Mexico: Chairwoman lauds progress on COFECE anniversary

The head of Mexico’s Federal Economic Competition Commission celebrated its first anniversary late last week, and the occasion was marked by COFECE Chairwoman Alejandra Palacios Prieto before the Senate.

COFECE announced that Palacios spoke before the Senate Assembly to praise the progress of Mexico’s competition enforcement since the establishment of the watchdog one year ago. Since, the regulator has reviewed 344 competition cases involving mergers, investigations and other antitrust matters, and attributes the elimination of barriers to market access as a major contribution to pro-competition efforts.

Chairwoman Palacios also announced to the Senate that COFECE is looking to collaborate with lawmakers to advise on new legislation involving competition matters.

One year after its establishment, COFECE said it is looking to compile revised guidelines on mergers, investigations and other cases, and said it will launch an investigation into the nation’s agroalimentary sector in only days.

The full press release can be read below:

Mexico City, October 23rd 2014. – One year after its establishment, the Mexican Federal Economic Competition Commission (COFECE) estimates that, through its resolutions, it has rendered potential benefits for consumers estimated at $3,900 billon Mexican pesos, equivalent to almost 13 times the allocated budget to this entity.

The foregoing is the result of reviewing 344 cases, including mergers, investigations and the submission of opinions for public tenders. It is thus confirmed that economic competition must be a key topic on the public agenda because of its broad reaching benefits. Consequently, COFECE dedicates most of its efforts to the elimination of barriers to competition and market access throughout different levels and activities, including those created by the State itself, affirmed Alejandra Palacios Prieto Chairwoman of this entity during her appearance before the Mexican Senate.

Furthermore, she stated that COFECE’s Board of Commissioners is willing to collaborate with the Legislative branch by providing technical insight regarding the effects on competition from every proposal or law under discussion, with total respect towards Congress’ decisions and procedures. With this joint work pro-competitive legal frameworks can be created.

For example, under the current liberalization process in the energy sector, it is essential for the Commission to be present throughout this stage in order to ensure competitive conditions exist in the medium and long term, and thus achieve the objectives this reform seeks to yield. With the presentation of COFECE’s results for this first year of operations as a constitutionally autonomous entity, the Chairwoman highlighted:

• 42 opinions on regulatory proposals were submitted 75% of which were welcomed.

• The Judiciary Branch resolved 50 challenges to COFECE’s resolutions 92% of which ruled in favor of the Commission and were resolved in substantially shorter periods.

The design of COFECE’s Strategic Plan 2014-2017 consists of 11 immediate implementation projects, 6 of which are currently in operation, and it is noteworthy to state that the Directorate of Market Intelligence has been created which is entrusted with the detection of anticompetitive practices.

By mandate of Congress, the market study on the Financial Sector which has resulted in 36 recommendations for sector regulators has been delivered, many of which are being implemented.

Likewise, Chairwoman Palacios announced new actions to be executed by COFECE:

• A compilation of guidelines, technical criteria and directives regarding mergers, investigations, unilateral conduct, penalties and concentration indexes is being finalized, and they are expected to be made available for public consultation during the latter part of this year.

• In the days to come, a new market study on the Agroalimentary Sector shall be commenced which is intended to analyze possible barriers to competition and market entry, this study shall delivered by August 2015 at the latest.

Finally, Chairwoman Palacios remarked on the Commission’s motto: A better México is everyone’s competence (or competition for the play on words in Spanish). In this sense, Congress, particularly the Senate, has been a strategic ally for COFECE for enhancing the transformative agenda which limits the spaces in our economy for anticompetitive practices which inhibit growth.

The Federal Economic Competition Commission is entrusted with safeguarding free competition and market access. Through these, it contributes to consumer welfare and the efficient working of the markets. Through its work it seeks better conditions for consumers, greater output and better services and a “level playing field” for companies.

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