General Law of Credit Auxiliary Organizations and Activities

GENERAL LAW OF CREDIT AUXILIARY ORGANIZATIONS AND ACTIVITIES Published in the Official Gazette of the Federation on January 14, 1985.
Updated with reforms published in the same Gazette on December 26, 1986; January 3, 1990; December 27, 1991; July 15 and December 23, 1993; November 17, 1995; April 30, 1996; May 7, 1997; January 18 and May 17, 1999; January 5 and December 29, 2000; June 1 and June 4, 2001; June 13, 2003; January 28, 2004; July 18, 2006; June 15 and June 28, 2007; August 28, 2008; August 3, 2011; January 10, 2014; March 9, 2018; January 24 and March 26, 2024, as well as November 14, 2025.

GENERAL LAW OF CREDIT AUXILIARY ORGANIZATIONS AND ACTIVITIES

INDEX

First Title
General Provisions
Single Chapter

Second Title
On Credit Auxiliary Organizations
Chapter I
On General Deposit Warehouses (38)
Chapter II (Repealed) (38)
On Financial Leasing Companies (31)
Chapter II-BIS (Repealed) (31)
On Savings and Loan Societies (41)
Chapter III (Repealed) (41)
On Credit Unions (38)
Chapter III-BIS (Repealed) (38)
On Financial Factoring Companies
Chapter III BIS-I
On Subsidiaries of Foreign Financial Institutions
Chapter IV
Common Provisions

Third Title
On Accounting, Inspection and Supervision
Chapter I
On Accounting
Chapter II
On Inspection and Supervision

Fourth Title
On the Powers of the Authorities
Chapter I
General Provisions
Chapter II
On Revocation and Liquidation

Fifth Title
On Credit Auxiliary Activities
Chapter I
On the habitual and professional purchase and sale of foreign exchange

Chapter II
On the habitual and professional execution of credit operations, financial leasing and financial factoring

Sixth Title
On Infractions and Crimes
Chapter I
On Administrative Infractions
Chapter I Bis (46)
On Self-Correction Programs (46)
Chapter II
On Crimes
Chapter III (46)
On Notifications (46)

Seventh Title
On the Protection of Public Interests
Transitory Provisions
Statement of Reasons
References

GENERAL LAW OF CREDIT AUXILIARY ORGANIZATIONS AND ACTIVITIES

First Title
General Provisions
Single Chapter

(5) Article 1st.- This Law shall regulate the organization and functioning of credit auxiliary organizations and shall apply to the exercise of activities deemed herein as auxiliary to credit. The Ministry of Finance and Public Credit shall be the competent body to interpret, for administrative purposes, the provisions of this Law and, in general, for all matters relating to credit auxiliary organizations and activities.

Article 2nd.- National credit auxiliary organizations shall be governed by their organic laws and, in the absence thereof or for matters not provided for therein, by what is established in this Law.

The Ministry of Finance and Public Credit shall have exclusive jurisdiction over the implementation of measures relating to both the organization and the functioning of national credit auxiliary organizations.

(5) Article 3rd.- The following are considered credit auxiliary organizations:

(5) I. General deposit warehouses;
(38) II. Repealed;
(31) III. Repealed;

(41) IV. Repealed;
(38) V. Repealed, and
(5) VI. Those others that other laws consider as such.

(42) Article 4th.- The following are considered credit auxiliary activities:
(42) I. The habitual and professional purchase and sale of foreign exchange; (42) II. The habitual and professional execution of credit operations, financial leasing or financial factoring, and (42) III. The transmission of funds.

(44) Article 5th.- Authorization from the Ministry of Finance and Public Credit shall be required for the constitution and operation of general deposit warehouses.

(45) These authorizations may be granted or denied at the discretion of said Ministry, according to its assessment of the convenience of their establishment, and shall be, by their very nature, non-transferable.

(36) For the granting of the authorizations that correspond to the Ministry of Finance and Public Credit pursuant to this article, it shall hear the opinion of the National Banking and Securities Commission and of the Bank of Mexico.

(2) Such authorizations shall be published in the Official Gazette of the Federation, as well as any modifications thereto.

(44) Only societies that possess authorization under the terms of this Law may operate as general deposit warehouses.

(28) Article 5 Bis 1.- Unless otherwise established in specific provisions, the term shall not exceed three months for administrative authorities to resolve what corresponds. Upon expiration of the applicable term, resolutions shall be understood to be negative to the petitioner, unless the applicable provisions provide otherwise. At the request of the interested party, a certificate of such circumstance shall be issued within two business days following the presentation of the respective application to the competent authority that must resolve, in accordance with the respective Internal Regulations; an equal certificate shall be issued when specific provisions provide that upon expiration of the applicable term, the resolution shall be understood to be positive. If the aforementioned certificate is not issued within the cited term, the applicable liability shall be imposed, if applicable.

(28) The presentation requirements and terms, as well as other relevant information applicable to promotions made by the societies referred to in articles 3 and 4 of this Law, shall be specified in general provisions.

(28) When the initial document does not contain the data or does not meet the requirements established in the applicable provisions, the authority shall notify the interested party, in writing and only once, to remedy the omission within a term that shall not be less than ten business days. Unless otherwise established in specific provisions, such notification shall be made no later than within half of the authority's response term, and when such term is not express, within twenty business days following the presentation of the initial document.

(28) Upon notification of the requirement, the term for administrative authorities to resolve shall be suspended and shall resume from the next business day following that on which the interested party responds. In the event that the requirement is not fulfilled within the stated term, the authorities shall dismiss the initial document.

(28) If the authorities do not make the information request within the corresponding term, they may not reject the initial document as incomplete.

(28) Unless expressly provided otherwise, the terms for authorities to respond shall begin to run on the next business day following the presentation of the corresponding document.

(28) Article 5 Bis 2.- The term referred to in the preceding article shall not apply to promotions where, by express provision of this Law, administrative authorities must hear the opinion of other authorities, in addition to those related to authorizations concerning the constitution, merger, spin-off, and liquidation of the societies referred to in articles 3 and 4 of this Law. In these cases, the term for administrative authorities to resolve what corresponds shall not exceed six months, and the other rules referred to in Article 5 Bis-1 of this Law shall apply.

(28) Article 5 Bis 3.- Competent administrative authorities, at the request of the interested party, may extend the terms established in this Law, provided that such extension does not exceed half of the term originally provided in the applicable provisions, when the matter so requires and they have no knowledge that third parties' rights are prejudiced.

(28) Article 5 Bis 4.- The provisions established in Articles 5 Bis 1, 5 Bis 2, and 5 Bis 3 shall not apply to administrative authorities in the exercise of their supervisory, inspection, and surveillance attributes.

(45) Article 6th.- The application for authorization to constitute and operate a credit auxiliary organization shall be accompanied by the documentation and information established by the Ministry of Finance and Public Credit through general provisions, as well as proof of having constituted a deposit in Nacional Financiera in national currency in favor of the Federal Treasury, equal to ten percent of the minimum capital required for its constitution, according to this Law.

(31) Penultimate paragraph.- Repealed.

(9) In cases of revocation referred to in fraction I of Article 78 of this Law, the guarantee deposit shall be made effective, applying the original amount of the deposit mentioned in the first paragraph to the federal treasury. In the event that the requested authorization is denied, there is withdrawal by the interested parties, or operations are initiated under the terms provided in this Law, the principal and accessories of the aforementioned deposit shall be returned to the applicant.

(45) Article 7th.- The words credit auxiliary organization, general deposit warehouse, multiple-object financial society, exchange house, exchange center, or money transmitter, as well as others that express similar ideas in any language, may only be used in the name of societies to which authorization has been granted or which are registered, as applicable, in terms of what is provided by Articles 81, 81-B, and 87-B of this Law.

(45) The application of the preceding paragraph is exempted for associations of credit auxiliary organizations or societies dedicated to credit auxiliary activities, as well as those that group exchange centers or money transmitters, provided they do not carry out operations subject to authorization, registration, or regulation, under the terms provided in this Law; and for other persons authorized by the National Commission for the Protection and Defense of Financial Services Users for these effects.

(42) Credit auxiliary organizations that do not have the status of national may not include the term national in their name.

(42) Likewise, the words exchange, purchase or sale of foreign exchange, transmission of funds, as well as others that express similar ideas in any language, whether referring to foreign exchange in general or to a specific type thereof, may not be used in the name or denomination of natural persons whose tax regime is income from business activities, legal entities, or establishments other than exchange houses, exchange centers, money transmitters, or those financial institutions that, according to the laws governing them, are authorized to carry out exchange or purchase and sale of foreign exchange operations, as well as transmission of funds.

(45) Article 8th.- Societies authorized to operate as credit auxiliary organizations and exchange houses shall be constituted as anonymous societies, organized in accordance with the General Law of Commercial Societies and the following provisions which are of special application:

(45) I. Social capital shall be represented by ordinary shares and, with prior authorization from the Ministry of Finance and Public Credit, by preferred or limited voting shares, which may be issued up to an amount equivalent to thirty percent of the paid social capital of the corresponding organization or exchange house, except for those constituted as Subsidiaries which may not issue this type of shares. Likewise, societies may issue shares without nominal value expression.

(45) In case there is more than one series of shares, this situation must be expressly provided for in their bylaws, as well as the percentage of social capital they may represent.

(45) Limited voting shares shall grant their holders voting rights exclusively on matters relating to change of corporate purpose, merger, spin-off, transformation, dissolution, and liquidation of the society, as well as cancellation of its registration in any stock exchange. This type of share may confer on its holders the right to receive a preferential and cumulative dividend, which shall invariably be equal to or greater than that of ordinary shares, provided that this is established in the bylaws.

(45) These societies may issue treasury shares, which may be delivered to their subscribers, against total payment of the value that, if applicable, the society fixes, according to the subscription and payment procedure determined in accordance with the law.

(45) When a credit auxiliary organization or exchange house announces its social capital, it must simultaneously announce its paid capital;

(45) II. The duration of the society shall be indefinite;

(45) III. At no time may the following participate directly or indirectly in the social capital of credit auxiliary organizations and exchange houses:

(45) 1. Foreign governments, except in the following cases:

(45) A. When done for the purpose of temporary prudential measures, such as financial support or bailouts.

(45) Credit auxiliary organizations and exchange houses that fall under the provision of this fraction must deliver to the Ministry of Finance and Public Credit the information and documentation that proves compliance with the aforementioned, within fifteen business days following the occurrence of such circumstance. The Ministry of Finance and Public Credit shall have a term of ninety business days, counted from receipt of the corresponding information and documentation, to resolve whether the participation in question falls under the exception provided in this fraction.

(45) B. When the corresponding participation implies having control of the credit auxiliary organization or exchange house, in terms of this article, and is carried out through official legal entities, such as funds, governmental development entities, among others, with prior authorization from the Ministry of Finance and Public Credit, provided that, in its judgment, such entities prove that:

(45) a) They do not exercise authority functions, and

(45) b) Their decision-making bodies operate independently from the foreign government in question.

(45) C. When the corresponding participation is indirect and does not imply having control of the credit auxiliary organization and exchange house in terms of the following paragraph. The foregoing, without prejudice to the notices or authorization requests that must be made in accordance with what is established in this Law.

(45) For these purposes, control shall be understood as the capacity to impose, directly or indirectly, decisions in the general shareholders' meetings of the credit auxiliary organization or exchange house; to maintain ownership of rights that allow, directly or indirectly, to exercise voting rights with respect to more than fifty percent of the social capital of the credit auxiliary organization or exchange house; to direct, directly or indirectly, the administration, strategy, or main policies of the credit auxiliary organization or exchange house, either through ownership of securities or by any other legal act.

(45) 2. Credit auxiliary organizations and exchange houses, except in the case of entities of the same type as the issuer that intend to merge according to programs approved by the Ministry of Finance and Public Credit and with prior authorization that may be granted temporarily by said Department; and

(45) 3. Guarantee institutions or mutual insurance societies.

(45) IV. Except as provided in the preceding fraction, any natural or legal person may, through one or several simultaneous or successive operations, acquire shares representing the social capital of credit auxiliary organizations and exchange houses. When it is intended to acquire directly or indirectly more than ten percent of the ordinary social capital, or to grant guarantees on shares representing said percentage, prior authorization from the Ministry of Finance and Public Credit must be obtained, which may be granted at its discretion, for which it must hear the opinion of the National Banking and Securities Commission.

(45) In the event that a person or group of persons, shareholders or not, intends to acquire twenty percent or more of the ordinary shares representing the social capital of a credit auxiliary organization or exchange house, or to obtain control of the entity itself, prior authorization from the Ministry of Finance and Public Credit must be requested, which may be granted at its discretion, with the favorable opinion of the National Banking and Securities Commission.

(45) For the purposes of the foregoing, control of the society shall be understood to be exercised when one has directly or indirectly twenty percent or more of the shares representing the social capital thereof, or has control of the general shareholders' meeting, or is in a position to appoint the majority of the members of the board of directors, or controls the society in question by any other means.

(45) The requirements to request the authorizations provided for in this fraction shall be established in the general provisions issued for such effect by the Ministry of Finance and Public Credit.

(45) V. Shareholders representing at least ten percent of the paid capital of a society shall have the right to designate one director.

(45) The appointment of these directors may only be revoked when the appointment of all others is revoked, without prejudice to what is provided in Article 74 of this Law;

(45) VI. The board of directors shall be composed of a minimum of five and a maximum of fifteen principal directors, of whom those comprising at least twenty-five percent must be independent. For each principal director, a substitute may be designated, understanding that substitute directors of independent directors must have the same character. Directors must meet the requirements established in Articles 8o Bis 1 and 8o Bis 2 of this Law.

(45) VII. Shareholders' meetings and board of directors meetings shall be held at the corporate domicile, which must always be located within national territory. The bylaws may establish that agreements of shareholders' meetings are valid in second call, regardless of the number of votes with which they are adopted, except when they are extraordinary shareholders' meetings, in which at least thirty percent of the paid capital is required for the adoption of resolutions proper to such meetings;

(45) VIII. From their profits, they shall set aside at least ten percent to constitute a capital reserve fund until reaching a sum equal to the amount of the paid capital;

(45) IX. Amounts by way of premiums or similar, paid by subscribers for shares above their nominal value, shall be carried to a special reserve fund; but may only be counted as capital, for the purpose of determining the existence of the minimum capital required by this Law;

(45) X. The supervisory body shall be composed of at least one auditor. Auditors must have technical quality, honorability, and satisfactory credit history, as well as extensive knowledge and experience in financial, accounting, legal, or administrative matters, and be residents in Mexican territory, in terms of what is provided in the Federal Tax Code. The following may not be principal or substitute auditors of credit auxiliary organizations and exchange houses:

(45) 1. Their general managers or managers;

(45) 2. The members of their boards of directors, principal or substitute;

(45) 3. Officials or employees of credit institutions, insurance companies, guarantee companies, stockbroking firms, other credit auxiliary organizations, and exchange houses; and

(45) 4. The principal or substitute members of the board of directors, general managers, or managers of societies that, in turn, control in terms of this Law the credit auxiliary organization or exchange house in question, or of companies controlled by the majority shareholders thereof.

(45) XI. The constitutive deed and any modification thereto must be submitted to the approval of the Ministry of Finance and Public Credit, to verify compliance with the requirements established by law. Once approved, the deed or its reforms must be presented for registration before the Public Commerce Registry. The society must provide the Ministry with the data of its respective registration within fifteen business days following the granting of the registration; and

(45) XII. The merger of credit auxiliary organizations or exchange houses shall take effect upon registration in the Public Commerce Registry and must be published in the Official Gazette of the Federation. Within ninety natural days following the date of publication, creditors may oppose judicially solely for the purpose of obtaining payment of their credits without this opposition suspending the merger.

(46) Article 8o Bis.- Credit auxiliary organizations and exchange houses shall abstain, if applicable, from registering in the registry referred to in Articles 128 and 129 of the General Law of Commercial Societies the transfer of shares carried out in contravention of what is provided in Article 8o, fraction III of this Law, and shall inform such circumstance to the Ministry of Finance and Public Credit within five business days following the date on which they become aware of it.

(46) When acquisitions and other legal acts through which direct or indirect ownership of shares representing the capital of credit auxiliary organizations and activities and exchange houses is obtained are carried out in contravention of what is provided in Article 8, fraction III of this Law, the patrimonial and corporate rights inherent to the corresponding shares of credit auxiliary organizations and exchange houses shall be suspended and, therefore, may not be exercised, until it is accredited that the corresponding authorization or resolution has been obtained, or that the requirements contemplated by this Law have been satisfied.

(46) Article 8o Bis 1.- The appointments of board members of credit auxiliary organizations and exchange houses must be made with individuals who possess technical competence, integrity, and a satisfactory credit history, as well as extensive knowledge and experience in financial, legal, or administrative matters.

(46) In no case may the following be board members:

(46) I. Officials and employees of the organization or exchange house, with the exception of the general manager and officials of the company who hold positions with the two immediate lower administrative hierarchies than that of the general manager, provided that these do not constitute more than one-third of the board of directors.

(46) II. The spouse, concubine, or concubine of any of the persons referred to in the preceding subsection. Persons who have blood or affinity kinship up to the second degree, or civil kinship, with more than two board members;

(46) III. Persons who have pending litigation with the credit auxiliary organization or exchange house in question;

(46) IV. Persons sentenced for property crimes; those disqualified from exercising commerce or holding a job, position, or commission in public service, or in the Mexican financial system;

(46) V. Bankrupts and those in bankruptcy proceedings who have not been rehabilitated;

(46) VI. Those who perform inspection and supervision functions for credit auxiliary organizations or exchange houses;

(46) VII. Those who perform regulation and supervision functions for credit auxiliary organizations or exchange houses, unless there is participation by the Federal Government in their capital, and

(46) VIII. Those who participate in the board of directors of another credit auxiliary organization or exchange house or of a controlling company of a financial group to which those entities belong.

(46) The majority of board members must be Mexican or foreign residents in the national territory, in accordance with the provisions of the Federal Tax Code.

(46) The person to be appointed as a board member of a credit auxiliary organization or exchange house who is a board member of another financial entity must disclose this circumstance to the shareholders' assembly of said institution at the time of their appointment.

(46) Article 8o Bis 2.- An independent board member shall be understood to be a person who is external to the administration of the respective credit auxiliary organizations and exchange houses and who meets the requirements and conditions determined by the National Banking and Securities Commission, through general provisions, in which the circumstances under which a board member ceases to be independent for the purposes of this article shall also be established.

(46) In no case may the following be independent board members:

(46) I. Employees or executives of the company;

(46) II. Persons who have command power in the company;

(46) III. Partners or persons who hold a job, position, or commission in companies or associations that provide services to the company or to companies belonging to the same business group of which it is part.

(46) A company or association is considered important when the income it receives for providing services to the company or the same business group of which it is part represents more than five percent of the total income of the company or association in question;

(46) IV. Clients, suppliers, service providers, debtors, creditors, partners, board members, or employees of a company that is an important client, supplier, service provider, debtor, or creditor of the entity.

(46) A client, supplier, or service provider is considered important when the services provided by the institution or the sales made by them to it represent more than ten percent of the total services or sales of the client, supplier, or service provider, respectively. Likewise, a debtor or creditor is considered important when the amount of the respective operation is greater than fifteen percent of the assets of the company or its counterparty;

(46) V. Employees of a foundation, association, or civil society that receives important donations from the entity.

(46) Important donations are those that represent more than fifteen percent of the total donations received by the foundation, association, or civil society in question, in each fiscal year;

(46) VI. General managers or officials who hold positions with the two immediate lower administrative hierarchies than that of the general manager, in a company in whose board of directors the general manager or an official holding a position with the two immediate lower administrative hierarchies than that of the general manager of the entity participates;

(46) VII. General managers or employees of companies belonging to the financial group to which the entity itself belongs;

(46) VIII. Spouses, concubines, or concubines, as well as relatives by blood, affinity, or civil kinship up to the first degree, of any of the persons mentioned in the preceding subsections III to VII, or up to the third degree of any of those indicated in subsections I, II, IX, and X of this article;

(46) IX. Directors or employees of companies in which the entity's shareholders exercise control;

(46) X. Those who have conflicts of interest or may be influenced by personal, property, or economic interests of any of the persons who maintain control of the entity or the consortium or business group to which the entity belongs, or the command power in any of these, and

(46) XI. Those who have been included in any of the preceding circumstances, during the year prior to the time when their appointment is intended.

(46) Article 8o Bis 3.- The appointments of the general manager and officials who hold positions with the two immediate lower hierarchies than that of the general manager, in credit auxiliary organizations and exchange houses, must be made with individuals who possess credit eligibility and integrity, and who additionally meet the following requirements:

(46) I. Be a resident in Mexican territory, in accordance with the provisions of the Federal Tax Code;

(46) II. Have provided at least five years of service in high-level decision-making positions, whose performance requires knowledge and experience in financial and administrative matters;

(46) III. Not have any of the impediments for being a board member indicated in subsections III to VIII of the previous article, and

(46) IV. Not be performing regulation functions for credit auxiliary organizations and exchange houses.

(45) Article 9o.- The powers granted by credit auxiliary organizations and exchange houses will not require other insertions than those related to the board agreement that authorized the granting of the power, the powers granted in the deed or statutes to the same board regarding the matter, and the verification of the appointment of the board members.

(45) Article 10.- Commercial laws, commercial usages and practices, and federal civil legislation will be supplementary to this Law, in the order cited.

Title Two
On Credit Auxiliary Organizations
Chapter I
On General Deposit Warehouses

(45) Article 11.- General deposit warehouses shall have as their object the storage, custody, or conservation, handling, control, distribution, or commercialization of goods or merchandise under their custody, including those in transit, covered by deposit certificates and the granting of financing with guarantee of the same. They may also carry out processes of adding value, as well as the transformation, repair, and assembly of deposited merchandise in order to increase its value, without essentially changing its nature.

(45) General deposit warehouses that operate with agricultural and fishing merchandise will seek to coordinate the provision of storage services with actions and programs related to sustainable rural development in accordance with the Sustainable Rural Development Law, in order to promote the participation of organizations or associations of producers in the rural and fishing sectors in the activities of the storage sector.

(45) General deposit warehouses authorized to receive merchandise destined for the fiscal deposit regime may carry out the aforementioned processes in relation to such merchandise in accordance with the Customs Law.

(52) Article 11 Bis.- General deposit warehouses shall have the exclusive authority to issue deposit certificates, which must be carried out through a cryptographic system referred to in the General Law of Credit Instruments and Operations.

(53) Such credit instruments shall be governed by the provisions of this Law and the General Law of Credit Instruments and Operations.

(53) General deposit warehouses must guarantee to legitimate holders, secured creditors, supervisory authorities, and other participants in operations with such credit instruments, access to the cryptographic system through which they are issued for the exercise of the rights and powers granted by this Law and the General Law of Credit Instruments and Operations, with respect to the certificates they issue, and otherwise they may be subject to civil liability, being responsible for any damages and losses that may be caused.

(53) Such cryptographic systems must meet minimum security standards that guarantee the confidentiality, availability, and integrity of information and the prevention of fraud and cyberattacks, the compliance with which is the responsibility of the issuing general deposit warehouse. For these purposes, the National Banking and Securities Commission must, through general rules, determine the requirements and characteristics that the system used by the general deposit warehouse for issuing its certificates must meet in these matters.

(52) General deposit warehouses are obligated to issue deposit certificates for the merchandise or goods delivered to them for deposit, except in the case provided for in Article 20 of this Law.

(53) Repealed.

(46) In their operations, general deposit warehouses must collect and verify information and documentation regarding the identification of their clients and users.

(52) General deposit warehouses will be liable to their depositors and holders of deposit certificates they have issued for any defect presented by the goods and merchandise deposited under their custody, their existence, and their quality, as long as they do not correspond to the terms, amounts, characteristics, and other conditions stated in the deposit certificate. This is independent of whether the goods and merchandise are deposited in own, authorized, or transit warehouses. Unless proof to the contrary is provided, the deficiency will be attributed to the warehouse.

(53) Repealed.

(52) In the event that deposit certificates are issued for merchandise in transit, the general deposit warehouse will be responsible for its transfer to the destination warehouse, in which it will continue to be the depositor of the merchandise until the substitution of the deposit certificates, including all transit warehouses. For these purposes, the merchandise in transit must be insured in favor of the general deposit warehouse, which may directly contract the respective insurance, designating the beneficiary of the policy issued by the corresponding insurance company, or, in the case of previously insured merchandise, must obtain the corresponding endorsement of the respective policy in its favor, in accordance with the Insurance Contract Law.

(52) The general deposit warehouse may, under its responsibility, accept or use any other mechanism different from the insurance referred to in the preceding paragraph that allows covering the risks inherent to the merchandise in transit, provided that they are effective to guarantee its liability to the depositor or holder of the certificate.

(46) Shipping documents must be issued or endorsed in favor of general deposit warehouses.

(46) Article 11 Bis 1.- Regarding deposit certificates covering agricultural and fishing products, the instruments must include the declaration of the depositor, regarding the following:

(46) I. If applicable, the express mention that they are basic and strategic products in accordance with Article 179 of the Sustainable Rural Development Law;

(46) II. The place of production. In the case of agricultural and fishing products of national origin, the corresponding key according to the territorial integration catalog of states, municipalities, and localities, published by the National Institute of Statistics and Geography, must be stated;

(46) III. The year and agricultural production cycle; the specification of the quality of agricultural and fishing products in accordance with applicable provisions;

(46) IV. Indicate if there is any price coverage mechanism and the related information;

(46) V. Unit of measurement in kilograms, liters, or meters, as applicable, of the merchandise and declared value by the depositor, and

(46) VI. The terms of the insurance, if the merchandise is covered against fire or other types of eventual damage.

(46) General deposit warehouses will provide facilities for competent authorities to perform inspection and certification functions for sanitary and quality standards of goods and agricultural and fishing products covered by certificates and stored in their warehouses and facilities.

(46) Article 11 Bis 2.- In addition to the activities indicated in Article 11, general deposit warehouses may carry out the following activities, provided that these do not constitute their predominant activity, except for the services provided in subsection IX:

(46) I. Provide collection, handling, control, distribution, transportation, and commercialization services, as well as others related to storage, of goods or merchandise under their custody, including those provided for in Article 20 of this Law, complying with safety, health, quality, storage, and refrigeration standards for agricultural and fishing goods;

(46) II. Certify quality and value goods or merchandise;

(46) III. Pack and package goods and merchandise received for deposit on behalf of depositors or holders of deposit certificates, as well as place labels, seals, or tags respectively;

(46) IV. Grant financing with guarantee of goods or merchandise received for deposit, including those in transit, covered by deposit certificates and pledge bonds;

(46) V. Obtain loans and credits from credit, insurance, and surety institutions, from foreign financial entities, and in general, from any financial entity established in national territory, destined to fulfill their corporate purpose;

(46) VI. Issue subordinated obligations and other credit instruments, in series or in mass, for placement among the general investing public;

(46) VII. Discount, pledge, or negotiate credit instruments and affect rights arising from financing contracts they carry out with their clients or from operations authorized to general deposit warehouses, with persons from whom they receive financing in accordance with the preceding subsection V, as well as affect in irrevocable trust the credit instruments and rights arising from financing contracts they conclude with their clients to guarantee the payment of issuances referred to in subsection VI of this article;

(46) VIII. Manage on behalf and in the name of depositors, the granting of guarantees in favor of the federal treasury, regarding merchandise stored by them, in order to guarantee the payment of taxes, in accordance with the procedures established in the Customs Law;

(46) IX. Provide fiscal deposit services, as well as any other expressly authorized to general deposit warehouses in accordance with the Customs Law;

(46) X. Provide fiduciary institution services exclusively in guarantee trusts referred to in the General Law of Credit Instruments and Operations, to guarantee obligations in their favor derived from their operations and activities;

(46) XI. Conclude repurchase agreements on deposit certificates and pledge bonds they issue, in accordance with the general provisions issued by the Bank of Mexico;

(46) XII. Conclude financial derivative operations, with prior authorization from the Bank of Mexico, and in accordance with the general provisions issued for this effect, and

(46) XIII. Other analogous and related operations that, through general rules, are authorized by the Ministry of Finance and Public Credit, with the opinion of the Bank of Mexico and the National Banking and Securities Commission.

(45) Article 12.- General deposit warehouses may be of four classes:

(45) I. Level I, those dedicated exclusively to carrying out agricultural and fishing storage operations, including other activities provided for in this Law directed to that sector, with the exception of the fiscal deposit regime and granting of financing;

(45) II. Level II, those dedicated to receiving goods or merchandise of any class for deposit and carrying out the other activities referred to in this Law, with the exception of the fiscal deposit regime and granting of financing;

(45) III. Level III, those additionally authorized in accordance with the preceding subsection, also authorized to receive merchandise destined for the fiscal deposit regime, and

(45) IV. Level IV, those additionally authorized in accordance with any of the preceding subsections, grant financing in accordance with what is provided in this Law.

(45) The Ministry of Finance and Public Credit will establish in general provisions the minimum capitalization requirements to which general deposit warehouses carrying out the activities provided for in the preceding subsection IV must be subject, as well as those that issue deposit certificates regarding goods or merchandise stored in authorized warehouses.

(45) Regarding general deposit warehouses referred to in subsection III and, if applicable, subsection IV of this article, they must be subject to the corresponding provisions provided by the Customs Law, regarding merchandise that cannot be subject to the fiscal deposit regime and the control measures that must be implemented to keep merchandise subject to this regime isolated, in accordance with what is established by the aforementioned law.

(45) The Ministry of Finance and Public Credit, in a list formulated for the knowledge of general deposit warehouses, will expressly indicate the products, goods, or merchandise that cannot be subject to their fiscal deposit in the warehouses referred to in subsection III and, if applicable, subsection IV of this article.

(46) Article 12 Bis.- The minimum subscribed and paid-in capital without withdrawal rights that general deposit warehouses must have, according to the classification referred to in Article 12 of this Law, will be:

(46) I. For Level I warehouses, the equivalent in national currency of 2,588,000 investment units;

(46) II. For Level II warehouses, the equivalent in national currency of 3,406,000 investment units;

(46) III. For Level III warehouses, the equivalent in national currency of 4,483,000 investment units, and

(46) IV. For Level IV warehouses, the equivalent in national currency of 8,075,000 investment units.

(46) The minimum capitals referred to in this article must be fully subscribed and paid by the last business day of the year in question. For these purposes, the value of the investment units corresponding to December 31 of the immediately preceding year will be considered.

(46) When social capital exceeds the minimum referred to in this article, it must be paid at least fifty percent, provided that this percentage is not lower than the minimum established according to the level corresponding to the warehouse in question.

(46) Regarding variable capital companies, the minimum capital required by this article will be integrated by shares without withdrawal rights, representing the fixed portion of social capital. The amount of capital with withdrawal rights may in no case be higher than the paid-in capital without withdrawal rights. Likewise, book capital may in no moment be lower than the minimum capital referred to in this article, as applicable.

(46) Article 12 Bis 1.- General deposit warehouses may group into guild associations, which may carry out, among other functions, the development and implementation of standards of

conduct and operation that their members must comply with, in order to contribute to the healthy development of the aforementioned societies.

(46) Trade associations of general warehouses, in accordance with their statutes, may issue, among others, rules regarding:

(46) I. The requirements for admission, exclusion, and separation of their members; (46) II. The process for adopting rules and verifying their compliance; (46) III. The standards and policies for adequate compliance with the provisions of a general nature referred to in Article 95 of this Law, and (46) IV. Procedures or mechanisms related to the authorization of warehouses and premises, and with the processes of inspection, supervision, conservation, and in general, control of merchandise.

(46) Trade associations may carry out periodic evaluations of their members regarding compliance with the rules issued by such associations. When, from the results of such evaluations, they become aware of any non-compliance with the provisions of this Law and the general provisions referred to in the preceding subsection III, such associations must report it to the National Banking and Securities Commission. Likewise, such associations must keep a record of the corrective and disciplinary measures applied to their members, which will be available to the National Banking and Securities Commission.

(46) The self-regulatory rules issued in accordance with the provisions of this article may not contravene or exempt what is established in this Law and other applicable provisions.

(45) Article 13.- General warehouses may only issue deposit certificates, whose joint value shall not exceed the amounts determined for this purpose by the Secretariat of Finance and Public Credit through general provisions. In any case, the value of the certificates may not exceed thirty times their book capital, excluding those issued as non-negotiable, except for what is provided in the following paragraphs.

(45) The Secretariat of Finance and Public Credit, with the opinion of the National Banking and Securities Commission and the Bank of Mexico, may temporarily raise the maximum proportion fixed in the preceding paragraph, and exclude from said calculation the certificates that cover merchandise deposited in warehouses owned, leased, or on loan, handled directly by the general warehouse, through general provisions that may be applicable to the entire country or only to a specific zone or locality. Likewise, it may, in individual cases, temporarily raise the aforementioned limit, provided that the proportion does not exceed sixty times, taking into account the particular circumstances of the general warehouse in question and the operations it intends to carry out.

(45) The aforementioned Secretariat, through general rules, will determine the proportion of the said sum of book capital that the value of the certificates covering merchandise deposited in authorized warehouses issued in favor of the same person, entity, or group of persons who, according to the same rules, must be considered for these purposes as a single one, may reach at most, and will establish the conditions and requirements that must be satisfied to obtain authorization to carry out operations exceeding the established limit.

(45) Article 14.- General warehouses must comply with the requirements, characteristics, and rules based on the official supply programs and applicable legal provisions, regarding the facilities, equipment, and procedures used for the collection, conditioning, industrialization, storage, and transport of food products for general consumption; requiring the depositor of the merchandise to present the corresponding phytosanitary and zoosanitary certificates, when these are required in accordance with the various applicable health provisions. General warehouses must give timely notice to the Secretariat of Agriculture, Livestock, Rural Development, Fisheries and Food, regarding the presence of any zoosanitary or phytosanitary risk factor.

(8) General warehouses that are to receive merchandise destined for the fiscal deposit regime will be subject to the control of customs authorities in accordance with the relevant Law.

Article 15.- The capital and capital reserves of general warehouses must be invested:

(45) I. In the establishment of warehouses, transformation plants, and offices owned by the organization; in the conditioning of external warehouses whose use is acquired by the general warehouse in accordance with this Law; in transport equipment, machinery, tools, and equipment necessary for its operation; in shares of societies organized exclusively to acquire ownership and administer buildings or warehouses, and provided that in some building owned by that society the general warehouse shareholder has established or establishes its main office or some branch or department; and in shares of the societies referred to in Article 68 of this Law. The investment in shares and the requirements that the societies referred to in this subsection must satisfy will be subject to the general rules issued by the Secretariat of Finance and Public Credit, with the opinion of the National Banking and Securities Commission.

(17) The Secretariat of Finance and Public Credit will establish through general provisions, the total amount of these investments in relation to the sum of paid capital and capital reserves.

(45) General warehouses must have their own premises for warehouses, from the start of their operations, as well as the minimum mandatory surface area and capacity that are set for each level, in the general rules issued for this purpose by the Secretariat of Finance and Public Credit with the opinion of the National Banking and Securities Commission;

(52)

II. In the granting of financing with collateral of goods or merchandise delivered in deposit to the warehouse in question, covered by deposit certificates or when it comes to repo operations acting as the repo lender, in accordance with Article 11 Bis 2, subsection XI of this Law; in the delivery of advances secured by the goods and merchandise delivered in deposit to the warehouse in question, which are destined for the payment of packaging, freight, insurance, import or export taxes, and transformation operations of those same goods and merchandise, with the advance noted in the relevant titles issued by the general warehouses; in pledged credit portfolios, and in inventories of the merchandise they commercialize, and

(45) III. In legal tender currency in the country or in demand or time deposits at the Bank of Mexico or in credit institutions, or in bank deposit certificates, or in bank balances in accounts of any kind, or in credits expressed in bills of exchange, promissory notes, and other commercial documents with at least one signature from a credit institution and always for a term not exceeding one hundred eighty natural days, or also in bills, promissory notes, and other commercial documents arising from sales transactions of merchandise effectively carried out, for a term not greater than ninety natural days, as well as in securities or instruments approved for this purpose by the National Banking and Securities Commission.

(9) The Secretariat of Finance and Public Credit will determine through general provisions the capital reserves computable for the purposes of this article.

(45) Article 16.- For the purposes of this Law, an authorized warehouse shall be understood to be those premises that form part of the depositor's facilities, whether they are owned, rented, or received on loan, which the general warehouse takes charge of to operate as warehouses and carry out the storage, custody, or conservation of goods or merchandise belonging to the same depositor or third parties, provided that they meet the requirements set forth in the fourth paragraph of Article 17 of this Law.

(45) The authorized warehouse keeper shall be designated by the general warehouse to take charge of the storage, custody, or conservation of deposited goods or merchandise in its name and representation, and must guarantee the correct performance of its functions through the guarantees that the general warehouse deems pertinent. In any case, the designation of the authorized warehouse keeper must fall at least on the General Director or equivalent of the depositor society, the President of the Board of Directors or Sole Administrator of the depositor society, and in the case of natural persons, on the depositor themselves.

(45) Article 16-A.- To cover claims in case of shortages of merchandise in owned, leased, or authorized warehouses, general warehouses must constitute a contingency reserve whose formation and investment will be adjusted to the general rules issued for this purpose by the Secretariat of Finance and Public Credit, with the opinion of the National Banking and Securities Commission and the Bank of Mexico. For the issuance of the aforementioned rules, the Secretariat must consider the financial and storage capacity of the general warehouses, whether such warehouses operate in owned or authorized warehouses, as well as the number of deposit certificates in circulation and whether such certificates are negotiable or not.

(52) Article 17.- In addition to the premises that general warehouses have for warehouses, offices, and other services in ownership, they may have external premises under lease, loan, or authorization anywhere in the Republic, in accordance with the terms established by the National Banking and Securities Commission through general provisions. Likewise, they may have premises abroad, whether owned, leased, on loan, authorized, or under any other analogous figure permitted by the legislation of the host country, in accordance with what is established in Article 65 of this Law.

(45) General warehouses must notify the National Banking and Securities Commission, at least ten business days in advance of the start of operations of the premises destined for warehouses, offices, and other services, which they own.

(45) No general warehouse may receive in leased warehouses and handled directly by it, merchandise whose certification value exceeds the percentage of the value of the certificates it has in circulation, as determined through general provisions by the National Banking and Securities Commission.

(52) The leased, loaned, or authorized premises must have direct access to the public roadway and be independent of the rest of the constructions located in the same building, and must also have good physical conditions of stability and adaptability that ensure the conservation of the merchandise subject to deposit.

(45) When there are shortages of merchandise deposited in authorized warehouses, general warehouses may request in the executive path the seizure of the real estate affected by the authorized warehouse keeper or their guarantor for the fulfillment of their obligations with the warehouse, based on the document that constitutes such encumbrance as collateral and provided that it has been ratified and registered in accordance with the following paragraph.

(45) The document in which the encumbrance is made must be ratified by the owner of the real estate before a judge, notary, or public broker, and shall be registered, at the request of the general warehouse, in the respective Public Property Registry.

(45) Authorized warehouse keepers must grant access to the authorized warehouses or premises to the persons designated by the general warehouse, to carry out inspection visits, who for these purposes will have certification powers, even in the case of shortages of goods or merchandise covered by deposit certificates, and the detailed minutes of facts drawn up for this purpose will serve as full proof in case of controversy. The National Banking and Securities Commission will determine through general provisions the frequency with which such visits must be carried out, for which it will consider the value of the inventories in each authorized local, the financial situation and credit history of each client. Likewise, in the aforementioned provisions, the requirements that the persons in charge of carrying out the aforementioned inspection visits must meet will be determined, who will draw up a detailed minute for this purpose. Such detailed minutes must be available to the National Banking and Securities Commission at all times.

(45) Opposition to the inspection by the authorized warehouse keeper or their auxiliary warehouse keepers or their officials or employees will presume, unless proven otherwise, shortages of deposited goods or merchandise.

(52) The National Banking and Securities Commission will additionally establish through general provisions the procedures or mechanisms that general warehouses must adopt to determine the validity of authorizations, as well as the guidelines for carrying out supervision. Likewise, the National Banking and Securities Commission will establish through general provisions the minimum guidelines that general warehouses must follow for the control of inventory, quality, conservation conditions, and other characteristics of the goods or merchandise delivered to them in deposit in owned, leased, loaned, or authorized warehouses or premises, in order to provide greater certainty and legal security to their depositors.

(45) General warehouses may acquire land or warehouses as well as construct or condition premises of their ownership, provided that they are in adequate conditions of location, stability, and adaptability for storage.

(52) General warehouses may also take under lease or loan the plants they require to carry out the transformation of deposited merchandise, in accordance with Article 11, first paragraph, of this Law.

(45) Article 18.- General warehouses will inform the National Banking and Securities Commission of the names of persons who have been convicted by a final judgment for having committed the conduct provided for in Article 100 of this Law. Such report must be provided within thirty business days following the date on which the judgment became final.

The aforementioned Commission, with the prior authorization of the interested parties and after carrying out the verifications it deems necessary, will communicate to the general warehouses the names of such persons, in order that henceforth they abstain from providing them with the service of warehouse authorization, regardless of the sanctions that correspond in accordance with this or other legal provisions.

Likewise, the authorized warehouse keeper will be suspended from their functions and the depositor or any official or employee thereof may not be designated for such effect, when they have committed the infractions referred to in the aforementioned Article 100 of this Law.

(2) Article 19.- General warehouses may act as correspondents of credit institutions, as well as of other general warehouses or companies providing complementary services to them, national or foreign, in operations related to those proper to them; they may also grant correspondentships to such institutions, warehouses, or companies in the aforementioned operations; take insurance on behalf of others for deposited merchandise; manage the negotiation of pawn bonds on behalf of their depositors; carry out the shipment of merchandise, processing the corresponding documents, and provide all the technical services necessary for the conservation and health of the merchandise.

(52) Article 20.- General warehouses may lease or loan some or some of their premises, when circumstances justify it, with prior authorization from the National Banking and Securities Commission.

(52) Likewise, general warehouses may assign areas in their owned, leased, or loaned warehouses for the exclusive storage of merchandise received for custody by the same depositor and, therefore, not covered by a deposit certificate, provided that such activities do not constitute a predominant activity. Only general warehouses that obtain prior authorization from the National Banking and Securities Commission for such purposes may carry out these custody activities.

(52) Article 21.- Unless otherwise agreed, when the price of the deposited goods or merchandise drops to the point that it is insufficient to cover the guaranteed obligation, the pledgee may request the general warehouse to hire the services of a public broker so that the latter certifies the fact and notifies the debtor, who will have ten natural days to improve the guarantee or cover the debt.

(52) If within said period they do not do so, proceedings will be taken for public auction in accordance with the terms agreed upon or in accordance with the terms of the following article. The expenses derived from the certification and notification will be charged to the pledgee.

(52) Article 22.- General warehouses will carry out the auction of the deposited merchandise and goods at public auction and to the highest bidder, in the case of the previous article, when requested by the pledgee, in accordance with the law.

(53) General warehouses may also proceed to the auction of the deposited merchandise or goods when, having expired the term set for the deposit, eight natural days or the days agreed upon for this purpose have elapsed, without these having been withdrawn from the warehouse, from the date of notification in the manner prescribed in the previous article.

(45) Unless another procedure is agreed upon, general warehouses will carry out the auction in the following terms:

(52) I. The notice of sale by public auction will be published in the RUCAM in accordance with the procedure established in the rules referred to in Article 22 Bis 7 of this Law, and if requested by the pledgee, it will additionally be published in a widely circulated newspaper in the locality where the merchandise is deposited;

(45) II. The notice must be published at least eight natural days in advance of the date set for the auction. When it comes to the auction of merchandise or effects that have suffered deterioration, at least three natural days must elapse between the publication of the notice and the day of the auction;

(45) III. The auctions will be held in the offices or warehouses of the general warehouse in the presence of the commissioner, external auditor of the society, or public notary. The merchandise or goods to be auctioned will be on public view from the day the auction notice is published;

(52) IV. The legal bid, in the absence of an estimation fixed for this purpose in the deposit certificate, is the one that covers in cash the amount of the debt owed to the warehouses and, if applicable, the amount of the loan guaranteed with deposit certificates, with the warehouses having, if there is no bidder, the right to adjudicate the merchandise or effects for the legal bid, and

(45) V. When there is no bidder, nor do the warehouses adjudicate the merchandise or effects auctioned, they may proceed to new auctions, with the respective notice, making in each of them a discount not greater than fifty percent on the price fixed as the base for the previous auction.

(52) When the proceeds from the sale of the deposited merchandise or goods are insufficient to cover the debt owed to the general warehouses for the outstanding balance, they will have action through the commercial executive path to claim from the original depositor the payment of the existing debt.

(54) The corresponding deposit agreement together with the certified statement of account by the accountant of the general warehouse in question, will be an executive title without the need for signature recognition or any other requirement.

(52) The pledgee must notify the general warehouse through the cryptographic system in which the deposit certificate is recorded, if they agreed with the pledgor debtor on a merchandise auction procedure different from that provided for in this article.

(54) In the event that the general warehouse has charge of the auction procedure or part of it, it must manifest its consent to the pledgee to proceed in the agreed terms; otherwise, the procedure described in the preceding paragraphs will apply, and only a different procedure may be followed if it is provided for in the deposit certificate.

(45) Article 22 Bis.- General depositories, without prejudice to maintaining the minimum capital established by this Law, must have an accounting capital of an amount not less than the result of applying a percentage that will not be less than six percent, to the sum of their assets and, where applicable, their contingent liability-generating operations exposed to significant risk. The Ministry of Finance and Public Credit, with the opinion of the National Banking and Securities Commission and the Bank of Mexico, and taking into account international practices in the matter, shall determine through general provisions which assets and contingent liabilities shall be considered within the aforementioned sum, as well as the applicable percentage under the terms of this article, and shall also indicate the concepts considered as part of the accounting capital of general depositories.

(52) Article 22 Bis 1.- General depositories must indicate in their offices, warehouses (whether owned, leased, received on loan, or authorized), as well as in the information used for the promotion of their services, whether they have qualifications or certifications regarding compliance with technical, operational, or financial standards, and, where applicable, the respective qualifications or certifications, as well as any other data that allows evaluating the quality of the general depository in these or other matters.

(46) Article 22 Bis 2.- The Integral System for Information on Agricultural and Fishing Product Storage is created, which is a national database that will be integrated with the periodic reports that general depositories must submit, in which they account for the physical inventory reflected in inventories, entries and exits, qualities, and quantities of stored grains, and other information determined by the Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food through general provisions, regarding primary agricultural, livestock, fishing, or forestry goods and inputs originating from or destined for agricultural, livestock, fishing, or forestry production in accordance with this Law and other administrative provisions.

(46) The System will be operated and administered by the Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food, through the Agricultural and Fishing Information Service, which through general provisions will establish the manner and terms in which information must be provided by general depositories.

(46) The operation of the System will be carried out by digital means using the computer program established by the Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food.

(46) Article 22 Bis 3.- General depositories that receive agricultural and fishing products in deposit must provide the Integral System for Information on Agricultural and Fishing Product Storage with, at a minimum, the following information:

(46) I. General report of entries and exits of goods subject to deposit and storage;

(46) II. General report of inventories;

(46) III. Report of operations performed with deposited goods;

(46) IV. Report of deposit certificates and pledge bonds issued, cancelled, or negotiated, and

(46) V. Where applicable, report on phytosanitary or zoosanitary control.

(46) For these purposes, the Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food will grant general depositories an individualized access key to the Integral System for Information on Agricultural and Fishing Product Storage so that they may provide the information required under the terms of this Law, without prejudice to the obligation to provide it by printed means when required due to force majeure or unforeseen circumstances.

(46) Article 22 Bis 4.- The information of the Integral System for Information on Agricultural and Fishing Product Storage is public, so any person will have access to the information contained therein. The Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food must implement remote or local electronic or printed communication mechanisms that are suitable and effective to provide access to such information, to make available to the public the information contained in said System in accordance with the general provisions issued for this purpose.

