete overhaul of the Federal Economic Competition Law, it introduces substantial changes to the country's competition system. The most relevant changes include: 

• Creation of a new authority: The bill proposes the creation of the National Antitrust Commission, a decentralized public agency with operational independence. It will consist of five commissioners (with non-renewable seven-year terms), one of whom will serve as the presiding commissioner (with a three-year term, renewable once). Commissioners will be appointed by the Federal Executive and must be ratified by the Senate. The Executive retains the power to remove commissioners for serious cause, in accordance with applicable law.

  The Commission will also include an Investigative Authority, appointed by the full panel, with a four-year term that may be renewed once.

• Merger notification: The bill reduces the economic thresholds for merger notification under current Article 86 and shortens the period in which the authority must resolve merger proceedings under Article 90.

  Mergers that do not meet the notification thresholds may still be reviewed up to three years after closing. In addition, the timeframe for the authority to investigate notifications is extended.

• Monopolistic practices: The bill expands the scope of relative monopolistic practices by including as a punishable conduct any unjustified limitation on other market participants' ability to compete.

  It also classifies the exchange of information between competing agents as a per se (absolute) monopolistic practice, repealing current Section V of Article 53 of the Law.

  Finally, the concept of potential competitors is introduced, thereby broadening the scope of prohibited practices to include those among both current and potential competitors.

• Increased penalties: The proposed reform significantly increases the maximum fines that the current Federal Economic Competition Commission may impose, as follows:
  • Fines of up to 20% of total revenues for engaging in absolute monopolistic practices.
  • Fines of up to 15% of total revenues for relative monopolistic practices and unlawful concentrations.
  • Fines of up to 10% of total revenues for carrying out a transaction without prior authorization from the authority (i.e., gun-jumping).
• Immunity and fine reduction programs: The bill also modifies the deadlines and eligibility criteria for immunity and fine reduction programs. Under the proposal, full immunity from fines would only be available to parties that self-report before the initiation of an investigation. Fine reduction would remain available.
• Compliance certification program: The bill grants the new authority the power to certify compliance programs implemented by economic agents in the field of competition. Such certification would be valid for three years and would be considered a mitigating factor under the law.
• New authorities in telecommunications: Finally, the bill includes new procedures and authorities for the antitrust authority in telecommunications and broadcasting matters, which previously fell under the jurisdiction of the Federal Telecommunications Institute.

The bill would take effect the day after its publication. However, the constitutional reform regarding the new authority’s powers would become effective once the commissioners have been duly appointed, no later than June 30^th, 2025.