August 2024
Frontpage
Anticompetitive conducts
Mergers
Competition advocacy
Institutional strengthening
Defense before the judiciary
Recommended reading
FRONTPAGE
Cofece appointed to lead The Group of Competition Agencies of the Americas
Cofece appointed to lead The Group of Competition Agencies of the Americas
Andrea Marván Saltiel, Chair of the Federal Economic Competition Commission (Cofece or Commission), was appointed by unanimous vote to hold the Secretariat of the Group of Competition Agencies of the Americas (GrACA) for 2024-2026.
From this position, Cofece will be able to give continuity to the work it has been carrying out since 2022,where it leads efforts aimed at promoting the strengthening of competition policies in Latin American countries.
In addition, it will continue working to support and promote the initiatives of the continent's competition agencies, so that the benefits generated by their actions impact the welfare of the region's population.
ANTICOMPETITIVE CONDUCTS
Cofece investigates probable illegal transnational agreement in the fragrance market
The Investigative Authority of Cofece launched an investigation to determine the existence of illegal agreements between competitors in the market for the manufacture, distribution, commercialization, and acquisition of fragrances and fragrance ingredients in the national territory.
During the first semester of 2023, various competition agencies around the world began to independently investigate the existence of anticompetitive agreements in the fragrance market that could have had consequences in several regions of the world. The Investigative Authority is in communication with the US Department of Justice and the Competition and Markets Authority of the United Kingdom, as it found indications of a probable illegal agreement that could have affected Mexicans.
The Investigative Authority of Cofece launched an investigation to determine the existence of illegal agreements between competitors in the market for the manufacture, distribution, commercialization, and acquisition of fragrances and fragrance ingredients in the national territory.
During the first semester of 2023, various competition agencies around the world began to independently investigate the existence of anticompetitive agreements in the fragrance market that could have had consequences in several regions of the world. The Investigative Authority is in communication with the US Department of Justice and the Competition and Markets Authority of the United Kingdom, as it found indications of a probable illegal agreement that could have affected Mexicans.
MERGERS
Cofece prevents the creation of monopolies and duopolies of ferries in Quintana Roo
The Board of Commissioners of Cofece denied Grupo Xcaret the purchase of four companies operating ferry routes in Quintana Roo because it would reduce the number of service providers, causing users to have fewer options to choose from, and the companies less incentives to compete on prices and quality.
The Commission warned that on the Hotel Zone - Isla Mujeres route, the operation would have resulted in Grupo Xcaret becoming a monopoly, which would allow it to raise prices or reduce the quality of its services without consumers having any other alternative.
On the Cozumel - Playa del Carmen route, the operation would have resulted in a duopoly structure, which would have reduced competition and resulted in higher prices, fewer choices, and fewer trips.
The Board of Commissioners of Cofece denied Grupo Xcaret the purchase of four companies operating ferry routes in Quintana Roo because it would reduce the number of service providers, causing users to have fewer options to choose from, and the companies less incentives to compete on prices and quality.
The Commission warned that on the Hotel Zone - Isla Mujeres route, the operation would have resulted in Grupo Xcaret becoming a monopoly, which would allow it to raise prices or reduce the quality of its services without consumers having any other alternative.
On the Cozumel - Playa del Carmen route, the operation would have resulted in a duopoly structure, which would have reduced competition and resulted in higher prices, fewer choices, and fewer trips.
COMPETITION ADVOCACY
Cofece and the Government of Jalisco strengthen collaboration to generate better competition conditions
The Commission and the Government of Jalisco released the report on the results of their collaboration agreement aim at disseminating the progress achieved in the proactive promotion of a culture of competition in the public, private, and academic sectors of the entity, to strengthen the foundations of a fair and inclusive economy.
The Commission and the Government of Jalisco released the report on the results of their collaboration agreement aim at disseminating the progress achieved in the proactive promotion of a culture of competition in the public, private, and academic sectors of the entity, to strengthen the foundations of a fair and inclusive economy.
INSTITUTIONAL STRENGTHENING
Position regarding the approval of the organic simplification proposed reform
Cofece reiterates its willingness to engage in a broader dialogue with all parliamentary groups that will make up the current legislature of the Congress of the Union, to contribute to the discussion on the importance of preserving and strengthening economic competition policy for the benefit of Mexican consumers, contemplating a strong institutional arrangement to preserve its principles.
Cofece trusts that the Legislature will evaluate the elements submitted for its consideration to adopt the best model for Mexicans. It is essential to design a reform that ensures the promotion of free competition that benefits consumers, protects micro, small, and medium-sized companies, promotes regional development, and attracts investment.
