Following the labor reform paseed in November 2012, and numerous precedents established by national andinternational authorities, Mexican labor authorities (better known as Conciliation and Arbitration Boards or LaborBoards) may currently hear and issue resolutions as to: (i) possible employee claims against company officers orwork colleagues in the companies where they render their services and (ii) possible personnel employmentterminations, without any liability for the companies, as a result of [mobbing] or workplace harassment and/orsexual harassment that employees were subject to, in order to remedy physical or emotional damage, as well asdamage to individual physical integrity or psyche, including non-pecuniary damages as a result of constantpressure from workplace or sexual harassment.Based on the foregoing, labor claims arising in the workplace and/or sexual harassment have increased. Some ofthese cases are justified, while others have no legal basis. As a result, it is essential to understand the terms andscope of possible indemnifications on this subject in order to prevent indiscriminate abuse of legal guaranties andlegal security for company employees. Abuse and/or sexual harassment in the labor reform appears in the decreepublished in the Official Journal of the Federation on June 6, 2011, which reforms, adds to and repeals variousprovisions contained in Articles 94, 103, 104 and 107 of the Mexican Constitution in order to update the amparoappeal lawsuit in labor matters in an effort to seek protection of the rights and personal guaranties of employeesand grant improved labor conditions for the working class, certainty regarding their employment, a sufficientsalary, a humane work schedule, breaks and vacations that promote good health and increased work productivity.As a result of the above, Article 2 of the Federal Labor Law establishes that dignified or decent work isunderstood to be that which fully respects the human dignity of the employee. Furthermore, discrimination basedon ethnic origin, nationality, gender, age, disability, social status, health conditions, religion, immigration status,opinions, sexual orientation or marital status are prohibited. Article 3 Bis of the Federal Labor Law defines: (i)harassment as the exercise of power in a relationship of subordination of the victim before the aggressor in theworkplace expressed through verbal or physical conduct or both; and (ii) sexual harassment as a form of violencewhere while subordination may not exist, there is abuse of power leading to a state of helplessness and risk forthe victim, independently of whether such is carried out in one or two events.Article 132, section VI of the Federal Labor Law imposes on employers the obligation to have properconsiderations for their employees, abstaining from verbal or physical mistreatment, meaning that the workenvironment should be free of any treatment that goes against the dignity, integrity and safety of the employees.It should be noted that the previously mentioned labor reform also modifies and adds various provisions relativeto non-discrimination for reasons such as gender, sexual orientation and provisions the purpose of which is toavoid and penalize workplace harassment and sexual harassment, including: (i) The authority of the employer torescind the employment relationship with its employees, without any liability, when the employees commitimmoral acts or sexual harassment against any person at the facility or workplace; (ii) The provision establishingthat in no event may work conditions be inferior to those set forth in the law, and such must be in proportion tothe importance of the service and the same for similar work with similar conditions of efficiency, withoutestablishing differences due to ethnicity or nationality, gender, age, disability, social status, health conditions,religion, opinions, sexual orientation or marital states; (iii) those that authorize employees to rescind the laborrelationship with the employer and request the payment of indemnification in accordance with that established bythe law when the employer, the employer’s family members or any other representatives, within the scope ofwork, engage in indecent or dishonest conduct, acts of violence, threats, injuries, harassment and/or sexualharassment, bad treatment or other similar conduct against the employee, his/her spouse, parents, children orsiblings and when the employee is asked to carry out acts, conduct or behavior that diminish or go against thedignity of the employee; (iv) those that prohibit employers or their representatives from refusing to hire employees due to ethnicity ornationality, gender, age, disability, social status, health conditions, opinions, sexual orientation, marital status orany other criteria that could result in a discriminatory act or to carry out acts of harassment and/or sexualharassment in the workplace; (v) those that prohibit employees from sexually harassing any person, or fromcarrying out immoral acts in the workplace; (vi) those that establish that the employer is jointly and severallyliable along with its employees to indemnify against any damage when it allows, tolerates or fails to investigatethe facts presented by an affected party or in the absence of such, fails to advise the Labor Inspector or theconduct. Furthermore, it is worth noting that the Article 179 of the Penal Code or the Federal District providesthat “sexual harassment with threats to cause the victim harm as to the activity that binds them will carry apenalty consisting of a term of six months to three years in