After more than ten years of history in the implementation of the immunity program, the Federal Economic Competition Commission (the "Commission") has identified that this tool has been very useful for initiating investigations of which it would hardly have become aware; however, throughout these years it has also faced unforeseen scenarios that created gaps at the time of applying the program. Through these new regulatory provisions, the Commission
I. INTRODUCTION On March 4, 2020, Agreement No. CFCE-049-2020, issued by the Plenary of the Commission on February 12, 2020 (the "Agreement"), was published in the Official Gazette of the Federation. By virtue of the Agreement: (i) the Regulatory Provisions of the Immunity and Sanction Reduction Program provided for in Article 103 of the Federal Economic Competition Law (the "Provisions") were issued; and (ii) Articles 114, 115 and 116 of the Regulatory Provisions of the Federal Economic Competition Law, which previously set out the requirements and procedure for availing oneself of the immunity and sanction reduction program (the "Program"), were repealed. These provisions entered into force on March 5, 2020. II. RELEVANT CHANGES Although the Provisions do not modify the stages and terms of the procedure for availing oneself of the Program, it is worth bearing in mind three substantial aspects that change its operation. A. New powers of the Investigative Authority 1. To require the applicant to continue its participation in the absolute monopolistic practice, for the purpose of obtaining information and documents useful to the investigation (Article 6, section II). 2. To authorize the applicant to, instead of submitting documentation, make oral statements detailing the circumstances of time, manner and place under which the absolute monopolistic practices were committed (Article 7). 3. To recommend to the Plenary that it definitively not grant the benefits of the Program to an applicant who interrupts its cooperation during the course of the investigation stage, for which purpose it must set out the elements demonstrating the lack of cooperation and notify the applicant of said circumstance (Article 9). B. Conduct that establishes "full and continuous cooperation" Article 6 of the Provisions sets out a series of conducts that the applicant must observe in order to be considered to have offered "full and continuous cooperation" both in the investigation stage and in the trial-like proceeding. This is so that the Commission may deem satisfied the requirement provided for in Article 103, section II, of the Federal Economic Competition Law (the "LFCE"). It should be noted that, during the trial-like proceeding, the applicant is obligated to "not deny its participation in the conduct with respect to which it requested the benefit" (Article 6, subsection B, section I). In this regard, the investigation for absolute monopolistic practices identified with case file number IO-003-2012, in the market for the provision of retirement fund management services for workers in the national territory, becomes relevant. In issuing the final resolution of the trial-like proceeding in said case file, the Plenary of the Commission denied the benefit of the Program to various companies and individuals summoned. To that end, it argued that said applicants failed to comply with the requirement of "full and continuous cooperation," since they responded to the accusations of the Investigative Authority with assertions aimed at denying or disputing their liability and the possibility of the Commission sanctioning them, which is inherently incompatible with the requirement of admitting the commission of absolute monopolistic practices (see pp. 573-580 of the resolution). Against the final resolution of the aforementioned case file, various economic agents filed amparo claims before the District Courts Specialized in Economic Competition, Broadcasting and Telecommunications. On the topic of interest, the head of the First Court ruled favorably for the plaintiffs in indirect amparo trial 1282/2017, holding that: • The applicant's cooperation must be analyzed in an integral context comprising both phases of the proceeding before the Commission; it cannot be deemed interrupted merely by the expression of an idea or argument, if this does not obstruct the willingness to cooperate previously demonstrated. • The Plenary of the Commission carried out an isolated and restrictive interpretation of the statements that the plaintiffs made in their response to the opinion of probable liability, as well as of their general conduct during the investigation stage and the trial-like proceeding. Such analysis is insufficient and, therefore, in violation of the fundamental rights of legality and legal certainty, due defense and judicial protection. • In the exercise of their fundamental rights, the plaintiffs must be able to reserve the power to challenge the constitutionality of a law or, in general, to make any legal argument. An expression of defense cannot be interpreted against the movant to determine that its cooperation was interrupted, unless it reveals a "decisive change in conduct." • The arguments contained in the responses to the opinion of probable liability may be interpreted as a "mere rhetorical exercise" to convince the authority that, in this case, there was a lesser degree of intent and severity of the sanctionable conduct. This exercise must be deemed permissible within the exercise of the fundamental rights of hearing, defense and access to justice, in complement with the right of freedom of expression, since otherwise, if a certain argumentative standard were required of them, it could lead to "undue censorship." The Commission filed an appeal for review against the final judgment of indirect amparo trial 1282/2017. The Supreme Court of Justice of the Nation reassumed its original jurisdiction to hear the matter, so it was recorded in its index under case file amparo in review 1030/2019 and, to date, remains pending resolution. On the other hand, it should be noted that when the Technical Secretary observes acts or omissions that could suppose a failure to comply with the requirements of the Program, it will issue an agreement making said situation known to the applicant, so that the latter may make clarifications or take actions to remedy the failure, where possible (Article 10). In this way, applicants may state whatever is in their interest and anticipate, with a certain degree of certainty, the possibility that the benefit may be revoked in the final resolution issued by the Plenary. C. Changes in the order of priority Article 103 of the LFCE establishes that applicants who meet the requirements of the Program may obtain a reduction of the sanctions that may eventually correspond to them, based on the chronological order in which they submit their respective applications (minimum fine or reduction of 50, 30 or 20 percent of the fine). Previously, the consequences were not foreseen in the event that one of the applicants was denied the benefit of immunity and sanction reduction, so it was argued that the position of the economic agent excluded from the Program should be occupied by the applicant next in chronological order and the rest of the positions moved up successively. The Provisions resolve such regulatory gap, distinguishing between two scenarios, namely: (a) cancellation of the application for the conditional benefit and (b) revocation of the conditional benefit, in accordance with the following table. Cancellation of the application Revocation of the conditional benefit Grounds a) Failing to attend the first meeting with the Investigative Authority; or b) Not having provided sufficient information, in the judgment of the Investigative Authority. Failing to cooperate fully and continuously in the trial-like proceeding. Issuer The Investigative Authority, upon resolving the application for the conditional benefit. The Plenary, upon resolving the trial-like proceeding. Effects • Priority with respect to other applicants of the Program is lost (the positions move up). • A new application may be submitted (up until the agreement concluding the investigation is issued). The other applicants of the Program retain their position according to the chronological order in which they submitted their applications (the positions do not move up). III. PROCEDURE FOR AVAILING ONESELF OF THE PROGRAM (1) Submission of application Contact information Expression of intent to avail oneself of the benefit Corresponding market(s), goods and services (2) First meeting A date and time are set within 5 days following the submission of the application. A postponement may be requested (at least 3 days before the original date). (3) Analysis of the information Term of 40 business days, extendable up to 4 times The Commission continues to require the applicant's cooperation (4) Resolution of the application (a) If the information provided is sufficient, a "Conditional Immunity Agreement" is issued. (b) If the information provided is not sufficient, the application is cancelled For additional information, contact our expert: Fernando Carreño, Partner: +52 (55) 5258 1042 | fcarreno@vwys.com.mx