(46) The Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food must make known to the general public by the means and with the frequency it deems appropriate, the name of the general depositories that comply with the obligations set forth in Articles 22 Bis 2 and 22 Bis 3 of this Law, as well as the location of their facilities and warehouses, with the purpose that users of their services, holders of deposit certificates, and takers of pledge bonds have information regarding the degree of compliance of the depositories with the applicable regulations in this matter.

(46) When the information that must be provided to the System must in turn be registered in the Registry referred to in Article 22 Bis 6 of this Law, the Ministries of Agriculture, Livestock, Rural Development, Fisheries, and Food, and of Economy, must sign coordination agreements so that such information can be shared between both agencies to have fulfilled in a single act the informational and registration obligations that are the subject of the coordination agreement.

(46) Article 22 Bis 5.- General depositories, in the development of processes, methods, facilities, services, or activities they carry out, must comply with the rules, specifications, attributes, guidelines, characteristics, or prescriptions that, where applicable, are determined by the competent agencies, in accordance with the Federal Law on Metrology and Standardization.

(46) Without prejudice to the powers of other agencies, it shall be the responsibility of the Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food to issue Mexican Official Standards or Mexican Standards related to processes, methods, facilities, services, or activities related to the storage of agricultural and fishing products.

(46) The conformity assessment referred to in the Federal Law on Metrology and Standardization may be carried out by the agencies themselves or by authorized third parties under the terms of said legislation.

(46) The National Banking and Securities Commission may issue basic security rules regarding the operation of general depositories, such as the installation of video cameras, motion detectors, among others, that minimize the risk of theft.

(52) Article 22 Bis 6.- The Unified Registry of Certificates, Warehouses, and Merchandise, known by its acronym "RUCAM," is created, in which general depositories must record:

(52) I. The deposit certificates they issue, as well as their cancellations;

(52) II. The goods or assets deposited covered by the issued deposit certificates;

(46) III. Their own, leased, or authorized warehouses, with their respective address, location, surface area, storage capacity, and class of goods allowed for storage, and in the case of authorized warehouses, the name of the owner and the authorized warehouseman;

(54) IV. Notices of sale at public auction of goods or merchandise deposited in warehouses to which this Law and the General Law on Negotiable Instruments and Credit Operations refer, and

(54) V. Other annotations specified by this and other applicable laws.

(52) Holders of deposit certificates may demand from the depository, at any time, that it accredit the registration of the titles and the goods or assets they cover, as well as other acts it is obligated to register in the RUCAM, and in case such registrations have not been made, that it carry them out.

(52) The omission or defect in the registration of titles in the RUCAM by general depositories shall not affect their validity nor the rights of the holders.

(52) Article 22 Bis 7.- The RUCAM will be under the charge of the Ministry of Economy, will be public, will be kept by digital means, using the computer program established by the Ministry itself in a national database, and may allow its interconnection with the cryptographic system or systems through which deposit certificates are issued, in order to comply with the registration obligations regarding said Registry provided for in this Law. Its functioning and operation will be governed by the General Rules issued for this purpose by the Ministry of Economy.

(52) Preventive notices, judicial or administrative resolutions, public certifications issued upon the deposit of goods or assets with general depositories, and those others specified by this Law and other applicable laws, will be subject to annotation in the RUCAM.

(52) General depositories will be responsible, for all purposes, for the existence of deposit certificates and legal acts they perform, as well as for the proper correspondence between the specified titles and the goods or merchandise they cover. This is without prejudice to the responsibilities and administrative sanctions to which they may be subject under the terms of this Law and other laws of a different legal nature. The provisions of this article are without prejudice to the fact that the omission or defect in the registration of titles in the RUCAM shall not affect the validity of these nor the rights of the holders.

(46) Article 22 Bis 8.- The procedure for registration in the RUCAM will be carried out according to the following bases:

(46) I. A file will be opened for each general depository;

(46) II. It will be automated;

(52) III. Registrations of deposit certificates, their annotations, modifications, and cancellations will receive a key per entry and may be carried out through interconnection with the cryptographic system that meets the technical and security requirements required by the RUCAM.

(52) In compliance with the obligation to record in the RUCAM the information referred to in Article 22 Bis 6 of this Law, it will not be subordinate to the proper functioning and continuity of the cryptographic system containing the deposit certificate, so at all times it will be the responsibility of general depositories to duly observe it;

(46) IV. Registrations and annotations will be carried out immediately upon receipt, prior to payment of the corresponding fees, and in the respective file;

(52) V. The corresponding ticket for the registered act will be generated, which will be made available to the applicant digitally in the RUCAM;

(52) VI. General depositories, public notaries, judges, as well as public officials and other persons authorized by said Ministry for such purposes, will be authorized to carry out registrations and annotations;

(46) VII. The persons referred to in the preceding subsection will be responsible for the existence and veracity of the information and documentation related to the registrations they carry out. In this way, they are liable for any damages and losses that may arise. This is without prejudice to the administrative or criminal sanctions that may apply;

(52) VIII. It will be the responsibility of the issuer of the deposit certificate to carry out corrections of errors that may have been made in said registry;

(46) IX. Any interested party will be authorized to request from the Ministry of Economy the issuance of certifications or statements regarding the documents, acts, or information registered in the Registry, prior to presenting the corresponding request and payment of the respective fees, and

(46) X. Those others established in the RUCAM Rules.

(46) Article 22 Bis 9.- The Rules of the Unified Registry of Certificates, Warehouses, and Merchandise will develop, among others:

(46) I. The technical and operational procedures and requirements that must be satisfied to carry out registrations, annotations, certifications, and queries that are made;

(52) II. The characteristics of the precoded forms for registration and annotation in the Registry, and the requirements that allow the interconnection of cryptographic systems through which deposit certificates are issued with the Registry;

(46) III. The requirements and procedure to obtain authorization to carry out registrations and annotations, as well as the manner in which authorized persons will be made known;

(46) IV. The procedure for the renewal of registrations;

(46) V. The procedures and requirements for the rectification, modification, or cancellation of the Registry information;

(46) VI. Any other data, requirement, procedure, or condition necessary for the adequate operation of the Registry, and

(46) VII. The procedures for verifying compliance with obligations on the part of general depositories, as well as the inspection visits that the Ministry of Economy must conduct for this purpose.

(46) The Ministry of Economy, for administrative purposes, will be authorized to administer and process the information existing in the RUCAM, as well as to share or exchange the same for informational or statistical purposes with other registries under its charge or with others under the charge of other Agencies or entities of the Federal, State, or Municipal Public Administration. Likewise, it may take advantage of the infrastructure and technological platforms of other registries under its charge, to optimize the costs of implementation, launch, and operation of the RUCAM.

(46) Article 22 Bis 10.- The Ministry of Economy will be authorized to verify compliance with the registration obligations on the part of general depositories, as well as those related to the existence of goods covered by the deposit certificate. For these purposes, the Ministry may assist itself with third parties, under the terms established by the RUCAM Rules.

(46) The Ministry of Economy may conduct inspection visits to any of the commercial societies operating as general depositories and require them, within the timeframes and in the manner established by said Agency, all the information and documentation necessary to carry out its verification functions regarding compliance with the obligations stated.

(46) As a result of its verification and inspection powers stated in the two preceding paragraphs, the Ministry of Economy may formulate observations and, where applicable, order the adoption of corrective measures for the irregular facts, acts, or omissions it has detected.

(46) Article 22 Bis 11.- The Ministry of Economy, in the exercise of the powers referred to in the previous article, may indicate the manner and terms in which general depositories must comply with their requirements.

(46) To enforce its determinations, the Ministry of Economy may employ, indistinctly, the following means of coercion:

(46) I. Admonition with warning.

(46) II. Fine of 100 to 500 days of the general minimum wage in force in the Federal District.

(46) III. Additional fine of 100 days of salary for each day the infraction persists.

(46) IV. The assistance of the public force.

(46) If the coercion is insufficient, the competent authority may be requested to proceed against the rebel for disobedience to a legitimate mandate of a competent authority.

(54) Article 22 Bis 12.- The Ministry of Economy must determine through general provisions, the technical and security requirements necessary for the cryptographic system or systems of general depositories to interconnect with the RUCAM, in order to comply with their registration and publicity obligations referred to by this Law.

Article 23.- General depositories are prohibited from:

(8) I. Operating with their own shares, except in the cases provided for in the Securities Market Law;

(10) II. Repealed.

III. Receiving bank deposits of money;

IV. Granting sureties or guarantees;

(8) V. Acquiring goods, furniture, or equipment not intended for their offices or activities proper to their corporate object. If by adjudication or any other cause they acquire goods that they should not maintain in their assets, they must proceed to sell them, which will be carried out, within a period of one year, if they are movable goods, or two years, if they are immovable goods;

(8) VI. Conducting operations with gold, silver, and foreign exchange. Operations related to foreign exchange transactions are excepted when related to financing or contracts entered into in foreign currency, or when they concern operations abroad linked to their corporate object, which will always be subject to the general provisions that, where applicable, are issued by the Bank of Mexico;

VII. Entering into operations pursuant to which the general managers or general managers of the general depository, the resident or alternate commissioners, whether or not in office, the external auditors of the depository, or the ascendants or descendants in the first degree or spouses (sic) of the aforementioned persons, become or may become debtors of the general depository. Violation of the provisions of this subsection will be sanctioned in accordance with the provisions of Article 96 of this Law; and

VIII. Carrying out other operations that are not expressly authorized to them.

(38) Chapter II (Repealed)

(38) On Financial Leasing Companies

(38) Article 24.- Repealed.

(38) Article 25.- Repealed.

(38) Article 26.- Repealed.

(38) Article 27.- Repealed.

(38) Article 28.- Repealed.

(38) Article 29.- Repealed.

(38) Article 30.- Repealed.

(38) Article 31.- Repealed.

(38) Article 32.- Repealed.

(38) Article 33.- Repealed.

(38) Article 34.- Repealed.

(38) Article 35.- Repealed.

(38) Article 36.- Repealed.

(38) Article 37.- Repealed.

(10) Article 37-A.- Repealed.

(38) Article 37-B.- Repealed.

(38) Article 37-C.- Repealed.

(38) Article 38.- Repealed.

(31) Chapter II-BIS (Repealed)

On Savings and Loan Societies

(31) Article 38-A.- Repealed.

(31) Article 38-B.- Repealed.

(31) Article 38-C.- Repealed.

(31) Article 38-D.- Repealed.

(31) Article 38-E.- Repealed.

(31) Article 38-F.- Repealed.

(31) Article 38-G.- Repealed.

(31) Article 38-H.- Repealed.

(31) Article 38-I.- Repealed.

(31) Article 38-J.- Repealed.

(31) Article 38-K.- Repealed.

(31) Article 38-L.- Repealed.

(10) Article 38-M.- Repealed.

(31) Article 38-N.- Repealed.

(31) Article 38-O.- Repealed.

(31) Article 38-P.- Repealed.

(31) Article 38-Q.- Repealed.

(41) Chapter III (Repealed)

(41) On Credit Unions

(41) Article 39.- Repealed.

(41) Article 40.- Repealed.

(41) Article 41.- Repealed.

(10) Article 42.- Repealed.

(41) Article 43.- Repealed.

(41) Article 43-A.- Repealed.

(4) Article 44.- Repealed.

(41) Article 45.- Repealed.

(38) Chapter III-BIS (Repealed)

(38) On Financial Factoring Companies

(38) Article 45-A.- Repealed.

(38) Article 45-B.- Repealed.

(38) Article 45-C.- Repealed.

(38) Article 45-D.- Repealed.

(38) Article 45-E.- Repealed.

(38) Article 45-F.- Repealed.

(38) Article 45-G.- Repealed.

(38) Article 45-H.- Repealed.

(38) Article 45-I.- Repealed.

(38) Article 45-J.- Repealed.

(38) Article 45-K.- Repealed.

(38) Article 45-L.- Repealed.

(38) Article 45-M.- Repealed.

(10) Article 45-N.- Repealed.

(38) Article 45-O.- Repealed.

(38) Article 45-P.- Repealed.

(38) Article 45-Q.- Repealed.

(38) Article 45-R.- Repealed.

(10) Article 45-S.- Repealed.
(38) Article 45-T.- Repealed.
(12) Chapter III BIS-I
Of the Subsidiaries of Foreign Financial Institutions (12) Article 45 Bis 1.- For the purposes of this Law, the following shall be understood:
(12) I. Subsidiary: The Mexican company authorized to be constituted and operate, in accordance with this Law, as an auxiliary organization of credit or exchange house, in whose capital a Foreign Financial Institution or a Controlling Subsidiary Company participates under the terms of this chapter; (12) II. Foreign Financial Institution: The financial entity constituted in a country with which Mexico has celebrated a treaty or international agreement under which the establishment of Subsidiaries in national territory is permitted; and (12) III. Controlling Subsidiary Company: The Mexican company authorized to be constituted and operate as a controlling company under the terms of the Law for the Regulation of Financial Groups, in whose capital a Foreign Financial Institution participates. (45) Article 45-Bis 2.- Subsidiaries shall be governed by the provisions of the corresponding treaties or international agreements, this chapter, the provisions contained in this Law applicable to auxiliary organizations of credit or exchange houses, as the case may be, and the rules for the establishment of Subsidiaries issued for this purpose by the Ministry of Finance and Public Credit, with the opinion of the Bank of Mexico and the National Banking and Securities Commission. (12) The Ministry of Finance and Public Credit shall be empowered to interpret, for administrative purposes, the provisions on financial services included in the treaties or international agreements referred to in the preceding paragraph, as well as to ensure their observance. (36) Article 45-Bis 3.- To be constituted and operate as a Subsidiary, authorization from the Federal Government is required, which competes to be granted at the discretion of the Ministry of Finance and Public Credit, hearing the opinion of the National Banking and Securities Commission and the Bank of Mexico regarding general warehouses and exchange houses, or authorization from the National Banking and Securities Commission when it concerns Credit Unions. By their nature, these authorizations shall be non-transferable. (12) The authorizations granted for this purpose, as well as their modifications, shall be published in the Official Gazette of the Federation. (12) Article 45-Bis 4.- Financial authorities, within the scope of their respective competencies, shall guarantee the compliance with national treatment commitments assumed by Mexico, as established in the applicable treaty or international agreement. (12) Subsidiaries may carry out the same operations as auxiliary organizations of credit or exchange houses, as applicable, unless the applicable treaty or international agreement establishes any restriction. (12) Article 45-Bis 5.- To invest in the share capital of a Subsidiary, the Foreign Financial Institution must carry out, in the country where it is constituted, directly or indirectly, in accordance with applicable legislation, the same type of operations that the Subsidiary in question is authorized to
carry out in Mexico, in accordance with what is established by this Law and the rules referred to in the first paragraph of Article 45 Bis 2. (12) The provisions of the preceding paragraph are exempted for Subsidiaries in whose capital a Controlling Subsidiary Company participates in accordance with the Law for the Regulation of Financial Groups and the rules mentioned in the preceding paragraph.

(12) Article 45-Bis 6.- The application for authorization to be constituted and operate as a Subsidiary must comply with the requirements established in this Law and in the rules referred to in the first paragraph of Article 45 Bis 2.
(14) Article 45-Bis 7.- The share capital of Subsidiaries shall be represented by two series of shares. At least fifty-one percent (51%) of the share capital of Subsidiaries shall be integrated by "F" Series shares. The remaining forty-nine percent (49%) of the share capital may be integrated indistinctly or jointly by "F" Series and "B" Series shares.
(45) All "F" Series shares must be owned at all times by a Foreign Financial Institution, directly or indirectly, or by a Controlling Subsidiary Company. "B" Series shares that are not owned by said Foreign Financial Institution or Controlling Subsidiary Company shall be subject to the provisions of fraction III of Article 8 of this Law. In all cases, regarding foreign governments, the provisions of the aforementioned fraction III shall apply. (14) Shares must be paid in full at the time of subscription. (14) Subsidiaries may not issue limited voting shares. (14) Article 45-Bis 8.- "F" Series shares of a Subsidiary may only be alienated with prior authorization from the Ministry of Finance and Public Credit. (12) Except in the case where the acquirer is a Foreign Financial Institution, a Controlling Subsidiary Company, or a Subsidiary, to carry out the alienation, the bylaws of the Subsidiary whose shares are the subject of the operation must be modified, in order to comply with the provisions of the Single Chapter of Title One of this Law. (12) When the acquirer is a Foreign Financial Institution, a Controlling Subsidiary Company, or a Subsidiary, the provisions of fractions I, III, and IV of Article 45 Bis 9 must be observed. (12) Article 45-Bis 9.- The Ministry of Finance and Public Credit may authorize Foreign Financial Institutions, Controlling Subsidiary Companies, or Subsidiaries to acquire shares representing the share capital of an auxiliary organization of credit or exchange house, provided that the following requirements are met:
(14) I. The Foreign Financial Institution, Controlling Subsidiary Company, or Subsidiary, as the case may be, must acquire shares representing at least fifty-one percent (51%) of the share capital; (12) II. The bylaws of the auxiliary organization of credit or exchange house, whose shares are the subject of alienation, must be modified, in order to comply with the provisions of this chapter; (47) III. Repealed.
(47) IV. Repealed.
(47) Last paragraph.- Repealed.
(12) Article 45-Bis 10.- Subsidiaries may not issue subordinated obligations, except to be acquired by the Foreign Financial Institution owning, directly or indirectly, the shares representing the share capital of the issuing Subsidiary. Subsidiaries are also not permitted to establish branches or subsidiaries outside national territory.
(45) Article 45-Bis 11.- The board of directors of Subsidiaries shall be composed of a minimum of five and a maximum of fifteen resident directors, of whom those comprising at least twenty-five percent (25%) must be independent. The majority must reside in national territory. Their appointment must be made in a special assembly for each series of shares. The provisions for ordinary general assemblies provided in the General Law of Commercial Companies shall apply, insofar as applicable, to the assemblies convened for this purpose, as well as those convened for the purpose of appointing auditors for each series of shares. (14) The owners of "B" Series shares, if any, shall have the right to appoint at least one director. The appointment of minority directors may only be revoked when the appointment of all other directors of the same series is revoked. (14) The president of the board must be elected among the owners of "F" Series, and shall have a casting vote in case of a tie. Alternates shall be appointed by the owners, who may replace any of the owners indistinctly, understanding that within each session, an alternate may only represent one owner. (45) Article 45-Bis 12 The general managers and officials holding positions with the two immediate hierarchies below that of the former must satisfy the requirements provided by Article 8o. Bis 3 of this Law. (45) Article 45 Bis 13.- The supervisory body of Subsidiaries shall be composed of at least one auditor appointed by the "F" Series shareholders and, if applicable, an auditor appointed by the "B" Series shareholders, and their respective alternates, who must satisfy the requirements provided by fraction X of Article 8 of this Law. (45) Article 45 Bis 14.- Regarding Subsidiaries, the National Banking and Securities Commission shall have all the powers attributed to it by this Law in relation to auxiliary organizations of credit or exchange houses, as the case may be. (46) Article 45 Bis 15.- In order to preserve financial stability, avoid interruptions or alterations in the functioning of the financial system, as well as to facilitate the adequate fulfillment of their functions, the Ministry of Finance and Public Credit, the National Banking and Securities Commission, the Bank of Mexico, and the National Commission for the Protection and Defense of Users of Financial Services shall, at the request of an interested party and in accordance with the terms of the agreements referred to in the last paragraph of this article, exchange with each other the information they hold having obtained it:
(46) I. In the exercise of their powers;
(46) II. As a result of their action in coordination with other entities, persons, or authorities, or (46) III. Directly from other authorities.
(46) The restriction regarding reserved or confidential information under applicable legal provisions shall not be opposable to the power mentioned in the preceding paragraph. Whoever receives the information referred to in this article shall be administratively and criminally liable, under applicable legislation, for the dissemination to third parties of confidential or reserved information.
(46) For the purposes of the provisions of this article, the aforementioned authorities must celebrate information exchange agreements in which they specify the information subject to exchange and determine the terms and conditions to which they must be subject for this purpose. Likewise, such agreements must define the degree of confidentiality or reservation of the information, as well as the respective control instances to which cases where the delivery of information is denied or delivered outside the established deadlines shall be reported. (46) Article 45 Bis 16.- The Ministry of Finance and Public Credit, the National Banking and Securities Commission, the Bank of Mexico, and the National Commission for the Protection and Defense of Users of Financial Services, within the scope of their competence, shall be empowered to provide foreign financial authorities with any kind of information they deem appropriate to address the requirements made to them, such as documents, certificates, records, declarations, and other evidence that such authorities hold having obtained it in the exercise of their powers.

(46) For the purposes of the provisions of the preceding paragraph, the authorities must have signed an information exchange agreement with the foreign financial authorities in question, which contemplates the principle of reciprocity.
(46) The National Banking and Securities Commission shall be empowered to deliver to foreign financial authorities information protected by confidentiality provisions that it holds having obtained it in the exercise of its powers, acting in coordination with other entities, persons, or authorities or directly from other authorities.
(46) The Bank of Mexico shall be empowered to deliver to foreign financial authorities information protected by confidentiality provisions that it holds having obtained it directly in the exercise of its powers. Likewise, the Bank of Mexico shall be empowered to deliver to foreign financial authorities information protected or not by confidentiality provisions that it obtains from other authorities of the country, only in cases where it is expressly authorized in the information exchange agreement, by virtue of which it received said information. (46) In all cases, the National Banking and Securities Commission and the Bank of Mexico may abstain from providing the information referred to in the two preceding paragraphs, when the use intended for it is different from that for which it was requested, is contrary to public order, national security, or the terms agreed upon in the respective information exchange agreement. (46) The Ministry of Finance and Public Credit, the National Banking and Securities Commission, the Bank of Mexico, and the National Commission for the Protection and Defense of Users of Financial Services must establish coordination mechanisms for the purposes of delivering the information referred to in this article to foreign financial authorities. (46) The delivery of information carried out in accordance with this article shall not imply any transgression of the obligations of reserve, confidentiality, secrecy, or analogous obligations that must be observed in accordance with applicable legal provisions. (46) Article 45 Bis 17.- The National Banking and Securities Commission, at the request of the authorities cited in Article 45 Bis 15 of this Law and, based on the principle of reciprocity, may carry out inspection visits to Subsidiaries. At its discretion, the visits may be made through its channel or, in cooperation with the foreign financial authority in question, it may allow the latter to carry them out. (46) The request referred to in the preceding paragraph must be made in writing, at least thirty (30) natural days in advance, and must be accompanied by the following:
(46) I. Description of the object of the visit.
(46) II. Legal provisions applicable to the object of the request.
(46) The National Banking and Securities Commission may request foreign financial authorities to carry out visits in accordance with this article a report on the results obtained.
Chapter IV
Common Provisions
Article 46.- The pledge on goods and securities shall be constituted in the manner provided in the General Law of Negotiable Instruments and Credit Operations, sufficient for this purpose that it be recorded in the respective credit document with expression of the necessary data to identify the goods given as collateral.
In all cases of advance on titles or securities, pledge on them, on their fruits and merchandise, auxiliary organizations of credit may carry out the sale of the titles, goods, or merchandise, in the cases that proceed in accordance with the General Law of Negotiable Instruments and Credit Operations, through a licensed public broker or two merchants of the locality, retaining in their possession the part of the price that covers the debtor's liabilities, which they may apply in compensation of their credit and keeping at the disposal of the debtor the surplus that may exist. (36) Article 47.- In the contracts celebrated by auxiliary organizations of credit in which it is agreed that the credit holder or the borrower may dispose of the credited sum or the loan amount in partial amounts or are authorized to make early repayments before the term indicated in the contract, the certified statement of account by the accountant of the creditor auxiliary organization of credit shall serve as evidence, unless proof to the contrary is offered, in the respective trial for the determination of the resulting balance owed by the debtor. (36) Article 48.- The contract or document in which the credits granted by auxiliary organizations of credit are recorded, together with the certification of the statement of account referred to in the previous article, shall be an executive commercial title without the need for signature recognition or any other requirement. (38) Second paragraph.- Repealed. (36) The aforementioned certified statement of account must contain data on the identification of the contract or agreement where the granted credit is recorded; the initial capital disbursed; the unpaid due capital; the pending capital to mature; the applicable interest rates of the credit for each payment period; the generated default interest; the interest rate applicable to default interest; and the amount of generated accessories. (36) Article 48-A.- The subordinated obligations issued by general warehouses shall be credit titles owed by these issuers, mandatorily convertible to capital and shall produce executive action regarding them, prior to payment request before a public notary. They shall be issued in series through a unilateral declaration of will of the corresponding entity, which must contain:
(9) I. The mention of being subordinated obligations mandatorily convertible to capital; (9) II. The expression of place and date of subscription; (36) III. The name and signature of the issuer; (9) IV. The amount of the issuance, with specification of the number and nominal value of each obligation; (9) V. The type of interest that they will accrue, if any; (9) VI. The terms for the payment of interest and conversion; (9) VII. The place of conversion; (9) VIII. The other conditions and forms of conversion; and (9) IX. The terms, conditions, and deadlines of the issuance act. (36) They may have attached coupons for the payment of interest and, if applicable, for partial conversions. The titles may cover one or more obligations. General warehouses reserve the faculty of early conversion. (36) The issuer shall keep the obligations in some of the institutions for the deposit of securities regulated in the Securities Market Law, delivering to their holders a certificate of their holdings. (36) In the event of liquidation of the issuer, the payment of subordinated obligations shall be made pro rata after covering all other debts of the organization, but before distributing to the holders of shares the social equity. The provisions of this paragraph must be stated prominently in the relevant issuance act and in the titles issued. (9) These titles may be issued in national or foreign currency.

(9) The issuance act may designate a common representative of the obligation holders, in which case, their rights and obligations must be indicated as well as the terms and conditions under which their removal and the appointment of the new representative may proceed. The provisions of the General Law of Negotiable Instruments and Credit Operations regarding common representatives of bondholders shall not apply to these representatives.
(45) Article 48-B.- The issuance of subordinated obligations mandatorily convertible to capital and other credit titles, in series or in mass, referred to in Articles 11 Bis 2 fraction VI, and 45 Bis 10, of this Law, shall require the corresponding opinion issued by a securities rating institution.
(9) Article 48-C.- Auxiliary organizations of credit and exchange houses may in no case carry out operations and provide services to their clientele in which conditions and terms are agreed that significantly depart from the prevailing market conditions at the time of their granting, the general policies of the entity, or sound financial practices.
(5) Article 49.- Auxiliary organizations of credit and exchange houses may not use equal or similar denominations, act jointly, or offer complementary services with other financial intermediaries, except in the cases provided for in the laws for the Regulation of Financial Groups, Credit Institutions, and the Securities Market.
Article 50.- Mortgages constituted in favor of auxiliary organizations of credit, on the complete unit of an industrial, agricultural, livestock, or dedicated to the exploitation of goods or public services enterprise, must comprise the respective concession or concessions, as the case may be; all material elements, movable or immovable, affected to the exploration, considered in their unit; and additionally, may comprise the cash in the current exploitation and the credits in favor of the company, born directly from its operations, without prejudice to the possibility of disposing of them and substituting them in the normal movement of operations, without the consent of the creditor except by contrary agreement.
Auxiliary organizations of credit, creditors of the mortgages referred to in this article, must allow the normal development of the exploitation of the goods affected by them, according to the destination corresponding to them, and may not, regarding goods affected by a public service concession, oppose the alterations or modifications made to them during the term of the mortgage, whenever they are necessary for the better provision of the corresponding public service. However, as creditors, they may oppose the sale or alienation of part of the goods and the merger with other companies, in case this originates a danger to the security of the mortgage credits. The aforementioned mortgage may be constituted in second place, if the amount of the net yields of the exploitation free of any other charge, is sufficient to cover the interest and amortizations of the loan. The mortgages referred to in this article must be registered in the Public Registry of the place or places where the goods are located. The provisions of Article 214 of the General Law of Negotiable Instruments and Credit Operations shall apply, insofar as pertinent, to the mortgages referred to in this article. (45) Article 51.- Auxiliary organizations of credit may only discount their portfolio with or without their responsibility, in credit institutions, insurance and surety companies, trusts constituted by the Federal Government for economic promotion, and auxiliary organizations of credit of the same type. The Ministry of Finance and Public Credit may authorize exceptions to this provision, with the opinion of the National Banking and Securities Commission and the Bank of Mexico. (45) Article 51-A.- Auxiliary organizations of credit, exchange houses, exchange centers, and money transmitters must present the information and documentation that the Ministry of Finance and Public Credit, the Bank of Mexico, and the National Banking and Securities Commission request within the scope of their respective competencies, within the deadlines established by them.

(45) Article 51-B.- The Federal Government and the entities of the Para-State Public Administration may not hold liable or guarantee the results of the operations carried out by credit auxiliary organizations and exchange houses, nor assume any responsibility for the obligations incurred with their partners or with third parties.

(45) Credit auxiliary organizations and exchange houses must keep the provisions of the preceding paragraph in a visible place in their offices and expressly indicate them in their advertising, under the terms established by the National Banking and Securities Commission through general provisions.

Title Three
On Accounting, Inspection and Supervision
Chapter I
On Accounting

(45) Article 52.- Every act or contract that signifies a variation in the assets or liabilities of a credit auxiliary organization and an exchange house, or implies an immediate or contingent obligation, must be recorded in the accounting. The accounting, the corresponding books and documents, and the period they must be preserved shall be governed by the general provisions issued for this purpose by the National Banking and Securities Commission.

(45) Credit auxiliary organizations and exchange houses may microfilm all those books, records, and documents in general that are in their possession related to the acts of their business and that the National Banking and Securities Commission indicates through general provisions, according to the technical bases for microfilming, handling, and conservation established by the same.

The original camera negatives obtained in accordance with what is stated in the preceding paragraph shall have in trial the same probative value as the books, records, and documents microfilmed.

(45) Article 53.- Credit auxiliary organizations and exchange houses must prepare their financial statements on the last day of each month. The National Banking and Securities Commission, through general provisions, is empowered to establish the form and terms in which these entities must present and publish their monthly and annual financial statements; these must be presented along with the information they remit for this purpose, within thirty natural days following the corresponding closing. The formulation and publication of such financial statements will be under the strict responsibility of the administrators and auditors of the society who have sanctioned and certified the authenticity of the data contained in said accounting statements, who must ensure that they effectively reveal the true financial situation of the society and will be subject to the corresponding sanctions in case the publications do not adjust to that situation.

(45) If the National Banking and Securities Commission, upon reviewing the financial statements, orders modifications or corrections that, in its judgment, are fundamental to warrant their publication, it may agree that they be published with the pertinent modifications, and, if applicable, this publication will be made within fifteen natural days following the notification of the respective agreement. In no other case may second publications be made. The review of said Commission will not have fiscal effects.

(45) The annual financial statements of credit auxiliary organizations and exchange houses must be audited by an independent external auditor.

(45) The National Banking and Securities Commission, through general provisions, is empowered to establish the characteristics and requirements that the opinions of external auditors on the financial statements of credit auxiliary organizations and exchange houses must meet.

(45) External auditors who audit the annual financial statements of credit auxiliary organizations and exchange houses must meet the requirements established by the National Banking and Securities Commission through general provisions and provide it with the reports and other elements of judgment on which their opinions and conclusions are based. If during the practice or as a result of the audit they find irregularities that affect the stability or solvency of said societies, the auditors are obligated to communicate said situation to said Commission.

(45) Credit auxiliary organizations and exchange houses may not pay the dividends decreed by their general shareholder meetings before concluding the review of the financial statements by the National Banking and Securities Commission. However, said body may, at its discretion, authorize the partial distribution of said dividends, based on the information and documentation presented to it.

(45) Distributions made in contravention of the provisions of the preceding paragraph must be returned to the society. The shareholders who received them and the administrators and officials who paid them will be jointly liable in this regard.

(45) Credit auxiliary organizations, as an exception to what is provided in Article 177 of the General Law of Commercial Societies, must publish their financial statements under the terms and means established by the general provisions referred to in the first paragraph of this article.

(45) Article 54.- The National Banking and Securities Commission will establish the maximum rules for the estimation of the assets of credit auxiliary organizations and exchange houses, as appropriate, and the minimum rules for the estimation of their obligations and liabilities.

These rules will be based on the following principles:

I. Credits and commercial documents pending maturity or that have been renewed will be estimated at their nominal value;

II. Goods or merchandise that have a regular market will be estimated by their quotation;

III. Bonds, obligations, and other titles of an analogous nature that are current in the payment of their interest and amortization will be estimated at the present value of the future benefits of the title, calculating said present value at the effective interest rate that the title earns according to the price on the stock exchange or, in its absence, in the free market at the time of its acquisition. When they are not current in the payment of their interest and amortization, they will be estimated according to the stock or market price;

(45) IV. Titles representing the capital of societies will be valued according to the rules issued by the National Banking and Securities Commission;

(45) V. Urban real estate will be estimated by the average of appraisals carried out by experts from credit institutions and approved by the National Banking and Securities Commission; and

VI. Goods that do not meet the characteristics indicated in the preceding subsections will be estimated by their acquisition value with the corresponding deductions for demerit due to use or exploitation, if applicable.

(45) When applying the valuation rules established by the National Banking and Securities Commission results in a higher estimation of the asset elements than the original value of the titles, effects, goods, or investments, the difference cannot be applied to the income statement until the benefit is effectively realized as a consequence of the collection, sale, realization, or liquidation of the respective titles, effects, goods, or investments, unless the National Banking and Securities Commission, seeing the continued stability of prices and quotations and the relative importance of the reserves constituted in this way, authorizes the adjustment of such funds with a credit to the income accounts.

(45) Without prejudice to the norms established in this article, the National Banking and Securities Commission may propose to the Secretariat of Finance and Public Credit that, through general provisions, the societies in question be authorized to, if necessary, by extraordinary write-off, maintain certain values of their assets at the estimation resulting from their acquisition prices, giving them a period that cannot exceed five years to regularize their valuations, and being subject during this period to the limitations regarding the distribution of profits that the Commission itself deems appropriate to agree.

(45) Article 55.- When the monthly status reports that organizations and exchange houses are obligated to present to the National Banking and Securities Commission result in those not keeping the proportions prescribed in this Law, they will not incur responsibility, when the divergence does not exceed four percent of said proportions, and always that they additionally prove, with their statements and accounting entries, to the satisfaction of said Commission, that the infringement has an exceptional character.

Chapter II
On Inspection and Supervision

(45) Article 56.- The inspection and supervision of credit auxiliary organizations, exchange houses, and regulated multiple-object financial societies is entrusted to the National Banking and Securities Commission, which will have, insofar as it does not oppose this Law, with respect to said credit auxiliary organizations, exchange houses, and regulated multiple-object financial societies, all the powers that the Credit Institutions Law confers on it in matters of inspection and supervision for multiple banking institutions, which it will carry out subject to what is provided in its law, in the respective Regulation, and in the other provisions that are applicable.

(42) With respect to unregulated multiple-object financial societies, exchange centers, and money transmitters, the inspection and supervision of these societies will be carried out by said Commission, exclusively to verify compliance with the provisions referred to in Article 95 Bis of this Law and the general provisions derived from it.

(42) Credit auxiliary organizations and exchange houses must render to the Secretariat of Finance and Public Credit and to the National Banking and Securities Commission, in the form and terms established for this purpose, the reports, documents, and proofs regarding their organization, operations, accounting, investments, or equity that are requested for purposes of regulation, supervision, control, inspection, supervision, statistics, and other functions that, in accordance with this Law or other legal and administrative provisions, correspond to them to exercise.

(42) Article 57.- Credit auxiliary organizations and exchange houses are obligated to allow inspection visits carried out by the National Banking and Securities Commission in terms of the provisions provided in this Law.

(45) Likewise, unregulated multiple-object financial societies, exchange centers, and money transmitters are obligated to allow inspection visits that the National Banking and Securities Commission carries out, exclusively to verify compliance with the provisions referred to in Article 95 Bis of this Law and the general provisions derived from it. The Commission may hire the services of auditors and other professionals to assist it in this function, who, in any case, must meet the requirements established by said Commission through general provisions.

(42) The principal official of the credit auxiliary organization, exchange house, exchange center, money transmitter, or unregulated multiple-object financial society in question must attend to the inspector of the National Banking and Securities Commission who is in charge of the corresponding inspection in terms of the two preceding paragraphs and, in the absence of said official, the one who replaces him or the official of the immediately lower hierarchy who is found in the respective establishment must attend to him.

(42) The National Banking and Securities Commission is not obligated to carry out inspection visits at the request of private parties nor to provide them with any information about said inspections.

(42) The inspection of credit auxiliary organizations and exchange houses will be carried out through visits, which will have the object of reviewing, verifying, checking, and evaluating resources, obligations, and equity, as well as operations, functioning, control systems, and, in general, everything that may affect the financial and legal position that is recorded or should be recorded in the records, in order to adjust to the compliance with what is provided in this Law, the general provisions derived from it, and the sound practices of the matter.

(48) The National Banking and Securities Commission, in inspection visits and in the exercise of supervision powers that it carries out on exchange centers, money transmitters, and unregulated multiple-object financial societies, may review, verify, check, and evaluate resources, obligations, and equity, as well as operations, functioning, and, in general, everything that must be recorded in books, records, systems, and documents to verify compliance with the provisions referred to in Article 95 Bis of this Law and the general provisions derived from it. For the exercise of supervision functions, the National Banking and Securities Commission may issue general provisions to determine the information that exchange centers, money transmitters, and unregulated multiple-object financial societies must periodically remit.

(42) The visits referred to in this article may be ordinary, special, and investigative. The first ones will be carried out in accordance with the annual program of the National Banking and Securities Commission. The second ones will be practiced whenever necessary in the judgment of the President of said Commission, to examine and, if applicable, correct special operational situations, and investigative ones which will have the object of clarifying a specific situation.

(42) Credit auxiliary organizations and exchange houses must justify, at any time, the existence of the assets in which their resources are invested, in the form, terms, and with the documents determined by the National Banking and Securities Commission.

(45) Article 57-A.- When in the practice of an inspection visit relevant facts are known that cannot be accredited with the documentation of the visited society, the National Banking and Securities Commission may require the appearance of the legal representative or the competent official of said society, considering the nature of the functions performed, in order to clarify the facts in reference.

(45) Article 58.- When it is found that the operations or capital of credit auxiliary organizations and exchange houses do not adjust to what is provided by this Law or the provisions emanating from it, the President of the National Banking and Securities Commission will issue the necessary measures to normalize the situation and will set a period that will not be greater than thirty natural days for the regularization to be carried out, immediately communicating its decision to the Secretariat of Finance and Public Credit.

(8) If the period indicated has elapsed and the organization or exchange house in question has not regularized its situation, the President of said Commission may order that the execution of operations contrary to what is provided by this Law be suspended, or that the liquidation of the same be proceeded with, disposing, if deemed convenient, the intervention of the organization or exchange house and that measures be taken to carry out collections and normalize the documents and operations that have been considered irregular.

(8) Article 59.- When in the judgment of the National Banking and Securities Commission there are irregularities of any kind in credit auxiliary organizations and exchange houses, the President of said Commission may proceed in terms of the previous article, but if those irregularities affect the stability or solvency of the society in question, the President may immediately declare the intervention with the character of management and designate the natural person who will take charge of it with the character of intervention-manager.

(8) The administrative intervention referred to in the preceding paragraph will be carried out directly by the intervention-manager and upon the start of said intervention, it must be attended to by the principal official or employee of the organization or exchange house that is found in the offices of these.

(45) Article 60.- The intervention-manager will have all the powers that normally correspond to the board of directors of the society and full general powers for acts of dominion, administration, litigation, and collections, with the powers that require special clauses according to the law, to grant or subscribe credit titles, to file complaints and lawsuits and to withdraw from the latter, prior agreement of the President of the National Banking and Securities Commission and to grant the general or special powers that he deems convenient, and revoke those that were granted by the intervened society and those that he himself had conferred.

The intervention-manager will not be subordinate in his actions to the shareholder assembly nor to the board of directors.

(45) The document containing the appointment of the intervention-manager must be registered in the Public Registry of Commerce corresponding to the domicile of the intervened society, without more requirements than the respective document of the National Banking and Securities Commission.

Article 61.- From the moment of the intervention, all powers of the board of directors and the powers of the persons determined by the intervention-manager will be subordinate to the intervention-manager, but the shareholder assembly may continue to meet regularly to know of the matters that concern it, and the same may be done by the board to be informed by the intervention-manager on the functioning and operations that the society carries out and to opine on the matters that the same intervention-manager submits to its consideration. The intervention-manager may call a shareholder assembly and board of directors meetings for the purposes he considers necessary or convenient.

(45) Article 62.- When the National Banking and Securities Commission agrees to lift the intervention with the character of management, it will communicate this to the person in charge of the Public Registry of Commerce who has made the entry referred to in Article 60 of this Law, in order to proceed to its cancellation.

(45) Article 63.- When the National Banking and Securities Commission notices that the equity status or the operations of a credit auxiliary organization or exchange house affect its book capital, or if it fails to meet the capitalization requirements referred to in Article 12 Bis of this Law, it may set a period of up to sixty natural days for it to integrate the capital in the necessary amount to maintain the operation of the society within the legal proportions, notifying it for this purpose.

(45) If the period referred to in the preceding paragraph has elapsed and the necessary capital has not been integrated, the National Banking and Securities Commission will make this situation known to the Secretariat of Finance and Public Credit, which, prior to the hearing of the interested society, may, in protection of the public interest, declare the revocation of the respective authorization in terms of this Law.

(45) Likewise, the National Banking and Securities Commission may, prior to the right of hearing of credit auxiliary organizations and exchange houses, suspend or limit partially the celebration of operations referred to in this Law, when these activities fall under any of the following situations:

(45) I. The necessary infrastructure or controls to carry out the respective operations and services are not available, in accordance with applicable provisions;

(45) II. Operations different from those authorized are carried out;

(45) III. The necessary requirements to carry out operations or provide specific services, established in general provisions, are not met;

(45) IV. Operations are carried out or services are provided that imply conflicts of interest to the detriment of their clients or intervene in activities that are prohibited in this Law or in the provisions emanating from it, and

(45) V. In the other cases indicated by this or other laws.

(45) The suspension order referred to in this article is without prejudice to the sanctions that may be applicable in terms of what is provided in this Law and other provisions.

(42) Article 64.- When the National Banking and Securities Commission presumes that a natural or legal person is carrying out operations reserved for credit auxiliary organizations or exchange houses without the authorization of the Secretariat of Finance and Public Credit, it may appoint to

an inspector and the necessary assistants to review the accounting and other documentation of the negotiation, company, or establishment of the natural or legal person, in order to verify if they are indeed carrying out the operations mentioned in violation of the provisions of this Law, in which case the National Banking and Securities Commission may order the immediate suspension of operations or proceed to close the negotiation, company, or establishment of the natural or legal person in question.

(42) If the National Banking and Securities Commission presumes that a natural person, including those whose tax regime is for income from business activities, or a legal person, is carrying out operations reserved for currency exchange centers or money transmitters without the registration referred to in Article 81-B of this Law, it will notify the natural person or the legal representative of the legal person in question, in order to immediately suspend the carrying out of the aforementioned reserved activities.

(42) If the suspension of activities referred to in the preceding paragraph is not carried out, the National Banking and Securities Commission may order the closure of the negotiation, company, or establishment of the natural or legal person in question. The foregoing, regardless of the administrative sanctions to which the person may have become liable once, through the review carried out by the inspector and assistants appointed by the Commission itself, it verifies that such person is indeed carrying out the aforementioned operations in violation of the provisions of this Law.

(42) Without prejudice to the foregoing, if the Commission presumes that currency exchange centers or money transmitters are carrying out operations in contravention of what is provided in this Law, once, through the review carried out by the inspector and assistants appointed by the Commission itself, it verifies that such person is indeed carrying out operations in violation of the provisions of this Law, it may order the immediate suspension of operations or close such companies, regardless of the cancellation of the registration in terms of Article 81-D of this Law.

(42) Likewise, the aforementioned Commission may order credit institutions, stock exchange houses, and currency exchange houses with which the legal persons referred to in the preceding paragraphs operate, to suspend or cancel the contracts they have entered into with such legal persons and to refrain from carrying out new operations.

(42) The foregoing shall be appropriate, regardless of the crime opinion, if any, issued by the National Banking and Securities Commission in terms of Article 95 of this legal instrument.

(42) The inspection, suspension, and closure procedures referred to in this article are of public interest. Those affected may appear in defense of their interests before the National Banking and Securities Commission within fifteen business days following the date on which they become aware of the act or acts they claim, without suspending such procedures. In case evidence is offered, it will be processed within ten business days.

Title Fourth
Of the Powers of the Authorities
Chapter I
General Provisions

(45) Article 65.- Credit auxiliary organizations and currency exchange houses must notify the National Banking and Securities Commission, at least thirty natural days in advance, regarding the opening, change of location, and closure of any kind of offices within national territory.
Likewise, general deposit warehouses must give notice in the same terms, regarding the acquisition of warehouses within national territory, and in the terms established in Article 17 of this Law, regarding the rental or enabling of warehouses or premises belonging to others within national territory. Regarding offices or warehouses abroad, in any of the situations mentioned in this article, credit auxiliary organizations will require prior authorization from the Ministry of Finance and Public Credit, satisfying the requirements established through general provisions determined by said Ministry.

(45) Regarding the change of social domicile, credit auxiliary organizations and currency exchange houses will require prior authorization from the Ministry of Finance and Public Credit.

(45) Article 65-A.- The National Banking and Securities Commission, in order to effectively enforce its closure, administrative intervention, managerial intervention, and other resolutions contemplated in this Law, may request, when it deems appropriate, the assistance of the public force.

(45) Article 65-B.- The personnel of the National Banking and Securities Commission will only be obligated to answer positions or give testimony in court, on behalf of the Commission or by virtue of their functions, when the positions and questions are formulated through an official letter from a competent authority, which will answer in writing within the term established by said authority.

(10) Article 66.- Repealed.

(45) Article 67.- For the transfer of their assets, liabilities, rights, and obligations, derived from their operation, as well as for their merger or spin-off, credit auxiliary organizations will require prior authorization from the Ministry of Finance and Public Credit, hearing the opinion of the National Banking and Securities Commission.

(45) Article 68.- Credit auxiliary organizations and currency exchange houses will require prior authorization from the Ministry of Finance and Public Credit to invest in shares of companies that provide them with services or carry out operations with them.

(45) These companies must comply, regarding the services or operations that the Ministry of Finance and Public Credit considers complementary or auxiliary to the operations or activities that are proper to the type of entity in question, with the general provisions issued by said Ministry, and with the inspection and supervision of the National Banking and Securities Commission.

(45) Article 69.- Credit auxiliary organizations will require prior authorization from the Ministry of Finance and Public Credit to acquire shares or participations in the social capital of foreign companies or societies.

(45) The Ministry of Finance and Public Credit will grant or deny the authorizations referred to in this article at its discretion, with the opinion of the National Banking and Securities Commission.

(47) Article 69-A.- Repealed.

(45) Article 70.- Credit auxiliary organizations and currency exchange houses may only close their doors and suspend their operations on the days specified by the National Banking and Securities Commission.
The days specified in the foregoing terms will be considered non-working days for the purposes of operations and activities of all kinds referred to in this Law.

(45) Article 71.- The National Banking and Securities Commission may order the suspension of the advertising carried out by credit auxiliary organizations and currency exchange houses, when in its judgment it implies inaccuracy, obscurity, or unfair competition among them, or if for any other circumstance it may induce error regarding their operations and services.

(8) Article 72.- Credit auxiliary organizations, in accordance with the rules, if any, issued by the Bank of Mexico, may carry out active operations with natural or legal persons with residence or domicile abroad, or by virtue of which they incur or may incur direct or contingent liabilities in favor of such persons.

(45) The rules issued by the Bank of Mexico in accordance with this article must have the favorable opinion of the Ministry of Finance and Public Credit.
In the case of national credit auxiliary organizations, without prejudice to what is stated in the first paragraph of this article, authorization from said Ministry corresponding to the General Public Debt Law must be obtained.

(10) Article 73.- Repealed.

