New Federal Antitrust Law
Dear clients and friends:
Yesterday, Wednesday, April 30, 2014, the Chamber of Deputies approved, in general and specifically, the new
Federal Antitrust Law (Ley Federal de Competencia Económica) (“LFCE” or the “Law”), a result of the
antitrust and telecommunications constitutional reform published in the Official Federal Gazette on June 11,
2013 (the “Constitutional Reform”).
This Law is the final result of analyses and discussions by the Federal Congress of the bill presented by the
Federal Executive Branch on February 19, 2014, which suffered more than 90 changes by the Chamber of
Deputies and the Senate.
In view of the above, the 1992 Federal Antitrust Law was repealed and the new LFCE will enter into force, with
a total of 138 articles, regulating article 28 of the Political Constitution of the United Mexican States.
Below we provide a brief summary of the most important changes resulting from this new Law.
A. FUNCTIONS AND POWERS OF THE FEDERAL ANTITRUST COMMISSION
Through the LFCE powers were given to the Federal Antitrust Commission (Comisión Federal de
Competencia Económica) (“CFCE” or the “Commission”), such as:
1.
2.
3.
4.
To order measures to eliminate barriers to competition and free enterprise.
To determine the existence and to regulate access to essential inputs.
To order the divestment of assets, rights, partnership interests or shares of the economic agents in the
proportions necessary to eliminate anticompetitive effects.
To publish regulatory provisions in relation to: (i) imposition of penalties; (ii) determination of substantial
power; (iii) determination of relevant markets; (iv) barriers to competition and free enterprise; (v) essential
inputs; (vi) divestment of assets, rights, partnership interests or shares of the economic agents.
The LFCE also includes a chapter on the integration and functioning of the plenary of the Commission, which
includes the Evaluation Committee, its powers and obligations, as well as new causes for removal of the
commissioners, their powers and prohibitions.
Guillermo Gonzalez Camarena 1100, 7th Floor, Santa Fe, Centro de Ciudad, Alvaro Obregon, 01210 Mexico City.
P: 5255 5258 1000 • www.vonwobeser.com
Finally, in the new LFCE the investigative authority and the enforcement authority are separated through the
creation of a special body called the Investigative Authority, regulated in title III of the Law.
B. NEW MONOPOLISTIC PRACTICES
The new Law includes as an absolute monopolistic practice the exchange of information with the purpose or
effect of fixing prices, restricting supply, dividing markets and bid rigging.
It also includes two types of conduct that will be considered relative monopolistic practices:
1.
The denial of, restriction of access to, or access under discriminatory terms and conditions to an essential input.
2.
The narrowing of margins between the price of access to an essential input provided by one or more economic
agents and the price of a good or service offered to the final consumer by those economic agents, in which the
same input is used for its production.
For greater regulatory precision, the LFCE establishes the criteria for determining the existence of Essential
Inputs.
C. CONCENTRATIONS
The most significant changes to the LFCE in the area of concentrations are the following:
1.
The elimination of the order not to execute, also known as the “stop order”, which will make it impossible
to close any transaction before the issuance of a favorable ruling by the Commission, until 60 (sixty) days
from the date of its notification have passed.
2.
The inclusion of the power of the Commission to request additional information and/or documentation
from any economical agent related to the concentration, public authorities, and in general any other
person, for purposes of doing the corresponding analysis.
3.
The change of the procedure for presenting proposed conditions, requiring as of this new Law that they be
presented from the presentation of the notification up to one day after the matter is listed to be addressed
in a meeting.
Guillermo Gonzalez Camarena 1100, 7th Floor, Santa Fe, Centro de Ciudad, Alvaro Obregon, 01210 Mexico City.
P: 5255 5258 1000 • www.vonwobeser.com
D. SPECIAL PROCEDURES
The new Law includes several special procedures, such as the following:
1.
Investigation procedure to determine the existence of barriers to competition or essential inputs that could
generate anticompetitive effects. Such investigations will be initiated ex officio, or at the request of the
Federal Executive Branch.
2.
Procedure for waiver and reduction of fines, which economic agents under investigation may resort to
before the judgment of probable liability is issued.
3.
Procedures for requesting a formal opinion and general guidelines in relation to free trade and antitrust
matters, which any economic agent may request in the case of new questions on relevant topics. Such
opinions will be binding on the Commission.
E. PENALTIES
In parallel to the creation of this new Law, article 254 bis of the Federal Criminal Code was amended, elevating
the penalties established therein of 3 to 5 years in prison to 5 to 10 years.
Furthermore, consistent with the absolute monopolistic practice added to the Law, another crime is included,
which is the exchange of information having the purpose or effect of fixing prices, restricting supply, dividing
markets and bid rigging.
Finally, article 254 bis 1 is included, which makes it a crime to alter, destroy or disturb documents, images or
electronic files that contain information or data during an inspection.
In case of any comments or additional information, please do not hesitate to contact us.
Fernando Carreño, Partner: +52 55 52 58 10 42, [email protected]
Sincerely,
Von Wobeser & Sierra, S.C.
Mexico City, May 1st, 2014.
Guillermo Gonzalez Camarena 1100, 7th Floor, Santa Fe, Centro de Ciudad, Alvaro Obregon, 01210 Mexico City.
P: 5255 5258 1000 • www.vonwobeser.com