The Federal Law of Economic Competition became effective in Mexico in 1993. Congress approved important amendments to this statute in 2006 and 2011. In 2013, the Constitution was amended to improve the enforcement of competition law and policy and, as a result of this constitutional amendment, Congress enacted a new Federal Law of Economic Competition (the Competition Law) in 2014. The Federal Economic Competition Commission (COFECE) enforces the Competition Law in all areas of the economy, except the telecommunications and broadcasting sectors, where the Competition Law is enforced by the Federal Telecommunications Institute (IFT).

Under the Competition Law, pre-merger notification is mandatory when certain monetary thresholds are met. Since 2014, a notified transaction must be approved by the COFECE or IFT before consummation. Under the Competition Law, reportable transactions will not produce legal effects without such approval.

The Competition Law provides both a size of transaction test and a size of person test for determining whether a filing is required. For 2019, pre-merger notification is required when:

  1. the transaction's value exceeds 1,520.82 million pesos in Mexico;2
  2. an economic agent acquires 35 per cent or more of the assets or capital stock of an economic agent with assets or annual sales of at least 1,520.82 million pesos; or
  3. the acquired assets or capital stock amount to more than 709.61 million pesos,3 and the assets or annual sales of the parties involved in the transaction, jointly or separately, amount to more than 4,055.52 million pesos.4

The assets and sales that must be taken into account when assessing the thresholds are the ones located or originating in Mexico.

Failure to file can result in a fine of between 422,455 pesos5 and 5 per cent of the parties' annual sales.

The Competition Law provides certain exemptions to the pre-merger notification requirement. Some general examples of these are:6

  1. intra-corporate transactions;
  2. acquisitions of capital stock by an acquirer who holds control of the company since its incorporation or when such control has already been approved by the COFECE or IFT;
  3. transfers of assets or capital stock to administration or warranty trusts;
  4. international transactions not implying acquisition of control of Mexican companies or accumulation of assets in Mexican territory; and
  5. certain acquisitions solely for investment purposes.

Approved transactions may not be subject to further investigation unless the approval has been based on false information, or the approval has been subject to conditions and the parties do not comply with such conditions.

Transactions not surpassing the thresholds or falling under the exemptions may not be investigated after a year following their consummation. Transactions not subject to mandatory pre-merger notification may be voluntarily reported in order to seek approval and eliminate the possibility of further investigation.7

Note that the ninth transitory provision of the Federal Law of Telecommunications and Broadcasting8 states that as long as preponderant economic agents9 exist in the telecommunications and broadcasting sectors, mergers between concessionaries (i.e., telecommunications and broadcasting operators) will not require previous authorisation from the IFT whenever:

  1. the preponderant economic agent is not involved in the transaction;
  2. the Dominance Index shows a negative variation in the sector, as long as the Herfindahl-Hirschman Index does not show an increase that exceeds 200 points;
  3. as a result of the transaction, the economic agent has a share of less than 20 per cent in the corresponding sector; and
  4. the merger does not produce harmful effects to competition in the sector.

This type of transactions will require a post-closing notice instead of the pre-merger notification filing.10

In addition to the Competition Law, the following regulations and guidelines are related to merger control:

  1. Regulations of the Competition Law, issued and amended by the COFECE on 30 October 2014, 21 January 2016 and 25 January 2018. These regulations complement the merger control provisions established in the Competition Law;
  2. Regulations of the Competition Law for the broadcasting and telecommunications sectors, issued by the IFT on 7 January 2015 and amended 12 December 2018. These regulations complement the merger control provisions established in the Competition Law;
  3. Technical Criteria for the Calculation and Application of a Quantitative Index to determine concentration in the relevant market, issued by the COFECE on 23 April 2015. This Technical Criteria maintains the application of the Herfindahl-Hirschman Index and determines the elimination of the Dominance Index;
  4. Technical Criteria for the Calculation and Application of a Quantitative Index to determine concentration in the markets related to telecommunications and broadcasting sectors, issued by the IFT on 17 March 2016. This Technical Criteria also maintains the application of the Herfindahl-Hirschman Index and determines the elimination of the Dominance Index (except for procedures under the ninth transitory provision of the Federal Law of Telecommunications and Broadcasting);
  5. Guidelines for the Notification of Concentrations, issued by the COFECE on 9 October 2015 and amended on 20 April 2017. These guidelines provide further details regarding application of thresholds, information and documents required for the filing, non-compete clauses, among other issues;
  6. Guidelines for the Notification of Concentrations for the telecommunications and broadcasting sectors, issued by the IFT on 28 June 2017. These guidelines provide further details regarding application of thresholds, information and documents required for the filing, and non-compete clauses, among other issues;
  7. Guidelines of the Investigation Procedure of Relative Monopolistic Practices (dominance) and Illegal Mergers, issued by the COFECE on 22 June 2015. These guidelines explain in detail the investigation procedure of illegal mergers, among other issues;
  8. Guidelines for Exchange of Information between Economic Agents, issued by the COFECE on 10 December 2015. These guidelines provide the rules regarding information exchange during the due diligence, among other issues;
  9. Regulations of the use of Electronic Systems of the COFECE, issued by such authority on 2 November 2017. These regulations establish the rules for the operation of the Electronic System of Filings of the COFECE (including merger control filing); and
  10. Rules for the Notification of Concentrations via electronic systems, issued by the COFECE on 8 December 2017. These rules establish the requirements and the procedure, in case the parties opt to submit a concentration filing via the newly created electronic system. Under proposed amendments to these rules published by the COFECE on 9 May 2019, the submission of a concentration filing via the electronic system will become mandatory in January 2020.