(45) Article 74.- The National Banking and Securities Commission, with the agreement of its Board of Directors, may at all times determine that the members of the board of directors, general managers, auditors, directors, managers, and officials who may obligate by their signature credit auxiliary organizations or currency exchange houses be removed, as well as suspend them for three months to five years, when it considers that they do not have technical quality, honorability, satisfactory credit history for the performance of their functions, do not meet the requirements established for this purpose, or commit serious or repeated violations of this Law or the general provisions derived from it.

(45) In the event that the aforementioned persons commit serious or repeated violations of this Law or the general provisions derived from it, the National Banking and Securities Commission may also disqualify them from holding a job, position, or commission within the Mexican financial system, for the same period of three months to five years, without prejudice to the sanctions applicable in accordance with this or other legal instruments. Before issuing the corresponding resolution, the Commission must hear the interested party and the credit auxiliary organization or currency exchange house in question.

(45) The Commission itself may, with the agreement of its Board of Directors, order the removal of independent external auditors of credit auxiliary organizations or currency exchange houses, as well as suspend or disqualify such persons for the period indicated in the preceding paragraph, when they commit serious or repeated conduct constituting violations of this Law or the general provisions emanating from it, or provide opinions or reports containing false information, regardless of the sanctions to which they may become liable.

(45) For the purposes of this article, the following shall be understood:

(45) a) Suspension, as the temporary interruption in the performance of the functions that the offender had within the credit auxiliary organization or currency exchange house at the time the violation was committed or detected; they may perform functions different from those that gave rise to the sanction, provided that they are not directly or indirectly related to the position or activity that gave rise to the suspension.

(45) b) Removal, as the separation of the offender from the job, position, or commission they held in the credit auxiliary organization or currency exchange house at the time the violation was committed or detected.

(45) c) Disqualification, as the temporary impediment to exercising a job, position, or commission within the Mexican financial system.

(47) Article 75.- Repealed.

(45) Article 76.- The documentation used by credit auxiliary organizations and currency exchange houses related to the request and contracting of their operations must be subject to the provisions of this Law, the general provisions emanating from it, and the other applicable provisions.
The National Banking and Securities Commission may object at any time to the use of the aforementioned documentation, when in its judgment it implies inaccuracy, obscurity, or for any other circumstance that may induce error regarding their operations and services.

(45) Article 77.- The National Banking and Securities Commission may provide what is necessary for credit auxiliary organizations and currency exchange houses to duly and effectively fulfill the commitments made with their users.

(10) Article 77 Bis.- Repealed.

Chapter II
Of Revocation and Liquidation

(45) Article 78.- The Ministry of Finance and Public Credit, after hearing the opinion of the National Banking and Securities Commission and the Bank of Mexico, and prior to the hearing of the interested company, may declare the revocation of the authorization granted to a credit auxiliary organization, in the following cases:

(45) I. If the respective company does not present the testimony of the constitutive deed for its approval within the term of four months from the granting of the authorization or if it does not begin its operations within the term of three months from the approval of the deed;

(45) II. If it does not maintain the minimum paid capital provided in this Law, or if its book capital becomes less than its required minimum capital;

(45) III. If the provisions of fraction III, subsection 1.- of Article 8o. of this Law are violated;

(45) IV. If the credit auxiliary organization conducts transactions through a foreign consulate;

(45) V. If it carries out operations in contravention of the provisions of this Law or the general provisions emanating from it, or if its activities deviate from the sound practices of the markets in which it operates, or if it abandons or suspends its activities;

(45) VI. If repeatedly, despite the observations of the National Banking and Securities Commission, the credit auxiliary organization exceeds the limits of its liabilities determined by this Law, executes operations different from those permitted by the authorization and this Law, or does not maintain the proportions of assets, liabilities, or capital established therein; or if, in the opinion of the Ministry of Finance and Public Credit, it does not adequately fulfill the functions for which it was authorized due to the lack of diversification of its operations or its corporate object, in accordance with the provisions of this Law;

(45) VII. When, due to causes attributable to the credit auxiliary organization, the operations carried out do not appear duly and timely registered in its accounting;

(45) VIII. If the credit auxiliary organization carries out any of the activities or operations provided in this Law or in the general provisions emanating from it without the authorization or approval of the Ministry of Finance and Public Credit, in cases where the law so requires;

(45) IX. If it is dissolved, liquidated, or declared bankrupt, unless the bankruptcy procedure determines rehabilitation and the National Banking and Securities Commission gives a favorable opinion that it continue with the authorization;

(45) X. If they repeatedly fail to comply with the informational and registration obligations provided by Articles 22 Bis 3 and 22 Bis 6 of this Law, despite the requirements issued for this purpose by the competent Departments.

(45) The Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food and the Ministry of Economy, within their respective scopes of competence in terms of this Law, will bring to the knowledge of the Ministry of Finance and Public Credit when, in their opinion, the cause indicated in the preceding paragraph applies, accompanying the documentary elements that support it;

(45) XI. In the case provided for in Article 63 of this Law, and

(45) XII. If it does not present to the National Banking and Securities Commission the certificate of visits made to the warehouses enabled in terms of the provisions of Article 17 of this Law.

(51) The Ministry will grant the right to a hearing to the interested company, in order that within the term of ten business days, counted from the business day following that on which the corresponding notification takes effect, it expresses in writing what is in its interest and offers evidence. The Ministry, at the request of the party, may extend once the term referred to in this subsection, for the same period, attending to the particular circumstances of the case. Notifications will take effect on the business day following that on which they are carried out.

(51) Upon completion of the term referred to in subsection I of this article, and in its case, its extension, the Ministry will have a term of up to sixty business days to process the evidence.

(51) Upon expiration of the term for processing evidence, the Ministry will notify the alleged offender of the opening of a five-business-day period to formulate arguments. The Ministry may carry out such notification by posting or by any other means it determines. On the business day following the expiration of the term to formulate arguments, the instruction will be considered closed, and the Ministry will have a term of no more than one hundred eighty business days to issue and notify the resolution that ends the revocation procedure referred to in this article.

(51) The National Banking and Securities Commission and the Bank of Mexico must issue the required opinion in terms of the first paragraph of this article, at least thirty business days in advance of the expiration of the term provided for issuing the resolution that ends the revocation procedure. In case any of the opinions is issued after the term indicated, the Ministry may resolve what corresponds with the records in the file, without the need to consider the opinions.

(50) The declaration of revocation will be published in the Official Gazette of the Federation and must be registered in the Public Commerce Registry corresponding to the social domicile of the Company in question, for which the Registry will only require prior notification from the Ministry of Finance and Public Credit. The revocation will incapacitate the company from carrying out its operations from the date on which it is notified, and it will be placed in a state of dissolution and liquidation without the need for the agreement of the shareholders' meeting.

(45) The National Banking and Securities Commission will promote before the judicial authority to appoint the liquidator, if within sixty business days of the revocation being published in the Official Gazette, none has been appointed. When the Commission or the liquidator finds that it is impossible to carry out the liquidation of the company, it will inform the competent judge so that they order the cancellation of its registration in the Public Commerce Registry, which will take effect after one hundred eighty natural days from the judicial order.

(45) Interested parties may oppose this cancellation within a term of sixty business days, counted from the registration of the cancellation in the Public Commerce Registry before the judicial authority itself.

(45) Article 79.- The dissolution and liquidation of credit auxiliary organizations will be governed by what is provided in Chapters X and XI of the General Law of Commercial Societies and the commercial bankruptcy in accordance with Chapter III of Title VIII of the Commercial Bankruptcy Law, with the following exceptions:

(45) I. The position of trustee and liquidator may fall to credit institutions, the Administration and Alienation of Goods Service, or to natural or legal persons who prove to have experience in the liquidation of companies. When it concerns natural persons, the appointment must fall on a person who meets the following requirements:

(45) a) Be a resident in national territory in terms of the provisions of the Federal Tax Code.

(45) b) Be registered in the registry kept by the Federal Institute of Specialists in Commercial Bankruptcy.

(45) c) Present a Special Credit Report, in accordance with the Law to Regulate Credit Information Societies, provided by credit information societies containing their background of at least five years prior to the date on which the position is intended to begin.

(45) d) Not have pending litigation against the company in question.

(45) e) Not having been sentenced for property crimes, nor disqualified from exercising commerce or holding an employment, position, or commission in the public service, or in the Mexican financial system.
(45) f) Not having been declared bankrupt or subject to insolvency proceedings.
(45) g) Not having served as the external auditor of the company in question during the twelve months immediately preceding the date of appointment.
(45) In the case of legal entities, the natural persons designated to perform activities linked to this function must meet the requirements referred to in this subsection.
(45) II. The National Banking and Securities Commission shall exercise, with respect to conciliators, trustees, and liquidators, the supervisory functions attributed to it in relation to auxiliary organizations; and (45) III. The National Banking and Securities Commission may request the declaration of Commercial Insolvency of the organizations in accordance with the Commercial Insolvency Law, and the declaration of bankruptcy.
(45) In the case of liquidation or commercial insolvency proceedings of auxiliary credit organizations, in which the Public Property Administration and Disposal Service serves as liquidator or trustee, the Federal Government may allocate resources to this decentralized body of the Federal Public Administration, with the exclusive purpose of covering expenses associated with publications and other procedures related to such proceedings, when it is evident that these cannot be borne by the assets of the Auxiliary Credit Organizations in question due to lack of liquidity, or insolvency, in which case, it shall become a creditor of the latter. (10) Article 80.- Repealed. Fifth Title Of the Auxiliary Credit Activities (36) Chapter I Of the habitual and professional purchase and sale of foreign currency (42) Article 81.- Authorization from the Ministry of Finance and Public Credit is required to carry out, in a habitual and professional manner, operations for the purchase, sale, and exchange of foreign currency, including those carried out through the transfer or transmission of funds, with the public within national territory, except in the cases provided for in this article. (42) These authorizations will be granted or denied at the discretion of the Ministry of Finance and Public Credit, after hearing the opinions of the Bank of Mexico and the National Banking and Securities Commission. In all cases, such authorizations may only be granted to the anonymous societies referred to in Article 82 of this Law and, by their nature, will be non-transferable. (42) The authorizations to carry out the operations referred to in the first paragraph of this article, as well as their modifications, will be published, at the expense of the interested party, in the Official Gazette of the Federation and in two newspapers of wide national circulation. (42) Financial entities that, in accordance with the laws governing them, may carry out the operations referred to in the first paragraph of this article will not require the aforementioned authorization and, in their foreign currency operations, must comply with the applicable legal provisions. (42) Nor will they require the authorization referred to in this article the anonymous societies registered as foreign exchange centers with the National Banking and Securities Commission in accordance with the provisions of Article 81-B of this Law.

(42) For the purposes of this Law, operations involving foreign currency connected to the payment for the sale of goods or provision of services carried out by natural or legal persons whose activity or corporate purpose is not the purchase, sale, or exchange of foreign currency through any means are not considered habitual and professional activities. The operations referred to in this article must at all times comply with the provisions of the Monetary Law of the United Mexican States. (42) Likewise, for the purposes of what is provided in this Law, foreign currency shall be understood as those mentioned in the first paragraph of Article 20 of the Bank of Mexico Law. (42) Article 81-A.- Only anonymous societies organized in accordance with the provisions of the General Law of Commercial Societies, which are registered as foreign exchange centers with the National Banking and Securities Commission, in terms of the provisions of Article 81-B of this Law, may carry out, in a habitual and professional manner, any of the following operations:
(42) I. Purchase and sale of banknotes, as well as minted pieces and common metals, with legal tender in the country of issuance, up to an amount not exceeding the equivalent in national currency to ten thousand United States dollars for each client on the same day; (42) II. Purchase and sale of traveler's checks denominated in foreign currency, up to an amount not exceeding the equivalent in national currency to ten thousand United States dollars for each client on the same day; (42) III. Purchase and sale of metal pieces minted in the form of coins, up to an amount not exceeding the equivalent in national currency to ten thousand United States dollars for each client on the same day, and (42) IV. Purchase of sight documents denominated and payable in foreign currency, issued by financial entities, up to an amount not exceeding the equivalent to ten thousand United States dollars for each client on the same day. Regarding this, foreign exchange centers may only sell these documents to credit institutions and exchange houses. (42) In the celebration of the operations described in the aforementioned subsections, the countervalue must be delivered in the same act in which they are carried out, and may only be settled through the delivery of cash, traveler's checks, or checks denominated in national currency, without, in any case, including the transfer or transmission of funds. Foreign exchange centers may not settle in advance operations that the same user intends to carry out on subsequent days. (42) In no case may foreign exchange centers carry out operations for the purchase, sale, and exchange of foreign currency through the transfer or transmission of funds, whether through any of the payment systems or through account credits. (42) The provisions of this article will not be applicable to exchange houses and financial entities that, in accordance with the laws governing them, may carry out operations for the purchase, sale, and exchange of foreign currency. (48) Article 81-A Bis.- For the purposes of what is provided in this Law and the provisions emanating from it, a money transmitter shall be understood exclusively as an anonymous society and limited liability company organized in accordance with the provisions of the General Law of Commercial Societies that, among other activities, and in a habitual manner and in exchange for the payment of a consideration, commission, benefit, or profit, receives in national territory rights or resources in national or foreign currency, directly in its offices or by cable, facsimile, messenger services, electronic media, electronic funds transfer, or by any means, with the sole object that, according to the instructions of the sender, they are transferred abroad, to another place within national territory, or to deliver them, in a single payment, at the place where they are received, to the designated beneficiary. Likewise, dependencies and entities of the Federal Public Administration that, in accordance
with the provisions regulating them, carry out operations for the transmission of rights or resources in national or foreign currency may act as money transmitters. (45) To this effect, only anonymous societies and limited liability companies that have a valid registration as a money transmitter with the National Banking and Securities Commission may carry out the operations indicated in the previous paragraph, which shall be considered as the transmission of funds. (49) The operations referred to in this article may not be carried out by related agents or by third parties contracted by them, without the intervention of money transmitters. A related agent shall be understood as the natural person who, in terms of the provisions referred to in this article, by virtue of a contractual relationship with a money transmitter, receives from this rights or resources in national currency or foreign currency to deliver to the beneficiary. (49) Money transmitters shall be responsible for compliance with the obligations established in Article 95 Bis of this Law, as well as those derived from the general provisions referred to in said article, with respect to operations carried out through related agents and with respect to third parties contracted by them. (49) In the event that money transmitters intend to issue electronic payment funds or payment instruments that store electronic payment funds, they must constitute themselves as an electronic payment fund institution, in terms of the provisions established in the Law to Regulate Financial Technology Institutions. (43) The provisions of this article will not be applicable to financial entities that, in accordance with the laws governing them, may carry out the operations referred to in the first paragraph of this article. (43) In no case may money transmitters carry out the operations referred to in Article 81-A of this Law. (45) Article 81-B.- To operate as a foreign exchange center and as a money transmitter, anonymous societies must be organized in accordance with the provisions of the General Law of Commercial Societies, as well as register with the National Banking and Securities Commission, for which they must comply with the following requirements:
(45) I. That, in the case of foreign exchange centers, their corporate purpose be exclusively the performance, in a habitual and professional manner, of the operations referred to in Article 81-A of this Law. In the case of money transmitters, the corporate purpose will not be limited to the performance of the operations referred to in Article 81-A Bis of this Law, except for the provisions of Article 81-A of the same Law.
(45) In the case of foreign exchange centers, these societies must add to their corporate name the expression "foreign exchange center". On the other hand, money transmitters must include in any propaganda and advertisement the reference that they are a "money transmitter".
(45) II. That their bylaws provide that, in the performance of their purpose, the society must comply with what is provided in this Law and in the other applicable provisions.
(45) III. That they have physical establishments destined exclusively to the performance of their corporate purpose.
(45) IV. That they accompany their application with the list and information of the persons who directly or indirectly intend to maintain a participation in the share capital of the foreign exchange center or money transmitter to be registered, which must contain the amount of share capital that each of them will subscribe.
(45) V. That, within three business days following the date on which the society in question has registered in the registry indicated in Article 128 of the General Law of Commercial Societies the transfer of any of its shares for more than two percent of its paid-in capital, notify the National Banking and Securities Commission of said transfer.
(45) VI. That they have the favorable technical opinion referred to in Article 86 Bis of this Law.

(45) VII. That they present the additional information required by the National Banking and Securities Commission through general provisions.
(45) The societies to which the aforementioned registration has been granted must present to the National Banking and Securities Commission the data of their registration with the Public Commerce Registry, within a period that must not exceed fifteen business days counted from the granting thereof.
(45) In all cases, such societies must obtain every three years the renewal of the registration referred to in this article, in terms of the general provisions issued for these purposes by the National Banking and Securities Commission, for which it will be necessary, at least, to obtain the opinion referred to in subsection VI.
(45) Regarding the registration referred to in the first paragraph of this article, the National Banking and Securities Commission shall determine, through general provisions, what information will be public, and must disseminate it through its Internet website. The registry will contain annotations regarding each foreign exchange center or money transmitter, which may refer, among others, to the suspension of operations, closure procedures, and the suspension or cancellation of the contracts referred to in Articles 64 and 95 Bis of this Law, as well as to the cancellation of the registration to operate as a foreign exchange center or as a money transmitter, in accordance with the provisions of Article 81-D of this Law. (43) Article 81-C.- Foreign exchange centers and money transmitters may group themselves in the respective trade associations, which may carry out, among other functions, the development and implementation of standards of conduct and operation that must be complied with by their members, in order to contribute to the healthy development of the aforementioned societies. (43) Trade associations of foreign exchange centers or money transmitters, in terms of their bylaws, may issue, among others, rules relating to:
(43) I. The requirements for admission, exclusion, and separation of their members; (43) II. The process for the adoption of rules and the verification of their compliance, and (43) III. The standards and policies for adequate compliance with the general provisions referred to in Article 95 Bis of this Law.
(43) Trade associations may carry out periodic evaluations of their members on the compliance with the rules issued by said associations. When, from the results of said evaluations, they become aware of non-compliance with what is provided in this Law and in the general provisions referred to in the previous subsection III, said associations must inform the National Banking and Securities Commission, without prejudice to the supervisory powers that correspond to the Commission itself. Likewise, said associations must keep a record of the corrective and disciplinary measures they apply to their members, which will be available to the National Banking and Securities Commission. (43) The self-regulatory rules issued in terms of what is provided in this article may not contravene or exempt what is established in this Law and other applicable provisions. (45) Article 81-D.- The National Banking and Securities Commission, after hearing the interested society, may declare the cancellation of the registration referred to in Article 81-B of this Law, in the following cases:
(45) I. If the society in question carries out operations in contravention of what is provided by this Law or the provisions emanating from it; (45) II. If the society does not carry out the operations for which the registration referred to in Article 81-B of this Law was granted; (45) III. If its administrators have intervened in operations that infringe the provisions of this Law or those derived from Article 95 Bis thereof;

(45) IV. If the society in question, through its legal representative, so requests; (45) V. If despite the observations and corrective actions that the National Banking and Securities Commission has carried out or ordered, the society reoffends in non-compliance with what is established in Article 95 Bis of this Law or in the general provisions derived from it.
(45) For the purposes of the provision of this subsection, the person who has committed an infraction that had been sanctioned and, in addition to that, commits the same infraction, within the two years immediately following the date on which the corresponding resolution became final, shall be considered a repeat offender; (45) VI. When, in terms of this Law, the society in question seriously fails to comply with what is provided in Article 95-Bis of this Law or in the provisions derived from it; (45) VII. If the society omits to send to the National Banking and Securities Commission or to the Ministry of Finance and Public Credit, within a calendar year period, the information and documentation provided in Article 95 Bis of this Law and the general provisions derived from it, and (45) VIII. If the society omits to renew its registration in terms of what is indicated in Article 81-B of this Law and in the general provisions published for such effect. (45) The cancellation of the registration will incapacitate the society to carry out the operations referred to in Articles 81-A and 81-A Bis, as applicable, from the date on which it is notified. In the case of foreign exchange centers, from that moment, they will be placed in a state of dissolution and liquidation. (45) The National Banking and Securities Commission will promote before the judicial authority to appoint the liquidator, if within the period of sixty business days from the notification of the cancellation of the registration, it has not been appointed. When the Commission itself finds that there is impossibility to carry out the liquidation of the society, it will make it known to the competent judge to order the cancellation of its registration in the Public Commerce Registry, which will take effect after three hundred sixty natural days from the judicial order. (45) Interested parties may oppose this cancellation within the aforementioned period of sixty business days, before the judicial authority itself. (45) Article 82.- Only those anonymous societies organized in accordance with the provisions of the General Law of Commercial Societies that comply with the following requirements, which shall be called exchange houses, will enjoy the authorization referred to in Article 81 of this Law:
(45) I. That their corporate purpose be exclusively the performance, in a habitual and professional manner, of the following operations:
(45) a) Purchase or collection of sight documents denominated and payable in foreign currency, issued by financial entities, without limit per document; (45) b) Sale of sight documents and payable in foreign currency that exchange houses issue on behalf of credit institutions of the country, branches and agencies abroad of the latter, or banks abroad; (45) c) Purchase and sale of foreign currency through fund transfers to bank accounts; (45) d) Those indicated in Article 81-A of this Law, and (45) e) Those that the Bank of Mexico authorizes, through general provisions. (45) II. The bylaws must indicate that in the performance of their purpose, the society must comply with what is provided in this Law and the other applicable provisions, and

(45) III. Exchange houses must have a minimum subscribed and paid-in capital without right of withdrawal, equivalent in national currency to 8,657,000 investment units, which must be fully subscribed and paid by the last business day of the year in question. For these purposes, the value of the investment units corresponding to December 31 of the immediately preceding year will be considered.
(45) When the share capital exceeds the minimum referred to in this article, it must be paid at least fifty percent, provided that this percentage is not lower than the established minimum.
(45) In the case of variable capital societies, the minimum capital will be integrated by shares without right of withdrawal, representative of the fixed portion of the share capital. The amount of capital with right of withdrawal, in no case, may be higher than the paid-in capital without right of withdrawal. Likewise, the accounting capital must in no moment be lower than the minimum capital referred to in this article.
Article 83.- Applications for authorization to operate exchange houses must be accompanied by the following:
(2) I. Draft bylaws of the corresponding anonymous society, list of partners who will integrate it with the capital they will subscribe, in addition to the documentation that the Ministry of Finance and Public Credit deems convenient to support their application; (10) II. Repealed.
(8) III. Deposit receipt in national currency constituted in Nacional Financiera in favor of the Federal Treasury, equal to ten percent of the minimum capital required for its constitution, according to this Law.
(8) In the cases of revocation referred to in subsection I of Article 87 of this Law, the guarantee deposit will be made effective, applying to the federal treasury the original amount of the deposit mentioned in the previous paragraph. In the event that the requested authorization is denied, there is withdrawal by the interested parties, or operations begin in the terms provided in this Law, the principal and accessories of the aforementioned deposit will be returned to the applicant. (1) Article 84.- Exchange houses must comply with the following:
I. They will have an exclusive premises for the performance of their operations;
II. They must provide the Ministry of Finance and Public Credit or the Bank of Mexico with their foreign currency position when requested;
(10) III. Repealed.
(10) IV. Repealed.
(5) V. Their operations with foreign currency and precious metals must comply with the general provisions established for this purpose by the Bank of Mexico, in which it may indicate the limits of the operations that exchange houses may carry out based on their accounting capital.
(5) At the request of the Bank of Mexico, exchange houses are obliged to inform them of their foreign currency positions, including precious metals, and to transfer to them their assets in these effects, which they have in excess of their obligations in the same. The transfer will be made at the price at which the foreign currencies have been quoted in the market, on the date on which the Bank of Mexico issues the respective agreement, and (5) VI. They will provide the National Banking and Securities Commission with their accounting statements, financial information, and everything related to their business, in the form and terms that the Commission itself indicates through general rules, and Articles 52 and 53 of this Law will be applicable to them.

(6) Article 84-A.- The amount of paid-in capital and capital reserves of exchange houses must be invested in the terms and conditions established by general rules determined by the Ministry of Finance and Public Credit, having previously heard the opinion of the Bank of Mexico and the National Banking and Securities Commission.

(10) Article 85.- Repealed.

(42) Article 86.- The use of any advertising or the performance of any activity within national territory related to the purchase, sale, or exchange of foreign currency, as well as the habitual and professional transfer of funds, is prohibited when carried out by individuals or companies that do not have the corresponding authorization under this Law or other applicable provisions, or are not registered with the National Banking and Securities Commission in accordance with Article 81-B of this Law.

(42) Exchange houses, exchange centers, and money transmitters must keep a copy of the authorization letter issued by the Ministry of Finance and Public Credit, or the registration with the National Banking and Securities Commission, as applicable, visible to the public in the premises where they conduct operations, and include the date and number of said letter or registration in all types of advertising and promotion.

(46) Article 86-Bis.- Exchange centers and money transmitters must apply to the National Banking and Securities Commission, prior to their registration, for the issuance of a technical opinion regarding the prevention, detection, and reporting of acts, omissions, or operations that could fall under the circumstances of Articles 139, 148 Bis, or 400 Bis of the Federal Penal Code. For these purposes, the Commission will issue general provisions that include, among others, the procedure and deadlines for the request, the making of observations, and the resolution granting or denying the opinion, or, where applicable, its renewal.

(46) The respective application must be accompanied by the following:

(46) a) Document of internal policies, criteria, measures, and procedures that they intend to use;

(46) b) The designation of internal structures that will function as compliance areas in this matter;

(46) c) Sworn statement that they have or are in the process of implementing an automated system that assists in compliance with the measures and procedures established in the general provisions referred to in Article 95 Bis of this Law, and

(46) d) That which is otherwise provided in the aforementioned general provisions.

(46) For the renewal of said opinion, the National Banking and Securities Commission will consider the compliance that such companies give to the provisions of Article 95 Bis of this Law, as well as the general provisions derived from it.

(46) In the event that the application of the company in question is not resolved within the deadlines established in the aforementioned provisions, it shall be understood that it was resolved in a positive sense.

(9) Article 86-A.- The Bank of Mexico may order the temporary suspension of the operations of exchange houses when the market situation makes such a measure necessary, as well as when they infringe upon the general provisions issued by the Central Bank itself, in accordance with the provisions of fraction V of Article 84 of this Law.

(45) Article 87.- The Ministry of Finance and Public Credit, with the opinion of the National Banking and Securities Commission and the Bank of Mexico and after hearing the interested company, may declare the revocation of the authorization referred to in this chapter, in the following cases:

(45) I. If the respective company does not present the certified copy of the constitutive deed referred to in Article 8o., fraction XI of this Law for its approval within the term of four months from the granting of the authorization, or if it does not begin its operations within the term of three months from the approval of the deed;

(45) II. If it does not maintain the minimum capital provided for in this Law, or if its book capital becomes less than its required minimum capital, or if it suspends or abandons its activities;

(45) III. If it conducts operations in contravention of the provisions of this Law, the provisions emanating from it, as well as policies dictated in foreign exchange matters by the competent authorities or, in general, sound foreign exchange practices;

(45) IV. If it is dissolved, liquidated, or declared bankrupt, unless the bankruptcy procedure determines rehabilitation and the National Banking and Securities Commission gives a favorable opinion that it continue with the authorization;

(45) V. If the company does not perform the functions, nor carry out the operations for which it was authorized;

(45) VI. If its administrators have participated in operations that infringe financial and foreign exchange provisions, and

(45) VII. In any other case established by the Law.

(51) The Ministry will grant the right to a hearing to the interested company, so that, within a term of ten business days, counted from the next business day following that on which the corresponding notification takes effect, it may express in writing what it considers in its interest and offer evidence. The Ministry, at the request of the party, may extend once the term referred to in this fraction, for the same period, taking into account the particular circumstances of the case. Notifications will take effect on the next business day following that on which they are carried out.

(51) Upon completion of the term referred to in fraction I of this article, and in its case, its extension, the Ministry will have a term of up to sixty business days to resolve the evidence.

(51) Upon expiration of the term for resolving the evidence, the Ministry will notify the opening of a five-business-day period to formulate arguments. The Ministry may make such notification through court records or by any other means it determines. On the next business day following the expiration of the term to formulate arguments, the instruction will be considered closed, and the Ministry will have a term of no more than one hundred eighty business days to issue and notify the resolution that ends the revocation procedure.

(51) The National Banking and Securities Commission and the Bank of Mexico must issue the required opinion in accordance with the first paragraph of this article, at least thirty business days in advance of the expiration of the term provided for issuing the resolution that ends the revocation procedure. In the event that any of the opinions is issued after the stated deadline, the Ministry may resolve what corresponds with the records in the file, without the need to consider the opinions.

(50) The declaration of revocation will be published in the Official Gazette of the Federation and must be registered in the Public Commerce Registry corresponding to the social domicile of the Company in question, for which the Registry will only require prior notification from the Ministry of Finance and Public Credit. The revocation will incapacitate the company from conducting its operations from the date on which it is notified, and it will be placed in a state of dissolution and liquidation without the need for the agreement of the shareholders' meeting.

(45) The National Banking and Securities Commission will promote before the judicial authority to designate the liquidator if, within sixty business days of the publication of the revocation in the Official Gazette of the Federation, it has not been designated. When the Ministry or the liquidator finds that there is an impossibility to carry out the liquidation of the company, they will inform the competent judge so that they order the cancellation of its registration in the Public Commerce Registry, which will take effect after one hundred eighty natural days have passed from the judicial order.

(45) Interested parties may oppose this cancellation within a term of sixty natural days, counted from the registration of the cancellation in the Public Commerce Registry before the respective judicial authority.

(6) Article 87-A.- Exchange houses are prohibited from:

(8) I. Operating with their own shares, except in the cases provided for in the Securities Market Law;

(10) II. Repealed.

(6) III. Receiving bank deposits of money;

(6) IV. Granting bonds, sureties, or guarantees;

(6) V. Acquiring real estate and furniture or equipment not intended for the offices or activities proper to their corporate purpose;

(6) VI. Conducting operations that are not expressly authorized to them, and

(6) VII. Concluding operations pursuant to which the exchange house, its officials and employees, except for general labor benefits; proxy holders, alternate holders, whether or not in office; external auditors of the exchange house; or ascendants or descendants in the first degree or spouses of the aforementioned persons, may become or potentially become debtors of the exchange house.

(46) Article 87-A Bis.- The dissolution and liquidation of exchange houses will be governed by the provisions of Chapters X and XI of the General Law of Commercial Companies and the commercial bankruptcy proceedings in accordance with Chapter III of Title Eight of the Commercial Bankruptcy Law, with the following exceptions:

(46) I. The position of trustee or liquidator may fall to credit institutions, the Administration and Disposition of Goods Service, or to natural or legal persons with experience in the liquidation of companies.

(46) When it concerns natural persons, the appointment must fall on a person who meets the following requirements:

(46) a) Be a resident in national territory in accordance with the provisions of the Federal Tax Code.

(46) b) Be registered in the registry maintained by the Federal Institute of Specialists in Commercial Bankruptcy.

(46) c) Present a Special Credit Report, in accordance with the Law to Regulate Credit Information Companies, provided by credit information companies containing their background of at least five years prior to the date on which the position is to be assumed.

(46) d) Not have pending litigation against the company in question.

(46) e) Not have been sentenced for property crimes, nor disqualified from exercising commerce or holding a job, position, or commission in public service, or in the Mexican financial system.

(46) f) Not be declared bankrupt or subject to bankruptcy proceedings.

(46) g) Not have served as external auditor of the company in question during the twelve months immediately preceding the date of appointment.

(46) In the case of legal persons, the natural persons designated to perform activities related to this function must comply with the requirements referred to in this fraction.

(46) II. The Commission may request the declaration of commercial bankruptcy.

(46) In the case of liquidation or commercial bankruptcy proceedings of exchange houses, in which the Administration and Disposition of Goods Service serves as liquidator or trustee, the Federal Government may allocate resources to this decentralized body of the Federal Public Administration, with the exclusive purpose of carrying out expenses associated with publications and other procedures related to such proceedings, when it is evident that these cannot be covered by the assets of the exchange house in question due to lack of liquidity, or insolvency, in which case, it will constitute itself as a creditor of the latter.

(37) Chapter II

(37) Of the habitual and professional conduct of credit operations, financial leasing, and financial factoring

(45) Article 87- B.- The granting of credit, as well as the conclusion of financial leasing or financial factoring, may be carried out habitually and professionally by any person without the need to require authorization from the Federal Government for such purposes.

(45) For all legal effects, only the anonymous company that has a valid registration with the National Commission for the Protection and Defense of Users of Financial Services will be considered a multi-object financial company (SOFOM), for which they must comply with the following requirements:

(45) I. They must expressly contemplate as their main corporate object the habitual and professional conduct of one or more of the activities of granting credit, financial leasing, or financial factoring;

(45) II. As complementary to the aforementioned activities, they may consider as part of their main corporate object, the administration of any type of credit portfolio, as well as granting movable or immovable property in lease, provided that this is contemplated in their statutes, in which case, income derived from these activities, as long as they do not exceed thirty percent of the total income of the company, will be considered as income from their main object;

(45) III. They must add to their corporate name the expression "multi-object financial company" or its acronym "SOFOM", followed by the words "regulated entity" or its abbreviation "E.R." or "unregulated entity" or its abbreviation "E.N.R", as applicable;

(45) IV. They must have the valid favorable technical opinion referred to in Article 87-P of this Law, in the case of unregulated multi-object financial companies, and

(45) V. The others established by the National Commission for the Protection and Defense of Users of Financial Services through general provisions.

(45) Multi-object financial companies will be deemed financial entities, which may be regulated multi-object financial companies or unregulated multi-object financial companies.

(45) Regulated multi-object financial companies will be those that maintain patrimonial links with credit institutions, popular financial companies with Operation Levels I to IV, community financial companies with Operation Levels I to IV, or savings and loan cooperatives with Operation Levels I to IV; those that issue debt securities issued by them, registered in the National Securities Register in accordance with the Securities Market Law in accordance with the provisions of the following paragraph; and those that obtain the approval of the National Banking and Securities Commission in accordance with Article 87-C Bis 1 of this Law, to adjust to the regulated entity regime, which are not in any of the other circumstances contemplated in this paragraph; and they will be subject to the supervision and oversight of the National Banking and Securities Commission in accordance with the provisions of Article 56 of this Law, without prejudice to the powers conferred by this Law to the National Commission for the Protection and Defense of Users of Financial Services in the applicable norms.

(45) For the purposes of the provisions of the previous paragraph, regulated multi-object financial companies will be those that issue debt securities issued by them, registered in the National Securities Register in accordance with the Securities Market Law, or, in the case of fiduciary titles equally registered in the aforementioned Register, when the fulfillment of obligations related to the titles issued under the trust depends totally or partially on such company, acting as settlor, assignor, or administrator of the trust estate, or as guarantor or surety of the aforementioned titles.

(45) Unregulated multi-object financial companies will be those that do not fall under the circumstances of the previous paragraphs.

(45) Multi-object financial companies may act as commission agents for other financial entities, in the terms and conditions established by the legislation and applicable provisions to these latter.

(45) Regulated and unregulated multi-object financial companies must provide the information or documentation requested by them within their respective competence by the Ministry of Finance and Public Credit, the National Banking and Securities Commission, the Bank of Mexico, and the National Commission for the Protection and Defense of Users of Financial Services, within the deadlines set by such authorities.

(45) Unregulated multi-object financial companies must provide aggregated information to the National Commission for the Protection and Defense of Users of Financial Services, as requested by it for statistical purposes.

(45) The National Banking and Securities Commission, the National Commission for the Protection and Defense of Users of Financial Services, and the Bank of Mexico, in the exercise of their supervision, inspection, and oversight powers, may impose fines of two hundred to two thousand daily minimum wages in effect in the Federal District on the date of the infraction, on the aforementioned companies, when they refrain from providing the information or documentation requested by each authority, within the determined deadlines, or when they present it incorrectly or late.

(45) Unregulated multi-object financial companies will be subject to the supervision of the National Banking and Securities Commission, in accordance with the provisions of the second paragraph of Article 56 of this Law, for which the aforementioned Commission will take as a basis the information referred to in Article 87–K of the same Law.

(46) Article 87-B Bis.- Regulated multi-object financial companies must provide the National Banking and Securities Commission with the information it requests regarding persons who directly or indirectly have acquired more than five percent of the shares representing their social capital, as well as those who hold the positions of councilor and general manager, in the form and subject to the conditions established by the Commission itself through general provisions.

(46) When an unregulated multi-object financial company, as a result of the acquisition of shares referred to in this article, falls under any of the linking circumstances provided in Article 87-C of this Law, it must notify the National Banking and Securities Commission, within five business days following the occurrence of the event, and must also proceed with the update of its information in the registry of the National Commission for the Protection and Defense of Users of Financial Services.

(45) Article 87-C.- For the purposes of this Law, it will be understood that a multi-object financial company has a patrimonial link with a credit institution, popular financial company with Operation Level I to IV, community financial company with Operation Level I to IV, savings and loan cooperative with Operation Level I to IV, or credit union, when:

(45) I. A credit institution, popular financial company with Operation Level I to IV, community financial company with Operation Level I to IV, savings and loan cooperative with Operation Level I to IV, or credit union, maintains, directly or indirectly, twenty percent or more of the shares representing the social capital of said company, or the company maintains said percentage of shares of a credit institution, popular financial company with Operation Level I to IV, community financial company with Operation Level I to IV, savings and loan cooperative with Operation Level I to IV, or credit union;

(45) II. A holding company of a financial group maintains, directly or indirectly, fifty-one percent or more of the shares representing the social capital of both the multi-object financial company and a credit institution; or

(45) III. The company has common shareholders or partners with the credit institution, popular financial company with Operation Level I to IV, community financial company with Operation Level I to IV, savings and loan cooperative with Operation Level I to IV, or credit union, that:

(45) a) Maintain, directly or indirectly, fifty percent or more of the shares representing the social capital of both financial entities, whether or not belonging to a financial group, or

(45) b) Control the general shareholders' or partners' meeting, are able to appoint the majority of the members of the board of directors, or control both companies by any other means.

(45) Common shareholders or partners will be understood as the group of persons who have agreements, of any nature, to make decisions in the same sense. It is presumed, unless proven otherwise, that this occurs when there is a relationship by consanguinity, affinity, or civil law up to the fourth degree, spouses, concubine and concubine, as well as companies that are part of a set of such legal persons organized under schemes of direct and indirect participation of social capital, in which a legal person or a group of natural persons maintain fifty-one percent or more of the shares representing the social capital of such legal persons.

(46) Article 87-C Bis.- Multi-object financial companies must be users of at least one credit information company, providing periodically information on all credits they grant, in accordance with the provisions of the Law to Regulate Credit Information Companies. Compliance with this obligation must be recorded in their registration with the National Commission for the Protection and Defense of Users of Financial Services, in the terms established by said Commission through general provisions.

(46) Article 87-C Bis 1.- Unregulated multi-object financial companies that voluntarily seek to be considered regulated entities must meet the following requirements:

(46) a) That their subscribed and paid-in social capital, without right of withdrawal, as well as their book capital, be at least equivalent in national currency to 2,588,000 investment units;

(46) b) That they maintain, at least, three continuous years of operation as a multi-object financial company prior to the application referred to in the following subsection d) and prove that during said period 70% of their income comes from the activities that constitute their main corporate object in terms of this Law;

(46) c) The others established through general provisions, and

(46) d) Submit an application for approval to the National Banking and Securities Commission.

(46) The application referred to in subsection d) above must comply with the general provisions issued by the Commission for these purposes for the effects of this article.

(46) The approvals referred to in this article may be granted or denied at the discretion of said Commission, based on its assessment of the convenience of their incorporation into the regulated entity regime, the minimum timeframes in which societies must adjust to the general prudential rules they must observe in accordance with this Law and other applicable provisions.

(46) Once the approval is granted, multiple-object financial societies that obtain it may not readjust to the unregulated entity regime, and will be subject to the regulation applicable to regulated multiple-object financial societies provided for in this Law, the provisions emanating from it, as well as the norms provided for in other legal frameworks that are applicable to them.

(45) Article 87-D.- Regulated multiple-object financial societies, in addition to the provisions applicable by their very nature, shall be subject to the following:

(45) I. Multiple-object financial societies that maintain asset links with a credit institution in terms of this Law shall be subject to the provisions of the Credit Institutions Law in matters of:

(45) a) Integration and functioning of governing bodies and administration; (45) b) Integration of official files; (45) c) Mergers and spin-offs; (45) d) Contracting with third parties for services necessary for their operation; (45) e) Risk diversification; (45) f) Use of equipment, electronic, optical, or any other technology; (45) g) Investments; (45) h) Integration of credit files, credit process, and comprehensive risk management; (45) i) Related credits; (45) j) Credit portfolio rating; (45) k) Assignment or discounting of credit portfolio and establishment of preventive estimates for credit risk; (45) l) Accounting; (45) m) Disclosure and presentation of financial information and external auditors; (45) n) Maximum estimation of assets and minimum estimation of their obligations and liabilities; (45) o) Prevention of operations with resources of probable illicit origin; (45) p) Confidentiality of information and documentation, relative to operations and services; (45) q) Internal controls; (45) r) Information requirements; (45) s) Termination of adhesion contracts and mobility of active operations, and (45) t) Capital requirements.

(45) II. Multiple-object financial societies that maintain asset links with a cooperative savings and loan society in terms of this Law shall be subject to the provisions of the Law to Regulate the Activities of Cooperative Savings and Loan Societies in matters of:

(45) a) Assignment or discounting of credit portfolio; (45) b) Related credits; (45) c) Investments; (45) d) Contracting with third parties for services necessary for their operation; (45) e) Internal controls; (45) f) Integration of credit files, credit processes, and comprehensive risk management; (45) g) Credit portfolio rating and establishment of preventive estimates for credit risk; (45) h) Risk diversification; (45) i) Accounting; (45) j) Disclosure and presentation of financial information and external auditors; (45) k) Confidentiality of information and documentation, relative to operations and services; (45) l) Maximum estimation of assets and minimum estimation of their obligations and liabilities; (45) m) Prevention of operations with resources of probable illicit origin; (45) n) Information requirements, and (45) o) Capital requirements.

(45) III. Multiple-object financial societies that maintain asset links with a popular financial society or a community financial society in terms of this Law shall be subject to the provisions of the Popular Savings and Credit Law in matters of:

(45) a) Integration and functioning of governing bodies and administration; (45) b) Integration of official files; (45) c) Confidentiality of information and documentation, relative to operations and services; (45) d) Related credits; (45) e) Investments; (45) f) Contracting with third parties for services necessary for their operation; (45) g) Acceptance of mandates and commissions from financial entities, related to their object; (45) h) Assignment or discounting of credit portfolio; (45) i) Internal controls;

(45) j) Integration of credit files, credit processes, and comprehensive risk management; (45) k) Credit portfolio rating and establishment of preventive estimates for credit risk; (45) l) Risk diversification; (45) m) Accounting; (45) n) Disclosure and presentation of financial information and external auditors; (45) o) Maximum estimation of assets and minimum estimation of their obligations and liabilities; (45) p) Prevention of operations with resources of probable illicit origin; (45) q) Information requirements, and (45) r) Capital requirements.

(45) IV. Multiple-object financial societies that maintain asset links with a credit union in terms of this Law shall be subject to the provisions of the Credit Unions Law in matters of:

(45) a) Integration and functioning of governing bodies and administration; (45) b) Integration of official files; (45) c) Mergers and spin-offs; (45) d) Contracting with third parties for services necessary for their operation; (45) e) Risk diversification; (45) f) Use of equipment, electronic, optical, or any other technology; (45) g) Investments; (45) h) Integration of credit files, credit process, and comprehensive risk management; (45) i) Related credits; (45) j) Credit portfolio rating; (45) k) Assignment or discounting of credit portfolio and establishment of preventive estimates for credit risk; (45) l) Accounting; (45) m) Disclosure and presentation of financial information and external auditors; (45) n) Maximum estimation of assets and minimum estimation of their obligations and liabilities; (45) o) Prevention of operations with resources of probable illicit origin; (45) p) Confidentiality of information and documentation, relative to operations and services;

(45) q) Internal controls;
(45) r) Information requirements, and
(45) s) Capital requirements.

(45) V. Multiple-object financial societies that issue debt securities under their responsibility, registered in the National Securities Registry in accordance with the Securities Market Law, or, in the case of fiduciary titles equally registered in said Registry, when the fulfillment of obligations related to the titles issued under the trust depends totally or partially on said society, acting as settlor, assignor, or administrator of the trust estate, or as guarantor or surety of the referred titles; as well as multiple-object financial societies that obtain approval in terms of Article 87-C Bis 1 of this Law, shall be subject to the general provisions issued for this effect by the National Banking and Securities Commission for any of the following matters:

(45) a) Credit portfolio rating and establishment of preventive estimates for credit risk; (45) b) Disclosure and presentation of financial information and external auditors; (45) c) Accounting, and (45) d) Prevention of operations with resources of probable illicit origin.

(45) The National Banking and Securities Commission may establish through general provisions, the legal provisions applicable whose matters have been referred to in fractions I to V above.

(45) Regulated multiple-object financial societies that maintain asset links with credit institutions, popular financial societies with Operation Levels I to IV, community financial societies with Operation Levels I to IV, cooperative savings and loan societies with Operation Levels I to IV, or with credit unions, shall be subject, as applicable, to the general provisions that, for credit institutions, credit unions, and the referred Societies, are issued by the competent authorities in the matters indicated in the previous fractions, based on what is provided by articles 4, fractions I to VI and 6, of the Law of the National Banking and Securities Commission; as well as 24 and 26 of the Law of the Bank of Mexico.

(45) Additionally, regulated multiple-object financial societies that maintain asset links with a credit institution shall be subject to what is indicated in matters of: active operations, administration of non-bank cards, admission and investment regime of liabilities, foreign currency operations, foreign exchange risk positions, securities lending, repos, trusts, and derivatives, to the general provisions issued by the Bank of Mexico, for credit institutions.

(45) What is provided by this article must be expressly foreseen in the bylaws of regulated multiple-object financial societies.

(45) What is provided in article 65-A of this Law shall be equally applicable to regulated multiple-object financial societies, regarding the administrative acts indicated in said provision that the referred Commission issues in relation to said financial entities.

(45) The Bank of Mexico, ex officio or at the request of any interested party, may verify compliance with the general provisions issued by it and applicable to regulated multiple-object financial societies that maintain asset links with a credit institution. If, as a result of said verification, the Bank of Mexico detects any non-compliance, it may sanction such societies with a fine of one thousand to ten thousand days of the general minimum wage in effect in the Federal District on the date of the infraction. Prior to the imposition of any sanction, the right to a hearing of the society in question must be respected.

(45) The supervision of the Bank of Mexico regarding the operations that regulated multiple-object financial societies carry out in terms of the general provisions issued by it, may be carried out through inspection visits within the timeframes and in the manner established by the Bank itself, or through information or documentation requests.

(45) Against the resolutions by which the Bank of Mexico imposes any fine, the reconsideration appeal provided for in articles 64 and 65 of the Bank of Mexico Law shall proceed, which shall be mandatory exhaustion and must be filed within fifteen banking business days following the date of notification of such resolutions. Regarding what is resolved in that defense mechanism, the provision in the last paragraph of article 65 of the Bank of Mexico Law shall apply. The execution of fine resolutions shall be made in accordance with articles 66 and 67 of the Bank of Mexico Law.

(51) The notifications, procedure, and resolution of the reconsideration appeal shall be governed by the Bank of Mexico Law, its Internal Regulations, and the general rules issued by the Bank itself.

(45) The provisions provided for in the previous fractions I to IV shall be applicable without prejudice that they are regulated multiple-object societies that issue debt in the securities market.

(37) Article 87-E.- In financial leasing, financial factoring, and credit contracts entered into by multiple-object financial societies, and in those where it is agreed that the lessee, the factor, or the borrower may dispose of the credited amount or the loan amount in partial amounts or is authorized to make early repayments before the term indicated in the contract, the statement of account certified by the accountant of the corresponding society shall serve as evidence, unless proof to the contrary is presented, in the respective trial for the determination of the resulting balance owed by the debtor.

(37) Article 87-F.- The contract in which the credit, financial lease, or financial factoring granted by multiple-object financial societies is recorded, provided that said instrument is accompanied by the certification of the statement of account referred to in the previous article, shall be a mercantile executive title, without the need for signature recognition or any other requirement.