prison”.Notwithstanding the payment of indemnification indicated in point (iii) above, it is possible that in systematiccases of workplace or sexual harassment, in addition to the deprivation of employment, non-pecuniary damageresults from the termination of the employment relationship in the form of emotional distress, harm to the beliefs,honor, reputation, private life and physical aspects of the employee. The Supreme Court of Justice has affirmedthat workplace harassment or [mobbing] suffered by employees is that which looks to “intimidate, subdue, scare,or emotionally or intellectually consume the employee with the purpose of excluding him/her from theorganization or to satisfy the need to attack, control or destroy by the harasser”. Given the previous, thefollowing conclusions result: (i) the Conciliation and Arbitration Boards or Labor Boards, taking into accountthe background of the case, the lack of responsibility on the employee’s part, and the economic situation of theemployer, such could establish the indemnification that corresponds to the employee due to [mobbing], workplace or sexual harassment that he/she was subject to in order to remedy the damage produced; (ii) sexualand/or workplace harassment is a reality in Mexico and may cause damage to the dignity of the victim; (iii) theConciliation and Arbitration Boards or Labor Boards may establish the amount of labor indemnifications in theevent of workplace or sexual harassment given that such are not regulated by the Federal Labor Law, except inthe event of rescission by the employee, which is not convenient for the employer; and (iv) to determine the corresponding indemnification for non-pecuniary damage, it is necessary that the cause for such is duly evidenced, systematic and occurs at theworkplace, given that the Labor Law does not regulate conduct occurring outside the workplace.
On October 31, 2014, Mexico’s Department of Economy published the amendments to the Regulations to theForeign Investment Law (RLIE for its acronym in Spanish) in the Official Journal of the Federation, which willcome into effect 60 business days after publication (February 12, 2015). This is the case notwithstanding theprovisions set forth in Articles 2 and 29 Bis of the RLIE, which came into effect on November 1, 2014, and wereenacted to simplify the submission of notices before the National Registry of Foreign Investments (“RNIE” forits acronym in Spanish), resulting in the reduction of monetary fines levied on companies registered before theRNIE.The amendments to the RLIE provide for various changes in the filing of notices, company registration renewalsand the filing of quarterly reports as to activities abroad, including the following:a) It is no longer necessary to provide notice to the RNIE when there is a change as to: (i) the domicile of thelegal representative; (ii) the legal representative; (iii) the domicile of the company’s plant; (iv) thedomicile of the company’s office; and (v) the name of the owners or shareholders.b) Notices as to changes of information previously submitted to RNIE within a term of 40 business days willnow be submitted quarterly and within 10 business days before the close of each quarter. Such noticesinclude those related to: (i) capital increases; (ii) transfer of equity interests; (iii) change of businessactivity; and (iv) change of tax domicile.c) Quarterly reports as to activities abroad previously submitted within a term of 20 business days will nowbe submitted within 10 business days following the close of the quarter.d) The schedule for presenting the annual financial report to renew company registrations has been modifiedin such a way that now, such submissions must be made within the first five months of each yeardepending on the first letter of the name of the company in accordance with the following: (i) A – J duringApril of each year; and (ii) K – Z during May of each year.e) The article requiring companies to cancel their registration before the RNIE due to liquidation, merger, ordomestication in Mexico and to previously update their registrations, submit financial reports for the lastfive years, and the quarterly reports on activities abroad was repealed.The National Commission on Foreign Investments (“CNIE” for its acronym in Spanish) will issue a generalresolution to determine the minimum amount for the submission of the (i) notices of capital increases, (ii) theannual financial report, and (iii) quarterly reports on activities abroad and with RNIE, as well as new forms forsubmitting such notices.Finally, on the day after the Decree comes into effect, companies with pending obligations before RNIE will have60 business days to comply with such Decree and update their files, with the chance of paying the minimum fine,depending on the type of notice involved.
Recently, the First Collegiate Court on Administrative Matters of the First Circuit approved legal opinion numberI.1o.A.79 A (10a.) entitled: “Expiration of trademark registrations. The use of a trademark by an authorized thirdparty, other than the owner, is sufficient to avoid its expiration.” In its opinion the Court determined that therelevant aspect to be considered in verifying the expiration of a trademark is its actual use for marketing of products, or for the rendering of services that are distinguished by such mark and, that said use by a third partyother than the owner serves to preserve the effectiveness of the trademark and avoid its expiration, in accordancewith the concept of mandatory use of the registered trademark under Mexican applicable intellectual propertylaw.
