Mexico: National Anticorruption System

Last Updated: 25 June 2015
Article by Galicia Abogados
  • The Decree amending the Mexican Federal Constitution on anticorruption matters was published today.
  • The creation of the National Anticorruption System sets the bases for new anticorruption legislation and new rules both for public officers and private parties.

The afternoon edition of the Official Gazette of the Federal Government ("DOF") of even date hereof, features the Decree amending the Mexican Federal Constitution on anticorruption matters (the "Decree") . Even though the Decree partially comes into force the day following its publication in the DOF, the relevant provisions relating to aggravated administrative offenses of both public officers and private individuals and entities, as well as the creation of the National Anticorruption System (Sistema Nacional Anticorrupción) shall enter into force once the national statutes (leyes generales) on this matter are issued by Congress, during the course of next year.

I. Background

The corruption phenomenon has been an issue in the national political agenda for several years now. In this respect, on June 12, 2012 the Federal Anticorruption in Public Contracts Act was published in the DOF. Such legislation was a response to the corruption scandals that at such time became publicly known because of the proceedings conducted in other jurisdictions pursuant to their anticorruption laws (as an example, proceedings involving Pemex, the Federal Electricity Commission and the Mexican Social Security Institute in the United Stated pursuant to the Foreign Corrupt Practices Act).

Likewise, Mexico is party to several international treaties on anticorruption matters1 and has included in its legislation several provisions aimed at fighting corruption, such as the aforementioned Federal Anticorruption in Public Contracts Act, the Federal Criminal Code (which specifies as a criminal offenses certain acts of corruption, such as corrupt influence (tráfico de influencias) and bribery (cohecho) both to national and foreign public officers), and the Federal Public Officers' Liabilities Act.

Notwithstanding the foregoing, recent acts of corruption and conflicts of interest involving public officers, civilians and private entities have evidenced that the legal and institutional anticorruption framework in Mexico is far from adequate. In his speech of enactment of the Decree, the Executive stated that the Anticorruption Index of Transparency International puts Mexico in place 103 among 175 countries and that, in his view it was unacceptable that Mexico ranked so low in such index.

As we have mentioned before in the context of prior legislative changes, the real impact of the Decree will be seen in the ability and willingness to apply the law and encourage the respect to the rule of law in our country.

II. National Anticorruption System.

The Decree creates the National Anticorruption System as an entity to coordinate all competent authorities (local, state and federal) to prevent, detect and sanction administrative offenses and acts of corruption, as well as in auditing and controlling the use and distribution of public funds. Such system shall have a Citizen Participation Committee comprised by five distinguished Mexicans.

The intent behind the creation of the National Anticorruption System is being able to combat corruption in a transversal manner, taking as axes the different levels of government, as well as the public and private sectors.

In addition to the fight and punishment of corruption, the System will be also in charge of promoting the culture of legality and preventing the corruption phenomenon through recommendations, training and other similar measures.

III. Powers of Congress on anticorruption matters.

Based on the doctrine of general laws applied by the federal courts as set forth in the 20072 Supreme Court decisions, that acknowledges the existence of general laws that can validly interfere in all partial jurisdictions that comprise the Mexican State [with respect to which] the Constituent Congress [...] explicitly waives its power to distribute jurisdiction among the political entities that comprise the Mexican State [and] that have their origin in constitutional clauses that mandate [Congress] to enact them, the Decree empowers Congress to issue two general laws: [1] the general law that sets forth the bases of coordination of the National Anticorruption System and [2] the general law that distributes jurisdiction among the different levels of government to establish the administrative responsibilities of public officers, their obligations, the applicable sanctions for aggravated acts and omissions of public officers and citizens, as well as the proceedings for the imposition thereof. Such general laws shall be enacted no later than May 28, 2016.

Additionally, Congress is empowered to enact the law creating the Federal Court of Administrative Justice (Tribunal Federal de Justicia Administrativa) ("TFJA") , endowed with constitutional autonomy, as a successor of the Federal Tax and Administrative Court (Tribunal Federal de Justicia Fiscal y Administrativa).