(37) In the case of financial factoring, in addition to the respective contract, multiple-object financial societies must have the documents that demonstrate the credit rights transmitted by virtue of said operation, as well as the notification to the debtor of said transmission when it must be carried out in accordance with applicable provisions.

(37) The statement of account cited in the first paragraph of this article must contain data on the identification of the contract or agreement where the credit, financial factoring, or financial lease granted is recorded; the initial capital made available or, if applicable, the amount of the determined rents; the capital or, if applicable, the unpaid due rents; the capital or, if applicable, the rents pending to mature; the interest rates of the credit or, if applicable, the variability of the rent applicable to the determinable rents for each payment period; the generated late interest; the interest rate applicable to late interest, and the amount of generated accessories.

(37) Article 87-G.- Mortgages constituted in favor of multiple-object financial societies on the complete unit of an industrial, agricultural, livestock, or primary, industrial, commercial, or service activity enterprise, must include the respective concession or concessions, if applicable; all material elements, movable or immovable assets affected by exploration, considered as a unit; and additionally, may include the cash in the current operation and credits in favor of the company, born directly from its operations, without prejudice to the possibility of disposing of them and substituting them in the normal movement of operations, without the need for the creditor's consent unless otherwise agreed.

(37) Multiple-object financial societies as creditors of the mortgages referred to in this article must allow the normal development of the operation of the assets affected by them, in accordance with their corresponding destination, and may not, in the case of assets affected by a public service concession, oppose alterations or modifications made to them during the term of the mortgage, provided they are necessary for the better provision of the corresponding public service.

(37) Notwithstanding what is provided by the previous paragraph, multiple-object financial societies, as creditors, may oppose the sale or alienation of part of the assets and the merger with other companies, in case this originates a danger to the security of financial leasing, financial factoring, and mortgage credit operations.

(37) The referred mortgage may be constituted in second place, provided that the amount of the net earnings of the operation free of any other charge is sufficient to cover the interest and amortizations of the respective credit.

(37) The mortgages referred to in this article must be registered in the Public Registry of the place or places where the assets are located.

(37) What is provided in article 214 of the General Law of Negotiable Instruments and Credit Operations shall be applicable in what is pertinent to the mortgages referred to in this article.

(37) Article 87-H.- The judge shall decree the possession of the asset object of the financial lease contract, requested in accordance with article 416 of the General Law of Negotiable Instruments and Credit Operations by multiple-object financial societies that have entered into said contract as lessors, provided that, in addition to the financial lease contract duly certified before a public notary, they accompany their request with the certified statement of account in the terms of article 87-E of this Law.

(45) Article 87 –I.- In credit, financial lease, and financial factoring operations that multiple-object financial societies enter into with their clients, interest may only be capitalized when, before or after their generation, the parties have agreed to do so. In this case, the respective society must provide its client with a monthly statement of account. A charge that contravenes what is provided by this article is inadmissible.

(45) Article 87-J.- In financial lease, financial factoring, and credit contracts, as well as in the other activities that the law expressly empowers them to carry out, that multiple-object financial societies enter into, they must expressly state that, for their constitution and operation with such character, they do not require authorization from the Ministry of Finance and Public Credit, and, in the case of unregulated multiple-object financial societies, they must additionally expressly state that they are subject to the supervision of the National Banking and Securities Commission, solely for the purposes of what is provided by article 56 of this Law. The same mention must be made in any type of information that unregulated multiple-object financial societies use for the purpose of promoting their operations and services.

(45) Article 87-K.- For the purposes of what is provided by the second paragraph of article 87-B of this Law, to obtain registration as a multiple-object financial society before the National Commission for the Protection and Defense of Financial Service Users, multiple-object financial societies shall observe, in addition to the provisions issued for this effect by said Commission in terms of the Law for the Protection and Defense of Financial Service Users, the following:

(45) a) Prior to their constitution as a multiple-object financial society, or to their organization under that regime in the case of already constituted societies, they will request from the National Commission for the Protection and Defense of Financial Service Users their registration in the registry, accompanying the necessary documentation in terms of the general provisions applicable to said registry. The National Commission for the Protection and Defense of Financial Service Users will issue, if appropriate, a favorable opinion so that the interested parties proceed with the formalization of the constitutive act of the multiple-object financial society or its assembly of transformation to said regime. In the case of unregulated multiple-object financial societies once constituted or transformed, they must obtain the favorable opinion referred to in article 87-P of this Law.

(45) b) Having fulfilled the above, multiple-object financial societies must communicate in writing that they have such character to the National Commission for the Protection and Defense of Financial Service Users, at the latest, within ten banking business days following the inscription of the corresponding constitutive act or the modification to their bylaws, in the corresponding Public Registry of Commerce in order to obtain their registration. They will have the same deadline to inform in writing to said Commission, any modification to their bylaws, as well as the change of social domicile, as well as the dissolution, liquidation, transformation, or any other corporate act of the entity that extinguishes its nature as a multiple-object financial society.

(45) Societies that do not obtain their registration and those whose registration is cancelled in accordance with what is provided in this article, will not have the character of multiple-object financial society.

(45) The cancellation of registration as multiple-object financial societies before the National Commission for the Protection and Defense of Financial Service Users shall proceed, prior to a hearing of the interested society, when:

(45) a) Repeatedly, in the judgment of said Commission, they fail to comply with the obligation to keep updated the information that must be provided in terms of this Law, the Law for the Protection and Defense of Financial Service Users, the Law to Regulate Credit Information Societies in accordance with what is provided by article 87-C Bis of this Law, and the provisions emanating from them;

(45) b) Repeatedly, those societies to which it is applicable fail to comply with the provisions referred to in article 87-D of this Law, prior to the opinion issued to that effect by the National Banking and Securities Commission and communicated to the National Commission for the Protection and Defense of Financial Service Users;

(45) c) Repeatedly, in the judgment of said Commission, they omit to provide the information required of them by said organism;

(45) d) If, despite the observations and actions carried out by the National Banking and Securities Commission, they reiterate non-compliance with what is established in article 95 Bis of this Law or in the general provisions derived from it.

(45) For the purposes of what is provided in this subsection, the one who has incurred in an infraction that had been sanctioned and, in addition to that committed, commits the same infraction, within the two immediate years following the date on which the corresponding resolution became final, shall be considered a recidivist;

(45) e) If the society omits to send to the National Banking and Securities Commission or to the Ministry of Finance and Public Credit in the period of one calendar year, the information and documentation provided in article 95 Bis of this Law and the general provisions derived from it;

(45) f) If the society omits to renew the opinion referred to in article 87-P of this Law, and

(45) g) In the other cases established for this effect by the National Commission for the Protection and Defense of Financial Service Users through general provisions.

(45) The loss of registration must be communicated to the general public by the means established in said provisions and must also be communicated to the National Banking and Securities Commission, within ten banking business days following the date on which this occurs.

(45) To resolve the cancellation of the registration of a regulated multiple-object financial society, the National Commission for the Protection and Defense of Financial Service Users must have the favorable opinion of the National Banking and Securities Commission.

(45) The declaration of cancellation shall be inscribed in the Public Registry of Commerce, prior to the order of the National Commission for the Protection and Defense of Financial Service Users, and, when it concerns regulated multiple-object financial societies, it shall be published in the Official Journal of the Federation.

(45) Regarding regulated multiple-object financial societies, the cancellation of their registration for the causes provided in paragraphs b), d) and e) of the third paragraph of this article, will put the society in a state of dissolution and liquidation without the need for an agreement of the general shareholders' meeting, incapacitating the society from carrying out its operations from the date on which it is notified of the same.

(45) The National Banking and Securities Commission will promote before the judicial authority for it to appoint the liquidator, if within the period of sixty business days from publication in the Official Journal of the Federation of the declaration of cancellation of the registration, no liquidator has been appointed. When said Commission or the liquidator finds that there is impossibility to carry out the liquidation of the society, it will make it known to the competent judge so that it orders the cancellation of its inscription in the Public Commerce Registry, which will take effect after one hundred and eighty natural days have passed from the judicial order.

(45) Interested parties may oppose this cancellation within a period of sixty business days, counted from the inscription of the cancellation in the Public Commerce Registry before the same judicial authority.

(45) Multiple-object financial societies that have complied with the registration requirement and maintain their information updated, may carry out the activities provided for in article 81-A Bis of this Law, prior to compliance with the requirements established in said provision.

Multiple-object financial societies will be subject to what is provided for financial institutions in the Law for the Protection and Defense of Users of Financial Services, as well as to the provisions that the National Commission for the Protection and Defense of Users of Financial Services issues based on said law.

(45) Multiple-object financial societies must refrain from using in their name, stationery or communications to the public, those words or expressions that are reserved for financial intermediaries authorized by the Federal Government in terms of the financial laws that regulate said intermediaries. In cases where this is provided for by the applicable financial laws, interested persons in their use must request the corresponding authorizations in terms of said regulations. The National Commission for the Protection and Defense of Users of Financial Services must require multiple-object financial societies to obtain a certified copy of the corresponding authorization to grant the respective registration.

(45) The competent authorities to resolve the requests for authorization for the use of reserved words referred to in the previous paragraph, are empowered to formulate observations to the promoters regarding the name and corporate object contained in the corporate statutes of multiple-object financial societies and require their resolution, so that they adjust to what is established in this Law.

(37) Article 87-L.- Without prejudice to what is provided by this Chapter, the powers that the Law of Transparency and Promotion of Competition in Secured Credit grants to the National Banking and Securities Commission, regarding financial entities that grant secured credit in the terms of said regulation, will be understood as conferred to the National Commission for the Protection and Defense of Users of Financial Services, regarding unregulated multiple-object financial societies.

(39) Second paragraph.- Repealed.

(37) Article 87-M.- In credit, financial leasing and financial factoring operations, multiple-object financial societies must:

(37) I. Inform their clients previously about the counter-performance; amount of partial payments, the form and periodicity to settle them; financial charges; accessories; amount and detail of any charge, if any; number of payments to be made, their periodicity; if applicable, the right to liquidate the operation early and the conditions for it, and the interests, including moratory ones, form of calculating them and the type of rate and, if applicable, discount rate.

(37) II. If a fixed rate is used, the client will also be informed of the amount of interest to be paid in each period. If a variable rate is used, the client will be informed about the rate adjustment rule, which cannot depend on unilateral decisions of the respective multiple-object financial society, but on the variations registered by an interest rate representative of the cost of the operation to the client, which must be easily verifiable by the client;

(37) III. Inform the client of the total amount to be paid for the operation in question, if applicable, number and amount of individual payments, the interests, commissions and corresponding charges, including those fixed for early payments or cancellation; providing them duly broken down the corresponding concepts;

(39) IV. Repealed.

(37) The National Commission for the Protection and Defense of Users of Financial Services may issue recommendations to multiple-object financial societies to achieve compliance with what is provided for in this article.

(45) Article 87-N.- In addition to what is provided by articles 87-K, 87-L and 87-M of this Law, the National Commission for the Protection and Defense of Users of Financial Services will have the surveillance and supervision of compliance, by multiple-object financial societies, with what is provided by articles 87-I and 87-M of this Law, under the criteria that said Commission determines to exercise said powers.

(45) Said Commission may exercise said powers in the places where the multiple-object financial societies in question operate, in terms of the Law for the Protection and Defense of Users of Financial Services. Likewise, said Commission may exercise such powers through visits, requests for information or documentation. For the purposes of what is provided in this article, multiple-object financial societies, as well as their representatives or employees, are obligated to allow accredited personnel of the Commission access to the place or places subject to verification.

(37) Article 87-Ñ.- Multiple-object financial societies will be subject, with respect to guarantee trust operations they administer in accordance with Section II of Chapter V of Title II of the General Law of Titles and Credit Operations, to what is provided by articles 79 and 80 of the Credit Institutions Law for said institutions. In the guarantee trust contracts referred to in article 395 of the General Law of Titles and Credit Operations and in their execution, multiple-object financial societies are prohibited from:

(37) I. Acting as trustees in any other trusts other than guarantee trusts;

(37) II. Using cash, goods, rights or values of the trusts for the realization of operations under which their fiduciary delegates, administrators, members of their board of directors, owners or substitutes, whether or not in office; their executives or employees; their commissioners, owners or substitutes, whether or not in office; their external auditors; the members of the technical committee of the respective trust; the ascendants or descendants in the first degree or spouses of the persons cited; the societies in whose assemblies these persons have a majority or the same multiple-object financial societies;

(37) III. Conclude operations on their own account;

(37) IV. Act in trusts through which limitations or prohibitions contained in this or other laws are evaded;

(37) V. Respond to the settlors or beneficiaries of the non-compliance of debtors for the goods, rights or values of the trust, unless it is due to their fault as provided in the final part of Article 391 of the General Law of Titles and Credit Operations.

(37) If at the end of the trust, the goods, rights or values have not been paid by the debtors, the trustee must transfer them, along with the cash, goods, and other rights or values that constitute the trust patrimony to the settlor or beneficiary, as the case may be, refraining from covering their amount.

(37) In the trust contracts, what is provided in this paragraph will be inserted in a notable manner and a declaration by the trustee to the effect that it made its content unequivocally known to the persons from whom it received cash, goods, rights or values for their fiduciary allocation;

(37) VI. Act as trustees in trusts through which resources from the public are captured, directly or indirectly, through any act causing direct or contingent liability;

(37) VII. Act in trusts through which limitations or prohibitions contained in this or other laws are evaded;

(37) VIII. Act as trustees in the trusts referred to in the second paragraph of Article 88 of the Investment Companies Law, and

(37) IX. Administer rural real estate, unless they have received the administration to guarantee the beneficiary the fulfillment of an obligation and their preference in payment with the value of said real estate or its products.

(37) Any pact contrary to what is provided by the preceding paragraphs will be null.

(46) Article 87-O.- Multiple-object financial societies may group themselves in the respective trade associations, which may carry out, among other functions, the development and implementation of standards of conduct and operation that must be complied with by their members, in order to contribute to the healthy development of the mentioned societies.

(46) Trade associations of multiple-object financial societies, in terms of their statutes, may issue, among others, norms relating to:

(46) I. The requirements for admission, exclusion and separation of their members;

(46) II. The process for the adoption of norms and the verification of their compliance, and

(46) III. The standards and policies for adequate compliance with the provisions of a general nature referred to in article 95 Bis of this Law.

(46) Trade associations may carry out periodic evaluations of their members on the compliance with the norms issued by said associations. When from the results of said evaluations they become aware of non-compliance with what is provided in this Law and in the provisions of a general nature referred to in the preceding paragraph III, said associations must inform the National Banking and Securities Commission, without prejudice to the supervisory powers that correspond to exercise to said Commission. Likewise, said associations must keep a record of the corrective and disciplinary measures they apply to their members, which will be available to the National Banking and Securities Commission.

(46) The self-regulatory norms issued in terms of what is provided in this article may not contravene or exempt what is established in this Law and other applicable provisions.

(46) Article 87-P.- Unregulated multiple-object financial societies must process before the National Banking and Securities Commission, prior to their registration, the issuance of a technical opinion in matters of prevention, detection and reporting of acts, omissions or operations that could be located in the circumstances of articles 139, 148 Bis or 400 Bis of the Federal Penal Code. For such purposes, the Commission will issue provisions of a general nature in which it includes, among others, the procedure and deadlines for the request, realization of observations and resolution granting or denying the opinion or, if applicable, its renewal.

(46) The respective request must be accompanied by the following:

(46) a) Document of policies, criteria, measures and internal procedures they intend to use;

(46) b) The designation of those internal structures that will function as compliance areas in the matter;

(46) c) Declaration under oath regarding that they have an automated system that contributes to the compliance with the measures and procedures that are established in the provisions of a general nature referred to in article 95 Bis of this Law, and

(46) d) The rest provided in the cited provisions of a general nature.

(46) For the renewal of said opinion, the National Banking and Securities Commission will consider the compliance that said societies give to what is provided by article 95 Bis of this Law, as well as to the provisions of a general nature derived from it.

(46) In case that the request of the society in question is not resolved within the deadlines established in the cited provisions, it will be understood that it was resolved in a positive sense.

Title Sixth
Of Infractions and Crimes
Chapter I
Of Administrative Infractions

(45) Article 88.- The fines that for non-compliance or violation of the norms of this Law and the provisions emanating from it, are imposed administratively by the National Banking and Securities Commission and the National Commission for the Protection and Defense of Users of Financial Services, in their respective scopes of competence, will be made effective by the Secretariat of Finance and Public Credit, once they have become final.

(45) It will correspond to the Board of Directors of the National Banking and Securities Commission, the imposition of sanctions, which may delegate this attribution to the President and the other public servants of the same, by reason of the nature of the infraction or the amount of the fines and will also have the indelegable power to condone, if applicable, totally or partially the fines imposed.

(45) For the purposes of the fines established in this chapter, days of salary will be understood as the general minimum wage in force in the Federal District at the time the infraction is committed.

(45) The fines referred to in this Law must be paid within fifteen business days following the date of their notification. In case that the offender promotes any legal defense means against the fine that has been applied to him and this is confirmed, totally or partially, its amount must be covered immediately once the offender is notified of the corresponding resolution.

(45) In case that the offender pays within the fifteen days referred to in the previous paragraph, the fines imposed in their respective scopes of competence by the mentioned Commissions, a reduction of twenty percent of their amount will be applied, provided that no defense means has been filed against said fine.

(45) The sanctions that in terms of article 90 of this Law correspond to impose to the National Commission for the Protection and Defense of Users of Financial Services, will follow the procedure established for this effect in the Law for the Protection and Defense of Users of Financial Services, so only what is provided by the first paragraph of article 88 Bis 3 of this Law will be applicable to them. Against said fines, the offender may file the review appeal provided for in the Law for the Protection and Defense of Users of Financial Services.

(46) Article 88 Bis.- The National Banking and Securities Commission, in the imposition of administrative sanctions referred to in this Law, will be subject to the following:

(46) I. A hearing will be granted to the alleged offender, who, within a period of ten business days counted from the business day following that in which the corresponding notification takes effect, must manifest in writing what is convenient for his interest, offer evidence and formulate his grievances. The Commission, at the request of the party, may extend by one occasion the period referred to in this paragraph, up to the same term, for which it will consider the particular circumstances of the case. The notification will take effect on the business day following that in which it is practiced.

(46) II. In case that the alleged offender does not make use of the right of hearing referred to in the preceding paragraph within the granted period or well, having exercised it, does not manage to dispel the imputations made against him, the infractions imputed will be considered accredited and the corresponding administrative sanction will be imposed.

(46) III. The following will be taken into account, if applicable:

(46) a) The impact on third parties or the financial system that the infraction has produced or may produce;

(46) b) Recidivism, the causes that originated it and, if applicable, the corrective actions applied by the alleged offender. He who has incurred in an infraction that has been sanctioned and, in addition to that, commits the same infraction, within the two immediate years following the date in which the corresponding resolution has become final, will be considered a recidivist.

(46) Recidivism may be sanctioned with a fine whose amount is equivalent up to double the originally provided;

(46) c) The amount of the operation;

(46) d) The economic condition of the offender, and

(46) e) The nature of the infraction committed.

(46) IV. Regarding conduct qualified by this Law as serious, in addition to what is established in the preceding paragraph III, it may take into account any of the following aspects:

(46) a) The amount of the patrimonial loss or damage caused;

(46) b) The profit obtained;

(46) c) The lack of honorability, by the offender, in accordance with what is provided by this Law and the provisions of a general nature emanating from it;

(46) d) The inexcusable negligence or dolus with which it has been acted;

(46) e) That the infringing conduct referred to in the administrative process may be constitutive of a crime, or

(46) f) The other circumstances that the National Banking and Securities Commission deems applicable for such purposes.

(51) Concluded the period referred to in paragraph I of this article, and if applicable, its extension, the National Banking and Securities Commission will have a period of up to sixty business days for the discharge of the evidence. Once the period for the discharge of the evidence has passed, the Commission will notify the opening of the period of five business days to formulate allegations. The Commission may carry out said notification by docket or by any other means that it determines.

(51) On the business day following the expiration of the period to formulate allegations, the instruction will be considered closed and the Commission will have a period not greater than one hundred and eighty business days to issue and notify the resolution that ends the sanctioning procedure and impose, if applicable, the sanctions that proceed according to law.

(46) Article 88 Bis 1.- The National Banking and Securities Commission will consider as a mitigating factor in the imposition of administrative sanctions, when the alleged offender, proves before said Commission having compensated the damage caused, as well as the fact that it provides information that contributes to the exercise of the powers of the Commission in matters of inspection and surveillance, in order to disclaim responsibilities.

(46) Article 88 Bis 2.- The procedures for the imposition of the administrative sanctions referred to in this Law will start independently of the opinion of crime, if any, issued by the National Banking and Securities Commission in terms of articles 95 and 95 Bis of this legal regulation.

(46) Article 88 Bis 3.- The fines referred to in this Chapter may be imposed on credit auxiliary organizations, exchange houses and regulated multiple-object financial societies, as well as on the members of the board of administration, general managers, executives, officials, employees or persons who hold a position, mandate, commission or any other legal title that said credit auxiliary organizations, exchange houses and regulated multiple-object financial societies grant them for the realization of their operations, who have directly incurred or have ordered the realization of the conduct subject of the infraction.

(46) Without prejudice to the foregoing, the National Banking and Securities Commission, attending to the circumstances of each case, may proceed in accordance with what is provided in article 74 of this Law.

(46) Article 88 Bis 4.- In the administrative procedures provided for in this Law, the relevant evidence will be admitted with the acts subject to the procedure provided that they are offered within the period of the discharge of the guarantee of hearing. In case of confession on behalf of authorities, this must be discharged in writing.

(46) Once the right of hearing referred to in article 88 Bis, paragraph I of this Law has been discharged or well, the written document through which the review appeal is filed, provided for in article 92 of this legal regulation, only supervening evidence will be admitted, provided that the corresponding resolution has not been issued.

(55) The National Banking and Securities Commission may obtain the means of proof that it considers necessary, as well as agree on the admissibility of the evidence offered. Evidence provided by interested parties may only be rejected when they are not offered in accordance with law, do not have relation with the substance of the matter, are inappropriate, unnecessary or contrary to morality or law. The valuation of the evidence will be made in accordance with what is established by the National Code of Civil and Family Procedures.

(45) Article 89.- The fines referred to in article 88 and that correspond to impose to the National Banking and Securities Commission, will be the following:

(45) I. Fine of 200 to 2,000 days of salary to credit auxiliary organizations, exchange houses and regulated multiple-object financial societies that do not comply with what is provided by article 70 of this Law as well as the provisions emanating from it;

(45) II. Fine of 200 to 2,000 days of salary to credit auxiliary organizations, regulated multiple-object financial societies and exchange houses that omit to submit for approval to the Secretariat of Finance and Public Credit or to the National Banking and Securities Commission, as appropriate, their constitutive deed or any modification to it;

(45) III. A fine of 200 to 2,000 days of salary, to persons who contravene what is provided in Article 8, fraction IV of this same legal instrument. Persons to whom a fine is imposed for infringing what is provided in said fraction will have a period of three months counted from the imposition of the aforementioned fine to correct such situation; upon its expiration, if they have not done so, new sanctions may be imposed on them for three times the amount of the previous fine. The National Banking and Securities Commission may continue to impose successive fines on the offender for three times the amount of the preceding fine, as many times as, after equal periods to those indicated, they fail to correct the irregular situation;

(45) IV. A fine of 200 to 2,000 days of salary, to regulated multiple-object financial societies that omit to report regarding the acquisition of shares referred to in Article 87-B Bis of this Law; as well as to regulated multiple-object financial societies that fail to comply with what is provided in fraction I, subsection s) of Article 87-D of this Law and the general provisions referred to in said provision;

(45) V. A fine of 200 to 2,000 days of salary, to regulated multiple-object financial societies that fail to comply with what is provided in fraction I, subsection k); fraction II, subsection a); fraction III, subsection h); and fraction IV, subsection k), of Article 87-D of this Law, regarding the assignment or discounting of credit portfolios, as well as if they fail to comply with the general provisions referred to in said provision in the matters referred to in the subsections mentioned in this fraction;

(45) VI. A fine of 400 to 5,000 days of salary, to credit auxiliary organizations and exchange houses that do not provide or exhibit in a timely manner the documentation and supplementary information to their financial statements, in non-compliance with what is provided in Article 56 in relation to Article 53 of this Law;

(45) VII. A fine of 400 to 10,000 days of salary, to credit auxiliary organizations and exchange houses that do not provide or do not present in a timely manner their monthly or annual financial statements as well as by not publishing them within the period provided in Article 53 of this Law;

(45) VIII. A fine of 400 to 10,000 days of salary, to credit auxiliary organizations and exchange houses that do not provide or do not present in a timely manner the documents or information referred to in Article 56 of this Law and the provisions emanating from it;

(45) IX. A fine of 400 to 10,000 days of salary, to credit auxiliary organizations and exchange houses that do not comply in a timely manner with the requirements formulated by the Secretariat of Finance and Public Credit, the Bank of Mexico, or the National Banking and Securities Commission;

(45) X. A fine of 2,000 to 20,000 days of salary or up to one percent of the paid-in capital and capital reserves, to natural or legal persons who use words reserved for credit auxiliary organizations or for exchange houses without having the corresponding authorization; likewise, the respective business may be administratively closed by the National Banking and Securities Commission until its name is changed. The same fine will be imposed on persons who, in contravention of what is provided in Article 87-B of this Law, hold themselves out or operate as multiple-object financial societies without having satisfied the requirements provided by said provision to be considered as such, or who continue to hold themselves out and operate as a Multiple-Object Financial Society when their registration before the National Commission for the Protection and Defense of Financial Services Users has been cancelled;

(45) XI. A fine of 1,000 to 50,000 days of salary, to regulated multiple-object financial societies, that fail to comply with what is provided in fractions I, subsections a), b), c), d), e), f), l), m), n), q) and r); II, subsections d), e), h), i), j), l) and n); III, subsections a), b), f), i), l), m), n), o) and q); IV, subsections a), b), c), d), e), f), l), m), n), q) and r); and V, subsections b) and c), of Article 87-D of this Law; as well as if they fail to comply with the general provisions referred to in said provision in the matters referred to in the subsections mentioned in this fraction.

(45) XII. A fine of 1,000 to 50,000 days of salary or up to one percent of the paid-in capital and capital reserves, to credit auxiliary organizations and exchange houses that do not keep accounting in the terms of Article 52 of this Law;

(45) XIII. A fine of 1,000 to 50,000 days of salary, to credit auxiliary organizations and exchange houses that do not constitute or maintain legal reserves;

(45) XIV. A fine of 2,000 to 50,000 days of salary to independent external auditors and other professionals or experts who render or provide opinions or reports to credit auxiliary organizations and exchange houses, who commit infractions of this Law or the general provisions emanating from it for such purposes;

(45) XV. A fine of 3,000 to 15,000 days of salary, to general deposit warehouses and to exchange houses that do not comply with the minimum capital required as provided by this Law;

(45) XVI. A fine of 3,000 to 30,000 days of salary, to regulated multiple-object financial societies, that fail to comply with what is provided in fraction I, subsection h); II subsection f); III subsection j); and IV subsection h), of Article 87-D of this Law; as well as if they fail to comply with what is provided in the general provisions referred to in said provision in the matters referred to in the subsections mentioned in this fraction;

(45) XVII. A fine of 4,000 to 30,000 days of salary, to persons who prevent or hinder inspectors of the National Banking and Securities Commission from carrying out the corresponding visits, verifying assets, liabilities, or the existence of deposited goods, or who refuse to provide the documentation and information requested of them;

(45) XVIII. A fine of 5,000 to 20,000 to regulated multiple-object financial societies that fail to comply with what is provided in fractions I, subsections g), j), and p); II, subsections c), g) and k); III, subsections c), e) and k); IV, fractions I, subsections g), j) and p); and V, subsection a), of Article 87-D of this Law; as well as if they fail to comply with the general provisions referred to in said provision in the matters referred to in the subsections mentioned in this fraction.

(45) XIX. A fine of 5,000 to 50,000 days of salary or up to one percent of the paid-in capital and capital reserves, to credit auxiliary organizations and exchange houses that exceed or do not maintain the percentages and limits determined by this Law and the general provisions emanating from it;

(45) XX. A fine of 5,000 to 50,000 days of salary, to credit auxiliary organizations and exchange houses that oppose or obstruct the exercise of the powers that this Law and other applicable provisions confer upon the Secretariat of Finance and Public Credit, the Bank of Mexico, and the National Banking and Securities Commission;

(45) XXI. A fine of 5,000 to 100,000 days of salary or up to one percent of the paid-in capital and capital reserves, to credit auxiliary organizations and exchange houses that carry out prohibited or unauthorized operations;

(45) XXII. A fine of 6,000 to 50,000 days of salary, to regulated multiple-object financial societies that fail to comply with what is provided in fractions I, subsections i) and t); II, subsections b) and o); III, subsections d) and r); and IV, subsections i) and s), of Article 87-D of this Law; as well as if they fail to comply with the general provisions referred to in said provision in the matters referred to in the subsections mentioned in this fraction;

(45) XXIII. A fine of 20,000 to 100,000 days of salary to credit auxiliary organizations and exchange houses that do not comply in the agreed manner with the operations and services they conclude with their clients or the public;

(45) XXIV. To regulated multiple-object financial societies, that fail to comply with what is provided in fractions I, subsection o); II, subsection m); III, subsection p); IV, subsection o); and V, subsection d), of Article 87-D of this Law and the general provisions referred to in said provision in the matters referred to in the subsections mentioned in this fraction, they will be sanctioned as follows:

(45) a) A fine of 10 to 100% of the unreported unusual operation;

(45) b) A fine of 3,000 to 100,000 days of salary when they commit the infractions considered serious in Articles 115 of the Credit Institutions Law; 71 and 72 of the Law to Regulate the Activities of Savings and Loan Cooperative Societies; 124 of the Popular Savings and Credit Law, and 129 of the Credit Unions Law, and

(45) c) A fine of 2,000 to 50,000 days of salary, when they commit the other infractions provided in the general provisions.

(45) XXV. A fine of 400 to 50,000 days of salary or up to one percent of the paid-in capital and capital reserves of the society in question, for infractions to any of the norms of this Law as well as to the general provisions emanating from it that do not have a specially designated sanction in this instrument.

(45) In the event that any of the infractions contained in this article generate a property damage or a benefit, the corresponding sanction may be imposed by adding to it up to one and a half times the equivalent to said damage or to the benefit obtained by the offender, whichever is greater. Benefit will be understood as the gain obtained or the loss avoided for oneself or for a third party.

(46) Article 89 Bis.- The Commission may abstain from sanctioning the persons and financial entities referred to in this Law, provided that the cause of such abstention is justified in accordance with the guidelines issued for such purposes by the Board of Directors of said Commission, and refer to facts, acts, or omissions that do not constitute gravity, there is no recidivism, there are no elements that allow demonstrating that the interests of third parties or of the financial system itself are affected, and they do not constitute a crime.

(46) Serious infractions will be considered the violation of what is provided in Articles 23; 38; 45-T; 51-A; 52; when it concerns omissions or alterations of accounting records; 53, penultimate paragraph; 87-A, 95, fractions I, regarding the failure to present to the National Banking and Securities Commission, the document of policies for user identification and knowledge and II, first paragraph, subsection a. for unreported operations, third paragraph of fraction II, subsections e. and f., 95 Bis, fractions I, regarding the failure to present to the National Banking and Securities Commission, the document of policies for client or user identification and II, first paragraph, subsection a. for unreported operations, and third paragraph, subsections e. and f., of this Law.

(46) Likewise, conduct indicated by this Law in its Article 89, fractions XI, in relation to non-compliance with fractions I, subsections l) and n); II, subsections i) and l); III, subsections m) and o); and IV, subsections l) and n) of Article 87-D of this Law; and XVIII, in relation to non-compliance with fractions I, subsection j); II, subsection g); III, subsection k); IV, subsection j); and V subsection a), of Article 87-D of this Law; when damage, detriment, or loss to society occurs, or when it concerns omissions or alterations of accounting records, will be considered serious.

(46) Likewise, conduct indicated in fractions XXII and XXIV of Article 89 of this Law will be considered serious.

(46) In any case, conduct will be considered serious when false information or information that fraudulently induces error is provided to the National Banking and Securities Commission, by concealment or omission.

(46) Article 89 Bis 1.- The powers of the National Banking and Securities Commission to impose the administrative sanctions provided in this Law, as well as in the provisions emanating from it, will expire within a period of five years, counted from the next business day after which the conduct was carried out or the infringement assumption was fulfilled.

(46) The expiration period indicated in the immediate preceding paragraph will be interrupted upon the initiation of the relevant procedures. It will be understood that the procedure in question has started from the notification to the alleged offender of the letter granting them the right to a hearing referred to in fraction I of Article 88 Bis of this Law.

(46) Article 89 Bis 2.- The National Banking and Securities Commission may, in addition to imposing the corresponding sanction, reprimand the offender, or merely reprimand them, considering their personal background, the gravity of the conduct, that there are no elements that allow demonstrating that the interests of third parties or of the financial system itself are affected, that having caused damage this has been repaired, as well as the existence of mitigating factors.

(46) Article 89 Bis 3.- To safeguard the exercise of the right of access to government public information, the National Banking and Securities Commission, adhering to the guidelines approved by its Board of Directors, must make known to the general public, through its Internet portal, the sanctions imposed for infractions of this Law or the provisions emanating from it, for which it must indicate:

(46) I. The name, trade name, or corporate name of the offender;

(46) II. The legal provision infringed, the type of sanction imposed, amount or period, as applicable, the infringing conduct, and

(46) III. The status of the resolution, indicating whether it is final or if it is subject to challenge and in the latter case if any defense mechanism has been filed and its type, when there is knowledge of such circumstance having been duly notified by the competent authority.

(46) In any case, if the imposed sanction is voided by any competent authority, such circumstance must also be published.

(46) The information mentioned above will not be considered reserved or confidential.

(45) Article 90.- The National Commission for the Protection and Defense of Financial Services Users will sanction with a fine of 200 to 1000 days of salary to the multiple-object financial society that:

(45) I. Fails to comply with what is provided in Article 87-I;

(45) II. Fails to comply with any of the obligations provided in subsections a) and b) of the first paragraph, and a) and c) of the third paragraph, of Article 87-K;

(45) III. Fails to comply with what is provided in fractions I to III of Article 87-M, or

(45) IV. Fails to comply with any other provision provided in this Law or in the general provisions emanating from it, whose supervision, monitoring, or compliance is the competence of said Commission.

(45) Article 91.- Persons who, infringing what is provided in fraction IV of Article 8 of this Law, become owners of shares of a credit auxiliary organization or exchange house, without having the required authorization, will be entitled to a fine that will be imposed administratively by the National Banking and Securities Commission, for the amount equivalent to ten to twenty percent of the value of the shares that exceed the percentage allowed without requiring authorization.

(2) Persons to whom a fine is imposed for infringing what is provided in fraction IV of Article 8 of this Law, will have a period of three months counted from the imposition of the aforementioned fine to correct such situation; upon its expiration, if they have not done so, new sanctions may be imposed on them for three times the amount of the previous fine. The National Banking Commission may continue to impose successive fines on the offender for three times the amount of the preceding fine, as many times as, after equal periods to those indicated, they fail to correct the irregular situation.

(46) Article 91 Bis.- When the National Banking and Securities Commission presumes that a natural or legal person is carrying out operations reserved for credit auxiliary organizations and exchange houses, without having the corresponding authorization, it may appoint an inspector and the necessary assistants to review the accounting and other documentation of the business, company, or establishment of the natural or legal person, in order to verify if they are indeed concluding the operations mentioned in violation of what is provided by this Law, in which case the National Banking and Securities Commission may order the immediate suspension of operations and, if necessary in the judgment of said Commission, proceed to the closure of the business, company, or establishment of the natural or legal person in question.

(46) The inspection, suspension of operations, and closure procedures referred to in the preceding paragraph are of public interest. What is provided in Title Three, Chapter II of this Law will be applicable insofar as relevant.

(46) Article 92.- Those affected by acts of the National Banking and Securities Commission that end authorization procedures or the imposition of administrative sanctions, may appeal in defense of their interests by filing a review appeal, the filing of which is optional.

(46) The review appeal must be filed in writing within fifteen business days following the date on which the notification of the respective act takes effect and must be presented before the Board of Directors of the National Banking and Securities Commission, when the act has been issued by said Board or by the President of the National Banking and Securities Commission, or before the latter when it concerns acts carried out by other public servants.

(46) The document by which the review appeal is filed must contain:

(46) I. The name, trade name, or corporate name of the appellant;

(46) II. Address for hearing and receiving all kinds of citations and notifications;

(46) III. The documents with which the personality of the promoter is accredited;

(46) IV. The act being appealed and the date of its notification;

(46) V. The grievances caused by the act indicated in fraction IV of this article, and

(46) VI. The evidence offered, which must have an immediate and direct relationship with the challenged act.

(46) When the appellant fails to comply with any of the requirements referred to in fractions I to VI of this article, the person in charge of resolving the matter will warn them in writing and only once, to rectify the warned omission within the three business days following the date on which the notification of said warning takes effect, and in case the omission is not rectified within the period indicated in this paragraph, said Commission will consider it not filed. If evidence is omitted, it will be considered not offered.

(46) Article 92 Bis.- The filing of the review appeal will suspend the effects of the challenged act when it concerns fines.

(46) Article 92 Bis 1.- The person in charge of resolving the review appeal may:

(46) I. Dismiss it as inadmissible;

(46) II. Dismiss it in the following cases:

(46) a) By express withdrawal of the appellant;

(46) b) By the occurrence of a cause of inadmissibility;

(46) c) For the cessation of the effects of the challenged act, and (46) d) Those other that proceed according to the law.
(46) III. Confirm the challenged act;
(46) IV. Revoke the challenged act in whole or in part, and (46) V. Modify or order the reinstatement of the challenged act or dictate or order the issuance of a new one that replaces it.
(46) Administrative acts may not be revoked or modified in the part not challenged by the appellant.
(46) The person responsible for resolving the review appeal must attend to it without the intervention of the public official who issued the administrative sanction that gave rise to the imposition of the corresponding appeal.
(46) The resolution of review appeals must be issued within a period not exceeding ninety business days following the date on which the appeal was filed, when it must be resolved by the President of the National Banking and Securities Commission or the Ministry of Finance and Public Credit, nor exceeding one hundred twenty business days when it concerns appeals that are the competence of the Board of Directors of the National Banking and Securities Commission. (46) The National Banking and Securities Commission and the Ministry of Finance and Public Credit must provide mechanisms that avoid conflicts of interest between the area that issues the resolution subject of the appeal and that which resolves it. (8) Article 93.- A fine whose amount will be from 500 to 6,000 days of salary will be imposed on notaries, registrars, or public brokers who authorize deeds or register acts in which any of the operations expressly prohibited by this Law are recorded, or who authorize the celebration of acts for which none of the grantors is authorized, or who register or authorize deeds or their modifications without the prior approval of the Ministry of Finance and Public Credit, as provided in fraction XI of Article 8. (8) Article 94.- If the fines referred to in this Law are imposed on a credit auxiliary organization or exchange house, the National Banking and Securities Commission may also impose a fine of up to 5,000 days of salary on each of the councilors, directors, administrators, officials, attorneys, agents, employees, and other persons who, by reason of their acts, caused or intervened so that the company incurred the irregularity or are responsible for it. Recidivism may be punished with a fine up to double the maximum provided for the infringement in question. (46) Article 94 Bis.- The sanctions provided for in this Law will be reduced by one third when it is proven that the damage or harm caused has been repaired or compensated. (46) Chapter I Bis (46) On Self-Correction Programs (46) Article 94 Bis 1.- Credit auxiliary organizations or exchange houses, through their general director or equivalent and with the opinion of the person or area that exercises the supervision functions of the respective credit auxiliary organization or exchange house, may submit to the authorization of the National Banking and Securities Commission a self-correction program when the credit auxiliary organization or exchange house in question, in the performance of its activities, or the person or area that exercises the supervision functions as a result of the powers conferred upon it, detects irregularities or non-compliance with what is provided for in this Law and other applicable provisions. (46) The following may not be the subject of a self-correction program under the terms of this article:
(46) I. The irregularities or non-compliance that are detected by the National Banking and Securities Commission in the exercise of its inspection and supervision powers, before the presentation by the credit auxiliary organization or exchange house of the respective self-correction program.
(46) It will be understood that the irregularity was previously detected by the National Banking and Securities Commission, in the case of supervision powers, when the irregularity has been notified to the credit auxiliary organization or exchange house; in the case of inspection powers, when it has been detected during the course of the inspection visit, or corrected subsequently after a request has been made during the visit; (46) II. When the violation of the norm in question corresponds to any of the crimes contemplated in this Law, or (46) III. When it concerns any of the infractions considered as serious in terms of this Law. (46) Article 94 Bis 2.- The self-correction programs referred to in Article 94 Bis 1 of this Law will be subject to the general provisions issued by the National Banking and Securities Commission. Additionally, they must be signed by the person or area that exercises the supervision functions in the credit auxiliary organization or exchange house, and be presented to the board of directors or equivalent body in the session immediately following the authorization request presented to the National Banking and Securities Commission. Likewise, it must contain the irregularities or non-compliance committed, indicating the provisions that have been considered violated; the circumstances that originated the irregularity or non-compliance, as well as indicating the actions adopted or intended to be adopted by the credit auxiliary organization or exchange house to correct the irregularity or non-compliance that motivated the program. (46) In the event that the credit auxiliary organization or exchange house requires a period to remedy the irregularity or non-compliance committed, the self-correction program must include a detailed schedule of activities to be carried out for that purpose. (46) If the National Banking and Securities Commission does not order the credit auxiliary organization or exchange house in question to make modifications or corrections to the self-correction program within twenty business days following its presentation, the program will be deemed authorized in all its terms. (46) When the National Banking and Securities Commission orders the credit auxiliary organization or exchange house to make modifications or corrections with the purpose that the program complies with what is established in this article and other applicable provisions, the corresponding credit auxiliary organization or exchange house will have a period of five business days counted from the respective notification to remedy such deficiencies. This period may be extended only once for up to five additional business days, with the authorization of the National Banking and Securities Commission. (46) If the deficiencies referred to in the previous paragraph are not remedied, the self-correction program will be deemed not presented, and consequently, the irregularities or non-compliance committed cannot be the subject of another
self-correction program. (46) Article 94 Bis 3.- During the validity of the self-correction programs authorized by the National Banking and Securities Commission in terms of Articles 94 Bis 1 and 94 Bis 2 of this order, it will refrain from imposing on the credit auxiliary organizations or exchange houses the sanctions provided for in this Law, for the irregularities or non-compliance whose correction is contemplated in said programs. Likewise, during such period, the statute of limitations for imposing sanctions will be interrupted, resuming until it is determined that the irregularities or non-compliance subject to the self-correction program were not remedied. (46) The person or area that exercises the supervision functions in the credit auxiliary organizations or exchange houses will be obliged to follow up on the implementation of the authorized self-correction program and report on its progress to the board of directors and the general director or the equivalent bodies or persons of the credit auxiliary organization or exchange house as well as to the National Banking and Securities Commission in the form and terms established in the general provisions referred to in Article 94 Bis 2 of this Law. This is without prejudice to the power of the National Banking and Securities Commission to supervise, at any time, the degree of progress and compliance with the self-correction program. (46) If as a result of the reports of the person or area that exercises the supervision functions in the credit auxiliary organizations or exchange houses or of the inspection and supervision activities of the National Banking and Securities Commission, this determines that the irregularities or non-compliance subject to the self-correction program were not remedied within the period provided, it will impose the corresponding sanction increasing the amount of this by up to forty percent; said amount being adjustable in terms of the applicable tax provisions. (46) Article 94 Bis 4.- Natural persons and other legal entities subject to the supervision of the National Banking and Securities Commission may submit to the authorization of the Commission a self-correction program when, in the performance of their activities, they detect irregularities or non-compliance with what is provided for in this Law and other applicable provisions, subject to what is provided for in Articles 94 Bis 1 to 94 Bis 3 of this Law, as applicable.
Chapter II
On Crimes
(45) Article 95.- To proceed criminally for the crimes provided for in Articles 96, 97, 98, 99, 99 Bis, 100, 101, 101 Bis and 101 Bis 2 of this Law, it will be necessary that the Ministry of Finance and Public Credit formulate a petition, with the prior opinion of the National Banking and Securities Commission; proceedings will also be initiated at the petition of the offended credit auxiliary organizations, regulated multiple-object financial companies or exchange houses, or of anyone with a legal interest. (45) The fines provided for in this chapter will be imposed at a rate of days of salary. To calculate their amount, the general minimum wage in force in the Federal District at the time the sanctioned conduct was committed will be taken as the base. (45) To determine the amount of the operation, loss or patrimonial damage provided for in this chapter, the general minimum wage in force in the Federal District at the time the crime in question was committed will be considered as days of salary. (45) Credit auxiliary organizations and exchange houses, in terms of the general provisions issued by the Ministry of Finance and Public Credit, with the prior opinion of the National Banking and Securities Commission, will be obliged, in addition to complying with the other obligations applicable to them, to:
(45) I. Establish measures and procedures to prevent and detect acts, omissions or operations that could favor, provide help, aid or cooperation of any kind for the commission of the crimes provided for in Articles 139 or 148 Bis of the Federal Penal Code or that could be located in the circumstances of Article 400 Bis of the same Code, and (45) II. Present to the Ministry of Finance and Public Credit, through the National Banking and Securities Commission, reports on:
(45) a. The acts, operations and services they carry out with their clients and users, relating to the previous fraction, and (45) b. Any act, operation or service, that could be located in the circumstance provided for in fraction I of this article or that, in its case, could contravene or violate the adequate application of the provisions indicated in the same, carried out or in which any member of the board of directors, administrators, executives, officials, employees and attorneys intervene. (45) The reports referred to in fraction II of this article, in accordance with the general provisions provided for in the same, will be prepared and presented taking into consideration, at least, the modalities referred to in said provisions for that effect; the characteristics that the acts, operations and services referred to in this article must meet to be reported, taking into account their amounts, frequency and nature, the monetary and financial instruments with which they are carried out, and the commercial and financial practices observed in the markets where they are carried out; as well as the periodicity and the systems through which the information will be transmitted. The reports must refer at least to operations defined by the general provisions as relevant, internally concerning and unusual, those related to international transfers and cash operations carried out in foreign currency. (45) Likewise, the Ministry of Finance and Public Credit in the cited general provisions will issue guidelines on the procedure and criteria that credit auxiliary organizations and exchange houses must observe regarding:
(45) a. The adequate knowledge of their clients and users, for which they must consider the background, specific conditions, economic or professional activity and the markets in which they operate; (45) b. The information and documentation that said credit auxiliary organizations and exchange houses must collect for the opening of accounts or celebration of contracts relating to the operations and services they provide and that fully accrediting the identity of their clients; (45) c. The manner in which the same credit auxiliary organizations and exchange houses must safeguard and guarantee the security of the information and documentation relating to the identification of their clients and users or who have been, as well as that of those acts, operations and services reported in accordance with this article; (45) d. The terms to provide training within the credit auxiliary organizations and exchange houses on the subject matter of this article. The general provisions referred to in this article will indicate the terms for its due compliance; (45) e. The use of automated systems that contribute to the compliance with the measures and procedures established in the own general provisions referred to in this article, and (45) f. The establishment of those internal structures that must function as compliance areas in the matter, within each credit auxiliary organization and exchange house. (45) Credit auxiliary organizations and exchange houses must conserve, for at least ten years, the information and documentation referred to in subsection c) of the previous paragraph, without prejudice to what is established in this or other applicable regulations. (45) The Ministry of Finance and Public Credit will be empowered to request and collect, through the National Banking and Securities Commission, information and documentation related to the acts, operations and services referred to in fraction II of this article. Credit auxiliary organizations and exchange houses, who will be obliged to provide said information and documentation. The Ministry of Finance and Public Credit will be empowered to obtain additional information from other sources for the same purpose and to provide information to competent authorities. (45) Credit auxiliary organizations and exchange houses must immediately suspend the carrying out of acts, operations or services with clients or users that the Ministry of Finance and Public Credit informs them through a list of blocked persons that will have the character of confidentiality. The list of blocked persons will have the purpose of preventing and detecting acts, omissions or operations that could be located in the circumstances provided for in the articles referred to in fraction I of this article. (45) The obligation of suspension referred to in the previous paragraph will cease to produce effects when the Ministry of Finance and Public Credit removes the client or user in question from the list of blocked persons. (45) The
Ministry of Finance and Public Credit will establish, in the general provisions referred to in this article, the parameters for the determination of the introduction or elimination of persons in the list of blocked persons. (45) The compliance with the obligations indicated in this article will not imply any transgression of the obligation of legal confidentiality, nor will it constitute a violation of the restrictions on the disclosure of information established by contractual means. (45) The general provisions referred to in this article must be observed by credit auxiliary organizations and exchange houses, as well as by the members of the board of directors, administrators, executives, officials, employees and respective attorneys, for which both the entities and the persons mentioned will be responsible for the strict compliance with the obligations established through said provisions. (45) The violation of the provisions referred to in this article will be sanctioned by the National Banking and Securities Commission in accordance with the procedure provided for in Article 88 Bis of this Law, with a fine equivalent to ten percent to one hundred percent of the amount of the act, operation or service carried out with a client or user who has been informed that they are on the list of blocked persons referred to in this article; with a fine equivalent to ten percent to one hundred percent of the unusual operation not reported, or in its case, of the series of operations related to each other of the same client or user, which should have been reported as unusual operations; regarding relevant, internally concerning operations, those related to international transfers and cash operations carried out in foreign currency, not reported, as well as non-compliance with any of the subsections a., b., c. or e. of the sixth paragraph of this article, it will be sanctioned with a fine of 10,000 to 100,000 days of salary and in the other cases of non-compliance with this provision and the provisions emanating from it, a fine of 2,000 to 30,000 days of salary. (45) The aforementioned fines may be imposed on credit auxiliary organizations and exchange houses, as well as on their members of the board of directors, administrators, executives, officials, employees and respective attorneys, as well as on natural and legal persons who, by reason of their acts, have caused or intervened so that said financial entities incur in the irregularity or are responsible for it. Without prejudice to the foregoing, the National Banking and Securities Commission, attending to the circumstances of each case, may proceed in accordance with what is provided for in Article 74 of this Law. (45) Public officials of the Ministry of Finance and Public Credit and the National Banking and Securities Commission, credit auxiliary organizations and exchange houses, their members of the board of directors, administrators, executives, officials, employees and attorneys, must refrain from
giving notice of the reports and other documentation and information referred to in this article, to persons or authorities other than those expressly empowered in the relative regulations to require, receive or conserve such documentation and information. The violation of these obligations will be sanctioned in terms of the corresponding laws. (45) Article 95 BIS.- Unregulated multiple-object financial companies, currency centers and money transmitters, in terms of the general provisions issued by the Ministry of Finance and Public Credit, with the prior opinion of the National Banking and Securities Commission, will be obliged, in addition to complying with the other obligations applicable to them, to:
(45) I. Establish measures and procedures to prevent and detect acts, omissions or operations that could favor, provide help, aid or cooperation of any kind for the commission of the crimes provided for in Articles 139 or 148 Bis of the Federal Penal Code or that could be located in the circumstances of Article 400 Bis of the same Code; (45) II. Present to the Ministry of Finance and Public Credit, through the National Banking and Securities Commission, reports on:
(45) a. The acts, operations and services they carry out with their clients and users, relating to the previous fraction, and

(45) b. Any act, operation, or service that could fall under the scenario provided for in fraction I of this article or that, if applicable, could contravene or undermine the proper application of the provisions indicated therein, carried out by or involving any member of the board of directors, administrator, executive, official, employee, factor, or proxy.

