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On July 18, 2013, the Federal Law for the Prevention and Identification of Operations with IllicitResources (the “Anti-Money Laundering Act”) went into effect, the same which was issued bythe Mexican Congress for the purpose of serving as an information hub in the government’s fightagainst money laundering. Similarly, (i) on August 16, 2013, the Regulations to the Anti-MoneyLaundering Act (the “Regulations”) were published; (ii) on August 23, 2013, the General Rules(the “General Rules”) were published; and (iii) on August 30, 2013, the formats for registrationand notification in terms of the Anti-Money Laundering Act were published (the “Formats”).The Anti-Money Laundering Act contains a list of at-risk activities and requires those whoconduct such activities to file certain notices with the Mexican Department of Finance and PublicCredit (Secretaría de Hacienda y Crédito Público). Unfortunately, the Anti-Money LaunderingAct and the rules deriving from such contain various inconsistencies resulting from draftingissues. These inconsistencies are generating confusion and include issues such as whether thepurchase and sale of real property is considered an at-risk activity, as well as who is required topresent the corresponding notice as to such transactions.In this regard, it is important to note that while various activities in the real estate sector areconsidered at-risk activities subject to the law’s required notice, the Anti-Money Laundering Actdoes not establish an obligation on the seller and/or buyer of real property to give notice as tosuch given that activities considered to be at-risk and subject to presentation of the respectivenotices are the following:(i) Real estate brokerage in the purchase and sale of real property, with the real estatebroker being required to give notice when the price of the transaction is for an amountequal to or greater than 8,025 times the Minimum Salary in Effect in the FederalDistrict (Salario Mínimo Vigente en el Distrito Federal [“SMVDF”]), meaningMX$519,699.00;(ii) The rendering of professional independent services, without the existence of anemployment relationship, when a service provider, on behalf of and in representationof his client, carries out a financial transaction related to the purchase and sale of realproperty or a related trust;(iii) The participation of a notary public in the purchase and sale of real property, the samewho must give notice when the value of the transaction or the property is greater than16,000 times the SMVDFD, meaning MX$1,036,160.00; and(iv) The participation of a notary public in the formation of a trust transferring ownershipof real property, the same who must give notice when the value of the transaction isgreater than 8,025 times the SMVDFD, meaning MX$519,699.00.It is important to note that the Anti-Money Laundering Act prohibits the payment and receipt ofall or part of the purchase price for real property in cash when the value of the transaction isgreater than 8,025 times the SMVDFD, meaning MX$519,699.00. As a result, it is necessary toprovide the notary public who supervises the closing of the transaction with detailed informationregarding the form of payment of the purchase price, date, legal currency and respectiveamounts, without there being an obligation upon notaries public to include such references in theactual notarial instrument or deed. Therefore, the notary public’s certification that he or she hasreceived the corresponding information is deemed to be sufficient.
Recently, the Second Chamber of the Supreme Court of Justice of the Nation (SCJN) resolved a contradiction by legal opinion resulting in legal opinion number 2a./J. 112/2013 (10a.) titled: Employee profit sharing. The amount set forth in Article 127, section III of the Federal Labor Law is only applicable to employers exclusively dedicated to activities indicated in such regulation." In this ruling, the Second Chamber of the SCJN held that the legislative intent upon creating such concept was that the maximum amount of one month's salary for employee profit sharing applies only to employers that obtain their income from the administration of assets and properties that generate rent, debt collection and interest, as long as such activities constitute the employer's sole source of income. Given the foregoing, for employers that carry out other types of business and/or activities in addition to those previously mentioned and such activities serve as a source of income, the general rule as to the one-month's salary as a maximum profit sharing payment amount does not apply. This ruling is pending publication in the Weekly Federal Court Reporter.
