In Mexico, all laws are drafted, discussed and approved by the legislative branch of government (Mexican Congress) and issued and published by the(Diario Oficial de le Federacion or DOF).  Meanwhile, the SHCP, Banxico, the CNBV, the CNSF and the IPAB are the governmental entities in charge of issuing secondary and delegated legislation that provide specific financial rules, guidelines and regulations to establish the legal framework for each financial activity. The federal government has issued a number of structural reforms  to modernize the legal framework of the main economic industries in Mexico so that they adapt to global standards. In this regard, the decree that reforms, adds and repeals various provisions in financial matters (“Financial Reform Decree”) was published in the DOF on 10 January 2014. The purpose of the Financial Reform Decree is to allow the Mexican banking and financial sectors to support Mexico’s economic growth by increasing competition within the financial sector to obtain  lower costs, better services and wider coverage of the credit facilities in Mexico. The Financial Reform Decree impacted the main framework laws in the Mexican financial sector, including reforms to the banking, financial services and insurance industries.

The principal laws governing the financial sector in Mexico are as follows:

• The Credit Institutions Law (Ley de Instituciones de Crédito), which, among others, sets forth the general framework governing credit institutions (instituciones de crédito), including their incorporation and authorization, governance, ownership, mergers, spin-offs, business activities, insolvency and resolution, and which also establishes the scope of authority of the different governmental entities that regulate and supervise banks and their activities

• The Bank Savings Protection Law (Ley de Protección al Ahorro Bancario), which governs the bank savings protection system

• The Financial Services User Protection and Defense Law (Ley de Protección y Defensa al Usuario de Servicios Financieros), which sets forth the general framework for the protection and defense of financial service users

• The Insurance and Bonding Companies Law (Ley de Instituciones de Seguros y de Fianzas), which focuses on the regulatory aspects of insurers, reinsurers and bonding companies

• The Law that regulates Financial Technology Institutions (Ley para regular las Instituciones de Tecnología Financiera), which covers financial technology institutions in Mexico, such as crowdfunding institutions, institutions engaged in electronic fund payments and sandboxes regime

With respect to anti-money laundering laws and regulations, there are two general regulatory frameworks — the AML Law for Financial Entities, which is applicable to financial institutions^[1] (i.e., banks, non-bank banks, warehouses, money transmitters, investment companies, credit unions, Fintech Entities,^[2] etc.), and the Federal Law for the Prevention and Identification of Transactions with Funds from Illegal Sources, otherwise known as the AML Law, which regulates individuals or entities engaged in non-financial “vulnerable activities.”  The purpose of the regulation is to protect the financial system and the national economy by establishing measures and procedures to prevent and detect acts or operations involving illegal resources.

[1] Within the AML Regulation for Financial Entities, the SHCP has issued specific regulation per type of financial institution.

[2] According to the Fintech Law, fintech entities are: a) crowdfunding institutions (instituciones de financiamiento colectivo); and b) electronic funds payments institutions (instituciones de fondos de pago electrónico).