In August 2012, a decree of reforms to the Mexican Constitution on political matters was published in theOfficial Journal of the Federation to, among other things, recognize the right of citizens to vote in popularreferendums on issues of national importance. Since then, this mechanism of direct democracy has complementedthe representative democracy model shaped by Articles 39, 40 and 41of the Constitution.In terms of Article 35, section VII of the Constitution, popular referendums shall be called by Mexico’s FederalCongress at the request of the President of at least 33% of the members of each of its chambers, or the equivalentof a minimum of 2% of registered voters.Under the latter option, last April members of the National Regeneration Movement (Movimiento deRegeneración Nacional, or MORENA political party), presented a statement of intent before the Mexican Senateso that on the election day in July 2015 the following question would be posed to Mexico’s electorate: “¿Do youagree or not agree in granting contracts or concessions to private parties, whether national or foreign, for theexploitation of oil, gas, refining, petrochemicals and the electrical industry?”. Members of the DemocraticRevolution Party (Partido de la Revolución Democrática, or PRD) submitted a corresponding notice to theChamber of Deputies so that citizens could be asked the following questions: “¿Do you agree that the reforms toArticles 25, 27 and 28 of the Constitution in matters of energy should remain?”. Based on such initiative, the twomajor political parties on the left of the ideological spectrum dedicated themselves to collecting the signatures ofmillions of citizens that would support the referendum request, which results could reverse the constitutionalreform on energy that was enacted in December 2013.In an exceptional example of prior review of constitutionality in the Mexican legal system, according to article 35of the Constitution, Mexico’s Supreme Court of Justice (Suprema Corte de Justicia de la Nación, SCJN), shalldecide the constitutionality of the proposed referendum. Fundamentally, the high court must ensure that thepurpose of the popular referendum does not involve matters expressly forbidden by the Constitution, including,among others, the restriction of human rights, national security, electoral matters and government income andexpenditures.The Federal Public Referendum Law, which has been in effect since March of this year, puts the SCJN in chargeof deciding the constitutionality of this issue, in the case of those initiated by citizens, once the requiredsignatures have been obtained and certified with the National Elections Institute (Instituto Nacional Electoral,INE) . Additionally, the SCJN should review whether the question posed arises directly from the subject matter ofthe referendum; is not biased and does not contain value judgments; uses neutral, simple and understandablelanguage; and produces a categorical response, whether affirmative or negative.On October 30th, the SCJN held in a plenary decision that the subject matter of the referendum requested by thePRD and Morena was unconstitutional. The arguments of the majority of nine justices of the SCJN focused onthe direct relationship between the energy reform and government revenue. Some justices even emphasized thefact that a principal justification of the reform was the need to increase such revenue. Apparently, the justiceswere thinking only about revenue from the exploration and extraction of oil and gas, because it is not clear whatother energy sector activities are related in such a direct manner with the revenues of the Mexican government.The only dissenting justice was José Ramón Cossío, who argued that the majority’s opinion was undulyrestrictive on the exercise of fundamental and political human rights that were recently incorporated into theConstitution, based on an extremely broad definition of "income".Also based on being linked to government revenue, some days afterwards the SCJN declared unconstitutional thereferendumproposed by the members of the National Action Party (Partido Acción Nacional, PAN) aboutminimum wages. Similarly, it rejected the question posed by the Institutional Revolutionary Party (PartidoRevolucionario Institucional, or PRI) about reducing the number of deputies elected throughnominating slates,because that is an electoral matter.Therefore, in 2015 popular referendums will be held in Mexico. A long legal road ahead exists in order to definethe scope and limits of the rights provided by such popular voting instrument and, fundamentally, its effects. Onthis issue, the Federal Public Referendum Law provides that the results of these plebiscites may be mandatory forthe Executive and Legislative branches and the “competent authorities”. At some point in the future, it will bedefined as to whether this includes the Constitution’s reforming body, which recently amended Articles 25, 27and 28 of the Constitution on energy concerns. Someday, it will become clear what this constraint really meansand the consequences of ignoring it.For now, the energy reform has become final at the constitutional level and deadlines have elapsed forchallenging its laws by way of a constitutional controversy and the appeal action alleging unconstitutionality. Forpeople dissatisfied with the implementation of these norms, they may file an “amparo” appeal lawsuit. Mexico’sPresident has already issued the respective rules and decrees for the creation of new agencies. In this regard, therehave already been several appointments. In addition, Mexican regulatory agencies are beginning to issue somedocuments and rulings required by the transitory provisions. In short, the implementation of the energy reform isunderway.