In 2018, the COFECE concluded reviews of 183 pre-merger notifications with the following outcomes: 172 transactions were authorised, one transaction was conditioned to comply with undertakings, three transactions were objected and seven did not finish their review. Also, in the first quarter of 2019, the COFECE reviewed 42 pre-merger notifications with the following outcomes: 40 transactions were authorised and two did not finish the process. Also, COFECE imposed fines in four cases: three for failing to notify a transaction when it was legally required and one for failing to comply with previously imposed undertakings. Information for mergers reviewed by the IFT is not published, but public information suggests that two transactions were conditioned to comply with undertakings.

Of the past year's cases, two are worth mentioning. First, the Disney/Fox transaction, which required concurrent review by both agencies. In this case, COFECE decided to clear the transaction after its structure was modified. In mid 2018, the transaction was notified as a global acquisition, which included the cinema and television studios, entertainment and regional sports channels, and international businesses related to television. However, in January 2019, in order to eliminate risks to competition in the distribution of movies for the cinemas market, the parties modified the transaction to include the transfer, on behalf of Sony Pictures, of the participation of Disney in the company that participated in this market in Mexico. After this, COFECE proceeded to clear the transaction.11

After reviewing 10 markets related to telecommunications and broadcasting, the IFT found that the transaction would harm competition in two markets: provision and licensing of restricted channels to cable TV providers in the categories 'factual' (which includes culture programmes, documentaries and reality TV) and 'sports'. Therefore, after asking the parties to propose undertakings, the IFT decided to clear the transaction with the condition to comply with the following undertakings: (1) for the factual category, several measures were imposed to avoid coordination between the new agent (Disney/Fox) and Discovery (main competitor); and (2) for the sports category, the divestiture of Fox Sports and its related assets was ordered.

The second relevant case is the Nestlé/Lala transaction, which was not notified before COFECE. After an investigation procedure for an illegal merger, the authority imposed fines of approximately 8 million pesos to the parties for failing to notify a transaction that took place in August 2013. The total sum of the fine was calculated taking into consideration the risks that were generated for not notifying.


The notification must be filed by all parties involved in the transaction (e.g., buyer and seller), while a common representative appointed to act on behalf of the parties before the COFECE.12 As of 1 January 2019, the mandatory filing fee is 184,539 pesos.

The initial filing must provide, in general, some corporate and financial information and documents (articles of incorporation, by-laws, capital structure, corporate charts and financial statements); the agreements governing the transaction; the scope of the non-compete obligations; an explanation of the transaction purposes; and a brief description of the products and market shares of the parties. Such information and documents are described in Article 89 of the Competition Law and are commonly known as 'basic information'.

Within any initial 10-business-day period, the COFECE may request basic information that was not provided with the initial filing, and such information must be submitted in a 10-business-day period, extendable under duly justified causes.

By reviewing the basic information, the COFECE should be able to determine whether the transaction produces relevant effects in the market, in which case they would issue an additional information request in order to proceed with a deeper analysis of concentration effects.

The additional information request may be issued and notified to the parties within a 15-business-day term after the compliance of the basic information request, or after the initial filing if such request was not issued. This additional information request may include such economic information that the authority deems necessary to analyse the effects of the transaction (description of products and substitutes, production processes, costs, investment amounts, distribution options, suppliers, clients, prices, market shares, etc.), and in many cases it has to be provided at a high level of detail. This information must be submitted within a 15-business-day term, extendable under duly justified causes.

