Amendments to Penalties contained in Mexico’s Fiscal Code of the Federation

The fiscal reform package published on October 1, 2007 includes an amendment to Article 89 of the Fiscal Code of the Federation (CódigoFiscal de la Federación or CFF), that establishes penalties for advising, counseling or providing services to completely or partially avoid thepayment of any tax or contribution in contravention of applicable Mexican tax laws and regulations. The CFF provides that an infractionoccurs in the following specific instances: when a person advises, counsels or provides services to another relating to the total or partialomission of payment of taxes or contributions; and when such person does so in violation of Mexican tax provisions. Notwithstanding theamendment, it is important to keep in mind that tax authorities will seek at all times to collect revenue they consider due and owing and, as thecase may be, to prosecute probable violations of tax laws or tax crimes. Based on this development, it is useful to keep in mind that the samearticle provides that advisors will not be considered to have committed an infraction when their opinion states that it could vary from positionsof the tax authorities, or that it could be interpreted in another way by such tax authorities.