(45) III. Register in their accounting each of the operations or acts they enter into with their clients or users, as well as operations entered into with financial institutions.

(45) The reports referred to in fraction II of this article, in accordance with the general provisions provided for therein, shall be prepared and presented taking into consideration, at a minimum, the modalities referred to in such provisions for this purpose; the characteristics that the acts, operations, and services referred to in this article must meet to be reported, taking into account their amounts, frequency, and nature, the monetary and financial instruments with which they are carried out, and the commercial practices observed in the markets where they are effected; as well as the periodicity and the systems through which the information shall be transmitted. The reports shall refer at least to operations defined by the general provisions as relevant, internal concerning, and unusual, those related to international transfers, and cash operations carried out in foreign currency.

(45) Likewise, the Ministry of Finance and Public Credit, in the aforementioned general provisions, shall issue guidelines on the procedure and criteria that unregulated multiple-object financial societies, currency exchanges, and money transmitters must observe regarding:

(45) a. The adequate knowledge of their clients and users, for which they must consider the background, specific conditions, economic or professional activity, and the markets in which they operate;

(45) b. The information and documentation that said unregulated multiple-object financial societies, currency exchanges, and money transmitters must collect for the celebration of the operations and services they provide and that fully accredit the identity of their clients;

(45) c. The manner in which said unregulated multiple-object financial societies, currency exchanges, and money transmitters must safeguard and guarantee the security of the information and documentation related to the identification of their clients and users or who have been such, as well as that of those acts, operations, and services reported pursuant to this article;

(45) d. The terms for providing internal training to unregulated multiple-object financial societies, currency exchanges, and money transmitters on the subject matter of this article. The general provisions referred to in this article shall indicate the terms for their due compliance;

(45) e. The use of automated systems that assist in compliance with the measures and procedures established in the aforementioned general provisions referred to in this article, and

(45) f. The establishment of those internal structures that must function as compliance areas in this matter, within each unregulated multiple-object financial society, currency exchange, and money transmitter.

(45) Unregulated multiple-object financial societies, currency exchanges, and money transmitters, in terms of the general provisions provided for in the first paragraph of this article, must conserve, for at least ten years, the information and documentation referred to in subsection c) of the previous paragraph, without prejudice to what is established in this or other applicable regulations.

(45) The Ministry of Finance and Public Credit shall be empowered to request and collect, through the National Banking and Securities Commission, information and documentation related to the acts, operations, and services referred to in fraction II of this article. Unregulated multiple-object financial societies, currency exchanges, and money transmitters are obligated to provide such information and documentation.

(45) Unregulated multiple-object financial societies, currency exchanges, and money transmitters must immediately suspend the carrying out of acts, operations, or services with clients or users whom the Ministry of Finance and Public Credit informs them are on a blocked persons list, which shall have the character of confidentiality. The blocked persons list shall have the purpose of preventing and detecting acts, omissions, or operations that could fall under the scenarios provided for in the articles referred to in fraction I of this article.

(45) The obligation to suspend referred to in the previous paragraph shall cease to have effect when the Ministry of Finance and Public Credit removes the client or user in question from the blocked persons list.

(45) The Ministry of Finance and Public Credit shall establish, in the general provisions referred to in this article, the parameters for the determination of the inclusion or removal of persons in the blocked persons list.

(45) Compliance with the obligations indicated in this article shall not imply any breach of the legal obligation of confidentiality, nor shall it constitute a violation of the restrictions on the disclosure of information established by contractual means.

(45) The general provisions referred to in this article shall be observed by unregulated multiple-object financial societies, currency exchanges, and money transmitters, as well as by the members of the board of directors, administrators, executives, officials, employees, factors, and proxies thereof; therefore, both the societies and the persons mentioned shall be responsible for the strict compliance with the obligations established through such provisions.

(45) Violation of the provisions referred to in this article shall be sanctioned by the National Banking and Securities Commission in accordance with the procedure provided for in Article 88 Bis of this Law, with a fine equivalent to ten percent to one hundred percent of the amount of the act, operation, or service carried out with a client or user who has been informed is on the blocked persons list referred to in this article; with a fine equivalent to ten percent to one hundred percent of the unusual operation not reported, or, if applicable, of the series of operations related to each other of the same client or user, which should have been reported as unusual operations; regarding relevant operations, internal concerning operations, those related to international transfers, and cash operations carried out in foreign currency, not reported, as well as non-compliance with any of subsections a., b., c., e. and f. of the third paragraph of this article, it shall be sanctioned with a fine of 10,000 to 100,000 salary days, and in other cases of non-compliance with this provision and the provisions emanating from it, a fine of 2,000 to 30,000 salary days.

(45) The aforementioned sanctions may be imposed on unregulated multiple-object financial societies, currency exchanges, and money transmitters, as well as their members of the board of directors, administrators, executives, officials, employees, factors, and proxies thereof, as well as on natural and legal persons who, by reason of their acts, have caused or intervened so that said financial entities incur in the irregularity or are responsible for the same.

(45) The National Banking and Securities Commission shall have the power to supervise, monitor, and inspect the compliance and observance of what is provided for in this article, as well as by the general provisions issued by the Ministry of Finance and Public Credit in terms of the same.

(45) Likewise, the National Banking and Securities Commission may order credit institutions, brokerage houses, and exchange houses with which currency exchanges and money transmitters operate, to suspend or cancel the contracts they have entered into with said persons and to refrain from carrying out new operations, when it presumes that they are violating what is provided for in this article or the general provisions emanating from it.

(45) Public servants of the Ministry of Finance and Public Credit and the National Banking and Securities Commission, currency exchanges, unregulated multiple-object financial societies, and money transmitters, their members of the board of directors, administrators, executives, officials, employees, factors, and proxies, must refrain from giving notice of the reports and other documentation and information referred to in this article to persons or authorities other than those expressly empowered by the relevant regulations to request, receive, or conserve such documentation and information. Violation of these obligations shall be sanctioned in terms of the corresponding laws.

(46) Article 95 Bis 1.- The National Banking and Securities Commission may issue general provisions, establishing best practices, guides, and guidelines, to provide for better compliance with the obligations incumbent upon unregulated multiple-object financial societies, currency exchanges, and money transmitters, contained in this regulation.

(36) Article 96.- A penalty of imprisonment of three months to two years and a fine of thirty to three hundred salary days shall be imposed on general managers or general managers, members of the board of administration, commissioners, and external auditors of credit auxiliary organizations or exchange houses that, in the exercise of their functions, incur in violation of any of the prohibitions referred to in articles 23, fraction VII, 45, fraction XII, and 87-A, fraction VII of this Law.

(45) Article 97.- Those counselors, officials, or employees of credit auxiliary organizations and exchange houses or those who intervene directly in the operation shall be sanctioned with imprisonment of two to ten years and a fine of five hundred to fifty thousand salary days:

(45) I. Who fraudulently omit or order the omission to register, in terms of article 52 of this law, the operations carried out by the credit auxiliary organization or exchange house in question, or who through maneuvers alter or order the alteration of the records to hide the true nature of the operations carried out, affecting the composition of assets, liabilities, contingent accounts, or results;

(45) II. Who, knowing the falsity regarding the amount of assets or liabilities, grant the loan or credit;

(45) III. Who knowingly present false data to the National Banking and Securities Commission regarding the solvency of the debtor, regarding the value of the guarantees of the credits, loans, or credit rights, making it impossible for it to adopt the necessary measures so that the corresponding adjustments are made in the records of the respective organization;

(45) IV. Who, knowing the flaws indicated in fraction III of article 98 of this law, grant the loan or credit, and

(45) V. Who refuse to provide information, documents, or files, including electronic ones, with the purpose of preventing or obstructing the supervision and monitoring acts of the National Banking and Securities Commission.

(46) Article 97 Bis.- Those persons who, having been removed, suspended, or disqualified, by final resolution of the National Banking and Securities Commission, in terms of what is provided for in article 74 of this Law, continue to perform the functions regarding which they were removed or suspended or occupy a job, position, or commission, within the Mexican financial system, despite being suspended or disqualified therefor, shall be sanctioned with imprisonment of two to seven years.

(46) Article 97 Bis 1.- Persons who hold any position, mandate, commission, or any other legal title that, for the performance of the activities and operations corresponding to credit auxiliary organizations, exchange houses, or regulated multiple-object financial societies, have been granted to them, shall be considered as officials or employees of said entities, for the purposes of the administrative and penal responsibilities established in this Title.

(22) Article 98.- A penalty of imprisonment of three months to two years and a fine of thirty to two thousand salary days shall be imposed when the amount of the operation, loss, or patrimonial damage, as applicable, does not exceed the equivalent of two thousand salary days.

(23) When the amount of the operation, loss, or patrimonial damage, as applicable, exceeds two thousand and does not exceed fifty thousand salary days, a penalty of imprisonment of two to five years and a fine of two thousand to fifty thousand salary days shall be imposed.

(23) When the amount of the operation, loss, or patrimonial damage, as applicable, exceeds fifty thousand, but does not exceed three hundred fifty thousand salary days, a penalty of imprisonment of five to eight years and a fine of fifty thousand to two hundred fifty thousand salary days shall be imposed.

(23) When the amount of the operation, loss, or patrimonial damage, as applicable, exceeds three hundred fifty thousand salary days, a penalty of imprisonment of eight to fifteen years and a fine of two hundred fifty thousand to three hundred fifty thousand salary days shall be imposed.

(23) Considering the amount of the operation, loss, or patrimonial damage, the sanctions provided for in this article shall be imposed on:

(36) I. Persons who, with the purpose of obtaining a loan or credit, provide a credit auxiliary organization with false data regarding the amount of assets or liabilities of an entity or natural or legal person, if as a consequence thereof there results a loss or patrimonial damage to the organization;

(22) II. Counselors, officials, employees, or those who intervene directly in the operation who, falsify, alter, simulate, or knowingly carry out operations that result in loss or damage to the patrimony of the organization or exchange house.

(22) Those counselors, officials, or employees of credit auxiliary organizations or exchange houses or those who intervene directly in the operations who:

(36) a) Grant loans or credits to societies constituted knowing that these have not integrated the capital registered in the respective assembly minutes;

(22) b) Carry out operations typical of the corporate purpose of credit auxiliary organizations and exchange houses with natural or legal persons whose state of insolvency is known to them, if it is foreseeable when carrying out the operation that they lack the economic capacity to pay or respond for the amount of the operations carried out that result in loss or damage to the patrimony of the respective credit auxiliary organizations or exchange houses;

(36) c) Renew loans or credits, partially or totally due, to the natural or legal persons referred to in the previous subsection;

(22) d) With the object of freeing a debtor, grant credits to one or several natural or legal persons who are in a state of insolvency, substituting in the records of the respective organization one asset for another, and

(36) e) Knowingly allow a debtor to divert the amount of the credit or loan, notably reducing their capacity to pay or respond for the amount of their obligation, and as a consequence thereof, there results a loss or patrimonial damage to the organization.

(36) III. Persons who, to obtain loans or credits from a credit auxiliary organization, present appraisals that do not correspond to reality, so that the real value of the goods offered as collateral is lower than the amount of the credit or loan, resulting in loss or patrimonial damage to the organization;

(36) IV. The borrowers who divert a credit granted by a credit auxiliary organization for purposes other than those for which it was granted, if such purpose was determinative for the granting of preferential conditions in the credit, and

(22) V. Natural or legal persons, as well as the counselors, officials, and employees thereof, who present false or altered financial statements with the purpose of obtaining from a general warehouse the authorization of premises.

(36) Article 99.- Counselors, officials, employees of credit auxiliary organizations and exchange houses, or those who intervene directly in the operation, who, regardless of the charges or interests fixed by the respective society, directly or through an intermediary, have obtained from the credit subjects or exchange house clients, benefits for their participation in the processing or granting of credit or exchange house operations, shall be sanctioned with a penalty of imprisonment of three months to three years when the benefit is not valuable, or does not exceed five hundred salary days, at the moment the offense is committed, and from two to fourteen years of imprisonment when the benefit exceeds five hundred days of the referred salary.

(23) Article 99 bis.- Counselors, officials, commissioners, employees, or shareholders who incite or order officials or employees of the credit auxiliary organization or exchange house to commit the offenses referred to in articles 97 and 98 fraction II, shall be sanctioned up to one half more of the penalties provided for in the respective articles.

(45) Article 100.- A penalty of imprisonment of five to ten years shall be imposed on:

(8) I. Persons who, having been designated as authorized warehousemen in terms of this Law, dispose or allow the improper disposal of the deposited merchandise or provide false data to the warehouse regarding the movements and stock of the same; and

(45) II. Persons who, on behalf of or in the name of the general warehouses and without justified cause, refuse to deliver, steal, dispose of, or allow the disposal of the merchandise deposited in said warehouses or premises authorized by means other than those established pursuant to the respective contract or the prevailing usages and customs in the warehousing environment. The same sanction shall be applicable to persons who order the carrying out of any of the aforementioned acts.

(46) III. Persons designated as authorized warehouseman or auxiliary warehouseman, as well as any other, who deny, prevent, or do not allow, by any means, access to the warehouses, premises, or facilities authorized, by representatives, officials, or employees of the general warehouses, any authority or person who has the right to access them.

(42) Article 101.- Natural persons, including those natural persons whose tax regime is for income from business activities, counselors, officials, or administrators of legal persons who carry out operations reserved for credit auxiliary organizations, exchange houses, currency exchanges, and money transmitters, without having the authorizations or registrations, as applicable, provided for in the law, shall be sanctioned with penalties of imprisonment of three to fifteen years and a fine up to 100,000 salary days.

(23) Article 101 Bis.- Public servants of the National Banking and Securities Commission shall be sanctioned with the penalty established for the corresponding offenses plus one half, as it concerns the offenses provided for in articles 96 to 99 and 101 of this law, when:

(23) a) They conceal from their superiors facts that probably may constitute an offense;

(23) b) They allow officials or employees of the credit auxiliary organization or exchange house to alter or modify records with the purpose of hiding facts that probably may constitute an offense;

(23) c) They obtain or seek to obtain a benefit in exchange for refraining from informing their superiors of facts that probably may constitute an offense;

(23) d) They order or incite their subordinates to alter reports with the aim of hiding facts that probably may constitute an offense, or

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(23) e) Incite or order not to file the corresponding petition, to those who are authorized to do so.

(45) Article 101 Bis 1.- The crimes provided for in this Law shall only admit intentional commission. The criminal action in the crimes provided for in this Law, prosecutable upon request by the Secretariat of Finance and Public Credit, the credit auxiliary organization, exchange house, or regulated multiple-object financial society offended, or by anyone with a legal interest, shall prescribe in three years counted from the day that said Secretariat, the credit auxiliary organizations, exchange houses, or regulated multiple-object financial societies, have knowledge of the crime and the offender, and if they do not have that knowledge, in five years which shall be computed from the date of the commission of the crime. In other cases, the rules of the Federal Penal Code shall apply.

(23) Article 101 Bis 2.- A penalty of three to fifteen years imprisonment shall be imposed on a member of the board of directors, official, or employee of a credit auxiliary organization or exchange house, who, directly or through an intermediary, gives or offers money or any other thing to a public servant of the National Banking and Securities Commission, to do or omit a specific act related to their functions.

(23) The same penalty shall be imposed on a public servant of the National Banking and Securities Commission, who, directly or through an intermediary, solicits for themselves or for another, money or any other thing, to do or refrain from doing any act related to their functions.

(46) Chapter III
(46) On Notifications
(46) Article 101 Bis 3.- Notifications of requirements, ordinary and special inspection visits, precautionary measures, requests for information and documentation, summons, citations, resolutions imposing administrative sanctions or of any act that puts an end to suspension procedures, revocation of authorizations referred to in this Law, as well as acts that deny the authorizations referred to in this Law and administrative resolutions regarding review appeals and forgiveness requests filed in accordance with applicable laws, may be carried out in the following ways:

(46) I. Personally, as follows:
(46) a) In the offices of the financial authorities, in accordance with what is provided in Article 101 Bis 6 of this Law.
(46) b) At the domicile of the interested party or their representative, in terms of what is provided in Articles 101 Bis 7 and 101 Bis 10 of this Law.
(46) c) In any place where the interested party or their representative is found, in the circumstances established in Article 101 Bis 8 of this Law.
(46) II. By letter delivered by messenger or by certified mail, both with receipt acknowledgment; (46) III. By edicts, in the cases indicated in Article 101 Bis 11 of this Law, and (46) IV. By electronic means, in the case provided for in Article 101 Bis 12 of this Law.

(46) Regarding the information and documentation that must be presented to inspectors of the National Banking and Securities Commission under an inspection visit, the provisions of the regulation issued by the Federal Executive, in matters of supervision, under what is established in Article 5, first paragraph of the Law of the National Banking and Securities Commission, shall be observed.

(46) For the purposes of this Chapter, financial authorities shall be understood to be the Secretariat, the National Banking and Securities Commission, the Bank of Mexico, and the National Commission for the Protection and Defense of Users of Financial Services.

(46) Article 101 Bis 4.- Authorizations, revocations of authorizations requested by the interested party or their representative, acts resulting from procedures promoted at the request of the interested party, and other acts different from those indicated in Article 101 Bis 3 of this Law, may be notified by delivering the letter in which the corresponding act is stated, in the offices of the authority carrying out the notification, obtaining a copy of said letter with the signature and name of the person receiving it.

(46) Likewise, financial authorities may carry out such notifications by ordinary mail, telegram, fax, email, or messenger when the interested party or their representative requests it in writing indicating the necessary data to receive the notification, leaving a record in the respective file of the date and time it was carried out.

(46) Also, the acts referred to in the first paragraph of this article may be notified by any of the notification methods indicated in Article 101 Bis 3 of this Law.

(46) Article 101 Bis 5.- Notifications of investigation visits and the declaration of intervention referred to in this Law shall be carried out in a single act and in accordance with what is provided in the regulation referred to in the penultimate paragraph of Article 101 Bis 3 of this Law.

(46) Article 101 Bis 6.- Personal notifications may be carried out in the offices of the financial authorities only when the interested party or their representative attends and manifests their agreement to receive notifications; for which the person carrying out the notification shall draw up a duplicate record that complies with the regulation applicable to this type of act.

(46) Article 101 Bis 7.- Personal notifications may also be carried out with the interested party or their representative, at the last domicile they had provided to the corresponding financial authority or at the last domicile they had indicated before said authority in the administrative procedure in question, for which a record shall be drawn up in the terms referred to in the penultimate paragraph of this article.

(46) In the event that the interested party or their representative is not found at the mentioned domicile, the person carrying out the notification shall deliver a summons to the person attending the diligence, so that the interested party or their representative waits at a fixed time on the next business day, and in such summons, the cited person shall be warned that if they do not appear at the fixed time and day, the notification will be carried out with the person attending or that in case the domicile is found closed or if they refuse to receive the respective notification, it will be made by instruction as provided in Article 101 Bis 10 of this Law. The person carrying out the notification shall draw up a record in the terms provided in the penultimate paragraph of this article.

(46) The aforementioned summons shall be drawn up in duplicate and addressed to the interested party or their representative, indicating the place and date of issuance, the fixed date and time they must wait for the notifier, who shall record their name, position, and signature on said summons, the purpose of the appearance and the respective warning, as well as the name and signature of the person receiving it. In case the latter does not wish to sign, such circumstance shall be recorded in the summons, without affecting its validity.

(46) On the day and hour fixed for the practice of the diligence subject of the summons, the person in charge of carrying out the diligence shall appear at the corresponding domicile, and finding the cited person present, shall proceed to draw up a record in the terms referred to in the penultimate paragraph of this article.

(46) In the event that the cited person does not appear, the notification shall be understood with any person found at the domicile where the diligence is carried out; for such purposes, a record shall be drawn up in the terms of this article.

(46) In all cases, the person carrying out the notification shall draw up a duplicate record in which they shall state, in addition to the circumstances mentioned above, their name, position, and signature, that they ensured they constituted themselves and appeared at the searched domicile, that they notified the interested party, their representative, or the person who attended the diligence, after identification of such persons, the letter in which the administrative act to be notified is stated, they shall also state the designation of the witnesses, the place, hour, and date of drawing up, identification data of the mentioned letter, the identification means exhibited, name of the interested party, legal representative, or person who attended the diligence, and of the designated witnesses. If the persons involved refuse to sign or receive the notification record, such circumstance shall be recorded in the record, without this affecting its validity.

(46) For the designation of witnesses, the person carrying out the notification shall request the interested party, their representative, or the person attending the diligence to designate them; in case of refusal or if the designated witnesses do not accept the designation, the notifier themselves shall do so.

(46) Article 101 Bis 8.- In the event that the person in charge of carrying out the notification searches for the interested party or their representative at the domicile referred to in the first paragraph of Article 101 Bis 7 of this Law, and the person with whom the diligence is understood denies that it is the domicile of said interested party or their representative, the person carrying out the diligence shall draw up a record to state such circumstance. Such record must meet, insofar as applicable, the requirements provided in the penultimate paragraph of Article 101 Bis 7 of this legal instrument.

(46) In the case provided for in this provision, the person carrying out the notification may carry out personal notification in any place where the interested party or their representative is found. For the purposes of this notification, the person carrying it out shall draw up a record stating that the notified person is known to them personally or has been identified by two witnesses, in addition to recording, insofar as applicable, what is provided in the penultimate paragraph of the aforementioned Article 101 Bis 7, or to state the diligence before a public notary.

(46) Article 101 Bis 9.- Notifications carried out by letter delivered by messenger or by certified mail, with receipt acknowledgment, shall take effect on the next business day after that which appears as the receipt date in said acknowledgment.

(46) Article 101 Bis 10.- In the event that on the day and hour indicated in the summons left in accordance with Article 101 Bis 7 of this Law, the person carrying out the notification finds the corresponding domicile closed or the interested party, their representative, or the person attending the diligence refuses to receive the letter subject of the notification, the warning indicated in the aforementioned summons shall be enforced. For such purposes, they shall carry out the notification, by instruction that they will fix in a visible place of the domicile, attaching the letter in which the act to be notified is stated, in the presence of two witnesses designated for that purpose.

(46) The aforementioned instruction shall be drawn up in duplicate and addressed to the interested party or their representative. In said instruction, the circumstances that made it necessary to carry out the notification by that means, place and date of issuance; the name, position, and signature of the person drawing up the instruction; the name, identification data, and signature of the witnesses; the mention that the person carrying out the notification ensured they constituted themselves and appeared at the searched domicile, and the identification data of the letter in which the administrative act to be notified is stated, shall be recorded.

(46) The instruction shall serve as proof of the existence of the acts, facts, or omissions recorded in it.

(46) Article 101 Bis 11.- Notifications by edicts shall be carried out in the event that the interested party has disappeared, has died, their domicile is unknown or there is impossibility of accessing it, and they do not have a known representative or domicile in national territory or are abroad without having left a representative.

(46) For such purposes, a summary of the respective letter shall be published three consecutive times in a newspaper of national circulation, without prejudice to the financial authority notifying disseminating the edict on the electronic page of the worldwide network known as Internet corresponding to the financial authority notifying; indicating that the original letter is available at the domicile which will also be indicated in said edict.

(46) Article 101 Bis 12.- Notifications by electronic means, with receipt acknowledgment, may be carried out provided that the interested party or their representative has expressly accepted or requested it in writing to the financial authorities through the automated systems and security mechanisms established by them.

(46) Article 101 Bis 13.- Notifications that are not carried out in accordance with this Chapter shall be understood as legally made and shall take effect on the next business day after that in which the interested party or their representative manifest they are aware of their content.

(46) Article 101 Bis 14.- For the purposes of this Law, the domicile for hearing and receiving notifications related to acts relative to the performance of their role as members of the board of directors, general managers, commissioners, directors, managers, officials, fiduciary delegates, executives occupying the hierarchy immediately below that of the general manager, and other persons who can obligate with their signature to the financial entities and societies regulated by this Law, shall be that of the place where the financial entity to which they provide their services is located, unless said persons indicate in writing to the Secretariat of Finance and Public Credit or to the National Banking and Securities Commission a different domicile, which must be located within national territory.

(46) In the cases indicated in the preceding paragraph, the notification may be carried out with any person found at the aforementioned domicile.

(46) For what is provided in this article, the domicile of the financial entity or society shall be considered the last one provided to the Secretariat of Finance and Public Credit or the National Banking and Securities Commission or in the administrative procedure in question.

(46) Article 101 Bis 15.- The notifications referred to in this chapter shall take effect on the next business day to that:
(46) I. They have been carried out personally; (46) II. The respective letter has been delivered in the cases provided for in Articles 101 Bis 4 and 101 Bis 12; (46) III. The last publication referred to in Article 101 Bis 11 has been carried out, and (46) IV. It has been carried out by ordinary mail, telegram, fax, electronic medium, or messenger.

(3) Title Seventh
On the Protection of Public Interests
(21) Article 102.- Repealed.
(21) Article 103.- Repealed.

TRANSITORY PROVISIONS
(Decree of the General Law of Organizations and Activities Auxiliary to Credit of December 20, 1984, published in the Official Gazette of the Federation on January 14, 1985)

FIRST.- This Law shall enter into force the day following its publication in the Official Gazette of the Federation.

SECOND.- The General Law of Credit Institutions and Auxiliary Organizations, published in the Official Gazette of the Federation on May 31, 1941, is repealed, insofar as it concerns auxiliary credit organizations and the activity of persons or societies dedicated to foreign currency exchange operations.

Societies that enjoy a concession in accordance with the repealed Law shall be deemed conceded to operate in accordance with the terms of this Law, according to the type of credit auxiliary organization that corresponds.

THIRD.- Persons or societies dedicated to foreign currency exchange operations that currently operate with the approval of the Secretariat of Finance and Public Credit, that comply with what is established in this Law, and submit their application within a period of one hundred twenty business days, counted from the date it enters into force, shall receive the authorization referred to in this Law, prior to verification before the Secretariat of Finance and Public Credit, of compliance with the corresponding requirements. Those who habitually and professionally carry out purchase, sale, and exchange of currency operations, without the approval of said Secretariat, must request the authorization of said Secretariat within a period not exceeding thirty business days, complying with the requirements indicated for that purpose.

The lack of the applications referred to in this provision shall give rise to the application to those found in such circumstances, the fine provided for in Article 92 in relation to Article 81 of this Law, and the negotiation shall be administratively closed by the National Banking and Insurance Commission.

FOURTH.- Until the Secretariat of Finance and Public Credit issues the general provisions referred to in Article 82, fraction IV of this Law, the minimum paid capital that societies intending to operate as exchange houses must have shall be one million pesos national currency.

FIFTH.- For the processing of infractions related to credit auxiliary organizations committed during the validity of the General Law of Credit Institutions and Auxiliary Organizations, the provisions of the previously applicable texts of this Law shall continue to be observed.

SIXTH.- Credit auxiliary organizations shall be subject to the current (sic) administrative provisions emanating from the General Law of Credit Institutions and Auxiliary Organizations, applicable to credit auxiliary organizations.

SEVENTH.- The references that in other laws or legal provisions are made to the provisions of the General Law of Credit Institutions and Auxiliary Organizations, regarding credit auxiliary organizations and the activity of persons or societies dedicated to foreign currency exchange operations, shall be understood as referring to the applicable provisions of this Law and to the credit auxiliary organizations and exchange houses, provided for therein.

Mexico, D.F., December 20, 1984.- Enrique Soto Izquierdo, D.P.- Celso Humberto Delgado Ramírez, S.P.- Arturo Contreras Cuevas, D.S.- Rafael Armando Herrera Morales, S.S.- "Rubbings".

In compliance with what is provided for in Fraction I of Article 89 of the Political Constitution of the United Mexican States and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-first day of the month of December of one thousand nine hundred eighty-four.- Miguel de la Madrid H. - Rubbing.- The Secretary of Finance and Public Credit, Jesús Silva Herzog Flores.- Rubbing.- The Secretary of the Interior, Manuel Bartlett D.- Rubbing.

TRANSITORY PROVISION
(Decree that reforms and adds various provisions of the General Law of Organizations and Activities Auxiliary to Credit of December 17, 1986, published in the Official Gazette of the Federation on December 26, 1986)

UNIQUE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Mexico, D.F., December 17, 1986.- Dip. Reyes Rodolfo Flores Z., President.- Sen. Gonzalo Martínez Corbalá, President.- Dip. Eliseo Rodríguez Ramírez, Secretary.- Sen. Héctor Vázquez Paredes, Secretary.- "Rubbings".

In compliance with what is provided for in fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the eighteenth day of the month of December of one thousand nine hundred eighty-six.- Miguel de la Madrid H. - Rubbing.- The Secretary of the Interior, Manuel Bartlett D.- Rubbing

TRANSITORIOS
(Decree amending, adding, and repealing various provisions of the General Law of Credit Organizations and Auxiliary Activities of December 28, 1989, published in the Official Gazette of the Federation on January 3, 1990)

ARTICLE ONE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

ARTICLE TWO.- Provisions that conflict with what is provided for in this Decree are repealed.

ARTICLE THREE.- General deposit warehouses, financial lessors, and credit unions that, on the date this Decree enters into force, hold a concession to operate under that status, shall be deemed authorized to continue operating in accordance with the terms established by the General Law of Credit Organizations and Auxiliary Activities.

Within a period of 180 days counted from the date this Decree enters into force, these auxiliary credit organizations must, where applicable, modify their corporate bylaws and request from the Secretariat of Finance and Public Credit, and in the case of credit unions, from the National Banking Commission, the adaptation to the terms of this Decree.

ARTICLE FOUR.- Financial lessors that, on the date this Decree enters into force, do not reach the book capital determined in accordance with Article 37-B of the Law, to comply with the same, shall enjoy the period specified by the Secretariat of Finance and Public Credit, through general rules, considering the magnitude of the adjustments that lessors must make.

ARTICLE FIVE.- Companies that enter into contracts with the characteristics indicated by Article 45-A, fraction I of the General Law of Credit Organizations and Auxiliary Activities, must request the corresponding authorization from the Secretariat of Finance and Public Credit within a period of 90 business days following the commencement of the validity of this Decree. Companies that do not present such request and those to which authorization is denied must modify their corporate purpose or proceed to their early dissolution and liquidation; the National Banking Commission must, in such case, act in accordance with the terms of Article 64 of the Law.

ARTICLE SIX.- Until the Secretariat of Finance and Public Credit, the National Banking Commission, or the Bank of Mexico, respectively, issue the general provisions mentioned in the reforms or additions that are the subject of this Decree in the points to which such general provisions refer, the previously applicable texts to the Law shall continue to be observed.

Mexico, D.F., December 28, 1989.- Deputy José Luis Lamadrid Sauza, President.- Senator Alfonso Martínez Domínguez, President.- Deputy Guadalupe Gómez Maganda de Anaya, Secretary.- Senator Oscar Ramírez Mijares, Secretary.- Signatures.”

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its proper publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-eighth day of the month of December of one thousand nine hundred and eighty-nine.- Carlos Salinas de Gortari.- Signature.- The Secretary of the Interior, Fernando Gutiérrez Barrios.- Signature.

TRANSITORIOS
(Decree amending and adding various provisions of the General Law of Credit Organizations and Auxiliary Activities of December 18, 1991, published in the Official Gazette of the Federation on December 27, 1991)

ARTICLE ONE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

ARTICLE TWO.- Provisions that conflict with what is provided for in this Decree are repealed.

ARTICLE THREE.- Administrators of savings banks must request, where applicable, from the Secretariat of Finance and Public Credit, authorization to constitute and operate as a savings and loan company within a period of 360 days following the commencement of the validity of this Decree. Persons who do not present such request or those to whom authorization is denied must refrain from carrying out such operations, and the National Banking Commission must, in such case, act in accordance with the terms of Article 64 of the Law.

ARTICLE FOUR.- Anonymous companies that, prior to the date of entry into force of this Decree, hold authorization from the Secretariat of Finance and Public Credit to operate as exchange houses and wish to continue operating, shall have a period of 90 calendar days, counted from the publication in the Official Gazette of the Federation of this Decree, to present to the Secretariat the first testimony and two copies of the notarization of the minutes of the extraordinary general meeting of shareholders in which it is stated that the minimum paid-in social capital of the company is increased to at least $6,000,000,000.00 (SIX BILLION PESOS 00/100 M.N.), in accordance with the general provisions in force issued for this purpose by the Secretariat of Finance and Public Credit. Likewise, within such period, exchange houses must comply with the provisions amended in this Decree or, otherwise, must remove the word “Exchange House” from their corporate bylaws and modify their corporate purpose in accordance with the provisions of Article 81-A of this Law.

ARTICLE FIVE.- Authorization requests referred to in Article 81 of this Law that are pending resolution shall be considered not presented if, within a period of 180 calendar days counted from the date this Decree enters into force, they do not comply with what is provided in Article 82, fraction I, of this Law.

ARTICLE SIX.- Shareholders of exchange houses who, upon the entry into force of this Decree, hold a shareholding participation greater than the percentage indicated in fraction IV of Article 82 of this Law, may retain their excess participation, but may not acquire in any case new shares, even in the event of subsequent capital increases, until they do not exceed the percentage referred to in the Law.

Mexico, D.F., December 18, 1991.- Deputy Rigoberto Ochoa Zaragoza, President.- Senator Artemio Iglesias Miramontes, President.- Deputy Irma Piñeiro Arias, Secretary.- Senator Alger León Moreno, Secretary.- Signatures.”

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States and for its proper publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twentieth day of the month of December of one thousand nine hundred and ninety-one.- Carlos Salinas de Gortari.- Signature.- The Secretary of the Interior, Fernando Gutiérrez Barrios.- Signature.

TRANSITORIOS
(Decree amending, adding, and repealing various provisions of the General Law of Credit Organizations and Auxiliary Activities of July 1, 1993, published in the Official Gazette of the Federation on July 15, 1993)

FIRST.- This Decree shall enter into force the day following the date of its publication in the Official Gazette of the Federation.

SECOND.- Provisions that conflict with what is provided for in this Decree are repealed.

THIRD.- Financial factoring companies shall have a period of thirty business days to comply with what is provided in the first paragraph of Article 45-K, counted from the entry into force of this Decree.

FOURTH.- Financial lessors and financial factoring companies that, on the date of entry into force of this Decree, have issued national currency securities indicated in Bank of Mexico Circular 1/91, for liabilities derived from the placement of such securities, shall continue to maintain the liquidity coefficient indicated in rules five, nine, and thirteenth, or in rules six, tenth, and fourteenth, depending on whether they are financial lessors or financial factoring companies, until the maturity of the respective securities. Such entities shall not be obligated to maintain the aforementioned coefficient when they have an opinion issued by a securities rating institution, regarding the issuance in question, made prior to the date of entry into force of this Decree.

FIFTH.- Subordinated obligations not convertible into securities representing capital or voluntary conversion into such securities, which financial lessors and financial factoring companies have issued in accordance with Bank of Mexico Circular 1/91, shall continue to be governed until their maturity, in accordance with the originally agreed terms, without any renewal being permitted.

SIXTH.- Persons who have committed offenses or crimes, including those prosecuted or sentenced, prior to the entry into force of this Decree, shall be subject to the sanctions in force at the time such conduct was carried out, without prejudice to applying, where applicable, what is provided in Article 56 of the Penal Code for the Federal District in matters of Common Jurisdiction, and for the entire Republic in matters of Federal Jurisdiction.

Mexico, D.F., July 1, 1993.- Senator Mauricio Valdés Rodríguez, President.- Deputy Liliana Flores Benavides, President.- Senator Gustavo Salinas Iñiguez, Secretary.- Deputy Diego Velázquez Duarte, Secretary.- Signatures.”

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States and for its proper publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twelfth day of the month of July of 1993.- Carlos Salinas de Gortari.- Signature.- The Secretary of the Interior, José Patrocinio González Blanco Garrido.- Signature.

TRANSITORIOS
(Decree amending, adding, and repealing various provisions of the Law to Regulate Financial Groups, Law of Credit Institutions, General Law of Credit Organizations and Auxiliary Activities, Securities Market Law, Investment Companies Law, General Law of Insurance and Mutual Insurance Institutions, and Federal Law of Surety Institutions of December 14, 1993, published in the Official Gazette of the Federation on December 23, 1993)

FIRST.- This Decree shall enter into force on January 1, 1994.

SECOND.- The Secretariat of Finance and Public Credit shall authorize the individual capital limit that each Subsidiary may reach, as well as the aggregate limit that Subsidiaries of the same type may reach collectively, in accordance with applicable international treaties or agreements.

THIRD.- Acquisitions by Subsidiaries, Foreign Financial Institutions, or Controlling Subsidiary Companies of shares in financial intermediaries, in whose capital Mexican investors participate predominantly, or of shares in Subsidiaries or Controlling Subsidiary Companies, shall be subject to the individual and aggregate capital limits that applicable international treaties or agreements establish, where applicable.

FOURTH.- When a Subsidiary reaches ninety percent of the authorized individual capital limit, it must notify this fact to the Secretariat of Finance and Public Credit within five business days following.

Failure to comply with the obligation referred to in the preceding paragraph shall be sanctioned by the competent National Commission, after a hearing, with a fine of up to 2,500 minimum wage days for each day of delay in the corresponding notification.

FIFTH.- When a Subsidiary exceeds the authorized individual capital limit, the Secretariat of Finance and Public Credit shall be empowered to establish a capital reduction program so that, within a determined period, it adjusts to said limit. In any case, to comply with applicable capitalization requirements, the lesser of the authorized individual capital limit and the actual capital held by the Subsidiary in question shall be taken into account.

When the authorized individual capital limit is exceeded, the competent National Commission shall be empowered to remove, suspend, or impose a veto on members of the board of directors, general managers, auditors, directors, managers, and officials who may obligate the company with their signature, after a hearing, in accordance with the procedure established in the applicable law.

If the infringement of the provisions of the preceding paragraph is repeated, or if the Subsidiary does not comply with the capital reduction program referred to in the first paragraph of this article, the revocation of the authorization to constitute and operate a Subsidiary or a Controlling Subsidiary Company may be declared, after a hearing, in accordance with the terms established in the applicable law.

SIXTH.- The granting of authorizations to organize and operate as Subsidiaries, as well as to register in the Intermediaries Section of the National Registry of Securities and Intermediaries, may be suspended when the aggregate limits on the participation of Foreign Financial Institutions have been reached, or when the safeguard clauses established by the applicable treaty or international agreement apply.

SEVENTH.- The individual and aggregate limits applicable to Subsidiaries that applicable international treaties or agreements establish, where applicable, shall be calculated based on the information provided by the competent National Commission and by the Bank of Mexico, in accordance with the rules for the establishment of Subsidiaries.

EIGHTH.- In the case of multiple banking institution Subsidiaries, individual and aggregate capital limits shall be fixed based on the net capital of all multiple banking institutions established in Mexico on the calculation date.

NINTH.- In the case of limited-object financial company Subsidiaries, individual and aggregate limits shall be fixed based on the sum of the assets of all multiple banking institutions and limited-object financial companies established in Mexico on the calculation date.

TENTH.- In the case of Subsidiary companies registered in the Intermediaries Section of the National Registry of Securities and Intermediaries, individual and aggregate capital limits shall be fixed based on the global capital of all institutions of the same type established in Mexico on the calculation date.

ELEVENTH.- In the case of auxiliary credit organizations, exchange house Subsidiaries, and surety institution Subsidiaries, individual and aggregate capital limits shall be fixed based on the sum of the book capital of all institutions of the same type established in Mexico on the calculation date.

TWELFTH.- The individual and aggregate capital limits applicable to insurance institutions shall be fixed based on the amount of gross solvency requirement needed by insurance institutions. Such gross solvency requirement shall correspond to the minimum guarantee capital established, according to the rules issued by the Secretariat of Finance and Public Credit under Article 60 of the General Law of Insurance and Mutual Insurance Institutions, and shall be considered separately for life, accident, and illness operations on one hand, and damage operations, considering each of their branches, on the other.

THIRTEENTH.- Notwithstanding what is provided in Article 29, fraction II of the General Law of Insurance and Mutual Insurance Institutions, Foreign Financial Institutions may acquire, prior to authorization of an investment program by the Secretariat of Finance and Public Credit, hearing the opinion of the National Insurance and Surety Commission, a shareholding participation in an insurance institution provided for in subsection a) of fraction I Bis, of Article 29 of the General Law of Insurance and Mutual Insurance Institutions, whether constituted or already established, in accordance with what is provided in applicable international treaties or agreements.

Foreign Financial Institutions that have investments in insurance institutions prior to the entry into force of the applicable treaty may increase these investments in accordance with said treaty.

The investments indicated in the two preceding paragraphs shall not be subject to individual and aggregate capital limits in accordance with the applicable international treaty or agreement.

Mexico, D.F., December 14, 1993.- Deputy Manuel Rivera del Campo, President.- Senator Eduardo Robledo Rincón, President.- Deputy Juan Adrían Ramírez García, Secretary.- Senator Israel Soberanis Nogueda, Secretary.- Signatures.”

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its proper publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the fifteenth day of the month of December of one thousand nine hundred and ninety-three.- Carlos Salinas de Gortari.- Signature.- The Secretary of the Interior, José Patrocinio González Blanco Garrido.- Signature.

TRANSITORIOS
(Decree amending, adding, and repealing various provisions of the Law of Credit Institutions, Securities Market Law, General Law of Credit Organizations and Auxiliary Activities, General Law of Insurance and Mutual Insurance Institutions, Federal Law of Surety Institutions, Bank of Mexico Law, and Federal Treasury Service Law of November 9, 1995, published in the Official Gazette of the Federation on November 17, 1995)

FIRST.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

SECOND.- What is provided in Article 118-A of the Law of Credit Institutions shall apply to contract models that serve as the basis for the celebration of contracts from the commencement of the validity of this Decree.

THIRD.- Credit institutions must establish the specialized units referred to in Article 118-B of the Law of Credit Institutions, within a maximum period of ninety days counted from the commencement of the validity of this Decree.

FOURTH.- Claims presented by users of banking and credit services before the National Banking and Securities Commission, prior to the commencement of the validity of this Decree, shall continue their processing until conclusion in accordance with the terms established by Articles 119 and 120 of the Law of Credit Institutions, which were in force at the time of their presentation.

FIFTH.- What is established in the second and third transitory articles of the Decree amending, adding, and repealing various provisions of the Law to Regulate Financial Groups, Law of Credit Institutions, General Law of Credit Organizations and Auxiliary Activities, Securities Market Law, Investment Companies Law, General Law of Insurance and Mutual Insurance Institutions, and Federal Law of Surety Institutions, published in the Official Gazette of the Federation on December 23, 1993, is not applicable to limited-object financial companies, financial lessors, financial factoring companies, and insurance institutions, subsidiaries, resulting from acquisitions authorized by the Secretariat of Finance and Public Credit.

SIXTH.- Limited-object financial companies, auxiliary credit organizations, exchange houses, insurance institutions, and surety institutions must, where applicable, carry out the acts

corporate necessary to adjust their statutes to what is provided by this Decree, within a maximum period of one hundred twenty days counted from the start of its validity.

SEVENTH.- The Law on the Surveillance Service of Funds and Securities of the Federation, published in the Official Gazette of the Federation on December 31, 1959, is hereby repealed; however, it will continue to apply regarding infractions and offenses that may have been committed during the validity of said regulation.

EIGHTH.- The provisions of the Regulations of the Law on the Surveillance Service of Funds and Securities of the Federation will remain in force until such time as they are reformed, insofar as applicable, by the Regulations of the Law on the Treasury Service of the Federation.

NINTH.- The provisions of articles 25, 26, 27, and 28 of the Law on the Treasury Service of the Federation will apply to requests for the cession of goods or services in payment that are submitted from the date of entry into force of this Decree.

Mexico, D.F., November 9, 1995.- Deputy Regina Reyes Retana Márquez, President.- Senator Ernesto Navarro González, President.- Deputy Alejandro Torres Aguilar, Secretary.- Senator Raúl Juárez Valencia, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the fifteenth day of the month of November of nineteen hundred ninety-five.- Ernesto Zedillo Ponce de León.- Signature.- The Secretary of the Interior, Emilio Chuayffet Chemor.- Signature.

TRANSITIONAL PROVISIONS
(Decree reforming, adding, and repealing various provisions of the Law to Regulate Financial Groups, the Law of Credit Institutions, the Securities Market Law, and the General Law of Organizations and Auxiliary Credit Activities of April 17, 1996, published in the Official Gazette of the Federation on April 30, 1996)

ARTICLE FIRST.- This Decree will enter into force the day following its publication in the Official Gazette of the Federation.