If the notifying parties fail to comply with the information requests, it is legally tantamount to the notification not being filed. However, the transaction may be notified again and the procedure would start from the beginning.13

The COFECE will issue its decision within a 60-business-day period after the compliance of the additional information request; the compliance of the basic information request (if an additional information request was not issued); or the initial filing (if no basic or additional information requests were issued). In exceptionally complex cases, this 60-business-day term may be extended for up to 40 additional business days. The COFECE decision may approve, with or without conditions, or disapprove the transaction. If a decision is not issued within the established time frames, the notified transaction is deemed approved. The approval of the transaction will be valid for a six-month period, which may be extended for another six months when justified causes are credited to the parties. The transaction may not be closed after the expiration of such periods, unless a new notification is filed. The parties shall provide the COFECE with documents evidencing the transaction formalisation within 30 business days after closing.

If, during the notification process, the concentration raises competition concerns, the COFECE will inform the parties about the concerns at least 10 days before the case is included for decision in the board of commissioners' agenda. No later than one day before the case is included for decision in the board of commissioners' agenda, the parties may offer undertakings to prevent the risks found by the authority. The 60 or 40-day terms mentioned above will start to count again from the day the proposed undertakings are filed. Also, parties can offer undertakings from the beginning of the process (with the initial filing), in which case these terms will not be interrupted, although this is rarely recommended.

The COFECE is empowered to, and frequently does, request information to third parties who may be related to the market where the concentration will take place or have effects, being also empowered to request information of other authorities. Such information must be provided in a 10-business-day period, extendable for another 10 days when justified.

The Competition Law does not acknowledge the legal standing of affected third parties to challenge approval decisions issued by the COFECE in a pre-merger notification process. However, third parties may submit their concerns and provide information and documents, which shall be taken into account by the COFECE when issuing its decision.

During the notification process, access to the file is restricted to the notifying parties. Once the process concludes, the COFECE publishes its decision, excluding the information classified as confidential, and any person may have access to the rest of the non-confidential information contained in the file, through a specific petition filed under the transparency law.

Regarding concurrent review of mergers, Article 5 of the Competition Law provides that if one of the two agencies determines that a case that is being reviewed by the other should actually be reviewed by it, it will inform the agency that is reviewing the case of its views. If this agency declines jurisdiction, the case is sent to the requestor agency within five business days. However, if after such notice the agency does not decline jurisdiction, then the procedure will be suspended and the case will be sent to the economic competition, telecommunications and broadcasting circuit courts in order to determine which agency holds jurisdiction over the case. Also, whenever one of the agencies receives a case and deems that it should be reviewed by the other, the case should be sent within five business days to this agency. However, if the receiving agency declines jurisdiction the other agency should be informed within five business days, and the case should be sent to the circuit courts to determine which agency holds jurisdiction. Finally, when a transaction affects markets in which both agencies have jurisdiction, the transaction may be reviewed by both agencies. However, the decision may only be issued with regard to the markets in which each agency has jurisdiction.


Even if the parties believe that the merger is not expected to produce competition risks, it is recommended to provide economic information with the filling. Even though the parties are not obligated to provide such information at that time, providing it may avoid a request of additional information (such situation will speed up the process).

It is also recommended to approach the COFECE or the IFT at the early stages of the process and hold meetings with the officers in charge of the case. The purpose of such meetings will be to answer any questions and to explain every aspect of the merger. By having these meetings, the scope of the basic information request and the additional information request may be reduced.

COFECE or IFT decisions may be challenged before federal courts via amparo, which is a trial aimed to revoke unconstitutional or illegal decisions. These trials are before competition, telecommunications and broadcasting specialised federal district judges and circuit courts that were created after the 2013 constitutional amendments. Amparo trials have no specific time frame and sometimes may last more than a year. Thus, in certain cases it is recommended to file a new notification offering suitable undertakings instead of challenging the COFECE decision before federal courts.

Finally, there is one very important aspect of the COFECE Guidelines for Notification of Concentrations regarding collaboration agreements (which are not regulated in the Competition Law). These Guidelines mention that such agreements may be reviewed under the merger control procedure whenever the transactions meet the characteristics of a concentration; therefore, the parties will have certainty regarding the legality of a collaboration agreement if they submit it to scrutiny by the COFECE before its closing. This implies that the agreement would be studied on a rule-of-reason basis, which will give the parties the possibility to submit economic arguments, such as efficiency gains and absence of substantial market power, for the authorisation of the agreement.


