MEXICO Trends and Developments Contributed by: Daniel Amézquita, Iván Valdespino, Sofía Jurado and Gilda Velázquez, Galicia Abogados
Dissolution of Autonomous Constitutional Bodies and Transfer of Functions to the Federal Executive In the 1990s and early 2000s, Mexico adopted an economic model that facilitated trade and financial liberalisation. As part of this new approach, various autono - mous bodies were created and later granted constitutional status, such as the Bank of Mex - ico, which was granted autonomy in 1994, the National Human Rights Commission (CNDH), established in 1999, the Federal Electoral Insti - tute (now INE), created in 1996, the Federal Economic Competition Commission (COFECE), created in 1992 and granted autonomy in 2013, the Federal Telecommunications Institute (IFT), created in 2013, and the National Institute for Transparency, Access to Information and Per - sonal Data Protection (INAI), established in 2002 and declared autonomous in 2014. The creation of these bodies has been crucial in carrying out highly technical functions and, in the case of INAI, exposing corruption scandals such as the “Master Fraud” , in which federal agen - cies diverted over MXN7.6 billion through shell companies. COFECE has intervened in several key cases to combat anti-competitive practices in Mexico, such as the case of collusion in drug tenders from the Mexican Institute of Social Security (a government agency providing public healthcare services). Through this case, COFECE imposed sanctions on both pharmaceutical companies and medicine distributors that illegally co-ordi - nated to allocate public sector drug supply con - tracts among themselves. Also, in September 2024, the IFT sanctioned a telecommunications company with a fine of
MXN90.6 million due to monopolistic practices in various states of the Republic. The company was found to have provided incentives to dis - tributors on the condition that they would not sell devices with SIM cards from competing pro - viders. However, on 20 December 2024, a constitutional amendment was published in the Federal Official Gazette, dissolving seven autonomous constitu - tional bodies and transferring their functions to the Federal Executive Branch. According to the amendment, the primary objec - tive is to reduce bureaucracy and associated expenses by centralising functions to improve administrative efficiency. The savings will be allocated to the Pension Fund for Well-Being. Among the eliminated bodies are INAI, the IFT and COFECE. The functions of COFECE and the IFT will be transferred to a new antitrust authority with tech - nical and operational independence. Meanwhile, INAI’s responsibilities may be integrated into the Ministry of Public Service, which will be rebrand - ed as the Ministry of Anti-Corruption and Good Governance. Congress has a period of 90 days from the entry into force of the reform – 21 December 2024 – to make the necessary adjustments to secondary legislation. In the meantime, the autonomous constitutional bodies will continue to perform their functions as usual. It should be noted that the secondary legislation issued to implement the reform will be of critical importance, as the loss of autonomy of the agen - cies responsible for enforcing competition and telecommunications laws may lead to scrutiny
183 CHAMBERS.COM
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