MEXICO Trends and Developments Contributed by: Carlos Chávez, Juan Carlos Burgos, Gerardo Rodríguez and Édgar Martín, Galicia Abogados
At the same time, lower notification thresholds, expanded telecoms and broadcasting responsibilities, shorter deadlines and staffing demands are increas - ing the authority’s workload. While the reform aims to accelerate reviews, these pressures may lengthen timelines in more complex transactions through exten - sions or, in some cases, pull-and-refile mechanisms. The authority has also noted that the “simplified” pro - cedure under Article 92 of Mexico’s Federal Economic Competition Law continues to carry a substantial evi - dentiary burden, meaning the standard route remains the most common in practice. The CNA’s most notable recent merger decision was the blocking of a proposed acquisition involv - ing a major international payment network and a key participant in Mexico’s payment infrastructure. The authority raised concerns over the loss of competi - tion in card brand licensing, risks to a low-cost card option for issuing banks, and access to sensitive user information, ultimately finding the proposed remedies insufficient. For transaction planning purposes, companies should continue building meaningful timing buffers into deal schedules, particularly for transactions involving hori - zontal overlaps or regulated sectors. Private Equity Under Scrutiny: The LP Disclosure Question Private equity transactions have received particu - lar attention in merger reviews, especially regarding the disclosure of limited partners (LPs) within fund structures. Consistent with prior COFECE practice, the CNA has requested detailed information on LPs and its investments in Mexico that may be relevant to the competitive assessment of the transaction. As a result, information gathering and disclosure in private equity transactions can represent a significant part of the merger review process. The CNA has indicated that a broader review of the merger control guidelines may take place, with dis - cussions including topics that have historically gen - erated questions in practice, such as private equity transactions, investment rounds and multi-step trans - actions. Future guidance in these areas may provide
additional clarity as the authority’s approach contin - ues to develop. Non-Compete Clauses: A New Area of Focus in Merger Review An important and sometimes overlooked development is the CNA’s heightened scrutiny of non-compete and non-solicitation clauses in the context of merger transactions. Since the appointment of the new board, scrutiny of labour-related restrictions, particularly non- compete and non-solicitation clauses, has intensified. Such provisions now require detailed justification, including a clear explanation of their necessity, pro - portionality, and scope in terms of duration, geo - graphic reach and affected personnel, consistent with the principles reflected in the authority’s guidance. In line with prior COFECE practice, the authority applies strict criteria to sign off on such arrangements, includ - ing that they should generally not extend beyond three years, should not bind parties other than sellers, and should not capture products or services not offered by the target nor territories served by it at the time of the transaction, except where the applicants can demon - strate that actual expansion plans exist. These provi - sions have also become a recurring focus of informa - tion requests, often generating extensive follow-up questions during review processes. The practical implication for deal teams is that non- compete provisions in transaction documents should be reviewed carefully before filing. Non-compete or non-solicitation clauses that do not clearly align with the above criteria may, in practice, lead to additional scrutiny and potentially delay clearance, even where the authority does not identify substantive competi - tion concerns in the underlying transaction. It will also be important to monitor whether the CNA continues to apply these criteria or introduces changes to its approach. Gun Jumping: Higher Stakes Than Ever The consequences of “gun jumping” have become increasingly significant following the FCA amendments and recent judicial developments. The amended law now substantially increases potential fines, which start at a much higher baseline and may reach up to 8% of a company’s annual income. The Supreme Court
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