ARTICLE SECOND.- Until the Ministry of Finance and Public Credit issues the general provisions referred to in the second paragraph of fraction I of article 15 of the General Law of Organizations and Auxiliary Credit Activities, the previously applicable text will continue to be observed.

Mexico, D.F., April 17, 1996.- Deputy Ma. Claudia Esqueda Llanes, President.- Senator Miguel Alemán Velasco, President.- Deputy Jesús Carlos Hernández Martínez, Secretary.- Senator Humberto Mayans Canabal, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-sixth day of the month of April of nineteen hundred ninety-six.- Ernesto Zedillo Ponce de León.- Signature.- The Secretary of the Interior, Emilio Chuayffet Chemor.- Signature.

TRANSITIONAL PROVISIONS
(Decree reforming various Financial Laws of April 24, 1997, published in the Official Gazette of the Federation on May 7, 1997)

FIRST.- This Decree will enter into force the day following its publication in the Official Gazette of the Federation.

SECOND.- The general provisions that the Ministry of Finance and Public Credit has issued under the validity of the articles reformed in this Decree will remain in force until they are modified, repealed, or abrogated by the same dependency.

Mexico, D.F., April 24, 1997.- Senator Judith Murguía Corral, President.- Deputy Mara Nadiezhda Robles Villaseñor, President.- Senator José Luis Medina Aguilar, Secretary.- Deputy Gladys Merlín Castro, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the sixth day of the month of May of nineteen hundred ninety-seven.- Ernesto Zedillo Ponce de León.- Signature.- The Secretary of the Interior.- Emilio Chuayffet Chemor.- Signature.

TRANSITIONAL PROVISIONS
(Decree of the Law of Protection and Defense of Users of Financial Services of December 13, 1998, published in the Official Gazette of the Federation on January 18, 1999)

FIRST.- This Law will enter into force ninety days after its publication in the Official Gazette of the Federation.

SECOND.- Articles 119 and 120 of the Law of Credit Institutions; 102 and 103 of the General Law of Organizations and Auxiliary Credit Activities; 87 and 88 of the Securities Market Law; 45 of the Investment Companies Law; fraction XI of article 108 of the General Law of Insurance and Mutual Societies; fraction XII of article 5, 109, and 110 of the Retirement Savings Systems Law, and fraction X of article 4 of the Law of the National Banking and Securities Commission are hereby repealed, as well as any other provisions that oppose this Law.

THIRD.- For the purposes of articles 72 and 83 of this Law, references to the National Commission of Insurance and Sureties in articles 135 and 136 of the General Law of Insurance and Mutual Societies, and 93 and 94 of the Federal Law of Surety Institutions, shall be understood as referring to the National Commission for the Defense of Users of Financial Services.

FOURTH.- The procedures that the National Commissions carry out to protect the interests of the public individually, and which as of the date of entry into force of this Law are ongoing, will be concluded definitively by the National Commission, in accordance with the provisions that were in force at the time the procedure began.

FIFTH.- The Ministry will carry out the necessary procedures and actions so that the human, material, and financial resources of the National Commissions, related to the powers attributed to the National Commission by this Law, are transferred to the same (sic). This transfer will include furniture, vehicles, instruments, devices, machinery, files, and, in general, the equipment that the National Commissions have used to attend to matters under their charge.

SIXTH.- The personnel of the National Commissions who, under the application of this Law, become part of the National Commission, shall in no way be affected in their acquired labor rights.

SEVENTH.- The Register of Financial Service Providers referred to in Title Four, Chapter I, of this Law, must be constituted within the six months following the date on which this Law enters into force.

EIGHTH.- The Ministry will carry out the necessary procedures so that the National Commission is included (sic) in the Expenditure Budget of the Federation for the fiscal year 1999.

NINTH.- The installation of the first Board of Directors referred to in article 16 must be concretized in the following terms:

I. The Ministry, the Bank of Mexico, and the National Commissions must designate their representatives, and the Secretary of Finance and Public Credit the President of the Commission;
II. The representatives referred to in the preceding fraction must issue the bases upon which the integration and installation of the National Advisory Council will proceed, within a period not exceeding 30 days; and
III. The members of the Board of Directors referred to in fraction I of this article must proceed to integrate the National Advisory Council, in accordance with the bases established in the preceding fraction, within a period not exceeding fifteen days from the issuance of the bases referred to in fraction II of this article, and said Advisory Council will designate the members thereof, who will form part of the Board of Directors.

TENTH.- All provisions that oppose this Law are hereby repealed.

Mexico, D.F., December 13, 1998.- Deputy Luis Patiño Pozas, President.- Senator José Ramírez Gamero, President.- Deputy Espiridión Sánchez López, Secretary.- Senator Gabriel Covarrubias Ibarra, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the thirty-first day of the month of December of nineteen hundred ninety-eight.- Ernesto Zedillo Ponce de León.- Signature.- The Secretary of the Interior, Francisco Labastida Ochoa.- Signature.

TRANSITIONAL PROVISIONS
(Decree reforming, adding, and repealing various provisions of the Law of Credit Institutions, the General Law of Organizations and Auxiliary Credit Activities, the Federal Law of Surety Institutions, the General Law of Insurance and Mutual Societies, the Securities Market Law, the Retirement Savings Systems Law, and the Federal Code of Criminal Procedures of April 30, 1999, published in the Official Gazette of the Federation on May 17, 1999)

FIRST.- This Decree will enter into force the day following its publication in the Official Gazette of the Federation.

SECOND.- Not Applicable.

Mexico, D.F., April 30, 1999.- Deputy Juan Moisés Calleja Castañón, President.- Senator Héctor Ximénez González, President.- Deputy Germán Ramírez López, Secretary.- Senator Sonia Alcántara Magos, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the thirteenth day of the month of May of nineteen hundred ninety-nine.- Ernesto Zedillo Ponce de León.- Signature.- The Secretary of the Interior, Francisco Labastida Ochoa.- Signature.

TRANSITIONAL PROVISION
(Decree reforming fraction IV and adding fraction V to article 81-A of the General Law of Organizations and Auxiliary Credit Activities of December 13, 1999, published in the Official Gazette of the Federation on January 5, 2000)

SINGLE.- This Decree will enter into force the day following its publication in the Official Gazette of the Federation.

Mexico, D.F., December 13, 1999.- Deputy Francisco José Paoli Bolio, President.- Senator Dionisio Pérez Jácome, Vice President acting.- Deputy Francisco J. Loyo Ramos, Secretary.- Senator Raúl Juárez Valencia, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-ninth day of the month of December of nineteen hundred ninety-nine.- Ernesto Zedillo Ponce de León.- Signature.- The Secretary of the Interior, Diódoro Carrasco Altamirano.- Signature.

TRANSITIONAL PROVISION
(Decree issuing the Law creating the Trust that will administer the Fund for the Strengthening of Savings and Loan Cooperatives and Support for their Savers, and adding article 51-B of the General Law of Organizations and Auxiliary Credit Activities of December 21, 2000, published in the Official Gazette of the Federation on December 29, 2000)

SINGLE.- The addition to article 51-B of the Law mentioned in the previous article will enter into force the day following its publication in the Official Gazette of the Federation.

Mexico, D.F., December 21, 2000.- Deputy Ricardo García Cervantes, President.- Senator Enrique Jackson Ramírez, President.- Deputy Manuel Medellín Milán, Secretary.- Senator Sara Castellanos Cortés, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-seventh day of the month of December of two thousand.- Vicente Fox Quesada.- Signature.- The Secretary of the Interior, Santiago Creel Miranda.- Signature.

TRANSITIONAL PROVISIONS
(Decree reforming, adding, and repealing various provisions of the General Law of Organizations and Auxiliary Credit Activities of April 28, 2001, published in the Official Gazette of the Federation on June 1, 2001)

ARTICLE FIRST.- This Decree will enter into force the day following its publication in the Official Gazette of the Federation.

ARTICLE SECOND.- The provisions of Articles 5 Bis 1, 5 Bis 2, and 5 Bis 3 will enter into force on January 1, 2002.

Mexico, D.F., April 28, 2001.- Senator Enrique Jackson Ramírez, President.- Deputy Ricardo Francisco García Cervantes, President.- Senator Yolanda González Hernández, Secretary.- Deputy Manuel Medellín Milán, Secretary.- "Signatures".

In compliance with what is provided by fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the thirtieth day of the month of May of two thousand.- Vicente Fox Quesada.- Signature.- The Secretary of the Interior, Santiago Creel Miranda.- Signature.

TRANSITIONAL PROVISIONS
(Decree issuing the Popular Savings and Credit Law and reforming and repealing various provisions of the General Law of Organizations and Auxiliary Credit Activities and the General Law of Cooperative Societies of April 30, 2001, published in the Official Gazette of the Federation on June 4, 2001)

FIRST.- Article First of this Decree will enter into force the day following its publication in the Official Gazette of the Federation, with the exception of what is stated in the following Transitional Articles.

Article Second of this Decree will enter into force two years after its publication in the Official Gazette of the Federation.

Article Third of this Decree will enter into force the day following its publication in the Official Gazette of the Federation, with the exception of article 26 contained therein, which will enter into force two years after its publication in the Official Gazette of the Federation.

SECOND.- Savings and Loan Societies, Credit Unions, and Cooperatives that intend to be subject to the terms established in the Popular Savings and Credit Law must register with the National Banking and Securities Commission within a term not exceeding six months counted from the publication of this Decree in the Official Gazette of the Federation, manifesting for this purpose their name, denomination, address, number of members, and other data regarding their activity requested by said body.

THIRD.- Savings and Loan Societies, Credit Unions that capture savings deposits, as well as Savings and Loan Cooperatives and those that have savings and loan sections, constituted prior to the start of the validity of the Popular Savings and Credit Law, will have a period of two years from the date established in the first paragraph of the previous FIRST Transitional Article to request from the National Banking and Securities Commission authorization to operate as an Entity, subject to what is provided by the EIGHTH Transitional Article and must obtain a favorable opinion from a Federation, in accordance with what is provided by the Popular Savings and Credit Law.

Upon completion of the aforementioned period, societies and Credit Unions that have not obtained the referred authorization must refrain from capturing resources; otherwise, they will fall under the infractions provided by the Popular Savings and Credit Law and by the applicable provisions.

FOURTH.- Savings and loan societies and Credit Unions that capture savings deposits will continue to be subject to the supervision and surveillance of the National Banking and Securities Commission, in terms of what is established in the General Law of Organizations and Auxiliary Credit Activities, until such time as they are subject to what is stated in the THIRD Transitional Article.

FIFTH.- Integration Bodies that are authorized under the Popular Savings and Credit Law within a period of one year from the entry into force thereof, will have a period of two years from their authorization to comply with the minimum number of ten Entities and five Federated members, in terms of article 53 of said law, as applicable.

SIXTH.- Without prejudice to what is established in article 5 of the Popular Savings and Credit Law, the Federal Government may deliver resources to the Protection Funds as Entities are integrated into them and based on the amount of savers of the Entities. Such contribution will be made only once and through the mechanisms established for this purpose by the Ministry of Finance and Public Credit.

The resources referred to in the preceding paragraph will not be applicable to the Entities indicated in the fifth paragraph of article 105 of the Popular Savings and Credit Law.

SEVENTH.- Entities authorized in the first two years from the entry into force of the Popular Savings and Credit Law may use the resources of the Protection Fund, provided that they have made contributions during a period of 2 years.

Regarding those constituted after the first two years of entry into force of the Popular Savings and Credit Law, they may use the resources of the Protection Fund from the fourth year following the entry into force of the Popular Savings and Credit Law.

The provisions of this article must be included in the trust contract of the Protection Funds.

Entities must inform their Members, Clients, and the general public of the date from which the validity of the respective Protection Fund system will begin, in accordance with the preceding paragraph.

EIGHTH.- For the purposes of fraction I of article 53 of said Law, Federations that request their authorization within a period of two years counted from the entry into force of the Law, must present the documents in which, in the judgment of the National Banking and Securities Commission, the intention of at least ten societies that comply with the requirements of article 10, with the exception of fractions II and IX, to affiliate with said Federation is manifested.

NINTH.- From the date of start of validity established in the first paragraph of the FIRST Transitional Article, authorized Federations will administer the Protection Funds provisionally, until such time as these Federations become part of an authorized Confederation or agree with any of them the transfer of the resources that integrate said funds in terms of Chapter IV of Title Three of the Popular Savings and Credit Law.

Upon completion of a period of two years from the start of validity of the Popular Savings and Credit Law, Federations that do not fall under the circumstances contemplated in the preceding paragraph may request from the National Banking and Securities Commission an extension that may not exceed two years to continue administering the Protection Fund of their Entities; otherwise, they will fall under the cause for revocation provided by fraction IX of article 60 of the Popular Savings and Credit Law. In this latter case, the National Banking and Securities Commission, in accordance with the general provisions it issues for this purpose, will determine the destination of the resources that integrate the respective Protection Funds.

TENTH.- Upon the installation of the first board of directors of a Savings and Loan Cooperative Society in accordance with the terms provided in the Popular Savings and Credit Law, the elected councilors by the assembly who will serve in their capacity only during the first half of the duration period determined by the Entity will be determined by lot, in order to proceed in subsequent periods to the renewal by half of the board of directors.

When the number of members is odd, the excess member who will form part of the first half will be chosen by lot during the installation of the board of directors, in order to proceed in subsequent periods to the partial renewal thereof. In the case of the supervisory board, the same procedure will be followed.

ELEVENTH.- For the purposes of what is provided in articles 65 and 101 of the Popular Savings and Credit Law, a transition period will be established for Integration Bodies to adjust thereto, as follows:

I. During the first two years after obtaining the favorable opinion, their board of directors may be composed up to seventy-five percent of the total of its members, by councilors or officials of the Entity, Federation, or Confederation, as the case may be, and
II. From the second year until the end of the third year, this percentage will be reduced to fifty percent, and from the fourth year this percentage may be up to thirty percent.

TWELFTH.- The Federal Executive, through the Ministry of Finance and Public Credit, will take the pertinent measures and provide what is necessary in terms of the applicable provisions, so that the National Banking and Securities Commission and the National Commission for the Protection and Defense of Users of Financial Services are able to fulfill the functions conferred by the Popular Savings and Credit Law.

THIRTEENTH.- Authorization requests submitted to the Ministry of Finance and Public Credit to constitute and operate Savings and Loan Companies, which have not been resolved prior to the entry into force of the Popular Savings and Credit Law, shall be deemed resolved in the negative, whereupon the interested parties may initiate the procedure to obtain the authorization referred to in Article 9 of said Law.
The requests referred to in the preceding paragraph shall be returned to the interested parties by the Ministry of Finance and Public Credit, within a period not exceeding forty-five natural days counted from the publication of this Decree in the Official Gazette of the Federation.

FOURTEENTH.- During the two years following the entry into force of the Popular Savings and Credit Law, the National Banking and Securities Commission shall have a period of one hundred eighty natural days to issue the resolution referred to in Article 9 of the cited Law, regarding authorization requests for operating as an Entity that are sent to it by the Federations.

FIFTEENTH.- The National Banking and Securities Commission shall have a period of 180 natural days counted from the publication of this Decree to issue all rules and general provisions that must be formulated as indicated in the Popular Savings and Credit Law.

SIXTEENTH.- All provisions that conflict with this Law are repealed.

Mexico, D.F., April 30, 2001.- Dep. Ricardo García Cervantes, President.- Sen. Enrique Jackson Ramírez, President.- Dep. Manuel Medellín Milán, Secretary.- Sen. Yolanda González Hernández, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the thirty-first day of the month of May of two thousand one.- Vicente Fox Quesada.- Signature.- The Secretary of the Interior, Santiago Creel Miranda.- Signature.

TRANSITORY
(Decree by which various provisions of the General Law of Negotiable Instruments and Credit Operations, the Commercial Code, the Credit Institutions Law, the Securities Market Law, the General Law of Mutual Insurance Institutions and Companies, the Federal Law of Guarantee Institutions, and the General Law of Organizations and Auxiliary Credit Activities of April 24, 2003, published in the Official Gazette of the Federation on June 13, 2003, are reformed, added to, and repealed)

SINGLE ARTICLE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.
The provisions of this Decree shall not be applicable to credits contracted prior to the date of entry into force thereof, nor even in cases of novation or restructuring of credits.

Mexico, D.F., April 24, 2003.- Dep. Armando Salinas Torre, President.- Sen. Enrique Jackson Ramírez, President.- Dep. Ma. de las Nieves García Fernández, Secretary.- Sen. Sara I. Castellanos Cortés, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the residence of the Federal Executive Power, in Mexico City, Federal District, on the twelfth day of the month of June of two thousand three.- Vicente Fox Quesada.- Signature.- The Secretary of the Interior, Santiago Creel Miranda.- Signature.

TRANSITORY
(Decree by which various provisions of the Credit Institutions Law; the Popular Savings and Credit Law; the Savings for Retirement Systems Law; the Federal Law of Guarantee Institutions; the General Law of Mutual Insurance Institutions and Companies; the Securities Market Law; the Investment Societies Law, and the General Law of Organizations and Auxiliary Credit Activities of December 28, 2003, published in the Official Gazette of the Federation on January 28, 2004, are reformed and added to)

SINGLE ARTICLE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Mexico, D.F., December 28, 2003.- Sen. Enrique Jackson Ramírez, President.- Dep. Juan de Dios Castro Lozano, President.- Sen. Sara I. Castellanos Cortés, Secretary.- Dep. Ma. de Jesús Aguirre Maldonado, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-second day of the month of January of two thousand four.- Vicente Fox Quesada.- Signature.- The Secretary of the Interior, Santiago Creel Miranda.- Signature.

TRANSITORY PROVISIONS
(Decree by which various provisions of the General Law of Negotiable Instruments and Credit Operations, General Law of Organizations and Auxiliary Credit Activities, Credit Institutions Law, General Law of Mutual Insurance Institutions and Companies, Federal Law of Guarantee Institutions, Law to Regulate Financial Groupings, Popular Savings and Credit Law, Foreign Investment Law, Income Tax Law, Value Added Tax Law, and the Fiscal Code of the Federation, dated April 27, 2006, published in the Official Gazette of the Federation on July 18, 2006, are reformed, repealed, and added to)

FIRST.- The following shall enter into force the day following the publication of this Decree in the Official Gazette of the Federation:
I. Article One of this Decree;
II. The reforms to articles 4; 7 and 95 Bis, as well as to the identification of the Single Chapter of Title Fifth and the additions to Title Fifth with Chapter II, which includes articles 87-B to 87-Ñ, and to article 89 of the General Law of Organizations and Auxiliary Credit Activities, contained in Article Two of this Decree;
III. The reforms to articles 46 and 89, as well as the addition to article 73 Bis of the Credit Institutions Law, contained in Article Three of this Decree, and
IV. Articles Nine, Ten and Eleven of this Decree.
From the entry into force referred to in this article, financial leasing and financial factoring operations shall not be considered reserved for financial lessors and factoring companies, so that any person may enter into them in their capacity as lessor or factor, respectively, without having the authorization of the Ministry of Finance and Public Credit referred to in Article 5 of the General Law of Organizations and Auxiliary Credit Activities. Limited-object financial societies may continue to act as trustees in the trusts referred to in Article 395 of the General Law of Negotiable Instruments and Credit Operations until the authorizations granted to them by the Ministry of Finance and Public Credit cease to have effect, in terms of fraction IV of Article 103 of the Credit Institutions Law, unless they adopt the modality of multiple-object financial society, in which case they may continue in the performance of their fiduciary mandate.

SECOND.- Persons who, from the date of entry into force of the provisions referred to in the first transitory article of this Decree, carry out financial leasing and financial factoring operations, in their capacity as lessor or factor, respectively, without having the authorization of the Ministry of Finance and Public Credit referred to in Article 5 of the General Law of Organizations and Auxiliary Credit Activities, shall be subject to the applicable provisions of the General Law of Negotiable Instruments and Credit Operations regarding said operations. The regime provided by the General Law of Organizations and Auxiliary Credit Activities for financial lessors and factoring companies shall not be applicable to said persons. In financial leasing and financial factoring contracts entered into by the persons referred to in this article, they must expressly state that they do not have the authorization of the Ministry of Finance and Public Credit provided for in Article 5 of the General Law of Organizations and Auxiliary Credit Activities and that, except for regulated multiple-object financial societies, they are not subject to the supervision of the National Banking and Securities Commission. The same mention must be made in any type of information that the persons mentioned use for the purpose of promoting their services.

THIRD.- The reforms to articles 5, 8, 40, 45 Bis 3, 47, 48, 48-A, 48-B, 78, 96, 97, 98 and 99, as well as the repeal of articles 3 and 48 and of Chapter II of Title Second, which includes articles 24 to 38, of Chapter II Bis of Title Second, which includes articles 45-A to 45-T, of the General Law of Organizations and Auxiliary Credit Activities contained in Article Two of this Decree, shall enter into force seven years after the publication of this Decree in the Official Gazette of the Federation. From the date on which the reforms and repeals referred to in the preceding paragraph enter into force, the authorizations granted by the Ministry of Finance and Public Credit for the constitution and operation of financial leasing companies and factoring companies shall cease to have effect by operation of law, so that the societies having such status shall cease to be auxiliary credit organizations. The societies referred to in the preceding paragraph shall not be obliged to dissolve and liquidate by virtue of the fact that, in accordance with the provisions of the preceding paragraph, the respective authorizations cease to have effect, although, in order to continue operating, they must:
I. Reform their corporate bylaws to eliminate any express reference or inference that they are auxiliary credit organizations and that they are authorized by the Ministry of Finance and Public Credit to constitute and function with such status.
II. Present to the Ministry of Finance and Public Credit, no later than the date on which the reforms and repeals referred to in the first paragraph of this article enter into force, the public instrument in which the bylaw reform referred to in the preceding fraction is recorded, with the data of the respective registration in the Public Commerce Registry.
Societies that do not comply with the provisions of the preceding fraction II shall enter, by operation of law, into a state of dissolution and liquidation, without the need for a resolution of the general shareholders' meeting.
The Ministry of Finance and Public Credit, regardless of whether or not the requirements set forth in the preceding fractions are met, shall publish in the Official Gazette of the Federation that the authorizations referred to in this article have ceased to have effect.
The entry into force of the reforms and repeal referred to in this transitory article shall not affect the existence and validity of contracts previously entered into by those societies that had the status of financial leasing companies and factoring companies, nor shall it be a cause for ratification or validation of those contracts. Without prejudice to the foregoing, from the entry into force indicated in this article, the financial leasing and factoring contracts referred to in this paragraph shall be governed by the corresponding provisions of the General Law of Negotiable Instruments and Credit Operations.

In financial leasing and financial factoring contracts entered into by the societies after the date on which, in accordance with the provisions of this article, the respective authorizations granted to them by the Ministry of Finance and Public Credit cease to have effect, they must expressly state that they do not have authorization from the Ministry of Finance and Public Credit and that, except for regulated multiple-object financial societies, they are not subject to the supervision of the National Banking and Securities Commission. The same mention must be made in any type of information that the societies mentioned use for the purpose of promoting their services.

FOURTH.- The Ministry of Finance and Public Credit shall only process authorization requests, for the constitution and operation of financial leasing companies and factoring companies, in terms of the provisions of the General Law of Organizations and Auxiliary Credit Activities, that have been submitted before the date on which this Decree is published in the Official Gazette of the Federation. The authorizations, if any, granted shall only be valid until the date on which seven years have elapsed from the publication of this Decree in the Official Gazette of the Federation and shall be subject to the provisions of the preceding article.

FIFTH.- The reforms, additions, and repeals to articles 45-A, 45-B, 45-D, 45-I, 45-K, 45-N, 49, 85 BIS, 103, 108, 115 and 116 of the Credit Institutions Law contained in Article Three of this Decree shall enter into force seven years after the publication of this Decree in the Official Gazette of the Federation.
From the date on which the reforms and repeals referred to in the preceding paragraph enter into force, the authorizations granted by the Ministry of Finance and Public Credit, in terms of Article 103, fraction IV, of the Credit Institutions Law, to limited-object financial societies, shall cease to have effect by operation of law, without them being obliged to dissolve and liquidate, although, in order to continue operating, they must:
I. Reform their corporate bylaws, to eliminate any express reference or inference that they are limited-object financial societies and that they are authorized by the Ministry of Finance and Public Credit to do so.
II. Present to the Ministry of Finance and Public Credit, no later than the date on which the reforms and repeals referred to in the first paragraph of this article enter into force, the public instrument in which the bylaw reform referred to in the preceding fraction is recorded, with the data of the respective registration in the Public Commerce Registry.
Societies that do not comply with the provisions of the preceding fraction II shall enter, by operation of law, into a state of dissolution and liquidation, without the need for a resolution of the general shareholders' meeting.
The Ministry of Finance and Public Credit, regardless of whether or not the requirements set forth in the preceding fractions are met, shall publish in the Official Gazette of the Federation that the authorizations referred to in this article have ceased to have effect.
The entry into force of the reforms, additions, and repeals to the articles of the Credit Institutions Law indicated in this transitory article shall not affect the existence and validity of contracts previously entered into by the societies that had the status of limited-object financial societies, nor shall it be a cause for ratification or validation of those contracts.
In credit contracts entered into by the societies after the date on which, in accordance with the provisions of this article, the respective authorizations granted to them by the Ministry of Finance and Public Credit cease to have effect, they must expressly state that they do not have authorization from the Ministry of Finance and Public Credit. The same mention must be made in any type of information that the societies mentioned use for the purpose of promoting their services.

SIXTH.- The Ministry of Finance and Public Credit shall only process requests to obtain the authorization indicated in Article 103, fraction IV, of the Credit Institutions Law and in terms of the provisions of said law, that have been submitted before the date on which this Decree is published in the Official Gazette of the Federation. The authorizations, if any, granted shall only be valid until the date on which seven years have elapsed from the publication of this Decree in the Official Gazette of the Federation and shall be subject to the provisions of the preceding article.

SEVENTH.- Financial leasing companies, factoring companies, and limited-object financial societies that, before the date on which seven years have elapsed from the publication of this Decree in the Official Gazette of the Federation, intend to carry out financial leasing, financial factoring, and credit granting operations without being subject to the regime of the General Law of Organizations and Auxiliary Credit Activities and the Credit Institutions Law, as applicable, must:
I. Agree in a shareholders' meeting that the financial leasing, financial factoring, and credit operations carried out by said societies in their capacity as lessor, factor, or lender shall be subject to the regime of the General Law of Negotiable Instruments and Credit Operations and, where applicable, to that of multiple-object financial societies provided for in the General Law of Organizations and Auxiliary Credit Activities;
II. Reform their corporate bylaws, to eliminate, as appropriate, any express reference or inference that they are auxiliary credit organizations or limited-object financial societies; that they are authorized by the Ministry of Finance and Public Credit; that, except in the case referred to in the penultimate paragraph of Article 87-B of the General Law of Organizations and Auxiliary Credit Activities, they are subject to the supervision of the National Banking and Securities Commission; and that their organization, functioning, and operation are governed by said Law or by the Credit Institutions Law, and
III. Present to the Ministry of Finance and Public Credit the public instrument in which the holding of the shareholders' meeting indicated in fraction I and the bylaw reform referred to in the preceding fraction II are recorded, with the data of the respective registration in the Public Commerce Registry.
The authorization granted by the Ministry of Finance and Public Credit, as applicable, for the constitution, operation, organization, and functioning of the financial leasing company, factoring company, or limited-object financial society in question, shall cease to have effect from the day following the date on which the bylaw reform indicated in fraction II of this article is registered in the Public Commerce Registry, without the society thereby entering a state of dissolution and liquidation. The Ministry of Finance and Public Credit shall publish in the Official Gazette of the Federation that the authorization has ceased to have effect. Contracts entered into by financial leasing companies, factoring companies, or limited-object financial societies prior to the date on which, in accordance with the provisions of this article, the aforementioned authorizations cease to have effect, shall not be affected in their existence or validity nor shall they need to be ratified or validated for that reason. In financial leasing, financial factoring, and credit contracts entered into by the societies referred to in this article after the date on which the authorization of the Ministry of Finance and Public Credit has ceased to have effect, they must expressly state that they do not have authorization from the Ministry of Finance and Public Credit and that, except for regulated multiple-object financial societies, they are not subject to the supervision of the National Banking and Securities Commission. The same mention must be made in any type of information that the societies mentioned in the first paragraph of this article use for the purpose of promoting their services.

EIGHTH.- Until the authorizations granted by the Ministry of Finance and Public Credit cease to have effect or are revoked, financial leasing companies, factoring companies, and limited-object financial societies shall continue, as applicable, to be subject to the regime of the General Law of Organizations and Auxiliary Credit Activities, the Credit Institutions Law, and other provisions applicable to them in accordance therewith, as well as to other provisions issued by the aforementioned Ministry to preserve the liquidity, solvency, and stability of the entities mentioned.

NINTH.- Articles Four and Five of this Decree shall enter into force the day following their publication in the Official Gazette of the Federation.

TENTH.- Article Six of this Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Financial leasing companies, financial factoring companies, and limited-object financial societies whose voting shares representing at least fifty-one percent (51%) of their social capital are owned by controlling societies of financial groups prior to the date when seven years have elapsed from the publication of this Decree in the Official Gazette of the Federation, shall be considered as part of said financial groups as long as the authorization granted by the Ministry of Finance and Public Credit to said entities to constitute, operate, organize, and function, as the case may be, with such status remains in force. In this case, the Law to Regulate Financial Groupings shall continue to apply insofar as it is pertinent.

In the event that, in accordance with the provisions of this Decree, the financial leasing companies, financial factoring companies, and limited-object financial societies referred to in the preceding paragraph adopt the modality of multi-object financial societies and the voting shares representing at least fifty-one percent (51%) of their social capital remain under the ownership of the respective controlling society, said societies shall be considered as part of the respective financial group under Article 7 of the Law to Regulate Financial Groupings, amended by this Decree, provided that the corresponding reforms to the bylaws of the controlling society are registered in the Public Commerce Registry, the responsibility agreement referred to in Article 28 of said Law is modified, and the Ministry of Finance and Public Credit approves the modification to the authorization granted to the respective financial group to constitute and function with such status. The responsibilities of the controlling society shall subsist as long as all obligations incurred by the societies that cease to have the status of financial leasing companies, financial factoring companies, and limited-object financial societies before the aforementioned registration are fully fulfilled.

ELEVENTH.- Articles Seven and Eight of this Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

TWELFTH.- Credit institutions and stock brokerage houses that are owners of shares representing the social capital of financial leasing companies and financial factoring companies, whose authorization has been rendered void by virtue of this Decree, may retain said shares provided that such societies adopt the status of multi-object financial societies.

Credit institutions that are owners of shares representing the social capital of limited-object financial societies, whose authorization has been rendered void by virtue of this Decree, may retain said shares provided that such societies adopt the status of multi-object financial societies.

THIRTEENTH.- Conciliation and arbitration proceedings conducted in accordance with the Law for the Protection and Defense of Users of Financial Services, which on the date of publication of this Decree are pending resolution, shall continue to be governed by said Law until their conclusion.

FOURTEENTH.- With respect to savings and loan societies, the transitional regime provided for them in the Decree by which various provisions of the Savings and Popular Credit Law are reformed, added to, and repealed, published in the Official Gazette of the Federation on January 27, 2003, shall apply, as well as in the Decree by which various provisions of the Savings and Popular Credit Law are reformed and added to, published in the same Gazette on May 27, 2005.

FIFTEENTH.- Multi-object financial societies are deemed rural financial intermediaries for the purposes of the Organic Law of the Rural Financial Institution.

SIXTEENTH.- After the date on which this Decree enters into force, the Ministry of Finance and Public Credit may authorize broad corporate purposes that include all credit operations under Article 46 of the Credit Institutions Law, leasing, and financial factoring for Limited-Object Financial Societies that so request, and maintain the regulation of said Ministry and the National Banking and Securities Commission, as well as the corresponding denomination.

For these purposes, the Ministry of Finance and Public Credit may grant authorization for the transformation to Limited-Object Financial Society to leasing and financial factoring companies that so request, which will continue to be regulated.

The regulation and authorization granted in accordance with the preceding paragraphs shall become void by operation of law three years following the date of entry into force of this Decree, and societies that have obtained such authorization from this date shall be subject to the provisions of the third and fifth transitional articles of this Decree.

Mexico, D.F., April 27, 2006.- Dep. Marcela González Salas P., President.- Sen. Enrique Jackson Ramírez, President.- Dep. Ma. Sara Rocha Medina, Secretary.- Sen. Sara I. Castellanos Cortés, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twelfth day of the month of July of two thousand six.- Vicente Fox Quesada.- Signature.- The Secretary of the Interior, Carlos María Abascal Carranza.- Signature.

TRANSITIONAL PROVISIONS

Decree by which the Law for the Transparency and Order of Financial Services, published on January 26, 2004, is repealed, the Law for the Transparency and Order of Financial Services is issued, and various provisions of the Credit Institutions Law, the Law for the Protection and Defense of Users of Financial Services, and the Law of the National Banking and Securities Commission are reformed, added to, and repealed, published in the Official Gazette of the Federation on June 15, 2007.

ARTICLE ONE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

ARTICLE TWO.- Infractions to general provisions issued by the Bank of Mexico, regarding total annual cost (TAC), credit cards, advertising, statements of account, and contracts, committed by credit institutions and limited-object financial societies, prior to the entry into force of this Law, shall be sanctioned by said Bank in accordance with the laws in force at the time such infractions were committed.

ARTICLE THREE.- Entities shall have a period of up to one hundred eighty (180) natural days from the entry into force of this Decree to comply with its provisions.

ARTICLE FOUR.- For the purposes of Article 48 Bis 2 of the Credit Institutions Law, the Bank of Mexico shall have thirty (30) days from the entry into force of this Decree to issue general provisions.

ARTICLE FIVE.- Upon entry into force of this Decree, the Law for the Transparency and Order of Financial Services, published in the Official Gazette of the Federation on January 26, 2004, is repealed.

ARTICLE SIX.- Upon entry into force of this Decree, the following legal provisions of the Law on Transparency and Promotion of Competition in Guaranteed Credit are repealed:

I. Articles 3, fraction I, 10, and 16, first paragraph.

II. Article 4. Without prejudice to the foregoing, the general rules issued by the Ministry of Finance and Public Credit under said Article shall remain in force, with respect to the Entity in question, until such time as the authorities that are competent, in accordance with Article 12 of the present Law for the Transparency and Order of Financial Services, issue in the scope of their respective competence, the general provisions regarding advertising provided by this latter Law.

III. Article 8. Without prejudice to the foregoing, the general rules issued by the Ministry of Finance and Public Credit under said Article shall remain in force, with respect to the Entity in question, until such time as the authorities that are competent, in accordance with Article 11 of the present Law for the Transparency and Order of Financial Services, issue in the scope of their respective competence, the general provisions regarding adhesion contracts provided by this latter Law, understanding that such provisions shall contemplate the minimum content indicated in fractions I to VI of said Article 8 for Guaranteed Housing Credits.

IV. Article 12. Without prejudice to the foregoing, when the authorities that are competent, in accordance with Article 13 of the present Law for the Transparency and Order of Financial Services, issue in the scope of their respective competence, the general provisions regarding statements of account provided by this latter Law, they must include the calculation of the Total Annual Cost corresponding to the remaining validity of the Guaranteed Housing Credit.

ARTICLE SEVEN.- Upon entry into force of this Decree, Articles 87-I, fraction II; 87-L, second paragraph, and 87-M, fraction IV of the General Law of Financial Organizations and Auxiliary Credit Activities are repealed.

ARTICLE EIGHT.- General provisions issued by the Bank of Mexico regarding advertising, statements of account, or adhesion contracts directed at credit institutions or limited-object financial societies shall remain in force until such time as general provisions, in accordance with this legislation, are issued by the National Banking and Securities Commission regarding the aforementioned topics.

Mexico, D.F., April 26, 2007.- Sen. Manlio Fabio Beltrones Rivera, President.- Dep. Jorge Zermeño Infante, President.- Sen. Renan Cleominio Zoreda Novelo, Secretary.- Dep. Antonio Xavier Lopez Adame, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twelfth day of the month of June of two thousand seven.- Felipe de Jesús Calderón Hinojosa.- Signature.- The Secretary of the Interior, Francisco Javier Ramírez Acuña.- Signature.

TRANSITIONAL PROVISIONS

(Decree by which various provisions of the Federal Penal Code; the Federal Code of Criminal Procedures; the Federal Law against Organized Crime; the Credit Institutions Law; the Savings and Popular Credit Law; the Law of Systems for Retirement Savings; the Investment Societies Law; the Securities Market Law; the Federal Law of Guarantee Institutions; the General Law of Mutual Insurance Institutions and Societies; and the General Law of Financial Organizations and Auxiliary Credit Activities are reformed, published in the Official Gazette of the Federation on June 28, 2007).

FIRST.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

SECOND.- The provisions of the Federal Penal Code in force at the time of their commission shall apply to persons who have committed a crime contemplated in this Decree prior to its entry into force.

Mexico, D.F., April 26, 2007.- Dep. Jorge Zermeño Infante, President.- Sen. Manlio Fabio Beltrones Rivera, President.- Dep. Antonio Xavier Lopez Adame, Secretary.- Sen. Renán Cleominio Zoreda Novelo, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the twenty-sixth day of June of two thousand seven.- Felipe de Jesús Calderón Hinojosa.- Signature.- The Secretary of the Interior, Francisco Javier Ramírez Acuña.- Signature.

TRANSITIONAL PROVISIONS

(Decree by which the Credit Unions Law is issued and the General Law of Titles and Credit Operations is added to and reformed, published in the Official Gazette of the Federation on August 20, 2008)

First.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Second.- Chapter III of Title Two of the General Law of Financial Organizations and Auxiliary Credit Activities, published in the Official Gazette of the Federation on January 14, 1985, is repealed, as well as any reference in said Law to credit unions.

Credit unions authorized to operate as such in accordance with the provisions that are repealed, shall be deemed authorized to operate under the terms of this Decree.

Credit unions authorized to operate as such prior to the entry into force of this Decree may only admit new members who meet the characteristic established in the first paragraph of Article 21 of Article One of this Decree. Furthermore, they may not renew operations they have contracted with members who do not meet said characteristic.

Third.- Until the National Banking and Securities Commission issues the general provisions referred to in this Law, those issued prior to its validity shall continue to apply in the corresponding matters, insofar as they do not oppose this Decree. Upon issuing the provisions referred to in this article, those that are replaced or remain repealed shall be expressly indicated.

Without prejudice to the foregoing, upon the entry into force of this Decree, the Agreement by which the minimum capitals that general depositories, financial leasing companies, credit unions, financial factoring companies, and exchange houses must have for the year 2008 are determined, published in the Official Gazette of the Federation on March 31, 2008, is repealed in all respects regarding credit unions.

Fourth.- Credit unions shall have a period of two years counted from the entry into force of this Decree to comply with the provisions referred to in Articles 61 and 62 of the Credit Unions Law.

Fifth.- Authorizations granted to credit unions and other administrative acts carried out based on the General Law of Financial Organizations and Auxiliary Credit Activities, which in accordance with the provisions of this Decree correspond to the National Banking and Securities Commission, shall remain in force until, if applicable, they are revoked or their terms expressly modified by said Commission, or until they cease to produce their effects.

Sixth.- Infractions and crimes committed prior to the date of entry into force of this Decree shall be sanctioned in accordance with the law in force at the time such infractions or crimes were committed.

In administrative proceedings that are pending, the interested party may opt for their continuation in accordance with the procedure in force at their initiation or for the application of the provisions applicable to administrative proceedings provided in this Decree.

Seventh.- Credit unions shall have a period of one hundred eighty (180) days from the entry into force of this Decree to submit to the National Banking and Securities Commission, for approval, their social bylaws in order to adjust their operation to what is provided in said Decree.

Eighth.- Upon the entry into force of this Decree, all credit unions that have been authorized to operate as such under the General Law of Financial Organizations and Auxiliary Credit Activities shall be classified with an operational level I.

Credit unions may request the National Banking and Securities Commission to authorize a change in operational level prior to fulfilling the requirements referred to in Articles 39 and 43 of Article One of this Decree.

Ninth.- Credit unions that, upon the entry into force of this Decree, do not meet the minimum capital provided in Article 18 of Article One of this Decree for operational level I, shall have a period of five years to integrate the referred minimum capital.

Upon expiration of the aforementioned period, authorizations granted by the National Banking and Securities Commission for the constitution and operation of credit unions that do not have a minimum capital equivalent in national currency to the value of 2,000,000 investment units, shall become void by operation of law, whereby societies with such status shall cease to be credit unions.

The societies indicated in the preceding paragraph are not obligated to dissolve and liquidate by virtue of the fact that, in accordance with the provisions of the preceding paragraph, the respective authorizations become void; however, to continue operating, they must:

I. Reform their social bylaws to eliminate any express reference or inference that they are credit unions and that they are authorized by the National Banking and Securities Commission to constitute and function with such status.

II. Submit to the National Banking and Securities Commission, no later than one hundred eighty (180) natural days, the public instrument in which the aforementioned bylaw reform is recorded, with the data of the respective registration in the Public Commerce Registry.

Societies that do not comply with the provisions of the aforementioned fraction II shall enter, by operation of law, a state of dissolution and liquidation, without the need for a general shareholders' meeting agreement.

The National Banking and Securities Commission shall publish in the Official Gazette of the Federation those authorizations that, in accordance with this article, become void.

Tenth.- Fraction IV of Article 6 of the Foreign Investment Law is repealed.

Mexico, D.F., April 30, 2008.- Sen. Santiago Creel Miranda, President.- Dep. Ruth Zavaleta Salgado, Presidenta.- Sen. Gabino Cué Monteagudo, Secretary.- Dep. Ma. Mercedes Maciel Ortiz, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on the nineteenth day of August of two thousand eight.- Felipe de Jesús Calderón Hinojosa.- Signature.- The Secretary of the Interior, Juan Camilo Mouriño Terrazo.- Signature.

TRANSITIONAL PROVISIONS

(Decree by which various provisions of the General Law of Financial Organizations and Auxiliary Credit Activities are reformed, added to, and repealed, published in the Official Gazette of the Federation on August 3, 2011)

ARTICLE ONE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

ARTICLE SECOND.- The powers granted through this Decree to the National Banking and Securities Commission (CNBV) regarding money exchange centers and money transmitters shall be conferred upon said Commission once two hundred and forty (240) natural days have elapsed from the effective date of this Decree.

ARTICLE THIRD.- During the period mentioned in the preceding Transitory Article Second, the Tax Administration Service (SAT) shall continue to exercise the functions of supervision, inspection, surveillance, and, where applicable, sanctioning, with respect to the obligations of money exchange centers and money transmitters established in the general provisions referenced in Article 95 Bis of the General Law of Organizations and Auxiliary Credit Activities. In order to exercise said powers and carry out the corresponding procedures, the Tax Administration Service may conduct inspection visits to the domiciles, premises, or establishments of said money exchange centers and money transmitters.

For the aforementioned supervision procedures, inspection visits, surveillance, and sanctioning, the Tax Administration Service shall continue to apply the legal provisions and powers regarding verification and review, as well as the regulations and other administrative norms applicable to it. Said decentralized body may appoint the inspectors, assistants, and support staff it deems appropriate in each case and request financial, economic, accounting, legal, operational, and administrative information and documentation as appropriate, regardless of the medium in which it is stored or preserved.

ARTICLE FOURTH.- Regarding the power provided for in Article 64, fourth paragraph, as amended by this Decree, if during the term mentioned in the Transitory Article Second of this Decree, the Tax Administration Service has indications of the carrying out of operations reserved for money exchange centers or money transmitters by legal entities not registered with said decentralized body, or by individuals, including those individuals whose tax regime is income from business activities, the Tax Administration Service may request the National Banking and Securities Commission to order the credit institutions, brokerage houses, and exchange houses with which said persons operate, to suspend or cancel, where applicable, the contracts they have entered into with them, and to refrain from carrying out new operations.

ARTICLE FIFTH.- Likewise, within the period mentioned in the preceding Transitory Article Second, companies intending to register as money exchange centers or money transmitters under the provisions of Article 81-B, which is added by virtue of this Decree, must carry out the corresponding registration with the Tax Administration Service, instead of the National Banking and Securities Commission.

The other acts that private parties must perform before the National Banking and Securities Commission, under Articles 57, 81-B, and 81-C, included in this Decree, must be performed before the Tax Administration Service, instead of said Commission, and shall produce the same effects as those provided for in said articles or derived from them.

ARTICLE SIXTH.- Persons who had presented the Notice provided for in the Resolution by which the rules for filling out the official format for presenting the notice are issued, pointing to the Resolution by which the General Provisions referred to in Article 95 Bis of the General Law of Organizations and Auxiliary Credit Activities applicable to persons carrying out the operations referred to in Article 81-A of the same law are issued, and the Resolution by which the General Provisions referred to in Article 95 Bis of the General Law of Organizations and Auxiliary Credit Activities applicable to the so-called money transmitters are issued by said law, published in the Official Gazette of the Federation on February 10, 2006, shall have a period of ninety (90) natural days from the entry into force of this Decree to, once the anonymous company in question has been incorporated under this Decree, present the corresponding notice to, if applicable, obtain the registration referred to in Article 81-B of this Decree, which shall be granted by the Tax Administration Service.

Likewise, those legal and natural persons who, prior to the entry into force of this Decree, had presented said Notice and obtained each more than one registration in order to carry out the activities referred to in the preceding paragraph, shall have the ninety-day period indicated in the preceding paragraph to, once the commercial company in question has been incorporated or the statutes and corporate purpose of the already incorporated company have been modified to comply with the provisions of this Decree, present the corresponding notice to obtain, if applicable, the registration referred to in Article 81-B of the same, which shall be granted by the Tax Administration Service.

Until the aforementioned ninety-day period is fulfilled or the registration is carried out in accordance with the provisions of the preceding paragraphs of this Article, whichever occurs first, persons who had presented the notice indicated in the same, and who had been operating as money transmitters or carrying out the operations referred to in Article 81-A of the General Law of Organizations and Auxiliary Credit Activities before the entry into force of this Decree, may continue to carry out, during said period, the activities referred to in Articles 81-A and 95 Bis of the aforementioned Law in force until the day before the entry into force of this Decree.

ARTICLE SEVENTH.- Within a period of two hundred (200) natural days counted from the entry into force of this Decree, the Tax Administration Service must initiate the transmission to the National Banking and Securities Commission of the files, as well as the registers and databases, containing information related to money exchange centers and money transmitters that are registered.

For the effect indicated in the preceding paragraph, the National Banking and Securities Commission and the Tax Administration Service shall jointly determine the most appropriate means and systems for the secure and timely transmission of the corresponding information and documentation.

Once the period referred to in Transitory Article Second of this Decree has elapsed, the National Banking and Securities Commission must have the entirety of the respective files, registers, and databases in order to be able to initiate the exercise of the powers granted to it through this Decree.

ARTICLE EIGHTH.- Once the period referred to in the preceding Transitory Article Second has been fulfilled, companies that are registered as money exchange centers or money transmitters with the Tax Administration Service shall be registered, by operation of law, with the National Banking and Securities Commission.

ARTICLE NINTH.- Until the Ministry of Finance and Public Credit issues the general provisions referred to in the reforms contained in this Decree, those issued prior to their validity shall continue to apply in the corresponding matters, insofar as they do not conflict with this Decree.

ARTICLE TENTH.- Infractions or crimes committed prior to the entry into force of this Decree shall be sanctioned in accordance with the provisions in force at the time said infractions or crimes were committed, by the competent authorities to impose the corresponding sanctions at that time.

In administrative proceedings that are in progress, except for those referred to in Article 81-D, which is added by virtue of this Decree, the interested party may opt for their continuation in accordance with the procedure in force during their initiation or for the implementation of the provisions applicable to administrative proceedings stipulated by this Decree.

ARTICLE ELEVENTH.- The criminal sanction referred to in Article 101 of the General Law of Organizations and Auxiliary Credit Activities shall be applicable with the exception of all those persons who, on the date of entry into force of this Decree, suspend the carrying out of operations reserved for money exchange centers and money transmitters established in Articles 81-A and 81-A Bis, respectively, and who, within a period that shall not exceed ninety (90) natural days counted from the aforementioned date, register with the Tax Administration Service under the terms stated in this Decree.

