Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
Mexico's new federal Anti-Corruption in Public Contracts Law (the "Anti-Corruption Law") became effective on June 12, 2012. The law makes it unlawful for a Mexican or foreign individual or corporation to give, offer or promise money or other valuable consideration, whether directly or indirectly, to a public official or third party for the purpose of obtaining or retaining a benefit or advantage in connection with a public contract with the Mexican federal government. Acts or omissions which also constitute a violation of the Anti-Corruption Law include:
- Performing acts or omissions with the purpose of bidding for a public contract if the individual or corporation is legally barred from the bidding process under the law or through an administrative order.
- Performing acts or omissions with the purpose of evading the requirements or rules established by the public contracting entities.
- Participating in the procurement of a public contract for the ultimate purpose of benefiting parties that are barred from the bidding process.
- Promoting or using any economic or political influence, real or fictitious, on a public servant, in order to obtain a benefit or advantage.
Liability will attach regardless of whether the unlawful conduct occurs through a third party, the valuable consideration is accepted, or the desired result is obtained.
The Anti-Corruption Law applies to Mexican and foreign individuals and companies directly or indirectly involved in the procurement of a contract with the Mexican federal government anywhere in the world, including, bidders, vendors, suppliers, contractors, licensees, licensors, or the like, as well as shareholders, partners, associates, representatives, principals, agents, attorneys, brokers, managers, advisers, consultants, subcontractors, employees, or those who otherwise are engaged in the procurement of public contracts with the Mexican government.
The Anti-Corruption Law establishes liabilities and penalties for violation of the law, including:
- Individuals that violate the Anti-Corruption Law may be fined one-thousand to fifty-thousand times the daily minimum wage for Mexico City, and disqualified from entering into federal public contracts for a minimum of 3 months, and up to 8 years. As the current daily minimum wage is $62.33 MXN (approximately $4.45 in U.S. Dollars), the fines may range from (at current rates) MXN$62,330.00 to $3,116,500.00 (approximately USD$4,452.14 to $222,607.14).
- Corporations are subject to penalties and fines that, contingent on the severity of the violation, may reach up to two million times the daily minimum wage for Mexico City (approximately $8,904,285.71 in U.S. dollars), and the disqualification may range between 3 months and 10 years.
Notably the Anti-Corruption Law provides for a possible reduction of sanctions for parties who willingly confess to their participation in the unlawful conduct before the administrative sanctions procedure is commenced or even while it is under way.
The Ministry of Public Administration (the "Ministry"), charged with the responsibility for conducting investigations and with imposing sanctions under the law, has absolute discretion in determining the penalties which will be imposed on a case by case basis. An investigation of alleged violations of the Anti-Corruption Law may be commenced at the Ministry's sole discretion or based on a sworn statement filed by a government entity, public servant, a person with relevant knowledge, or a complaint filed anonymously.
To learn more about the law and its potential implications for employers, please continue reading Littler's ASAP Mexico's New Federal Anti-Corruption in Public Contracts Law (or, in Spanish, Nueva Ley Federal Anticurrupción en Contrataciones Públicas)