IV. Powers of the General Comptroller of the Federation (Auditoría Superior de la Federación).

One of the main aspects of the Decree is the strengthening of the auditing powers of the General Comptroller of the Federation, including: [1] the power to review the national accounts during the fiscal year in "real time", eliminating the principles of annuity and after-the-fact review, without eliminating its powers to audit previous fiscal years; [2] extending the period of review of the public accounts to the entire succeeding fiscal year; [3] the public nature of the general and individual reports issued by the General Audit of the Federation with respect to the public accounts, [4] the power to review the use of the proceeds of public debt when the local and state entities contract debt guaranteed by the Federation, as well as the use of federal resources and federal participations by the states, [5] the power to determine responsibilities and to request the application of sanctions against public officers and civilians, and [6] the audit of trusts that operate with public resources.

V. New constitutional status of the TFJA.

The TFJA retains the same powers that the Federal Court of Tax and Administrative Justice had, but it becomes a constitutional autonomous entity and is now endowed with new powers to sanction aggravated administrative offenses of public officers of the Federation and, in certain cases as set forth in the Constitution, public officers of the states, municipalities, the Federal District and its territories, as well as civilians and private entities involved in aggravated administrative offenses.

VI. Liabilities.

The Decree sets forth a distinction between aggravated and ordinary administrative offenses. On the one hand, aggravated administrative offenses will be investigated by the General Comptroller of the Federation and the internal control departments of each agency and the TFJA, or its equivalents in the several states, shall be in charge of imposing the relevant liabilities. On the other hand, administrative liabilities considered by applicable laws as ordinary (i.e., not aggravated) shall be investigated by the local internal control departments of each agency.

The administrative liability for public officers can entail a simple reprimand, suspension, dismissal and disqualification, as well as economic sanctions (fines). Such liabilities will be imposed according to the economic benefits obtained by the responsible public officer and the patrimonial damages caused to the State by her acts or omissions, in each case pursuant to the general law to be approved by Congress.

With respect to liabilities that can be imposed on civilians, the Decree establishes that the competent courts shall determine their liability based on their participation in acts related to aggravated administrative offenses and, in should the case be, such courts may impose administrative liability consisting of: economic sanctions (fines), prohibition to participate in public procurement (acquisitions, leases, services and public works) and the payment of the damages caused to the public finances.

Additionally, in the case of legal entities or corporations, the same shall be directly sanctioned if the commission of acts qualifying as aggravated administrative offenses is made on behalf or for the benefit of such entity. In such cases, if it is evidenced that there is an aggravated administrative offense and provided that the entity or corporation obtained an economic benefit therefrom and it is established that (i) the management or surveillance bodies of the legal entity or corporation, or the partners or shareholders thereof, were involved in such actions, or (ii) such entity is regularly involved in aggravated administrative offenses, other sanctions can be imposed such as suspension of activities, dissolution or intervention of the entity.

It is worth mentioning that the proceedings to determine the imposition of sanctions are autonomous (i.e., the responsibility of the entity does not depend on the previous declaration of responsibility of the individuals involved).

VII. Conflicts of interest.

In order to prevent and eradicate conflicts of interest among public officers, the Decree sets forth that public officers shall be required to file, under oath, in addition to the traditional patrimonial declaration currently existing, a declaration of interests.

The general law will define the concept of conflict of interest and the form in which public servants shall comply with such declaration.

VIII. Conclusions.

The Decree is an additional step in the long path towards the eradication of corruption in Mexico.

The measurable effects of the corruption added to the negative externalities of this phenomenon are estimated to represent thousands of millions of pesos and an important percentage of the Gross Domestic Product. The costs for corporations are equally high due not only to economic losses but also to the lack of competitiveness and the risk of being extorted.

The National Corruption System, the new powers of the TFJA, the strengthening of the General Comptroller of the Federation and the increased regime of responsibilities are additional tools in the fight against corruption, which naturally makes the Decree a positive step. Having said that, there are still areas of opportunity and issues that were not addressed in the Decree.

For our clients, it is again evident the need to implement periodic training programs in the matters of anticorruption and conflict of interest as well as internal policies and manuals. It is also critical to set appropriate control mechanisms to minimize the legal and reputational risks that a company may face if involved in acts of corruption.

Footnotes

1. Such as the Inter-American Convention against Corruption (OAS; 1996); the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (OECD; 1997) and the United Nations Convention against Corruption (UN; 2003).

2. Amparo under appeal 120/2002. February 13, 2007.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.