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Anti-corruption compliance in theme subject known to all

It is a well-known fact that corruption is a pressing issue in Mexico, as we constantly hear about the high levels of corruption in our country. In more objective terms, and according to the most recent statistics, Transparencia Mexicana announced that Mexico once again fell in the Corruption Perception Index, going from the 123th position it obtained in 2016, to the 135th position of 180 countries that participate in the ranking.

In response to this complex situation, in 2015 and following a citizen initiative, a constitutional amendment was achieved seeking to establish the foundations of a system that successfully attacks corruption at all levels. The creation of the National Anticorruption System (Sistema Nacional Anticorrupción -SNA-) represents the largest effort that has been made in the country to tackle corruption. Together with the constitutional amendment, the creation of the National Anticorruption System also implied the establishment of new laws and the amendment of some others.

Among the new laws, the so-called “3 out of 3 law” stands out. This law was created as a citizen’s proposal and is well known because, among other things, it sets forth the obligation for public officials to file three public statements disclosing: (i) their assets; (ii) the compliance of their fiscal obligations and (iii) their personal relationships with other persons and entities, in order to avoid any possible conflict of interest. This law, formally called the General Law of Administrative Responsibility (Ley General de Responsabilidades Administrativas) is at the center of the reform, since it establishes important changes in anti-corruption matters. One of the main changes is its scope of application, which now includes not only public officials but also private individuals and entities who commit serious administrative offenses. The new law establishes penalties for both individuals and entities, which is an innovation, since the previous legislations did not regulate private individuals.

The new law provides for penalties for entities, which may now be dissolved, temporarily closed or intervened in their administration, subject to the imposition of fines, or prohibited to participate in public bids and sign contracts with the Federal Government.

It is important to note that the new law also provides mitigation and aggravating instances for the imposition of penalties, standing out the content of Article 25 of the aforementioned law which establishes that in the determination of the liability of entities, it will be assessed if the entity has an integrity policy. This article also details the minimum elements that an integrity policy must include to be considered as such, namely: i) an organization and procedures manual; ii) a code of conduct; iii) rules and procedures for control, monitoring and auditing; iv) an internal system of complaints, investigation and punishment of acts of corruption; v) permanent training and information programs on integrity policy, the risk agenda and internal measures for the prevention and mitigation of responsibilities; vi) objective, stable and gradable human resources policies to prevent the incorporation of people who may represent a risk for the integrity of the corporation; and vii) internal and external mechanisms that ensure transparency and publicity of the entity’s interests. In view of the forgoing, it is important for managers, partners and, in general, for people related to the business sector, to check whether their companies already have such an integrity policy. This is not a minor task because although anticorruption policies are usually known for compliance with foreign standards, such as the Foreign Corrupt Practice Act (FCPA) of the United States or the UK Bribery Act of the United Kingdom, due to the fact that the review that must be carried out on the occasion of the entry into force of the new General Law of Administrative Responsibility, involves the preparation of certain documents (codes of conduct, manuals, policies, etc.), as well as the preparation of certain activities for its implementation, for example, the preparation of training programs and the inclusion of anti-corruption clauses in contracts entered into by the company. The implementation of a business integrity program is very important in the prevention of serious administrative infringements, which is why it is essential to consider this issue when reviewing the compliance of a company in anti-corruption matters.

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