The Recent Focus on Corruption in Mexico -

On July 19, 2017, the General Law of Administrative Responsibilities (GLAR) went into effect in Mexico, making it a “serious administrative offense” for individuals and companies to engage in bribery, collusion in public bid procedures, influence peddling, and misuse of public funds and resources. Sanctions for violations include significant fines, temporary disqualification from participation in public bids, payment of damages and lost profits, suspension of business activities, and dissolution of a company. When determining a company’s liability, GLAR allows the relevant enforcement authority to take into account whether the company self-disclosed the violation, and whether the company had in place a real and effective compliance program or “integrity policy”—analogous to what federal law enforcement authorities in the United States can consider when resolving matters involving companies.

GLAR is part of the new National Anti-Corruption System (SNA) approved by Mexico President Enrique Pena Nieto as part of a significant effort to counter Mexico’s reputation as a country where corruption in the government and private sector is commonplace and goes unpunished. Through the SNA, Mexico is seeking to attack corruption in the government and private sector using a coordinated anti-corruption enforcement effort at all levels of government—municipal, state, and federal. Although recent news reports have revealed some disenchantment by government enforcers in Mexico about the government’s seriousness about fighting corruption under the new laws, the recent arrest of a former deputy to President Pena—in connection to allegations of illegally funneling public monies through fake Mexican businesses for campaign purposes—may soon undercut that narrative.