Mexico approves a new regulatory regime on economic competition

In recent days, the Mexican Congress approved a reform to the Federal Economic Competition Law (LFCE), which had been in effect since 2014. This reform aligns with the constitutional amendment passed in December 2024 and marks the beginning of a new regulatory framework for competition in Mexico.

Although the LFCE has not been replaced by an entirely new law, the reform introduces significant changes to the structure and functioning of Mexico’s antitrust system.

Among the many amendments adopted, the following stand out:

• Creation of the National Antitrust Commission (CNA)
  
  The CNA will consolidate all competition-related powers into a single authority and will operate as a decentralized public agency attached to the Ministry of Economy. It will enjoy operational autonomy and technical and managerial independence.
  
  This body, similar to the current COFECE, will operate through a board of five commissioners and an investigative unit.
  
  The Federal Executive will appoint the commissioners, subject to ratification by the Senate.
  
  The CNA will be empowered to issue regulatory provisions and an organic statute governing its internal operation, as well as guidelines, technical criteria, and non-binding guidance regarding the exercise of its functions under the LFCE.

• Sanctions
  
  The reform introduces significant increases in the amounts of fines that may be imposed by the CNA under the new LFCE, including fines of up to 15% of an economic agent’s revenues for engaging in absolute monopolistic practices (PMA), and up to 10% for relative monopolistic practices (PMR)—compared to the current caps of 10% and 8%, respectively.
  
  Additionally, the law introduces new sanctionable scenarios, including:

  • Disqualification from participating in public procurement processes for those involved in bid rigging;
  • Failure to appear at hearings or to respond to questions;
  • Failure to comply with disqualification orders issued by the authority;
  • Obstruction of on-site inspections;
  • Delays in proceedings conducted by the CNA.
     

  Lastly, the reform incorporates sanctions for telecommunications-related procedures previously enforced by the Federal Telecommunications Institute (IFT).

• Mergers Control Filings
  
  The statute of limitations for the authority to investigate concentrations will increase to three years, up from one year under the current LFCE.
  
  The timeframe for clearance of concentrations will be reduced. Once the reform comes into effect, the CNA will have 30 days to issue a decision on merger notifications.
  
  Importantly, the reform also significantly increases gun-jumping penalties.
  
  The monetary thresholds for requiring prior authorization from the authority have been reduced in each of the subsections of current Article 86 of the LFCE, as follows:
  • Transaction value: 16 million times the UMA (previously 18 million);
  • Accumulation of 30% or more (previously 35%) of the assets or shares of an entity with sales or assets in Mexico exceeding 16 million UMAs (previously 18 million);
  • Accumulation in Mexico of assets or equity exceeding 7.4 million UMAs (previously 8.4 million), where two or more economic agents involved in the transaction have annual sales or assets in Mexico—jointly or separately—exceeding 40 million UMAs (previously 48 million).

• Monopolistic Practices
  
  Under the new provisions of the LFCE, the authority must consider the following elements when assessing substantial market power:

  • Degree of market positioning of the goods or services in the relevant market;
  • Lack of access to imports or existence of high import costs;
  • Existence of high switching costs that consumers may face when seeking alternative providers.
     

  The duration of investigations is reduced from five to four periods of 120 business days. In addition, the authority must issue a statement of probable liability and resolve the proceedings within 30 business days.

• New Legal Figures, Authorities and Procedures
  
  The reform introduces a compliance program certification scheme, under which certified programs will remain valid for three years and may be considered as a mitigating factor for liability under the LFCE.
  
  The reform also allows economic agents to initiate a procedure to exclude communications protected by attorney–client privilege in investigations conducted by the CNA.
  
  Additionally, the CNA will be authorized to conduct inspections, surveys, and collect data deemed relevant to the performance of its duties.
  
  The Ministry of Economy will have authority to file complaints in competition matters, and the investigative unit must cure any deficiencies in such complaints.
  
  Lastly, the Federal Executive, through the Ministry of Economy, may notify the CNA regarding relevant matters of free market access and economic competition. In such cases, the CNA will be required to issue a response within 10 days.
  
  This reform was published on July 16^th in the Official Gazette of the Federation (DOF) and will enter into force the day after its publication.