This is without prejudice to the administrative sanctions to which said persons may have become liable for non-compliance with the provisions of the Law amended by this Decree.

Transitory Provisions
(Decree by which various provisions in financial matters are reformed, added, and repealed, and the Law to Regulate Financial Groupings is issued, published in the Official Gazette of the Federation on January 10, 2014)

ARTICLE THIRTIETH.- In relation to the modifications referred to in Articles Twenty-Eighth and Twenty-Ninth of this Decree, the following shall apply:

I. The Agreement by which the minimum capitals that general deposit warehouses, financial leasing companies, factoring companies, and exchange houses must have for the year 2012, published in the Official Gazette of the Federation on March 30, 2012, and the Resolution by which the minimum capitals that general deposit warehouses, financial leasing companies, factoring companies, and exchange houses must have for the year 2013, published in the Official Gazette of the Federation on March 29, 2013, shall be without effect, only insofar as they conflict with this Decree.

II. For the purposes of the “General Provisions by which the additional capital, to the minimum subscribed and paid capital without right of withdrawal, that general deposit warehouses must have to act as fiduciaries in guarantee trusts referred to in the Second Section of Chapter V of Title Two of the General Law of Securities and Credit Operations”, published in the Official Gazette of the Federation on January 26, 2009, the capital established in Article 12 Bis of the General Law of Organizations and Auxiliary Credit Activities, which is added by this Decree, shall serve as the basis to determine the additional capital that general deposit warehouses intending to act as fiduciaries in said guarantee trusts must have, no later than the last business day of the year 2013. Consequently, any reference provided for in said general provisions regarding minimum capitals determined by the Ministry of Finance and Public Credit for auxiliary credit organizations and exchange houses based on fraction I of Article 8 of the General Law of Organizations and Auxiliary Credit Activities, which is reformed by this Decree, shall be understood to refer to the minimum capitals provided for in Article 12 Bis of the same law, which is added by this Decree.

III. The Rules for the functioning and operation of the Unique Registry of Certificates, Warehouses, and Merchandise referred to in Articles 22 Bis 6 to 22 Bis 8 of the General Law of Organizations and Auxiliary Credit Activities, must be issued and published for immediate entry into force, within three hundred and sixty (360) natural days following the entry into force of this Decree. Likewise, during the three hundred and sixty (360) natural days following the entry into force of this Decree, the obligations provided for by this Decree and by the provisions of the aforementioned Law added by the present one, in relation to said Registry, shall not be enforceable. Once the Rules are issued, the registry kept by the warehouses under Article 11 Bis may be replaced by the RUCAM.

IV. Articles 22 Bis 2, 22 Bis 3, 22 Bis 4, 22 Bis 7, 22 Bis 10, and 22 Bis 11 of the General Law of Organizations and Auxiliary Credit Activities, added by this Decree, shall enter into force once three hundred and sixty (360) natural days have elapsed following the publication of this Decree in the Official Gazette of the Federation.

V. The Integrated System for the Storage of Agricultural and Livestock Products referred to in Article 22 Bis 2 of the General Law of Organizations and Auxiliary Credit Activities, shall enter into force three hundred and sixty (360) natural days counted from the date of publication of this Decree, so the Ministry of Agriculture, Livestock, Rural Development, Fisheries, and Food shall have that same period to issue the general provisions and have in operation the digital computer system referred to in Article 22 Bis 2, as well as to grant to General Deposit Warehouses the individualized access key to the system referred to in Article 22 Bis 3 and establish the remote or local mechanisms for electronic or printed communication referred to in Article 22 Bis 4.

VI. Until the rules or general provisions referred to in the reforms and additions contained in this Decree are issued or modified, those issued prior to their entry into force shall continue to apply in the corresponding matters, insofar as they do not conflict with this Decree.

VII. When issuing the provisions referred to in this Article, those that they replace or repeal must be expressly indicated.

VIII. The National Commission for the Protection and Defense of Financial Services Users shall have a period of two hundred and seventy (270) natural days counted from the day following that in which this Decree enters into force, to issue the general provisions referred to in this Decree regarding the Registry of multiple-object financial companies.

IX. Multiple-object financial companies that, at the entry into force of this Decree, are registered with the National Commission for the Protection and Defense of Financial Services Users under the Law for the Protection and Defense of Financial Services Users and provisions emanating from it, shall enjoy a period of two hundred and seventy (270) natural days counted from the day following that in which the general provisions regarding the Registry of multiple-object financial companies referred to in this Decree enter into force, to request the renewal of their registration with said Commission. Those multiple-object financial companies that are not registered shall enjoy the same period to request their registration under this Decree. Once said period has elapsed without compliance therewith, the companies in question shall lose their status as multiple-object financial companies by operation of law.

X. Infractions and crimes committed prior to the entry into force of this Decree shall be sanctioned in accordance with the law in force at the time said infractions or crimes were committed.

XI. In administrative proceedings that are in progress, the interested party may opt for their continuation in accordance with the procedure in force during their initiation or for the provisions applicable to administrative proceedings stipulated by this Decree.

XII. The expenditures that, where applicable, are required by the Federal Public Administration to comply with the provisions of this Decree shall be subject to the budget authorized for said purposes in the corresponding fiscal year.

XIII. Money exchange centers and money transmitters that, at the entry into force of this Decree, are registered with the National Banking and Securities Commission, shall enjoy a period of two hundred and forty (240) natural days counted from the day following that in which this Decree enters into force, to request the renewal of their registration. Once said period has elapsed without compliance therewith, the companies in question shall lose their status as money exchange centers or money transmitters by operation of law.

XIV. The general provisions referred to in Articles 86 Bis and 87-P of this Decree must be issued within sixty (60) business days following the entry into force of this Decree. The general provisions referred to in Article 87-C Bis 1 of this Decree must be issued within three hundred and sixty (360) natural days following the entry into force of this Decree.

TRANSITORY PROVISION OF THE DECREE
(Decree by which various provisions in financial matters are reformed, added, and repealed, and the Law to Regulate Financial Groupings is issued, published in the Official Gazette of the Federation on January 10, 2014)

SINGLE. This Decree shall enter into force the day following its publication in the Official Gazette of the Federation, except for what is provided in ARTICLES TWENTY-FIFTH, fraction I; THIRTIETH, fractions IV and VI; FORTIETH, fractions I and II; and FIFTIETH, fractions I and II, which shall enter into force on the dates established in said provisions.
Mexico City, November 26, 2013.- Deputy Ricardo Anaya Cortes, President.- Senator Raúl Cervantes Andrade, President.- Deputy Javier Orozco Gomez, Secretary.- Senator María Elena Barrera Tapia, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree at the Residence of the Federal Executive Power, in Mexico City, Federal District, on January 9, two thousand fourteen.- Enrique Peña Nieto.- Signature.- The Secretary of the Interior, Miguel Ángel Osorio Chong.- Signature.

TRANSITORY
(Decree by which the Law to Regulate Financial Technology Institutions is issued, and various provisions of the Credit Institutions Law, the Securities Market Law, the General Law of Organizations and Auxiliary Credit Activities, the Law for Transparency and Ordering of Financial Services, the Law to Regulate Credit Information Companies, the Law for the Protection and Defense of Financial Services Users, the Law to Regulate Financial Groupings, the Law of the National Banking and Securities Commission, and the Federal Law for the Prevention and Identification of Operations with Resources of Illicit Origin are reformed and added, published in the Official Gazette of the Federation on March 9, 2018)

SINGLE.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation, unless the Transitory Provisions of this Decree provide otherwise.
Mexico City, March 1, 2018.- Senator Ernesto Cordero Arroyo, President.- Deputy Edgar Romo García, President.- Senator Rosa Adriana Díaz Lizama, Secretary.- Deputy Ana Guadalupe Perea Santos, Secretary.- Signatures.

In compliance with the provisions of fraction I of Article 89 of the Political Constitution of the United Mexican States, and for its due publication and observance, I issue this Decree in the municipality of Acapulco de Juárez, state of Guerrero, on March 8, two thousand eighteen.- Enrique Peña Nieto.- Signature.- The Secretary of the Interior, Dr. Jesús Alfonso Navarrete Prida.- Signature.

TRANSITORY PROVISION OF THE DECREE
(Decree by which various financial laws in administrative procedure matters are reformed, added, and repealed, published in the Official Gazette of the Federation on January 24, 2024)

First.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Second.- Sanctioning administrative proceedings that, on the date of entry into force of this Decree, had been initiated, shall continue until their conclusion, in accordance with the procedure in force at the time of notification to the alleged infringer.

Third.- Resolutions that bring to an end revocation administrative proceedings that had been initiated through the notification of the act by which the right to a hearing is granted, before the entry into force of this Decree, shall continue until their conclusion, in accordance with the procedure in force at the time of notification to the corresponding institution or entity.

Fourth.- The processing and resolution of sanctioning proceedings that, on the date of entry into force of this Decree, had been initiated by the Bank of Mexico shall be governed by the provisions of the Rules of

Supervision, Self-Correction Programs, and the Sanctioning Procedure, effective on the same date as the entry into force of this Decree.

TRANSITORY PROVISIONS OF THE DECREE
(Decree reforming, adding, and repealing various provisions of the General Law of Credit Instruments and Credit Operations and the General Law of Credit Auxiliary Organizations and Activities, published in the Official Gazette of the Federation on March 26, 2024)

First.- This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Second.- The Federal Executive shall have a period of 180 business days from the entry into force of this Decree to adjust the regulations or any other normative provision that requires updating, in accordance with the content of this Decree.

Third.- The National Banking and Securities Commission shall have a period of 180 business days from the entry into force of this Decree to adjust any normative provision that requires updating and to issue the relevant Rules, in accordance with the content of this Decree.

Fourth.- General deposit warehouses must adjust their operations for the issuance of electronic deposit certificates, no later than 18 months following the date of entry into force of this Decree.

Until the period indicated in the preceding paragraph is fulfilled, or the issuance of electronic deposit certificates is adopted prior to said term, general deposit warehouses may continue to issue the documented deposit certificate on physical media, to guarantee the continuity of the certification service. In the event that a pledge credit is constituted over the goods or merchandise indicated in the deposit certificate, the information referred to in Article 232 of the General Law of Credit Instruments and Credit Operations must be incorporated into it. Those warehouses that begin the issuance of said electronic titles will be prohibited from continuing to issue documented certificates on paper, in order to ensure the adequate transition of the deposit certificate to electronic media.

Fifth.- Deposit certificates and pledge bonds that have been issued prior to the entry into force of this Decree will remain valid until their cancellation. The legislation in force at the time of their last negotiation shall apply to said bonds. Said deposit certificates may be substituted by electronic titles in the terms indicated in this Law.

TRANSITORY PROVISIONS OF THE DECREE
(Decree reforming various provisions of various legal instruments, regarding normative homologation relative to the National Code of Civil and Family Procedures, published in the Official Gazette of the Federation on November 14, 2025)

First. This Decree shall enter into force the day following its publication in the Official Gazette of the Federation.

Second. The application of what is provided in this Decree shall enter into force in each of the federative entities at the same time as the Gradual Application Declaration issued by the Local Congresses for the purpose of the entry into force of the National Code of Civil and Family Procedures, in accordance with the Second Transitory Article of the Decree published in the Official Gazette of the Federation on June 7, 2023.

At the federal level, the application of what is provided in this Decree shall enter into force in accordance with the Gradual Application Declaration that the Chambers of Deputies and Senators that make up the Congress of the Union shall issue, indistinctly and successively, for the National Code of Civil and Family Procedures.

In all cases, upon expiration of the period without the respective Declaration having been issued, the entry into force of what is provided in this Decree shall be automatic from April 1, 2027.

Third. Proceedings that are pending at the entry into force of this Decree in accordance with what is provided in the preceding article, shall continue their processing with the legislation applicable at the time of their initiation, unless the parties jointly opt for the regulation of the content of the National Code of Civil and Family Procedures.

The accumulation of processes shall not proceed when any of them is processed in accordance with the National Code of Civil and Family Procedures and the other process in accordance with an abrogated Code.

Fourth. Article Forty-First of this Decree shall remain in effect until the Federal Telecommunications and Broadcasting Law is abrogated, in accordance with what is provided in the Sixth Transitory Article of the Decree by which the Law in Matters of Telecommunications and Broadcasting is issued and the Federal Telecommunications and Broadcasting Law is abrogated, published in the Official Gazette of the Federation on July 16, 2025.

STATEMENT OF MOTIVES
(Decree of January 14, 1985)

Mr. Secretaries of the Chamber of Deputies of the Honorable Congress of the Union. Present.

In the renovating effort of financial legislation that has been undertaken, with the object of adapting the legal structure of the financial system to the new historical-political and economic conditions prevailing, I permit myself to submit to the sovereignty of that Congress, as a complement to the initiative of the Regulatory Law of the Public Service of Banking and Credit, the present initiative of the General Law of Credit Auxiliary Organizations and Activities.

Traditionally, the banking legislation of our country had included the regulation of activities that, although not banking, contribute to the better development of credit activity. For this reason, they were entrusted to companies concessioned by the Federal Government to act as credit auxiliary organizations.

In the General Law of Credit Institutions and Auxiliary Organizations in force since 1941, credit institutions, general deposit warehouses, banking clearinghouses, stock exchanges, and credit unions were regulated in the same legal body. This regulation was subject to various modifications, as throughout its validity, banking clearinghouses and stock exchanges ceased to be considered subject to it, and in recent times, financial lessors were added.

With the nationalization of banking and the reforms to Article 28 of the Constitution, which establishes the basis for a law to regulate the exercise of the public service of banking and credit, it becomes necessary to separate the legal regulation of this activity reserved to the State from others that, although concessioned by the Federal Government, are not exclusive to it, such as credit auxiliary organizations.

In light of this, the activity of credit auxiliary organizations, which in the constitutional context must be framed as a priority activity for national development and to whose exercise the Public, Social, and Private sectors contribute, must now be regulated by a legal statute different from that of banking.

The object of this initiative is to compile the regulation that banking legislation contained regarding credit auxiliary organizations and, with the necessary adaptations, adjustments, and modifications, propose a legal regime that contributes to the modernization and development of these entities that are part of the Mexican financial system.

The activity of these organizations must be conceived as a necessary complement for the better development of credit activity, especially in its active aspect, and in no way as an open or veiled competition with credit institutions.

To accentuate the above, the initiative emphasizes that auxiliary organizations are auxiliary to credit and not to credit institutions.

Likewise, activities of economic significance that must be subject to regulation are included, not only with regard to the protection of the interests of the public user, but also to the monetary and credit policies of the Federal Government, such as the professional and habitual purchase and sale of foreign exchange.

The Law initiative submitted to your consideration consists of 100 articles divided into six titles and twelve chapters and constitutes the comprehensive regulation of credit auxiliary organizations and activities: with it, it is sought to have specific normative assumptions that allow the Public Administration to induce and guide the development of these organizations and activities, adapting them to the demands of the times and seeking the sufficiency of institutional and operational structures that make possible the application of the policies conceived to achieve these objectives.

According to the subjects it regulates and the objectives it pursues, the initiative can be divided into two categories: one relating to credit auxiliary organizations, and the other corresponding to credit auxiliary activities.

Regarding the first of them, the initiative establishes as credit auxiliary organizations those same ones indicated by the General Law of Credit Institutions and Auxiliary Organizations in force, that is, general deposit warehouses, financial lessors, and credit unions. The regulation to which they are subject, both in formal and essential aspects, is fundamentally the same as that in the said Banking Law, although measures recommended based on the experience of recent years are introduced, in order to streamline and modernize their operational and legal regime, and to promote their development.

With regard to adjetive norms, the corresponding regime is also modernized, adapting it to current legal, economic, and social situations.

As a predominant common aspect for credit auxiliary organizations, it is reiterated that they are subject to a concession regime of the Federal Government, since, being part of the Mexican financial system, they are custodians of public confidence and their operation is an important contributor to the good development of the activities of the system.

The initiative follows the principle of establishing the fundamental and concrete objectives that must govern the constitution, operation, functioning, and development of these organizations, indicating that the detail of that regulation will be established by the administrative authority, in compliance with the legal framework.

Regarding the property holding regime of general deposit warehouses and financial lessors, the principle established in the current law is maintained, in the sense that authorization from the Secretariat of Finance and Public Credit will be required to acquire 10% or more of the shares representing their capital. The regime of the current Banking Law is also preserved, which does not establish special maximum limits on the holding of capital of these auxiliary organizations, since by their nature and operational functions, it is not necessary to establish regimes different from those of anonymous societies in general.

Likewise, the initiative, like the current law, establishes the figure of the national credit auxiliary organization, as a way for the State to participate directly in the corresponding activities in order to strengthen its role as inducer, promoter, and regulator of the market, in addition to contributing to the satisfaction of the needs that the Public Sector has in such fields.

Regarding banking participation in the capital of general deposit warehouses and financial lessors, the initiative does not establish any limitation, since by the nature of these auxiliary organizations, banking can represent important support within a coordinated operation. However, the Regulatory Law initiative of the Public Service of Banking and Credit establishes the prior authorization of the Secretariat of Finance and Public Credit for national credit societies to acquire shares of auxiliary organizations.

As another aspect correlated to deposit warehouses and financial lessors, they are prohibited from continuing, vis-à-vis the public, common operational and service policies among themselves or with insurance, surety, or brokerage firms, nor presenting themselves as a group with them.

With respect, in particular, to general deposit warehouses, the reduction of the types of concession for their operation from three to two stands out, establishing only financial and fiscal storage. As for their operational regime, practice has indicated the need for them to carry out activities accessory to their fundamental objective as financial depositaries. To this effect, the initiative proposes that deposit warehouses may provide goods or merchandise transportation services, provided that these articles leave or enter their facilities because they are or are to be entrusted to them for deposit.

These auxiliary organizations are also authorized to issue deposit certificates for merchandise in transit entrusted to the warehouse, provided that the depositor, and in its case the pledge creditor, manifest their agreement to assume responsibility for losses or other damaging eventualities that originate directly from the movement of effects in transit.

With the purpose of facilitating the handling of credit titles that cover merchandise, as well as their negotiation and that of the goods they represent, they are authorized to announce the sale of the goods and merchandise deposited in their warehouses, being able to exhibit and show them, as well as make known the respective sales quotes. They are also authorized to certify the quality of goods and merchandise they have in deposit, as well as their valuation, for the purpose that this data be recorded in the corresponding titles.

Seeking that warehouses contribute to facilitating the processes of supply, accumulation, and commercialization of goods and merchandise, they are authorized to pack and package them on behalf of the depositors or holders of deposit certificates. With the objective that these credit auxiliary organizations contribute to the great national priorities, incorporating their efforts into those carried out by the Federal Government, it is proposed to establish the adaptation of the operation of general deposit warehouses to the guidelines indicated by official supply programs.

With the intention of defining the regime of enabled warehouse more clearly, it is proposed that the National Banking and Insurance Commission, in its inspection and surveillance powers, may authorize the enabling of external warehouses as if they were its own.

In congruence with the above, the initiative incorporates the concept of enabled warehouseman, as that person under whose responsibility, in the name and representation of the warehouse, the custody of the deposited merchandise is left. The manner in which the enabled warehouseman must guarantee its operation is also established, and he is subject to responsibilities, including criminal type, when he fails in his obligations.

Collecting an operational need of deposit warehouses, in order to increase service elements for their clientele in both export and import markets, the possibility is proposed that they may establish branches or offices abroad and make investments in the capital of foreign entities whose object is the storage of goods or merchandise deposited in enabled warehouses, authorized by the Secretariat of Finance and Public Credit.

With the purpose of establishing adequate guarantee in the operation of warehouses, it is proposed to allow the relationship of paid capital plus capital reserves, which the current law establishes at fifty times the declared amount of the merchandise covered by certificates, to be expanded up to one hundred times, considering the particular circumstances of each warehouse, as well as the operations they intend to carry out. Likewise, the Secretariat of Finance and Public Credit is authorized to determine the maximum limit that the value of the certificates covering the merchandise deposited in enabled warehouses, issued in favor of the same person or group, may reach, considering that the enabling of warehouses is a risky operation.

Regarding the regime of financial lessors, the initiative collects the same provisions established in the General Law of Credit Institutions and Auxiliary Organizations, since it is a regulation of recent promulgation by that Congress, so it is only beginning to have legal effect.

In this regard, with the purpose of establishing principles of a legal nature that allow differentiating financial leasing from common leasing, even in judicial proceedings, financial leasing operations are included in the initiative, in terms similar to active credit operations, since in the last instance, this form of leasing is assimilable to the latter. This is necessary given that, in forensic practice, by applying the principles corresponding to common leasing, the agility that financial lessors must have in the recovery of their assets is diminished, precisely because it is a financial operation and not simply the transfer of the use and enjoyment of goods temporarily, as is the case in common leasing.

As for credit unions, the initiative preserves, in general terms, the same legal regime applicable to them. In this sense, the shareholding regime for each member is maintained at 7% of the union's capital.

Nevertheless, the initiative introduces some adjustments to contribute to the better development of credit unions.

To this effect, in the National Program for Development Financing, it is established that this type of auxiliary organization will be promoted, which, due to its characteristics, can contribute to the more efficient and equitable channeling of credit resources, as they constitute an effective instrument to financially support the productive activity of the Social Sector and of medium and small enterprises of the Private Sector.

Among such measures, the need to change the structure of mixed credit unions stands out, to allow the association not only of members dedicated to agricultural and industrial activities, but also to accept members who carry out commercial activities, provided that they all have a direct relationship with the activity to be developed.

To this effect, it is proposed to empower the National Banking and Insurance Commission to grant this type of concession, when it considers that the corresponding union will better satisfy the financial needs of the members and promote the development of their activities.

The initiative proposes to flex the domicile limitation established in the current law for all types of unions, referring it not to the plaza of the union's domicile, but to the economic zone in which it is located, if it is thereby helped to better satisfy the needs of the members.

Another important aspect relates to the capital leverage regime of unions. In the cited Banking Law, it is indicated that the amount of real liabilities shall not exceed ten times the paid capital and capital reserves and that said liabilities, added to contingent liabilities, shall not exceed thirty times the amount of said capital and reserves. In the initiative, it is suggested to unify these ratios and indicate that the sum of real liabilities and contingent liabilities shall not exceed thirty times the paid capital and reserves.

Likewise, it is proposed to empower the Secretariat of Finance and Public Credit to determine, after hearing the National Banking and Insurance Commission, types of obligations that by their nature, security, and particular conditions, may be excluded from the computation of such liabilities. The regulation of loans that union members can grant to them is also streamlined.

A series of technical adjustments to secondary provisions that already existed in the General Law of Credit Institutions and Auxiliary Organizations are contemplated, as well as those that according to experience it is necessary to incorporate. Likewise, some provisions that have been introduced in other laws of the financial sector and that refer to similar situations or assumptions, mainly in matters of accounting, inspection and surveillance, and active credit operations, are collected.

On the other hand, within the category of Credit Auxiliary Activities and with the fundamental purpose of protecting the interests of the public that uses the services provided by exchange houses, their regulation is proposed. In effect, until now the public is affected, in many cases, by the lack of specific regulation that protects their rights. Likewise, these measures have the purpose that the services provided to the public are carried out efficiently and with the required professionalism.

It is submitted to your consideration that these exchange houses be subject to a non-transferable authorization regime by the Secretariat of Finance and Public Credit. Without it, operations of purchase, sale, and exchange of foreign exchange cannot be carried out in a habitual and professional manner within the Mexican Republic.

These provisions are excepted for credit institutions and brokerage firms, as they have specific regulation; for companies located in the border strips and free zones of the country, which capture foreign exchange through the sale of goods or provision of services; and for companies whose normal activities are carried out with foreigners.

Exchange houses will be organized as anonymous societies, restricting their corporate object to the purchase and sale of foreign exchange, as well as other activities that are compatible, with the purpose of streamlining this activity and achieving it to be carried out in a more professional manner.

Operations with foreign exchange, gold, and silver shall be subject to the provisions issued by the Bank of Mexico.

The National Banking and Insurance Commission may supervise the operations of exchange houses, who must also submit any advertising they conduct for prior authorization; additionally, it is prohibited for persons who are not duly authorized to carry out any type of advertising related to the professional and habitual purchase, sale, and exchange of foreign currency.

Regarding the regime of infractions and crimes, the scenarios of the Banking Law applicable to credit auxiliary organizations are collected, and to modernize it, the amounts of fines are referred to days of general minimum wage, considering the one in effect in the Federal District at the time of the legal violation, thereby avoiding the obsolescence of specifically determined amounts.

Regarding crimes, various technical-legal adjustments are proposed, and a new criminal offense is introduced in the matter of general deposit warehouses, relative to persons who act as authorized warehouse keepers, sanctioning the conduct that is performed dishonestly, failing to act with the honesty and loyalty expected in the performance of their duties. This will provide greater security in the handling of warehouse authorization.

In view of the above, and based on the authority conferred upon me by Article 71, fraction I of the Political Constitution of the United Mexican States, I permit myself to submit to the sovereignty of that Congress of the Union, the following Initiative for the General Law of Credit Auxiliary Organizations and Activities.

EXPLANATORY STATEMENT
(Decree of December 26, 1986)

Mr. Secretaries of the Chamber of Deputies of the Honorable Congress of the Union. Present.

In the ordinary session period of 1984, that Honorable Congress of the Union issued the General Law of Credit Auxiliary Organizations and Activities, as a response to the need to adapt the legal structures of the financial system to the historical, political, and economic conditions prevailing in the country, and also to promote the more dynamic and firm development of a set of institutions that are, without a doubt, a valuable complement to the national banking system.

Likewise, with that law, the protection of the interests of the public users of the services provided by exchange houses was regulated; likewise, a framework was defined that allows their orderly development, within the context of the exchange and monetary policies drawn up by the Federal Government.

Now, a set of reforms and additions is proposed to that Honorable Congress of the Union, which, if approved, will allow perfecting their operation, adjusting it to the evolution of the entire Mexican financial system.

For these purposes, it is proposed to reinforce the foundations for authorizing the operation of an exchange house, so it is considered appropriate to specify the concept of exchange operations as a characteristic of those carried out by said exchange houses, as well as to add the opinion of the Bank of Mexico to that of the National Banking and Insurance Commission, as necessary for the Secretariat of Finance and Public Credit to grant or deny, at its discretion, such authorization.

To ensure better administration of exchange houses and consequently preserve the interests of the public, modifications are also introduced regarding the administration of the company, in the sense of obtaining prior authorization from the Secretariat of Finance and Public Credit for any change in said administration.

Likewise, with the purpose of regulating the transfer of shares of exchange houses, it is proposed that they only be carried out with the prior approval of the Secretariat, thereby avoiding the commercialization or speculation with administrative acts ordered for the safeguarding of the public interest, distorting the nature of said companies.

With the same purpose and regarding the financial situation of exchange houses, the obligation to report, related to their business, to the National Banking and Insurance Commission is established, in the terms that the Secretariat itself determines.

To obtain real and adequate professionalism in the activity of exchange houses, some more causes for revocation are incorporated, and clarification is provided regarding those already established, especially concerning carrying out operations in contravention of what is provided by law.

Finally, and regarding violations of the law, express powers are expanded for the Secretariat of Finance and Public Credit to apply sanctions, ranging from the imposition of fines, referring them to days of general minimum wage, up to administrative intervention and the closure of the establishment that incurs infractions of what is provided in the General Law of Credit Auxiliary Organizations and Activities.

Additionally to the above, it is provided to typify as a crime, the operation of exchange houses without due authorization.

For the aforementioned reasons and in exercise of the authority granted to the Federal Executive in my charge, fraction I of Article 71 of the Political Constitution of the United Mexican States, I permit myself to submit to the consideration of the Honorable Congress of the Union, through your dignified channel, the following Initiative for reforms and additions to the General Law of Credit Auxiliary Organizations and Activities.

EXPLANATORY STATEMENT
(Decree of January 3, 1990)

Citizens Secretaries of the Chamber of Deputies of the Honorable Congress of the Union.- Present.

The reform to the General Law of Institutions and Auxiliary Credit Organizations that that honorable Congress of the Union approved in the year 1984, had the object of adapting the legal structure of the financial system to the new historical, political, and economic conditions prevailing in the country. The aforementioned reform had the purpose of separating from the same legal body, the regulation applicable to credit auxiliary organizations.

That new legal framework facilitated the more efficient participation of these non-bank financial intermediaries, to achieve the achievement of the great national objectives, clearly delimiting their operational and functional scope, avoiding duplication with other non-bank financial intermediaries, but ensuring that they effectively covered the need for protection of the public user.

In the National Development Plan 1989-1994, it has been contemplated that to achieve the modernization of the country, a financial system is required that supports and incentivizes the productivity and competitiveness of the economy; this development strategy requires a financial modernization that responds to the new economic conditions of the country. In attention to this premise, it corresponds to the financial system, in its different modalities, institutions, and instruments, the responsibility of recovering and increasing the capture of national savings, in order to channel them with efficiency and opportunity to the national productive system.

With this purpose, it is necessary to adapt the legal framework that regulates non-bank financial intermediaries, to guarantee their sound and efficient functioning and exercise their control with management autonomy, and sufficient flexibility so that their activities adjust to the new economic and financial conditions. Under this consideration, it has been judged convenient to propose to this honorable representation, the introduction of some reforms and additions to the legal regime of credit auxiliary organizations and activities.

Thus, the initiative for reforms and additions to the General Law of Credit Auxiliary Organizations and Activities that I submit to your consideration, is aimed at allowing the application of the modernization policy of these non-bank financial intermediaries, through the liberalization and deregulation of their activity, which promotes their balanced development and offers users better service.

A chapter is added to the General Law of Credit Auxiliary Organizations and Activities to regulate the operation of companies dedicated to financial factoring, in view of the fact that they provide an important financial support service to small and medium-sized industry that do not have easy access to credit, but that through the alienation of their collection rights, obtain an adequate cash flow for the realization of their operations.

In congruence with the statements contained in the National Development Plan, regarding the responsibilities of the State, according to its constitutional powers to induce and regulate the action of the private and social sectors, in the initiative it is proposed to consider as authorization and not as concession the administrative act, under which auxiliary credit organizations can carry out their activity. This is mainly due to the fact that said activity is not contemplated within those specified as exclusively constitutional for management by the State.

With the purpose of making the reforms of the law in this matter congruent with commercial opening in the international arena, and in order for warehousing and financial factoring companies to be in conditions to compete in the foreign market, the participation of foreign investors in a minority form is allowed, reserving this possibility to warehousing or financial factoring companies from abroad, foreign natural or legal persons, or groups thereof, maintaining the prohibition to foreign governments or official dependencies and the rest of the foreign financial entities.

The dynamics of our economic system have facilitated that companies of different kinds, in the non-bank financial sphere, interrelate patrimonially and operationally through the individual participation of their shareholders in the capital of these, constituting themselves in fact as financial groups. This situation is a reality that must be regulated and recognized through the constitution of a controlling shareholding company, in which the participation of foreign investment in its capital is prohibited in general, as well as of legal persons, credit institutions, or any other financial intermediary, even those that are part of the respective group. The controlling company will be integrated by at least three financial intermediaries, and must hold 51% of the paid capital of each of the participants of the financial group.

Likewise, it is proposed that the shareholding company respond subsidiarily, jointly, and unlimitedly for the losses of all and each of the financial intermediaries that make up the group, which do not respond for the losses of the controlling company, nor for the losses of the other participants of the group.

With the aim of imparting greater dynamism to the transfer of goods, general deposit warehouses are authorized to issue a deposit certificate, in which it is expressed that the goods that constitute the pledge may be in the warehouse or in transit.

To simplify administrative operation and reduce costs, general deposit warehouses are authorized to issue negotiable deposit certificates, with or without a pledge bond.

With the purpose of achieving greater control of the risks that warehouses incur by receiving goods for deposit, it is proposed to consider in the determination of their legal certification capacity, the value of the negotiable certificates they issue for goods deposited both in their own warehouses and in rented warehouses.

In order for general deposit warehouses to have the solvency that allows them to face claims for missing deposited goods, the creation of a contingency reserve is proposed.

To facilitate that general deposit warehouses make effective the guarantees offered by authorized warehouse keepers in commercial executive trials, it is proposed that warehouses be authorized to register them in the Public Property Registry.

It is proposed that general deposit warehouses can act directly in relation to the illicit acts committed by authorized warehouse keepers, in order to speed up the criminal action against infringers.

To achieve and expand the operation of warehouses towards the international market, it is intended that they can sign correspondent contracts with other warehouses and related service companies abroad.

Moving to the scope of financial lessors, and in order to specialize their operations channeling them to financial leasing, the repeal of fractions VI and VII of Article 24 of the General Law of Credit Auxiliary Organizations and Activities is proposed, which currently authorize them to grant credits.

To give greater financial solidity to financial lessors, it is proposed that henceforth the Secretariat of Finance and Public Credit establish limits on the amount of contingent obligations assumed by said lessors. Likewise, and in order to ensure the liquidity of financial lessors, it is proposed that the Secretariat of Finance and Public Credit determine the proportions of investments in relation to book capital, by establishing asset classifications, maximum percentages of payable liabilities, and minimum capital amounts.

Currently, financial lessors operate based on leverage proportions, contained in operational rules issued by the Secretariat itself. Henceforth, it is intended that these proportions be contained in the General Law of Credit Auxiliary Organizations and Activities itself, referred to percentage capitalization relationships.

To contribute to the Bank of Mexico controlling the monetary and foreign exchange flow, it is proposed that financial leasing operations related to said currencies be adjusted to the provisions issued by that Central Institute.

In the part regarding credit unions, to stimulate capitalization without promoting an inconvenient concentration, it is proposed to expand the shareholding limit per partner from 7% to 10%.

With the object of promoting the development, growth, and opening of new credit unions, it is intended to release mixed credit unions from the restriction that obliges them that the activities of all their partners maintain a direct relationship with each other.

To impart greater dynamism that contributes to the modernization of credit unions, it is intended to authorize them to expand their credit sources; open other alternatives for investment of their partners' resources; diversify the acquisition of merchandise and supplies; lease capital goods to their partners, and in general, various procedures, limits, and reports that hinder the development of such unions are eliminated.

To achieve optimization in the management of liquid resources, it is being proposed to reduce the liquidity reserve on contingent liabilities from 9% to 5%.

In order to establish limits on credit operations, which were not previously expressly authorized, it is proposed to authorize credit unions to grant, through the special department, credits to their partners without real guarantee, formalized through the union.

In order to expand the operational capacity of the partners of said unions, and make the participation and access of others attractive, it is proposed that credit limits be increased, in operations with real guarantee from 20 to 40 times the partner's share of the union's paid capital, plus the proportion corresponding to them of the capital reserves, including the surplus from the revaluation of real estate.

To adjust the terms in which liabilities that unions incur for the construction of industrial plants will be liquidated, it is proposed that said terms be adjusted to the needs of the projects and not to the three years currently fixed.

Regarding the activity of financial factoring in our country, based on its importance and growing participation in non-bank financial intermediation, it was considered necessary to promote its orderly insertion into the financial system. To this end, the initiative proposes adding a chapter to the law in this matter.

In said chapter, the active and passive operations that such companies may carry out are regulated, with the purpose of precisely limiting the operations and activities that are authorized for them to undertake.

It was sought to distinguish factoring without liability and with liability. The first modality consists of the client not being obliged to respond for the payment of the credit rights transmitted to factoring companies; the second type of factoring provides that the client remains jointly liable with the debtor to respond for the payment of said credit rights.

Additionally, a set of norms is proposed in this initiative aimed at ensuring the liquidity and financial balance of factoring companies, for which, in the case of capital structure and establishing proportions between assets and liabilities, the Secretariat of Finance and Public Credit will be in charge of determining the general operational rules. As far as factoring with liability is concerned, it is proposed that the Bank of Mexico be the one to set the operational rules, due to the relationship it has with the control of the monetary flow.

To promote solvency in the commercial payment system, it is intended to provide financial factoring companies with instruments with characteristics of executability that give security to the payment of obligations incurred, by the supply of goods and services. The effects expected from this measure will translate into greater support for the working capital of small and medium-sized enterprises.

To make the proposal of applicable regulations for financial factoring companies consistent with the regulation to which other regulated organizations are subject, it is intended that the same general provisions be applied to them correlatively.

In the case that irregularities arise in factoring operations, sanctions, fines, and penalties similar to those applied to other credit auxiliary organisms are proposed.

On the other hand, and generally, it is proposed that a seventh title be included in this law regarding the protection of public interests. The proposal seeks that claimants from credit auxiliary organizations or partners of credit unions can choose to present their claim before the competent courts or before the Commission itself. These measures will allow more expeditious attention and resolution of conflicts, taking advantage of the experience and information that the Commission has.

Regarding the inspection and supervision carried out by the National Banking and Insurance Commission, as well as its participation in the issuance of rules applicable to credit auxiliary organizations, it is intended that it have a more vigorous intervention, so that by taking advantage of the specialization achieved in the knowledge of this sector, the principle of authority will be reinforced, since modernization presupposes greater freedom both of simpler activity rules, but with stricter compliance.

With the purpose of strengthening the inspection and supervision function carried out by the National Banking Commission, it is proposed to authorize it to, within its sphere of competence, provide what is necessary so that companies authorized to operate as credit auxiliary organizations and activities duly fulfill the commitments they incur in connection with their operations.

Regarding exchange houses, it is proposed to authorize said Commission to proceed to the administrative closure, removal of advertising and external symbols of exchange houses that operate without due authorization, being able to carry out direct inspection visits to said houses, eliminating for such effect the requirement of prior request from the Secretariat of Finance and Public Credit.

Congruent with the proposal to strengthen the functions of the National Banking Commission, it is authorized for it to be the body that determines and imposes the administrative sanctions corresponding to contraventions of the law norms, whose reforms are submitted to the consideration of that sovereignty.

In view of the above, and based on the authority conferred upon me by Article 71, fraction I of the Political Constitution of the United Mexican States, I permit myself to submit to the sovereignty of that Congress of the Union the following Initiative for Decree that reforms, adds, and repeals various provisions of the General Law of Credit Auxiliary Organizations and Activities.

EXPOSICIÓN DE MOTIVOS
(Decree of December 27, 1991)
Citizens Secretaries of the Chamber of Deputies of the Honorable Congress of the Union.- Present.
The fundamental strategy of the current administration is the modernization of national life and structural change, which pursues among other the following objectives: the recovery of economic growth with price stability and the productive improvement of living standards.

To achieve these purposes, financial modernization has been a tool of great relevance, identified in its application two aspects; first, the liberalization of financial markets and second, the institutional development of the system, through reforms to the legal framework that defines its structure and operation.

In the financial system, significant changes have been recorded in a short period. However, the modernization process proposed by the current regime before the nation is not yet complete; a large part of it is underway, highlighting the banking disincorporation, the formation of financial groups, as well as the establishment of mechanisms to promote popular savings.

At the end of the last century and the beginning of this one, savings banks emerge in our country, with the purpose of helping economically unprotected classes. In the fifties, they appear with characteristics similar to those currently operating.

The process of integration of these societies was consolidated in the year 1974 with the constitution of institutional and operational support mechanisms in which a large number of popular savings banks are grouped.

In this context, savings banks cease to be isolated manifestations of little importance, to become organized entities that have begun to develop a social function and occupy an economic space not currently covered by other institutions.

The role of savings banks begins to exceed the objectives originally defined by their organizers, to become potential promoters of regional and local development in some areas of the country.

The new appearance that this legislation intends to confer on savings banks will revitalize their role and functioning in the economic and social structure of our country. This fact implies that important segments of the population will be incorporated, not only to the financial services they provide, but also to the general economic progress that derives from it.

The legal, economic and social recognition of savings banks as financial intermediaries with singular characteristics, is part of the modernization process committed, which responds to the new reality that requires adequate and necessary changes. By formally incorporating savings banks into economic life, it is expected not only to increase the national economic space by integrating areas that have remained outside financial services, but also to promote the reduction of usury.

The promotion of these societies will increase the depth of the financial system, contributing to finance development with internal resources by taking advantage of the savings capacity of a wide segment of the population that constitutes savings characterized by its permanence.

Likewise, with these societies, the culture of saving is promoted and disseminated in the population.

By correcting these types of inconveniences, savings banks will become attractive societies of greater interest to the population, offering greater security and possibility of development.

In summary, the full recognition and incorporation of savings and loan societies into the financial life of our economic system is based on the following:

The financial modernization that is taking place is integral, so it is necessary to include all its agents achieving greater competitiveness among them.

Financial modernization and opening require greater economic rationality.

The great challenges of our time are greater economic growth and better living standards for the population, especially for those who have less.

Savings and loan societies will be the adequate channel to aggregate dispersed resources of small savers and incorporate them productively.

The purpose of this proposal is to encourage the activity of these societies, for which it will be necessary to give them a convenient fiscal treatment that promotes their development and allows institutionalizing this intermediation, in addition to the fact that they are entities with non-profit purposes.

For the foregoing, it is necessary to create a legal framework that regulates savings banks, guaranteeing their sound and efficient functioning, with sufficient flexibility for the development of their activities adjusting to the current economic and financial conditions of the country. Under this consideration, it has been judged convenient to propose to that honorable representation, the introduction of reforms and additions to the legal regime of organizations and auxiliary activities of credit.

In view of the operations carried out by savings banks, it is considered convenient to endow them with legal personality. By their nature, it is proposed to incorporate them as an auxiliary organization of credit, regulated in the General Law of Organizations and Auxiliary Activities of Credit.

Like some other auxiliary organizations of credit, authorization from the Ministry of Finance and Public Credit will be required for the constitution and operation of savings and loan societies; with the understanding that those that are constituted must request the same authorization.

However, because the social object of the societies mentioned in the preceding paragraph is not of a profit-making nature, it is convenient to exempt them from the obligation to accompany their request to constitute and operate as a savings and loan society, the deposit that is required for other auxiliary organizations of credit. Likewise and in view of the purpose they pursue, it is not possible that they are constituted as a joint-stock company, as is the case with other organizations.

Savings and loan societies will base their nature on a new corporate figure, with its own equity in which its partners will be limited to the payment of their contributions; which will not pursue profit purposes; its duration will be for an indefinite time; established in national territory and its name must always be followed by the words “Savings and Loan Society”.

The object of the regulated societies will be the capture of resources exclusively from their partners, for subsequent placement among them.

As for the social capital of savings and loan societies, it will be integrated by social parts, which will be of equal value and confer the same rights, remaining fully paid at the time they are subscribed.

In the case of the existence of operating surpluses presented by savings and loan societies, after deducting the expenses that originate them, they will be destined to social benefit works own in collaboration with federal, state or municipal authorities, public or private organizations, so that they are oriented to public health, research, teaching and culture, social assistance services, all of them extended especially to the regional scope of operation of the society itself. Likewise, constitute a reserve for its own development, reduce interest and accessories to borrowing partners, or provide a greater return to saving partners.

Although the object of savings and loan societies is eminently social and non-profit, it is pertinent to consider a prohibition regime, to which they are subject, denying them the possibility of receiving demand deposits in checking accounts, guarantee with their properties, pledge the titles or securities of their portfolio, operate on titles representing their capital, grant bonds or sureties, participate in the capital of another savings and loan society and any financial entity, and grant credits other than those of their social object, except those of a labor nature.

It is necessary to clarify that savings banks constituted in accordance with the provisions of the Federal Labor Law, will not be subject to the provisions applicable to savings and loan societies.

In view that the inspection and supervision of auxiliary organizations of credit is entrusted to the National Banking Commission, it is prudent that said body also exercise its functions with respect to savings and loan societies.

With respect to the revocation of the authorization to constitute and operate as a savings and loan society, it is estimated that it is the Ministry of Finance and Public Credit itself, hearing the opinion of the National Banking Commission, that is competent to resolve what is appropriate prior to the hearing of the affected savings and loan society.

Finally, in the case of the existence of a claim against the savings and loan society, due to the operations and services it provides to its partners, it may be presented before the National Banking Commission or enforce their rights before the competent courts as they see fit.

On the other hand, it is important to highlight that in December 1989, the Federal Executive Branch under my charge submitted to that honorable Congress the reforms, additions and repeals to various provisions of the General Law of Organizations and Auxiliary Activities of Credit, with the purpose that the legal framework regulating non-bank financial intermediaries be adapted, in order to guarantee their sound and efficient functioning as well as exercising their control with management autonomy and sufficient flexibility so that their operations adjusted to the new economic and financial conditions of modernization under which the country would operate.

Those legal modifications gave validity to the purposes inscribed in the National Development Plan 1989-1994, to modernize the financial system in order to support economic reactivation and incentivize the productivity of the country. However, in order for this development strategy to provide better results, it is necessary to permanently update the legal framework that regulates non-bank financial intermediation, in order that through its various modalities, institutions and instruments, the capture of national savings is recovered and increased to channel it efficiently and timely to the national productive system.

According to these considerations, the initiative presented in this legislative period to your consideration, contemplates reforms and additions to the aforementioned regulatory framework in order to facilitate the application of the modernization policy to exchange houses to promote their balanced development, improve the service provided to users and raise the degree of supervision and supervision of the responsible authority.

The current conditions of the foreign exchange market are different from those prevailing in 1985, the year in which the activities of these societies were regulated with the purpose of protecting the interests of the user public who was affected by lacking specific provisions that preserved their rights. The reforms proposed at that time sought to induce the supply of services in matters of changes that were characterized by their efficiency and professionalism. In this sense, a regime of non-transferable authorization in charge of the Ministry of Finance and Public Credit was submitted to the consideration of that honorable Congress of the Union to constitute societies whose social object consisted of carrying out habitual and professional operations of purchase, sale and exchange of foreign currency within the Mexican Republic.

Any other person who lacked that authorization was prohibited from dedicating themselves to that activity, except credit institutions and stock exchange houses, as well as establishments located in the border strips and free zones of the country that, with the sale of goods or provision of services, captured foreign currency and also companies whose normal activities were carried out with foreigners.

The economic stabilization efforts of the last three years have allowed eliminating exchange controls; reduce the sliding of our currency against other currencies; reduce nominal interest rates and curb the inflationary process. The generalized confidence in the future development of the country has had a profound and extensive impact on the scope of the activities carried out by exchange houses.

Likewise, it must be recognized that the spot operations that retail exchange houses must carry out, by their very nature, are assimilated to those others that in the current law are exempt from regulation by the responsible authority, specifically those referring to those contracted by establishments located in border zones and free zones of the country, as well as by companies whose daily operations are made with foreigners.

To this extent, in order to homogenize the treatment that the law on the matter provides to persons who carry out spot operations, the present initiative contains a series of modifications aimed at deregulating that type of operations. With this, inspection and supervision activities will be released that will reinforce those currently exercised on wholesale exchange houses, as well as on those other societies that opt to continue in the activity, as long as they adjust their minimum paid capital to that indicated by the provisions of the matter.

Based on the foregoing, exchange houses are distinguished from those commercial establishments in which spot operations in foreign currency are carried out. The first will continue to be subject to authorization by the Ministry of Finance and Public Credit, while the second will not require it. With this measure, the constitution and operation of retail exchange houses will cease to be authorized, and as for those that currently operate as such, they may choose between increasing their minimum required capital for wholesale exchange houses or remaining in the retail market, suppressing from their name the expression exchange house.

In order to provide protection to the public, exchange operations at spot are limited to those that can be carried out in establishments that do not have the status of exchange houses, which will also be included in those that these societies can contract.

When purchasing and selling foreign currency is carried out in commercial establishments, its countervalue must be settled invariably in cash, traveler's checks or checks denominated in national currency, which will give them security and liquidity to the transactions carried out outside of exchange houses.

Suspension or abandonment of their activities is added as a cause for revocation of exchange houses, as well as the fact that they maintain their accounting capital below their minimum paid capital, a period of up to two months may be granted to replenish the deficiency. With this last amendment, close supervision is intended to be exercised so that these societies always have sufficient capital resources to absorb any eventual bankruptcy and avoid that it is passed on to third parties.

On the other hand, the operations that exchange houses can carry out are ordered and specified, and conversely, the operations that are prohibited to them are expressly indicated.