Cofece reiterates its willingness to engage in a broader dialogue with all parliamentary groups that will make up the current legislature of the Congress of the Union, to contribute to the discussion on the importance of preserving and strengthening economic competition policy for the benefit of Mexican consumers, contemplating a strong institutional arrangement to preserve its principles.
Cofece trusts that the Legislature will evaluate the elements submitted for its consideration to adopt the best model for Mexicans. It is essential to design a reform that ensures the promotion of free competition that benefits consumers, protects micro, small, and medium-sized companies, promotes regional development, and attracts investment.
Cofece submits for public consultation its draft modification to the Technical Criteria for the Request and Issuance of Interim Measures and the Setting of Sureties.
The Commission initiated a public consultation on its Draft Modifications to the Technical Criteria of the Federal Economic Competition Commission for the Request and Issuance of Interim Measures, as well as for the Setting of Sureties.
The modifications to the Technical Criteria submitted for public consultation contain, among other issues, the requirements for the acceptance, custody, return, and effectiveness of the guarantees in favor of the Commission that are granted as surety for the issuance of interim measures.
The Commission initiated a public consultation on its Draft Modifications to the Technical Criteria of the Federal Economic Competition Commission for the Request and Issuance of Interim Measures, as well as for the Setting of Sureties.
The modifications to the Technical Criteria submitted for public consultation contain, among other issues, the requirements for the acceptance, custody, return, and effectiveness of the guarantees in favor of the Commission that are granted as surety for the issuance of interim measures.
DEFENSE BEFORE THE JUDICIARY
The Federal Judicial Power denies an amparo to Consorcio Villacero against the resolution of verification of compliance with conditions that sanctioned it for recidivism
The First Collegiate Circuit Court Specialized in Economic Competition, Broadcasting, and Telecommunications denied an amparo to Consorcio Villacero, determining that the sanction imposed for $10,084,604.90 due to the non-compliance with the conditions imposed by the Board of Commissioners of Cofece to authorize a merger was in accordance with the law.
In 2009, the former Federal Competition Commission authorized Villacero to acquire the capital stock of Savoy International Investments, a company that owns part of the capital stock of GCollado. Given that the economic agents that merged overlap in different markets of the steel industry, the flow of information between them could lead to anticompetitive conducts. Therefore, the transaction was conditioned to the fact that Villacero could not appoint people who had any relationship with the company, nor with any of its affiliates or subsidiaries to be part of the Board of Directors of GCollado.
However, one of the directors was a simultaneous member of the Board and of its subsidiaries in Villacero, which implied a non-compliance. In addition, the obligation to submit annual reports on the activities of the members appointed by the company to be part of the Board, during the first month after the end of the year, was made partially and untimely, reasons for which the company incur in recidivism, violating the Federal Economic Competition Law and for this reason was sanctioned.
The First Collegiate Circuit Court Specialized in Economic Competition, Broadcasting, and Telecommunications denied an amparo to Consorcio Villacero, determining that the sanction imposed for $10,084,604.90 due to the non-compliance with the conditions imposed by the Board of Commissioners of Cofece to authorize a merger was in accordance with the law.
In 2009, the former Federal Competition Commission authorized Villacero to acquire the capital stock of Savoy International Investments, a company that owns part of the capital stock of GCollado. Given that the economic agents that merged overlap in different markets of the steel industry, the flow of information between them could lead to anticompetitive conducts. Therefore, the transaction was conditioned to the fact that Villacero could not appoint people who had any relationship with the company, nor with any of its affiliates or subsidiaries to be part of the Board of Directors of GCollado.
However, one of the directors was a simultaneous member of the Board and of its subsidiaries in Villacero, which implied a non-compliance. In addition, the obligation to submit annual reports on the activities of the members appointed by the company to be part of the Board, during the first month after the end of the year, was made partially and untimely, reasons for which the company incur in recidivism, violating the Federal Economic Competition Law and for this reason was sanctioned.
RECOMMENDED READING
Contributions to the Global Dictionary of Competition Law Concurrences
The Global Dictionary of Competition Law Concurrences is a pioneering work dedicated to the collection and definition of key terms in the field of competition and antitrust law worldwide. This innovative project responds to the need for an evolving and adaptable reference that integrates the practices of multiple jurisdictions.
This first edition, launched in May 2024, includes two definitions contributed by Cofece’s public officials. Sonia Rocha Esquivel, executive director of the Board of Commissioners, contributed with the definition of the term Boycott; while Claudia Georgina Brambilla Ramírez, general coordinator of International Economic Competition Analysis, and Rodrigo Ríos Dordelly, executive director of International Affairs, contributed with the definition of the term Concessions.
BY THE NUMBERS
BY THE NUMBERS
During August, the Commission dealt with 124 matters, of which 69 correspond to mergers, 30 to procedures for monopolistic practices and unlawful mergers, 4 to special procedures, and 21 to opinions on bidding processes, concessions, and permits.
