Issue 141 – March / April 2018

May 2, 2018


By Mario Melgar Adalid

Three Presidential Candidates and the United States Some have speculated that the U.S. government plays a defining role in Mexico’s presidential election. This popular belief unquestionably has no solid base in reality. No evidence exists in historical records showing such influence or intervention. Notwithstanding this speculation, the importance of the two countries’ relationship and the need to maintain security in the region is crucial given that Mexico and the United States share a border stretching almost 2,000 miles and economies that complement each other in important ways. The three leading Mexican presidential candidates (Andres Manuel Lopez Obrador, Ricardo Anaya and Jose Antonio Meade) have been careful in their statements regarding Mexico’s neighbor to the north. Under the circumstances, they have … read more

May 2, 2018

Political Thermometer

Mexico’s political temperature continues to rise as the political campaigns formally begin their march towards Mexico’s upcoming election.  The public is now learning of the candidates’ proposals, and while there had been indications of what each candidate’s proposal would contain, they are now learning the details of each candidate: Andres Manuel Lopez Obrador, for the MORENA-PES-PT, Ricardo Anaya, for the PAN-PRD-MC,  and Jose Antonio Meade, for the PRI-PVEM-PANAL, who are joined by Margarita Savala and Jaime Rodriguez Calderon (Mr. Rodriguez is also known as “El Bronco”), as two independent candidates who have gained entry onto the presidential ballot. In light of the confusion generated by the various party coalition, in which it has been difficult to distinguish the ideological formulas … read more

Economic Indicators

On April 30, 2018, updated financial indicators reflected:

Peso/Dollar Exchange Rate: $18.6847 pesos per Dollar.

Mexican Stock Exchange: The Mexican Stock Exchange (BMV) closed at 48,320.82 points.

Interest Rates: The Average Interbank Rate (TIIE) for a 28-day period was at 7.8455%

New Guidelines for Determining Actual and Exemplary Damages in Mexican Civil Lawsuits for Personal Injury and Wrongful Death
By Gustavo Padilla

As of April 2017, the manner of quantifying damages in Mexican civil liability lawsuits changed. Prior to such date, Mexico followed rules that provided a fixed cap on the amount of damages that could be claimed in wrongful death cases. Such determination varied, depending on the applicable laws of each Mexican state. In the past, it was common practice to use rules applicable to Mexico City, even if the incident or origin of the claim occurred in another state. This was because the applicable law in Mexico City established a broader range for these types of damages. Now, by virtue of the new binding legal precedent issued by Mexico’s Supreme Court, Mexico has a consistent set of rules that applies … read more

Amendments to Mexico’s General Law of Business Associations Applicable to Corporate Dissolutions and Liquidations
By Iker Diéguez y Fernanda Revilla

A decree published in Mexico’s Official Journal of the Federation on January 24, 2018 amended and supplemented numerous provisions of the Mexican General Law of Business Associations. Such changes are designed to simplify the process of dissolving and liquidating Mexican business entities and will enter into force on July 25, 2018. Consistent with the Mexican government’s efforts in recent years to facilitate legal procedures, reduce costs and eliminate complications in the formation of new companies in Mexico, the new amendments add a simplified process through which eligible entities may close down their operations in an easy, fast and cost-free manner, and thus provide legal certainty and closure for their shareholders or partners and third parties alike.  Note, however, that the … read more

Legal Considerations for Hiring Students in Mexico
By Pablo Saenz and Fernanda Magallanes

Mexican companies commonly hire students to work in their businesses in order to enable such students to fulfill their community service or professional internship requirements, which can lead to complications given that this type of work is not regulated by Mexico’s Federal Labor Law (Ley Federal del Trabajo).  Notwithstanding such gap in the law, the Mexican Federal Department of Labor (Secretaría del Trabajo y Prevision Social or STPS) has issued guidelines regulating how students may provide services to fulfill their community service or professional internship requirements and, at the same time, reduce the employer’s labor liability under Mexican Federal Labor Law.  The STPS guidelines regulating students working in a community service or professional internship capacity include the following: Educational institutions … read more

Electric Supply Alternatives for Large Consumers
By Jose Maria Lujambio

Based on the Electricity Industry Law (“LIE” for its acronym in Spanish) of 2014, many companies that currently consume large quantities of electricity can access the benefits of receiving their electricity supply from a company other than Mexico’s Federal Electricity Commission (CFE) as a Supplier of Basic Services, if they register as qualified end users with the Energy Regulatory Commission (“CRE” for its acronym in Spanish). In order to register with the CRE, the contracted load must be one (1) megawatt (MW) or more. This is not the actual volume of electricity consumption, measured in MWh, but instead a maximum consumption capacity. End users belonging to the same economic interest group may aggregate their loads to reach the minimum of … read more

Constitutionality of Lists Detailing Taxpayers Who Conduct False or Non-Existent Transactions
By Miriam Name and Fernando Juarez

In proceedings on February 7, 2018, Mexico’s Supreme Court held that lists of taxpayers detailing those who carried out false or non-existent transactions, as published in conformity with Article 69-B of the Mexican Federal Tax Code, are constitutional. This ruling is important because it means that all taxpayers must pay special attention and confirm that their suppliers and service providers are not found to be on such lists. Article 69-B of the Federal Tax Code establishes that when a supplier or service provider issues formal tax invoices without actually possessing the assets, personnel, infrastructure or capacity to provide the services or produce the goods being sold, the authorities will presume that such transaction did not occur, and, therefore, is “non-existent.”  … read more