05 Jul Ongoing investigation regarding the possible commission of relative monopolistic practices in the digital products and/or services market, and related services.
The Federal Economic Competition Commission in Mexico ("COFECE") published on July 3rd, 2023 a notice informing of the investigation that commenced since January 6th, 2023, as a result of a complaint received in connection with the possible commission of relative monopolistic practices (abuse of dominance) in the digital products and/or services market (including development, commercialization and sale activities), and related services.
E-books, software, videogames, online pictures, music and movies, are included within the digital products and services subject matter of the investigation, among others. The digital products and services, as well as apps, are created by developers and are offered to the final users through different channels. The authority also intends to assess the corresponding negotiation and pay-processing mechanisms.
In these regards, the COFECE indicates that, in Mexico and in many other countries, a significative increase in the consumption and revenues for the sale of digital products and services has been observed. As an example of this, during year 2021, the sales of videogames in Mexico increased 24% with respect to the preceding year, while sales of e-books increased 35%, and 19% regarding digital pictures and videos.
In light of said investigation, individuals, companies and entities who are customers, intermediaries, suppliers and users related to the sale of digital goods and/or services may receive requests for information (“RFIs”) from COFECE so that, as third parties, they provide information to assist the authority with its investigation. Also, within the investigation tools of the COFECE, it may perform dawn raids and request market participants to personally appear to declare facts known.
Failure to comply with the RFIs or to the exercise of the investigative authorities by the COFECE, could result in significant penalties to the parties involved. Additionally, economic agents incurring in relative monopolistic practices could be sanctioned with penalties amounting up to 8% of their revenues, independently to the risk of being subject to claims for indemnification of damages and losses.
At Cuesta Campos we have experience providing legal advice to companies regarding economic competition regulations in Mexico and with the implementation of antitrust compliance programs, as well as to timely respond to RFIs deriving from investigations carried out by the COFECE.
For any question or comment regarding the above, you may contact the following attorneys of our firm:
Contact
Azucena Marín
Héctor Mercado
Hugo Cuesta Tamayo
THE ABOVE IS PROVIDED AS GENERAL INFORMATION PREPARED BY PROFESSIONALS WITH REGARD TO THE SUBJECT MATTER. THIS DOCUMENT ONLY REFERS TO THE APPLICABLE LAW IN MEXICO. WHILE EVERY EFFORT HAS BEEN MADE TO ENSURE ACCURACY, NO RESPONSIBILITY CAN BE ACCEPTED FOR ERRORS OR OMISSIONS. THE INFORMATION CONTAINED HEREIN SHOULD NOT BE RELIED ON AS LEGAL, ACCOUNTING OR PROFESSIONAL ADVICE BEING RENDERED