MEXICO Trends and Developments Contributed by: Fernando Carreño, Sergio López, Carlos Cevallos and Dolores Jiménez, Von Wobeser y Sierra, SC
LFCE amendments. The LFCE reform initiative addresses certain concrete points, such as the nature and structure of the new unified competi - tion authority. However, beyond these specific areas directly dictated by the constitutional changes, the LFCE reform opens the door to a wide range of policy choices that will significantly impact competi - tion policy in Mexico in the coming years. The specific details of the new LFCE are still under discussion. Proponents argue these changes will improve regulatory efficiency and better align competition policy with national development objectives. Yet, skeptics warn that without the crucial element of institutional independence that COFECE and IFT previously enjoyed, Mex - ico risks regulatory capture. In such a scenario, powerful economic interests – including the state itself or entities closely aligned with it – could exert undue influence over the application and enforcement of competition rules, potentially weakening the state’s ability to effectively combat cartels that might operate within or alongside these powerful interests. Concerns regarding the quality of future judicial review of the new authority’s decisions Legal professionals and the business commu - nity have expressed significant concern regard - ing the potential impact of another controversial reform (the recent 2024 judicial reforms) on the quality and impartiality of the judicial review of future decisions made by the new competition authority. The controversial 2024 reforms to the judiciary in Mexico have raised concerns about its independence and its ability to provide effec - tive judicial review of administrative decisions, including those made by regulatory bodies.
This context amplifies the apprehension about the new competition authority, as the legal and business sectors worry whether its resolutions will be made with the necessary technical rigor and due process. The concern is that a weak - ened or less independent judiciary may be less likely to effectively check potential abuses or errors by the new competition authority, further exacerbating the risks associated with the loss of its constitutional autonomy. The crucial question of technical autonomy under the new framework A key aspect of the ongoing debate centres on the technical autonomy of the new competition authority. Despite the fact that it will no longer possess the constitutional protections afford - ed to COFECE and IFT, the question remains whether the new antitrust authority can operate free from undue political pressures. It is important to recall that prior to the establish - ment of COFECE as a constitutionally autono - mous body, Mexico’s first competition author - ity, operating from 1992 until the 2013 reform, enjoyed a significant degree of de facto auton - omy. This was partly due to a prevailing con - sensus among governments during that period regarding the importance of an independent competition watchdog. It is within this historical context that the current apprehension arises regarding the situation of the new authority. Will the new authority have sufficient safeguards to protect its technical decision-making? Equally critical is the future attitude of the government towards respect - ing this operational autonomy in practice. The worst-case scenario is that behind a seemingly autonomous authority, political pressures could severely undermine competition policy in the country or even weaponise it for political ends.
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