As previously mentioned, in 2013 the Mexican Constitution was amended to improve the enforcement of competition law and policy. Another one consisted of improving the telecommunications and broadcasting law, and enhancing its enforcement. Some of the most important changes are as follows:

  1. the Federal Competition Commission and Federal Telecommunications Commission (both agencies within the executive branch) were replaced by the new autonomous constitutional entities COFECE and IFT, respectively;
  2. the five former commissioners were replaced by seven commissioners for each entity;
  3. the power to enforce the Competition Law in the telecommunications and broadcasting industries was transferred to the IFT;
  4. the COFECE and IFT were empowered to issue Competition Law regulations (before the constitutional reform, the Competition Law regulations were issued by the president);
  5. new federal courts specialised in competition, telecommunications and broadcasting were created; and
  6. the reconsideration appeal was eliminated, so the COFECE and IFT decisions may only be challenged through amparo trial before the specialised federal courts.

In order to implement the constitutional reform, in 2014, a new Federal Law of Economic Competition and a new Federal Law of Telecommunications and Broadcasting were enacted.

Besides the above, the main changes to the competition legal framework that had an impact on the merger control regime are the following:

  1. concentrations surpassing the monetary thresholds require approval from the COFECE or IFT prior to its consummation. No agreement or legal act executed to formalise the transaction will be valid without said authorisation;
  2. a new stage of the notification procedure was created, where the parties may offer conditions or remedies in order for the concentration to be approved;
  3. the time frame to request basic information was extended from five to 10 business days and the time frame to issue a decision was extended from 35 to 60 business days. As a consequence, a notification procedure may last seven months, plus the time consumed by the parties in gathering and submitting requested information. In the cases that the parties propose conditions or remedies, the procedure may last about one year;
  4. generation of competition barriers as a consequence of the proposed transaction was included as a cause for objection. Acquiring or increasing substantial market power, as well as acquiring the ability to displace other economic agents or to perform monopolistic practices, remained as causes to object the transaction; and
  5. the Herfindahl-Hirschman Index is still applicable for the analysis of market concentration levels and the proposed transaction effects. However, the Dominance Index, which acknowledged positive effects on competition derived from mergers between small players, was eliminated.

In December 2018, a new President started his mandate and an austerity policy was implemented. This meant that the federal budget for 2019 was reduced for all public entities. In the case of COFECE, the reduction was 5 per cent of the previous year's budget. Also, a new Federal Remunerations Law was enacted, which provides that public officials, no matter how specialised, cannot receive a higher salary than that of the President. This law is currently under review by the Judicial Power via amparo trials that several officials of the public administration started against such determination. Some of the officials that initiated these trials are officials at both COFECE and the IFT. Notwithstanding, is too early to foresee the effects of both the new austerity policy and the Federal Remunerations Law, and there have not yet been significant losses of talent from the competition authorities (in other regulatory entities, several commissioners have resigned).


1 Rafael Valdés Abascal is the founding partner and Enrique de la Peña Fajardo is senior associate at Valdés Abascal Abogados SC.

2 18 million times the unit of measure and update (UMA), currently: 80.60 pesos. The value of the UMA is updated each year.

3 8.4 million UMAs.

4 48 million UMAs.

5 5,000 UMAs.

6 It is noted that the Competition Law provides eight exemptions. Also, please bear in mind that some specific requirements need to be met to fall into each of the exemptions.

7 Transactions that do not meet the thresholds can still be illegal. An illegal merger is defined in the Competition Law as any merger that has the purpose or effect of hindering, diminishing, damaging or preventing free competition or economic competition. This type of merger is penalised with a fine up to the equivalent of 8 per cent of the infringing parties' annual sales.

8 Effective as of 13 August 2014.

9 Preponderant economic agents are agents that have a national share of more than 50 per cent in the corresponding sector. As of 6 March 2014, the IFT determined the existence of two preponderant economic agents, one for each of the telecommunications and broadcasting sectors.

10 This notice must be filed before the IFT within 10 days following the closing. The IFT will have 90 days to investigate the merger and, if substantial market power in the relevant market exists, such authority will be entitled to impose measures in order to protect competition.

11 The other markets that were analysed by COFECE were: (1) licensing of audiovisual content for entertainment in physical and digital formats, both for direct acquisition and direct download; (2) licensing of music for entertainment in physical and digital formats, both for direct acquisition and direct download; (3) licensing of music in non-digital media; (4) live entertainment; and (5) licensing of intellectual property rights for books and magazines, and for consumer goods and development of interactive media and gaming.

12 Unless specified, the acronym COFECE will be used to refer to both competition authorities in this section.

13 The payment of a new filing fee would be required.