In Mexico, as in the rest of the world, trademarks that are duly registered may be enforced against third parties who attempt to utilize or copy them. Nonetheless, it is advisable to take certain measures with respect to their use and proper maintenance, including the following recommendations:
Mexico ardently protects the privacy of its individual citizens' personal data and sensitive personal information (Information). This protection is enforced though the Federal Personal Information Protection Law ( Law) and its regulations (Regulations). The Federal Institute for Access to Public Information and Protection of Information (IFAI) is the agency in charge of enforcing the Law and its Regulations. The Law has the following eight main principles: i) Lawfulness, which requires using the Information in compliance with the Law; ii) Consent, meaning that consent should be obtained before handling the Information; iii) Information, prescribing instructions as to how Information should be handled; iv) Quality, seeking to maintain current and correct Information ; v) Purpose, tending to limit handling of the Information to the sole purpose described in the privacy notice (Notice); vi) Loyalty, which is the obligation to respect the terms in which the Information was issued to the responsible party; vii) Application, referring to the application of the Information solely for the strict purpose for which it was collected; and viii) Responsibility, adopting only those measures that are necessary in order to comply with the Law. Additionally, there are two duties that the responsible party should observe: a) Duty of Confidentiality, maintaining confidentiality of the Information; and b) Duty of Safeguarding, implementing the security measures of an administrative, physical and technical nature that guarantee the confidentiality and integrity of the Information. Among other things, the Law defines what constitutes Information and how such should be handled. As a result, companies should review and identify which types of Information they handle or will handle. Once the type of Information is identified, companies can take required measures and necessary actions to safeguard the integrity of the Information, being that the collection and protection of such varies according to the nature of the Information itself. Under the Law, companies must write, publish and issue the corresponding privacy notice, guidelines for which were briefly discussed in the February 2013 edition of this report.It is important that each person or company comply with the Law because any breach of such may result in an Information protection proceeding or in a verification procedure and, if applicable, fines of between 100,000 to 320,000 days of minimum salary in effect for the Federal District may be levied, with the possibility of being doubled in the event of a reoccurrence. For violations related to the handling of sensitive Information, fines can increase and even double, apart from applicable civil and/or criminal liability (including jail time), depending on the severity of the violation.
Mexico's Federal Labor Law provides a series of rights that employees are entitled to that allow them to work under optimal conditions resulting in greater productivity and better performance of their job responsibilities. Among such rights is the right to receive a day of rest on at least a weekly basis. The purpose of the weekly rest day is to protect the health and physical and mental integrity employees. Such is intended to allow employees to reenergize themselves after the work week, and to provide them with time to rest and to spend time with their families. The Federal Labor Law establishes that for each six days of work, an employee will be entitled to at least one day of rest, with payment of full salary and benefits. The law also establishes that jobs requiring continuous labor, employees and employers must mutually agree on the days which employees will take e their weekly rest day. Nevertheless, they must try to designate Sundays for taking the weekly rest day. Today, it is common practice for non-union employees and employers to vary the scheduling of work hours during the work week, provided such schedule does not exceed the maximum allowed by law, in order to allow employees to take both Saturdays and Sundays off. Even so,, certain employment activities must, due to their nature, be performed on a Sundays, and those employees who are required towork on Sundays and rest on another day of the week shall receive an additional bonus of at least 25% of their regular salary. This bonus, which is referred to as the "Sunday bonus", takes into account that Sunday is normally given as a rest day, as it is often the day an employee can spend time with his/her family; this is the reason why an employee who works on Sundays receives the bonus payment, irrespective of the fact that he/she is given another day of the week to rest. It is important to note that when an employee does not work every day of the work week, or when he/she provides services to several employers on the same day or within the same week, such employee will be entitled to his/her proportional share of the salary for days of rest, calculated based on the corresponding salary for the days on which the employee worked or the salary received from each employer. The Federal Labor Law establishes that employees are not obligated to render services on their days of rest. However, if such work is necessary, the employer must then pay the employee (notwithstanding the salary corresponding for the day of rest salary for the services rendered. In the event that the weekly day of rest of the employee falls on a Sunday and he/she works on such day, in addition to payment of the salary corresponding to the day of rest, he/she must be paid double his/her salary for the services rendered. In such case, the employer is not required to make additional payment of the aforementioned Sunday bonus equivalent to 25% of the salary for an ordinary day of work.If the employer does not comply with the provisions set forth in the Law, labor authorities may order the employer to pay for all of those days of work that were not paid to its employees, or to pay the full salaries that were not correctly paid to the employees. In addition, during company visits customarily made by the Department of Labor and Welfare, said Department may impose a larger fine on companies, ranging from 50 to 250 times the minimum general salary for each employee affected, in the event that the employees of the company do not receive at least one rest day per week with payment of full salary and benefits if such officials determine the employer has not met applicable rest day payment requirements.