Complaints, investigations, and trial-like procedures
- 7 complaints were analyzed, 6 of which were filed during the period. Of these, 3 were dismissed, 1 was referred to the Federal Telecommunications Institute and 3 were still being analyzed at the end of the month.
- Follow-up was given to 16 investigations and 7 trial-like procedures for monopolistic practices and unlawful mergers.
- Follow-up was given to 4 special procedures to determine the existence of essential facilities and barriers to competition.
Mergers
- Follow-up was given to 69 mergers, 18 of which were notified during the period. Of these transactions, 13 were authorized, 1 was closed, 1 was challenged and 54 were still under analysis at the end of the month.1
- 1 concentration was challenged by which a monopoly and a duopoly would be established in the maritime transportation market of passengers by ferries in Quintana Roo.
- The amount of authorized transactions is $63,981.2 million Mexican pesos.
Amparo trials
- During August, the Judicial Power resolved 16 amparo trials: 2 were granted, 3 were denied and 11 were dismissed.2 At the end of the period, 373 trials are still in process, of which 339 correspond to economic competition matters.
1. The files of the authorized mergers are: CNT-094-2023 (Repuinv, S.A.P.I. de C.V / Fuentes de Reforma, S.A. de C.V. / Aralpa Capital, S.A. de C.V), CNT-132-2023 (Scorpion Distribuidor Mayorista, S.A. de C.V. / Comercializadora Grupo Scorpion, S.A. de C.V. / Productos de Consumo Z, S.A. de C.V.), CNT-008-2024, CNT-013-2024 (Promotora del Desarrollo de América Latina, S.A. de C.V. / Mota-Engil México, S.A.P.I. de C.V. / Mota-Engil Engenharia e Constricao, S.A. / Grupo Promotor de Desarrollo e Infraestructura, S.A. de C.V. / Desarrollo de América Latina, S.A. de C.V.), CNT-022-2024 (Promotora del Desarrollo de América Latina, S.A. de .C.V. / Mota-Engil México, S.A.P.I. de C.V. / Concesionaria Autopista Tuxpan-Tampico, S.A. de C.V. / Mota-Engil SGPS, S.A. / Desarrollos y Recuperaciones Urbanas, S.A. de C.V.), CNT-039-2024 (Holding GAC, S.A. / Celta GP, S.A.P.I. de C.V.), CNT-043-2024 (Wintershall New Co / Letter One Holding S.A. / Harbour Energy Plc / Basf Se), CNT-052-2024 (Tire Direct International Holding, S.A.P.I. de C.V. / SL & TD, S.A.P.I. de C.V. / Sailun International Holdings Pte. Ltd.), CNT-053-2024, CNT-071-2024 (Davis Mining & Manufacturing, Inc. / Austin Powder Holdings Company / A-AP Funding, LP / Persona física), CNT-073-2024 (Lululemon Athletica Inc. / Ente Way SL / Centro Iberia 5000 SL), CNT-076-2024 (NBC Fashion Mexico, S. de R.L. de C.V. / Grupo Axo, S.A.P.I. de C.V.), CNT-091-2024 (WeWork Companies / Sla WW Holdco LLC / Latam CO B.V.).
2. Of which it is reported that the jurisdictional body that finally resolved and the file number of the Amparo trials granted are: First Collegiate Circuit Court of the Auxiliary Center of the First Region, with residence in Mexico City, R.A. 168/2023; First Collegiate Circuit Court of the Auxiliary Center of the First Region, A.R. 1127/2022; of the Amparo trials denied are: First Collegiate Circuit Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, R.A. 459/2022; First Collegiate Circuit Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and Jurisdiction throughout the Republic, R. A. 522/2023; First District Court in Administrative Matters, Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and Jurisdiction throughout the Republic, Exp. 79/2024; of the Amparo trials dismissed are: First District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, Exp. 229/2020; First District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, Exp. 290/2020; Second Collegiate Court in Administrative Matters Specialized, R.A. 303/2023; Third District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications with residence in Mexico City and jurisdiction throughout the Republic, Exp. 98/2021; First Collegiate Circuit Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, R.A. 723/2022; First Collegiate Circuit Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, R.A. 683/2022; Second Collegiate Circuit Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, R.A. 380/2022; Second District Court in Administrative Matters, Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and jurisdiction throughout the Republic, Exp. 341/2022; Second District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and Jurisdiction throughout the Republic, Exp. 224/2023; Second District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and Jurisdiction throughout the Republic, Exp. 226/2023, and Second District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications, with residence in Mexico City and Jurisdiction throughout the Republic, Exp. 225/2023.
Monthly Report – September 2024