This delimitation allows having a more detailed framework of the scope of the activities that they are authorized to develop and, in this measure, facilitates the inspection tasks and, if applicable, sanctions.

To encourage that resources from the paid social capital of exchange houses are applied adequately, the Ministry of Finance and Public Credit is authorized to issue the rules through which the investments that must be made will be established.

In order to remedy the interest of the user public when affected in the celebration of transactions with exchange houses, it is proposed to subject these, as is currently being done in other auxiliary organizations of credit, to the administrative intervention of the National Banking Commission when justified. Likewise, with the purpose of extending the protection to the interests of the public that this decentralized body provides to auxiliary organizations of credit, it is proposed to incorporate exchange houses into the conciliation and arbitration process.

The need to implement corrective measures in a timely manner that contravene legal provisions and put the interests of the user public at risk, requires strengthening the intervention powers of the National Banking Commission with the help of public force. In this same sense, said body would be authorized to reprimand, remove, suspend and disqualify officials and employees of auxiliary organizations of credit and exchange houses are incorporated into this provision.

In order to have reliable information that reveals the real situation in which exchange houses are, it is considered appropriate that annual financial statements be audited by external auditors, who in turn will be obligated to communicate to the National Banking Commission the irregularities they detect.

Likewise, individual participation is limited to 10% of the paid capital, in order to diversify shareholding, establishing the exceptions of the case.

In view of the foregoing, and based on the power conferred on me by article 71, fraction I of the Political Constitution of the United Mexican States, I allow myself to submit to the sovereignty of that honorable Congress of the Union the following Initiative of Decree that reforms, adds and repeals various provisions of the General Law of Organizations and Auxiliary Activities of Credit.

EXPOSICIÓN DE MOTIVOS
(Decree of July 15, 1993)
In the years 1989 and 1991, that Honorable Congress approved various modifications to the General Law of Organizations and Auxiliary Activities of Credit to lay the foundations for the modernization of non-bank financial intermediaries as well as to promote their management autonomy and sufficient flexibility to strengthen their development in accordance with the prevailing economic and financial conditions in the country.

Those changes introduced to the legal framework have largely promoted the expansion and consolidation of auxiliary organizations of credit and exchange houses and it has contributed to the dynamics and penetration of the financial sector of the country.

However, in the face of the growing financing requirements demanded by the expansion of the national productive plant, it is convenient to further promote the activity of these intermediaries in order that they contribute to the effort of capture and allocation of national savings.

In light of these considerations and in accordance with the guidelines set by the National Development Plan 1989-1994, the initiative I present to that Honorable representation, contains modifications that incentivize the growth of these intermediaries in an area of less regulation without neglecting the protection of the interests of the user public and promote new functions that will allow their diversification, strengthening and specialization in a market more open to competition from foreign intermediaries.

In particular, general warehouses, by the type of functions they perform, have accumulated experience in the commercial activities carried out in the regions or localities where they are located and consequently, are prepared to participate more dynamically in domestic trade and in commercial opening. This is the reason why it is considered essential to endow them with additional powers to achieve these purposes.

In this sense, they are allowed to commercialize goods or merchandise, in general, to expand their operation and rationally take advantage of their installed capacity. In this way, and in addition to the activities of transportation, certification, packaging and packaging that they currently have authorized, it is proposed that they be authorized to place labels on the goods and merchandise under their custody.

The proposed reforms contemplate the need to take advantage of the national storage infrastructure more efficiently through the storage and custody of goods and merchandise owned by third parties in warehouses enabled to their clients. Under such conditions, currently unused spaces and capacities will be utilized.

To affirm the nature of general warehouses as auxiliary organizations of credit, it is proposed that they participate more actively in financial intermediation, for which they are authorized to provide financing to their depositors with guarantee of the goods or

merchandise deposited in their own premises or in rented warehouses that they administer directly.

With the purpose of enabling them to fulfill the financing function that is being suggested for incorporation into the activities they can perform, it is proposed that warehouses obtain loans and credits from credit, insurance, and surety institutions in the country or from financial entities abroad, as well as allowing them to issue subordinated obligations and other series or mass credit instruments.

Regarding deregulation, it is deemed necessary to facilitate the sustained development of these intermediaries so that they become more competitive; for this reason, it is proposed to eliminate restrictions applicable to their location, repealing the obligation that warehouses receiving merchandise and goods destined for the tax deposit regime can only be established where customs offices are located.

Likewise, it is considered convenient that warehouses only notify the competent authorities regarding the opening, change of location, and closure of rented warehouses in national territory, instead of requiring prior authorization.

Due to commercial opening, an international expansion of the activities of these intermediaries is projected, which is why the incorporation of warehouses authorized in other countries into the prior authorization faculty is foreseen.

With respect to financial lessors, it is indispensable to strengthen their basic function, for which it is proposed to authorize them to obtain loans and credits from surety institutions and to issue subordinated obligations and other series or mass credit instruments.

The obligation to invest their resources according to maximum proportions of their exigible and contingent liabilities, as well as the application of percentages to different asset categories for capitalization purposes, is repealed, without this resulting in a detriment to the prudential measures that underpin their activities, as it is considered that the general regulation on this last aspect will continue to be in force.

The experience of credit unions in commercial matters has grown alongside the economic expansion of the country, and to take advantage of it, credit unions are authorized to promote the organization and administration of marketing companies, for which they may associate with third parties.

Additionally, they may carry out the purchase and sale of fruits or products obtained or manufactured by third parties, commercialize inputs, and lease capital goods on behalf of other persons, as well as acquire said inputs and goods to alienate or rent them to persons other than members.

On the other hand, it is considered convenient to allow them to lease capital goods to their members or to third parties, thereby enabling them to make more rational use of them, while obtaining additional income and providing a service to the community in which they operate.

It is necessary to contribute to strengthening the financial capacity of producers by implementing measures that promote social savings and, in general, financing mechanisms for the benefit of credit union members; therefore, credit unions are authorized to receive savings deposits from their members.

To the extent that the financial strengthening of credit unions and the diversification of funding sources are pursued, it is possible to support micro and small business owners and producers who largely constitute the members of credit unions. Under this assumption, it is considered appropriate to authorize them to obtain loans from foreign financial entities and to issue series or mass credit instruments.

On the other hand, it is suggested that credit unions issuing these instruments must maintain a book capital that will not be less than six percent of the sum of their assets subject to significant risk and, where applicable, of their operations generating contingent liabilities, with the aim that their intermediation activity be homologated with that performed by other auxiliary credit organizations.

With the aim of increasing the borrowing capacity of members, the balance of total liabilities under their responsibility is increased from forty to fifty times, and the approval of the National Banking Commission to exceed this limit is eliminated.

With respect to reforms that will promote the deregulation of their activity, the suppression of the obligation to belong to these societies under the same guild classification and to reside in the economic zone corresponding to the plaza where the social domicile of the union to which they belong is located is proposed.

With a view to liberalizing the financial activity of unions, it is proposed to deregulate various limits related to their investments and application of profits, as well as the terms in which financings contracted with suppliers and union members must be settled. In virtue of this, the obligation to create a reserve fund from their profits is reduced from twenty to ten percent; the terms in which unions must repay their discount, loan, and credit operations are suppressed; and, in credit operations carried out with their members as well as those carried out on behalf of the union itself through the special department, the fixing of maximum terms is eliminated.

The deregulation strategy seeks to promote the financial competitiveness of unions, for which it is considered convenient that they individually determine the liquidity they must maintain to guarantee the payment of their real and contingent liabilities. In virtue of this, the obligation to maintain twelve and five percent in demand deposits or in securities issued by the Federal Government and in liquid assets, with respect to the cited liabilities, is repealed.

To provide greater autonomy to the general assemblies of members and the boards of directors of unions, it is deemed necessary to eliminate the intervention of the authority in decision-making on matters of an internal administrative nature. In this way, the prior approval of the National Banking Commission for the launch of industrial projects, the limits on the establishment of branches and the change of location of any kind of offices, as well as the presentation of their work program and the report on its compliance, are suppressed.

With regard to financial factoring companies, due to their importance and growing participation in non-bank financial intermediation, modifications to the regulatory framework are proposed that seek security in their operation and the free channeling of their capital and capital reserves to the achievement of their corporate purpose.

In view of this, greater legal security is sought for the operation of financial factoring by imposing the obligation to notify the debtor of the transfer of credit rights in the terms set forth in tax provisions.

In order to increase the channeling of financing to their clients, the prohibition of applying resources derived from the placement of credit instruments among public investors in factoring contracts with recourse is eliminated; likewise, the provisions of the Bank of Mexico to regulate the issuance of subordinated obligations and other series or mass credit instruments are suppressed.

Analogously, the obligation to invest at least forty percent of paid capital and reserves in government securities, banking instruments, or both types of investments is eliminated, in order to homologate the treatment established for liquidity matters for other auxiliary credit organizations.

In a manner similar to financial lessors, the obligation to invest their resources according to maximum proportions of their exigible and contingent liabilities, as well as that relating to applying percentages to different asset categories for capitalization purposes, is repealed.

With these reforms, financial factoring companies will be able to carry out their operations with greater autonomy and additional resources in order to achieve their sustained development.

In another order of ideas, various general application reforms are proposed for auxiliary credit organizations and exchange houses that seek greater clarity in the application of the Law of the

matter, and with the purpose of achieving sufficient flexibility so that the activities of these intermediaries adjust to the new economic and financial conditions experienced by the country.

According to these considerations, the proposed reforms for exchange houses pursue, on the one hand, that these entities receive treatment similar to that of auxiliary credit organizations, with the object of establishing a uniform regime in this legislation, and on the other hand, technical-legal reforms are proposed that have the purpose of transparenting the content and application of the Law of the matter.

In order for auxiliary credit organizations, except savings and loan societies and, where applicable, credit unions, to have sufficient equity resources to meet their responsibilities, it is proposed that their book capital be not less than six percent of the sum of their assets subject to significant risk and, when so determined, of their operations generating contingent liabilities.

Regarding the cited intermediaries, the prohibition of operating with their own shares is eliminated. This reform is applicable only to those societies that have obtained the registration of said shares in the Securities Section of the National Registry of Securities and Intermediaries.

In view of the convenience of homologating the content of the Law of the matter with other provisions governing the national financial system, the prohibition of issuing preferred or limited voting shares is suppressed, except in the case of credit unions and savings and loan societies.

Such issuance may only be carried out with the prior authorization of the Secretariat of Finance and Public Credit and shall not exceed twenty-five percent of the amount of paid capital.

With the aim of providing greater security to public investors, a set of norms is proposed tending to give transparency and uniformity to the issuance of subordinated obligations and other series or mass credit instruments issued by general warehouses, financial lessors, credit unions, and financial factoring companies, among which stand out the obligation to obtain audits of the corresponding issuances, issued by a securities rating society, as well as to affect in trust the rights generated by financing contracts concluded with their clients, to guarantee the payment of said obligations.

To reduce costs and diversify financing channels, it is proposed that auxiliary credit organizations may discount their portfolio with trusts constituted by the Federal Government for economic promotion and auxiliary credit organizations of the same type.

The public users of the services provided by auxiliary credit organizations and exchange houses have legal instances that protect their rights from eventual irregularities to which they may be subject by the cited intermediaries. Based on this consideration, it is proposed that the Federal Government and entities of the para-state public administration will not be responsible for nor guarantee the result of the operations carried out with these societies.

Additionally, and among other administrative simplification measures, the faculty of the National Banking Commission to auction off assets that warehouses general deposite, financial lessors, and financial factoring companies should not maintain in their assets is eliminated, as well as the prior authorization of the models of requests and contracts used by these intermediaries.

Finally, it is considered that the proposed deregulation means greater autonomy for intermediaries, for which the faculties and functions of supervision of the National Banking Commission are strengthened and expanded, to admonish and, where applicable, veto those officials and employees of auxiliary credit organizations or exchange houses that incur in a serious or repeated manner in infractions of this Law or of the general provisions emanating from it, also specifying the infractions and raising the amount of sanctions.

For the reasons stated, the Federal Executive in my charge, in exercise of the faculty conferred by section I of article 71 of the Political Constitution of the United Mexican States, submits to the consideration of the Honorable Congress of the Union, through the worthy channel of you, the present Initiative of Decree that reforms, adds, and repeals various provisions of the General Law of Organizations and Auxiliary Credit Activities.

STATEMENT OF REASONS
(Decree of December 23, 1993)
One of the pillars of the structural change of the Mexican economy constitutes economic opening.
This is not limited to the exchange of goods, but also comprises investment and international trade in services. In congruence with the National Development Plan 1989-1994, this administration has promoted the commercial opening of Mexico.
As commercial exchanges increase, the mobilization of financial resources, the natural counterpart of those, will also increase. Therefore, financial services should not be excluded from the process of integration of our economy into the world economy. Economic globalization demands the internationalization of financial services. The growing exchange of goods and the increase in investment flows that will accompany the treaties for the liberalization of trade in which Mexico participates will result in an increase in the demand for financial services in our country.

The internationalization of financial services aims to increase competition within the financial system for the benefit of consumers, promote savings so that greater financial resources are channeled to productive investment, and facilitate international transactions.
The North American Free Trade Agreement ("NAFTA"), ratified by the Honorable Senate of the Republic on November 22 of this year, establishes a free trade zone between Mexico, the United States, and Canada. This free trade zone does not comprise exclusively the exchange of goods, but also covers the liberalization of services trade and foreign investment. The provisions of NAFTA applicable to financial services are contained in its Chapter XIV. This chapter covers the provision of financial services in the territory of the signatory countries, investment in financial intermediaries, and the cross-border provision of financial services.

However, the financial opening of our country should not be limited to the United States of America and Canada, but should be extended to other countries with which Mexico signs treaties for the liberalization of trade. This will allow increasing the competition to which foreign intermediaries will be subject and benefit from the technology existing in other markets. In addition to NAFTA, there are other international instruments through which Mexico can negotiate the liberalization of financial services, among which stand out: the General Agreement on Trade in Services ("GATS"), proposed within the negotiations of the Uruguay Round of the General Agreement on Tariffs and Trade; the Liberalization Codes of Invisible Current Transactions and Capital Movement of the Organization for Economic Cooperation and Development ("OECD"), and other international agreements, such as the one currently being negotiated with Venezuela and Colombia. From the foregoing arises the convenience that the reform to the financial legislation establish a general framework that serves as a basis for future liberalizations in this sector.

Although as an integral part of NAFTA and in accordance with article 133 of our Political Constitution, the provisions of the chapter on financial services have the force of law, it is necessary to reform the current financial legislation with the double purpose of implementing the provisions of the chapter on financial services of NAFTA that are not self-executing, particularly some exceptions to the obligations of the Treaty that were posed in facultative terms, and creating a general legal framework for future liberalizations in this matter.

The main commitment assumed by Mexico, within the chapter on financial services of NAFTA, is to allow the establishment in our territory of foreign financial intermediaries through subsidiaries. The presence of subsidiaries of foreign financial intermediaries in our territory will increase competition in the provision of financial services in Mexico, increasing the efficiency of the system, which will be reflected in lower intermediation costs. On the other hand, the presence of subsidiaries will help increase the available financial resources for productive investments that will translate into greater economic growth. Finally, the existence of subsidiaries of foreign financial intermediaries and the presence of Mexican financial institutions abroad will facilitate international transactions, promoting international trade. The ultimate objective that my administration pursues with the opening of the financial system to external competition is to benefit the users of financial services: Mexican companies and individuals.

The current legal framework does not allow direct access of foreign financial institutions. Foreign investment in Mexican financial intermediaries must be minority in all cases. The only direct access contemplated by our current legislation is very limited, as it only benefits some intermediaries to whom the establishment of representation offices is allowed. On the other hand, article 7 of the Law of Credit Institutions contemplates the possibility of establishing "offshore" branches of first-rank foreign banks. These branches cannot carry out passive or active operations with residents in Mexico. For the foregoing, it is necessary to modify the financial legislation to allow direct access of foreign financial intermediaries to our country.

The initiative submitted to the consideration of the Honorable Congress of the Union proposes the inclusion of a new chapter, within each of the laws that regulate our financial intermediaries, applicable to subsidiaries of foreign financial institutions. This chapter contemplates a general regime that serves as a basis for the implementation of NAFTA, as well as for future liberalizations that are negotiated through other treaties.

The reform opens the possibility for foreign financial intermediaries, constituted in countries with which Mexico has celebrated international treaties under which the establishment of subsidiaries is allowed, to provide financial services in our territory, but through Mexican companies constituted in accordance with our legislation, to which they will be subject. Thus, foreign intermediaries must meet the same requirements that are demanded of Mexicans to establish and operate financial intermediaries, and some additional ones.

It must be clarified that, in general terms, the financial opening agreed in NAFTA is exclusively for foreign financial intermediaries, so the limits on aggregated foreign investment, applicable to other investors, will be preserved. Financial intermediaries from other countries may establish subsidiaries in Mexico, provided that they provide, directly or indirectly, the same type of financial services in their country of origin. In this way, it is guaranteed that the foreign financial intermediary has the necessary specialization to provide services in Mexico.

Notwithstanding the foregoing, in accordance with NAFTA, foreign financial intermediaries authorized to constitute a multiple banking institution or a brokerage house subsidiary may constitute a holding company and form a financial group. Consequently, the initiative proposes that only foreign intermediaries expressly authorized in the applicable agreement may form financial groups.

To constitute and operate a subsidiary, foreign financial intermediaries must meet additional requirements to those applicable to Mexican investors. These additional requirements will refer basically to the financial situation and international experience of the foreign financial intermediary, as well as to the technical capacity and moral solvency of its investors and executives in the country of origin. It is convenient that these requirements, in addition to other particularities related to the authorization process, be governed by rules issued by the Secretariat of Finance and Public Credit.

This authority will be in charge of interpreting, for administrative purposes, the provisions on financial services included in international treaties and of providing everything necessary for their application.

As already said, subsidiaries are societies constituted in Mexico, have their own legal personality, and are subject to our jurisdiction. The legal nature of subsidiaries is not different from that of financial intermediaries with majority Mexican capital: both are anonymous societies authorized for the provision of certain financial services. Therefore, unless there is a special provision in the applicable international treaty or in the new chapter proposed, Mexican subsidiaries of foreign financial intermediaries will be governed by the general provisions contained in each of the financial laws.

With respect to their operations in Mexico, financial authorities will guarantee that the principle of national treatment is applied when this is agreed in the applicable international instrument, in the terms and with the restrictions established therein.

The chapter on subsidiaries of foreign financial institutions contains special provisions, which differ from the general regimes established in the laws, on the following aspects:

a) The structure of its capital; b) The composition of its governing bodies; c) The consolidated supervision to which their parent companies may be subject in their country of origin; and d) The creation of a regime of individual and aggregate market limits, as well as a mechanism for their compliance.

The modifications related to the shareholding structure of intermediaries are necessary because the opening is exclusively for foreign financial intermediaries, who must be majority shareholders of the subsidiaries. In this regard, it is proposed to require foreign financial intermediaries, or the controlling parent companies of those subsidiaries in the case of financial groups, to acquire and maintain at all times at least ninety-nine percent of the share capital of a subsidiary, except in the case of insurance institutions and securities investment advisors, where the required percentage, in accordance with the Free Trade Agreement (FTA), is fifty-one percent. The aim is that foreign intermediaries interested in participating in our country's financial system make a significant capital contribution. For the same reason, except with regard to insurance institutions, subsidiaries are not allowed to issue subordinated bonds, except to be acquired by the parent company. This approach is not contrary to the capital diversification policy contained in most of our financial laws, because in practically all cases the foreign intermediaries are legal entities and the majority of their capital is highly diversified.

In the case of insurance institutions, the remaining forty-nine percent of the share capital may be represented by "M" Series shares and acquired by other Mexican or foreign investors. This is to allow for the creation of associations. Also with regard to these institutions, the cross-border operations regime contained in Article 3 of the relevant law is modified to allow greater consumer freedom in cargo transport or tourist operations.

To allow the acquisition of subsidiary shares by Mexicans, as well as the acquisition of shares of financial institutions controlled by Mexicans by foreign financial institutions, it is provided that, with prior authorization from the Ministry of Finance and Public Credit, the bylaws of the subsidiary or the financial intermediary in question may be modified so that the shareholding structure is adapted to the provisions of the law that are applicable, depending on the nationality of the capital. When a foreign financial institution already has a subsidiary and acquires shares of another intermediary of the same type, it must proceed with a merger, as it is proposed that foreign financial institutions cannot own shares of more than one subsidiary of the same type. Acquisitions will also be subject to the individual and aggregate participation limits referred to below.

To facilitate the capitalization of multiple banking institutions and their association with foreign intermediaries, it is proposed that the individual shareholding limit currently provided for in the Law could reach up to twenty percent, with the authorization of the Ministry of Finance and Public Credit, when the investment is made by foreign financial entities whose capital is diversified in their country of origin. In the same vein, it is proposed to allow foreign financial entities to participate in the share capital of brokerage houses and stock market specialists; that individual foreign investment in both types of intermediaries could reach up to fifteen percent of their share capital, as is the case with Mexican shareholders; and to repeal the rule prohibiting legal entities from investing in the capital of stock market specialists.

The modification to the shareholding structure results in changes to the composition of the board of directors, the general manager, and the auditors. A residence requirement is imposed for the majority of board members and the General Manager. For stock market intermediaries, residence will also be required for attorneys-in-fact to conduct operations with the public and for operators.

On the other hand, subsidiaries of foreign financial intermediaries will not be allowed to establish branches outside national territory, nor to acquire shares representing the social capital of foreign financial entities.

Foreign stock market intermediaries may also, according to the initiative, establish representative offices in Mexico, as is already permitted to other intermediaries, but without those offices being able to conduct intermediation operations in our territory.

Regarding the supervision of subsidiaries of foreign financial intermediaries, the principle is confirmed that, like any financial intermediary established in Mexico, inspection and surveillance fall to the Mexican authorities, specifically the Supervisory Commissions. The parent financial institution could be subject, in its country of origin, to consolidated supervision. This form of supervising financial intermediaries is consistent with the global trend that has developed as a result of the internationalization of financial services, and allows for an evaluation of the situation of intermediaries taking into account all their operations worldwide. However, although the benefits that consolidated supervision of financial institutions brings, both for users and for the stability and solidity of financial markets in Mexico, are not denied, the supervision of financial institutions, as already stated, falls solely to the Mexican authorities. If any authority from the country of origin of the foreign financial intermediary intends to carry out an inspection act on a subsidiary established in Mexico, it must request it from the competent Mexican Supervisory Commission. In any case, the inspection must be carried out through the aforementioned Commission, which will establish the terms under which it will be conducted.

Although, as already noted, the opening of the financial system is convenient for the national economy, this opening must be done in a way that does not put Mexican financial institutions at risk before they have had the opportunity to prepare for competition. It should be remembered that since the beginning of my administration, various actions have been undertaken to modernize the financial system: operational deregulation, bank privatization, and constant adjustment of the legal framework are the three main dimensions of the financial modernization that has been carried out.

Financial intermediaries have responded to the challenge of the reform undertaken and we have avoided that the pace of change causes imbalances in the markets or even the bankruptcy of some intermediaries, with all the consequences this would have for the public users of financial services. Therefore, by now adding a fourth component to financial modernization, the opening, we must do so gradually to avoid risking what has been achieved.

With this objective in mind, the financial opening negotiated in the FTA contemplates a transition period, from its entry into force until the year 2000, during which market limits will apply to foreign institutions that establish subsidiaries, regarding most types of intermediaries regulated by our legislation. The limits on the participation of foreign intermediaries are, with respect to the main types of intermediaries (multiple banking institutions, brokerage houses, and insurers), both individual and aggregate. The former apply to each subsidiary individually, while the latter apply to all subsidiaries of the same type collectively. In other cases (financial leasing companies, financial factoring companies, and limited-object financial companies), aggregate limits are foreseen. Additionally, there are safeguards in the chapter on financial services of the FTA that our country can exercise unilaterally when credit institutions and brokerage house subsidiaries reach certain limits, which allow Mexico not to increase the aggregate participation of foreign financial intermediaries of those types. This is in addition to the general safeguards provided for in the FTA.

The initiative I submit to the consideration of the H. Congress of the Union proposes including a series of transitional articles, which refer to the market participation limits that will apply to foreign financial intermediaries. However, in congruence with the purpose of creating a general legal framework, such transitional provisions refer to the corresponding international treaties in order to know in detail the magnitude of such limits, as well as the duration of the periods in which they will be applicable. In this way, the possibility of negotiating in future treaties in which Mexico is a party different market limits and transition periods than those included in the FTA is preserved, but at the same time the concept is provided for in the law on the basis of which the limits will be measured, the procedures that must be followed to ensure their observance, as well as the special sanctions that will be applied to violators of such limits.

In particular, the initiative proposes a mechanism that guarantees strict compliance with individual and aggregate limits. Regarding the former, subsidiaries are obliged to give notice, within a period of five business days, when they reach ninety percent of the authorized limit. This is to ensure that financial authorities follow their growth with special attention so that they do not exceed such limits. In the event that, despite the above, the subsidiary exceeds the authorized individual limit, the Ministry of Finance and Public Credit may establish an asset reduction program so that this limit is observed again. In any case, for the fulfillment of capitalization requirements that exist, only the authorized limit will be taken into account. Sanctions for non-compliance with the above obligations range from the imposition of fines, the dismissal of intermediary officials, to the revocation of the authorization to operate as a financial intermediary.

Finally, to guarantee compliance with aggregate limits, it is provided that the Ministry of Finance and Public Credit may suspend the granting of authorizations when these have been reached. The Ministry of Finance and Public Credit may also decree the aforementioned suspension when the safeguard clauses contained in the applicable international treaties apply.

In addition to the reforms to the financial laws referring to the opening of the sector to external competition, the present initiative contains some other proposals described below.

For purposes of clarity and precision, Articles 11 of the Credit Institutions Law and 18 of the Law to Regulate Financial Groups are modified, establishing that shares of series "A", "B", and "C" will form part of the ordinary share capital and series "L" shares will integrate the additional part of the share capital of credit institutions and holding companies.

In congruence with the limit proposed for the individual shareholding participation of foreign financial entities in the capital of multiple banking institutions and holding companies of financial groups, provided their capital is diversified in their country of origin, it is considered convenient to expand the limit applicable to institutional investors, up to twenty percent of the share capital.

In the initiative of reforms I send for your consideration, it is established that when a person or group of persons intends to acquire control of a multiple banking institution or holding company of financial groups, they will require authorization from the Ministry of Finance and Public Credit. With this, the authorities intend to identify at all times the ultimate responsible parties for the management of any bank or financial group and analyze case by case the convenience of this type of operation.

It has been observed that to measure the growth of the banking system, the net capital of the system itself is a better reference than its paid-in capital and reserves. Therefore, it is suggested the modification of Article 19 of the Credit Institutions Law, so that the minimum capital required to constitute a bank is a percentage of the net capital of the system. To not substantially modify the amount that currently corresponds to the minimum capital, the point of twelve percent of the net capital of the system is suggested.

Three more reforms to the Credit Institutions Law are included in the initiative in question. With the first of them, the intermediaries referred to in fraction IV of Article 103 of the aforementioned Law will be given the name "limited-object financial companies". The second reform, attending to the growing globalization of markets, aims to empower the National Banking Commission to sign coordination treaties with banking supervisory authorities of other nations. Finally, the article on non-working bank days is adjusted so that the National Banking Commission can designate them through general provisions.

It is also proposed to adapt the provision governing the formation of financial groups referred to in the Law to Regulate Financial Groups, in two aspects: first, by allowing limited-object financial companies, recently created financial intermediaries, to be part of a financial group; second, given the importance and size of the financial entities mentioned below, stating that financial groups can be formed with at least two different types of the following entities: multiple banking institutions, brokerage houses, and insurance institutions.

It is proposed to empower the holding company to invest in shares representing at least fifty-one percent of the paid-in capital of foreign financial entities, so that Mexican financial groups can have subsidiaries abroad in which the holding company invests directly. Additionally, it is clarified that members of a financial group may invest in the share capital of said foreign financial entities.

In the Law of Organizations and Auxiliary Activities of Credit, it is proposed to allow foreign investment in exchange houses, to assimilate them to other auxiliary organizations of credit.

In the matter of securities investment advisors, it is proposed to adapt the legal text so that the provisions to avoid conflicts of interest, contained in the second paragraph of fraction I of Article 12 Bis, also include natural persons who provide this service.

The active process of internationalization of the securities market, among whose most important manifestations is the participation of Mexican issuers in foreign markets, poses the need to reform the provisions applicable to the acquisition of own shares. To this end, it is proposed to suppress the limitation that shares of the fixed portion of variable capital anonymous societies are not susceptible to being acquired by the issuing society, thereby seeking similar liquidity conditions and avoiding unjustified price arbitrages. Likewise, to ensure that through the purchase of own shares the percentages provided for the issuance of shares without voting rights are not exceeded, as well as with the limitation of other corporate rights, or restricted voting rights, it is planned to incorporate the express provision that such acquisition and the redistribution of the titles must not result in exceeding said percentages.

The growing evolution of financial groups poses the requirement to advance in the disclosure of consolidated figures, starting from the harmonization of accounting standards and principles among the different financial entities, in a process of approaching international practices. The reforms proposed to Articles 26 Bis 4, first paragraph, and 26 Bis 7, fraction V, of the Securities Market Law, as well as 99 of the General Law of Insurance and Mutual Society Institutions, will facilitate concrete results in this matter.

Additionally, it is proposed to modify the aforementioned Law and the Law of Surety Institutions to include an operational adjustment regarding the regime of subordinated issuances, which may form part of capital since they are of mandatory conversion to capital.

The reforms proposed to Articles 9, fraction III; 29, fraction VI, and 41, fraction III, of the Investment Companies Law, have the purpose of unifying the terminology used in the rest of the legal instruments of the financial system. A reform is also included that establishes requirements of moral and economic solvency, as well as technical and administrative capacity for the general managers of operating companies of investment companies.

The modernization of the regulatory framework applicable to investment companies, whose main purpose has been to provide them with competitive operating conditions to face the challenges posed by opening and globalization, determines the convenience of repealing the prohibition for them to invest in foreign securities and, at the same time, empowering them to conduct securities lending operations, subject to the provisions issued by the Bank of Mexico.

In view of the foregoing, and based on what is provided in fraction X of Article 73 of the Political Constitution of the United Mexican States, I allow myself to submit to the consideration of the H. Congress of the Union this Initiative of Decree that reforms, adds, and repeals various provisions of the Law to Regulate Financial Groups, Credit Institutions Law, General Law of Organizations and Auxiliary Activities of Credit, Securities Market Law, Investment Companies Law, General Law of Insurance and Mutual Society Institutions, and Federal Law of Surety Institutions.

STATEMENT OF MOTIVES
(Decree of November 17, 1995)
The constant evolution of the Mexican economy demands a continuous modernization of its financial system, based on the growing competitiveness among intermediaries and on a healthy and balanced relationship among all participants. In this context, the State also assumes its responsibilities within the framework of modernization, adjusting the provisions that regulate the

financial institutions to respond to current needs. Therefore, this initiative proposes modifications to various legal frameworks in aspects such as the protection of public interests by the National Banking and Securities Commission, the modification of the shareholding structure of certain financial intermediaries, the adoption of measures to assist in the prevention of the crime of money laundering, as well as the update of the legal regime of the Federal Treasury.

An efficient financial system requires the exercise of sound practices in the conduct of financial transactions between the public and the intermediaries that comprise it. Considering the complexity of the financial matter and its repercussions on the economies of families and businesses, it is sometimes necessary for the intervention of authorities to assist in achieving a more transparent and balanced relationship between these participants.

This initiative proposes, along with other reforms, modifications to the Banking Institutions Law with the aim of more effectively protecting the interests of users of banking and credit services. In this regard, it is submitted to the consideration of that Sovereignty to establish in the aforementioned legislation the authority of the National Banking and Securities Commission to review the standard contract models used extensively by credit institutions, with the purpose that they comply with the provisions of the Banking Institutions Law, the general provisions issued pursuant thereto, and other applicable regulations, as well as to verify that they do not contain confusing stipulations that prevent clients from knowing the scope of the obligations agreed upon. The Commission could order the modifications it deems pertinent to the aforementioned contract models, if applicable, suspend their use until they are modified, and order the publication of the characteristics of the transactions formalized with them.

On the other hand, in order to contribute to establishing a more balanced relationship between institutions and their clients, it is proposed that the Commission be able to remedy deficiencies in complaints presented to it for the benefit of the users themselves.

Regarding the Commission's powers in matters of conciliation and arbitration between banks and their clientele, it is proposed to incorporate the possibility for the parties to designate as arbitrator a third party other than the Commission itself, from among those proposed by the Commission. Likewise, it is proposed that if the credit institution declines arbitration and there are elements leading the authority to presume its liability, the Commission may issue a technical opinion that would be delivered to the claimant so that it can be asserted before the competent courts. It is worth noting that the Law would expressly establish the obligation for courts to take the aforementioned technical opinion into account, to better provide for in the respective procedure.

The development of the financial system constitutes one of the necessary conditions for generating economic growth. This development requires, among other aspects, encouraging the capitalization of financial institutions with internal and external resources, adapting the regulatory framework governing them for this purpose.

The above represented one of the objectives of the reform that that Sovereignty approved in February of this year, which included the laws to Regulate Financial Groupings, of Credit Institutions, and of the Securities Market. The practical result of these modifications regarding the shareholding of the aforementioned intermediaries has allowed the strengthening of their capital levels and the celebration of strategic alliances between national and foreign investors.

Currently, other members of the financial system, such as limited-object financial companies, auxiliary credit organizations, insurance and surety institutions, have been experiencing a growing need to obtain new resources in order to meet the capitalization and reserve creation requirements imposed by financial regulations to ensure the adequate performance of their activities.

In view of the foregoing, it is appropriate to adjust the laws of Credit Institutions, Organizations and Auxiliary Activities of Credit, General of Institutions and Mutual Insurance Societies, and Federal of Surety Institutions, to modify the shareholding structure of the capital of these financial entities, thereby facilitating access for national and foreign investors.

In this sense, it is proposed to increase the maximum percentage of limited voting shares that can be issued by auxiliary credit organizations, insurance and surety institutions, up to thirty percent of their paid-in capital, thereby expanding the possibility for these intermediaries to capture resources through capital-neutral mechanisms. Since these are shares that do not grant voting rights on the ordinary decisions of the company, it is foreseen that their acquisition shall not be subject to the individual shareholding limits established for ordinary shares, nor shall they count for purposes of determining the maximum percentage of foreign investment.

With respect to the ordinary capital of the financial intermediaries in question, the proposal suppresses the requirement of prior authorization from the Secretariat of Finance and Public Credit for foreign investment, when it is not for significant amounts, leaving it subject, however, to the individual limits applicable to nationals.

In this sense, regarding insurance and surety institutions, it is deemed appropriate to increase the maximum limits of individual shareholding, prior to the authorization of the aforementioned Secretariat, up to twenty percent of the social capital.

Additionally, with the object of suppressing administrative obstacles to investment, and considering the existence of the aforementioned authorization requirement, the obligation for holders of shares of insurance and surety companies to obtain share participation certificates from the National Insurance and Sureties Commission would be eliminated, which are currently required for amounts exceeding a certain proportion of the capital.

Regarding investments made by financial institutions from abroad directly or indirectly in insurance companies, surety companies, and auxiliary credit organizations, it is proposed to establish that the Secretariat of Finance and Public Credit may authorize the acquisition of shares, above the limits provided as a general rule for individual holding, with the purpose that intermediaries with predominantly Mexican capital can become subsidiaries of such institutions.

To promote a greater number of strategic alliances between national and foreign investors, it is proposed to reduce from ninety-nine to fifty-one percent the shareholding proportion of subsidiaries constituted as limited-object financial companies, auxiliary credit organizations, and surety institutions, which must necessarily be owned by a financial institution from abroad directly or indirectly. For this purpose, it is proposed that the ordinary social capital be integrated by two series of shares, as well as the establishment of rules regarding the designation of directors and auditors, to safeguard the rights of minorities.

On the other hand, in order for the financial system to effectively assist in the prevention of the crime of money laundering, and as part of a comprehensive reform to be submitted to its consideration in this matter, it is proposed to establish the authority for the Secretariat of Finance and Public Credit, hearing the opinion of the supervisory commissions, to issue guidelines, measures, and mechanisms to intermediaries financial, as well as their officials and employees, to prevent the commission of the aforementioned crime.

In another order of ideas, pursuant to what is established in the tenth transitional article of the Bank of Mexico Law, it may only continue to perform the role of trustee in the public economic development trusts it administers, until March 31, 1996. The cited provision states that the Federal Government through the Secretariat of Finance and Public Credit will agree with the credit institution that it determines, the acts conducive to the substitution of trustee. In this regard, it is considered that since the operating policies of these trusts are determined by the Secretariat of Finance and Public Credit, there is no clear need for the substitution of trustee provided for in the aforementioned article.

However, it might be convenient for these entities to have a different legal nature than public trusts. For this, it would be necessary to evaluate the possibility of establishing a new legal framework for such entities. In order to have sufficient time to carry out this evaluation, and its corresponding legal and administrative implementation, it is proposed to extend by two years the deadline established in the aforementioned tenth transitional article.

Finally, the new dynamics of the concentration, disposition, investment, and surveillance of the resources and values of the Federal Government, functions performed by the Federal Treasury, require updating the legal provisions regulating these activities, so it is proposed to modify the Law of the Federal Treasury Service in these aspects.

In accordance with the Bank of Mexico Law, which establishes that from April 1997 the Federal Treasury will no longer be able to issue checks in favor of third parties against the current account that the Central Bank keeps for it, it is considered convenient to expand the possibilities and alternatives for said Treasury to make its payments through credit institutions.

We also seek the adaptation of provisions that allow for the optimal administration of the Federal Government's financial resources, both regarding the concentration and the disposition and investment of said resources.

In other aspects, the reforms also aim to clarify and make more transparent figures such as the transfer of property in payment (dación en pago), where it is intended to establish a regime that provides greater legal security to both the State and the individual when settling their obligations in this manner.

Pursuant to current provisions, the surveillance function of the resources and values of the Federal Government is performed by the Federal Treasury through the Fund and Value Surveillance Unit under the Law on the Surveillance Service of Funds and Values of the Federation. However, the provisions of said legislation have been surpassed by modern practices of resource auditing. Therefore, it is proposed to repeal the cited Law, with the purpose of incorporating its fundamental content into the Law of the Federal Treasury, updating the administrative provisions in this matter.

For the aforementioned reasons and based on Article 71, fraction I of the Political Constitution of the United Mexican States, I permit myself to submit to the Honorable Congress of the Union through your dignified channel, the following Initiative of Decree that reforms, adds, and repeals various provisions of the Banking Institutions Law, Securities Market Law, General Law of Organizations and Auxiliary Activities of Credit, General Law of Institutions and Mutual Insurance Societies, Federal Law of Surety Institutions, Bank of Mexico Law, and Law of the Federal Treasury Service.

STATEMENT OF REASONS
(Decree of April 30, 1996)
With the purpose of contributing to economic reactivation and the strengthening of the financial sector, it is necessary to modify certain provisions of the Laws to Regulate Financial Groupings; of Credit Institutions; of the Securities Market; and General of Organizations and Auxiliary Activities of Credit.

A fundamental element to guarantee the solvency of financial intermediaries and protect the deposits of the public saver is the existence of a solid capital base in credit institutions. To guarantee better capitalization of these and brokerage houses, the Initiative contemplates three measures.

The first consists of prohibiting credit institutions and financial entities that are part of a group from granting financing for the acquisition of shares of the institution itself or of shares of said entities or of the financial group to which they belong, respectively, with the purpose of preventing resources destined to capitalize banks from originating in the institution itself or remaining within the same group, disincentivizing the contribution of fresh resources to the same.

In congruence with the above, it is proposed to establish the prohibition for financial entities of groups and credit institutions to receive as collateral shares of financial entities or holding companies, unless the Secretariat of Finance and Public Credit authorizes it, having heard the opinions of the Bank of Mexico and the National Banking and Securities Commission.

The second measure consists of allowing potential buyers of portfolios of institutions and investors by significant percentages of the capital of banks or holding companies of groups that include a bank, in the latter case prior authorization of the Secretariat of Finance and Public Credit, to know detailed information of said credits or of the total portfolio or other assets, respectively. This measure, in addition to supporting capitalization by increasing certainty in the acquisition of credits or investment in the capital of banks, will contribute to reactivating the economy, by expanding the credit capacity of the banking sector and allowing the financing of a greater number of projects destined to productive investment.

The third measure to foster capitalization consists of modifying the basis for calculating the initial fee that recently created banks must pay to the Banking Fund for Savings Protection (FOBAPROA). Currently, this formula is based on the net capital of the institutions and the equity of FOBAPROA, which disincentivizes the capitalization of new banks. Therefore, it is proposed that, like ordinary and extraordinary fees, the Secretariat of Finance and Public Credit, at the proposal of the Bank of Mexico, determine the initial fees using criteria of general application taking as a base, the amount of liabilities and the level of capitalization of each institution.

Likewise, with respect to the Securities Market Law, it is proposed to modify the basis for calculating the initial contributions that recently created brokerage houses and stock specialists must make to the Securities Market Support Fund (FAMERVAL), also empowering the Secretariat of Finance and Public Credit to determine them, at the proposal of the Bank of Mexico, through criteria of general application, which will take into account, among other elements, the maximum operating capacity, as well as the volume and risk of the operations of each company.

On the other hand, in order to make the payment system more efficient and achieve a more expeditious settlement of securities, it is proposed to empower the Bank of Mexico to authorize credit institutions to carry out repo and securities lending operations on behalf of third parties that tend to streamline said system, without the intermediation of brokerage houses.

Additionally, with the object of homogenizing and modernizing the regulation applicable to the different financial intermediaries, it is proposed to empower the Secretariat of Finance and Public Credit to authorize mergers between multiple banking institutions with any other company, as currently it is only empowered to authorize mergers between banks; authorize the constitutive deeds and their modifications, of limited-object financial companies and credit information societies; and allow credit institutions to keep their information on optical disks and other media.

The repeal of the relevant paragraphs of articles 2 and 103 of the Banking Institutions Law is proposed, in order to give greater legal certainty to individuals.

With respect to financial groupings, finally, it is proposed that any entity of a group may dissociate from it automatically, when FOBAPROA or FAMERVAL acquire at least 50% of its social capital, without the need to hold the corresponding assemblies for that purpose in the group and in the entity to be dissociated.

On the other hand, regarding the General Law of Organizations and Auxiliary Activities of Credit, general warehouses, as non-bank financial intermediaries, play an important role in the economic growth of the country.

These intermediaries must be auxiliary in strengthening savings, expanding productive capacity, and economic reactivation. In this virtue, it has been considered necessary to expand the range of their activities related to financing, as well as to the consolidation of domestic and foreign trade, in order to raise the competitiveness levels of these organizations.

Likewise, with respect to fiscal deposit, some activities are clarified according to Customs Legislation, foreseeing that these intermediaries can manage on behalf and in the name of the depositors, the granting of guarantees in favor of the federal treasury.

Other reforms proposed in this regard refer to simplifying the registration of deposit certificates and pledge bonds, through rules issued by the National Banking and Securities Commission; substituting the authorization to lease premises with prior notice; establishing rules for the Secretariat of Finance and Public Credit to set investment limits regarding paid-in capital and reserves; flexibilizing the discount percentage to a level not greater than 50% in successive auctions of the sale of merchandise, and converting the deposit agreement into an executive title along with the statement of account certified by the warehouse accountant, to achieve the expeditious recovery of debts, as established in this and other laws, in the case of other intermediaries.

Finally, other technical aspects provided by the Initiative, in matters of auxiliary credit organizations, consist of establishing in the Law the legal basis for the rules regarding the maximum amount of liabilities in favor of financial lessors.

For the aforementioned reasons, and based on what is provided in fraction I of article 71 of the Political Constitution of the United Mexican States, through your dignified channel, citizens secretaries, I submit to the consideration of the Honorable Congress of the Union, this Initiative of Decree that reforms, adds, and repeals various provisions of the Law to Regulate Financial Groupings; Banking Institutions Law; Securities Market Law; and General Law of Organizations and Auxiliary Activities of Credit.

STATEMENT OF REASONS
(Decree of May 7, 1997)
In November 1995, the Honorable Congress of the Union, as part of an integral effort in the matter of combating the crime commonly known as "money laundering," approved various reforms to financial laws, so that the Mexican financial system could effectively assist in the prevention of said illicit act.

To this effect, in the cited laws, the authority was established for the Secretariat of Finance and Public Credit, hearing the opinion of its respective supervisory commissions, to issue to financial intermediaries, as well as their officials and employees, the guidelines, measures, and mechanisms to prevent, detect, and combat the commission of the aforementioned crime.

As part of that same integral effort, in May 1996, the Congress of the Union issued the Decree that Reforms, Adds, and Repeals Various Articles of the Penal Code for the Federal District in Common Jurisdiction and for the Entire Republic in Federal Jurisdiction; of the Federal Tax Code; of the Code of Criminal Procedures for the Federal District; and of the Federal Code of Criminal Procedures.

As one of the fundamental aspects of these reforms, in article 400 bis of said Code, a new typical description of activities known as "money laundering" was established, in which emphasis was placed on the intentionality of the offender to hide or transform the illicit origin of the resources, also seeking to make our internal legislation on the matter and its corresponding financial legislation compatible with international legislation, which would serve as preventive and control measures, to assist in detecting financial operations with resources of illicit origin.

In the report issued by that Honorable Chamber of Senators, it was then recognized that the complexity and multinational nature of drug trafficking and its numerous implications and ramifications, pose crucial questions to the nations of Latin America, as well as to their public and private institutions. This, mainly through the conduct traditionally known as "money laundering," understood as the act of disguising the origin of money or covering up the ownership of the same coming from an illegal activity, to make that money appear as legitimate.

It was emphasized at that time and reiterated now, that it is the national financial system that primarily suffers the effect of injections of this "laundered money," but that banks, basically, among other financial institutions, are the most affected by the performance of unclear operations, with money of dark origin, which can derive and do derive, in frauds.

Regarding the aforementioned article 400 bis, the report itself considered it convenient to maintain in the Law the control of the Secretariat of Finance and Public Credit over the penal actions that are exercised in this matter, due to the implications that they have on the financial system as a whole and for the fiscal and financial effects they may have, without failing to take into account that the Public Ministry is

the holder of the exercise of criminal actions, so the opinion of the Secretariat of Finance and Public Credit ceased to be binding, except in cases where the resources of illicit origin are related to the financial system, establishing for said Dependency the mandatory and non-discretionary faculty to exercise its verification and reporting powers.

In the same vein, in November 1996 that same Sovereignty issued the Federal Law Against Organized Crime, in which, recognizing the great influence that drug trafficking and other crimes of this nature exert on financial activity, it was considered a serious crime, susceptible of being committed by criminal organizations, the now called "operations with resources of illicit origin", provided for in the aforementioned article 400 bis of the substantive penal codification.

In that same law, the collaboration of fiscal and financial authorities in the investigation of the financial nature activities of organized crime was established, stating that the requests for information or documents related to the financial system that the Attorney General of the Republic, the public servant to whom this faculty is delegated, or, in its case, the judicial authority, make, will be made through the National Banking and Securities Commission, the Insurance and Surety Commission and the Retirement Savings System, in their respective competencies, and those of a fiscal nature, through the authority determined by the head of the Secretariat of Finance and Public Credit, and that they can only be used in the investigation, having to keep the strictest confidentiality.

For the reasons stated and given that the substantive legislation on the new criminal type of operations with resources of illicit origin uses terminology with greater technical content and precision, I have considered it convenient to propose to that Sovereignty the use of the same terms to refer in financial legislation to the cited typical conduct to which we have been referring.

The above implies minimal modifications to article 115 of the Credit Institutions Law, reiterating also that the exercise of the attributes that are conferred there on the fiscal authority, must be considered within the exceptions of reserve that establishes article 117 of the same Law.

In the same sense, the necessary adjustments to the text of articles 52 Bis 3 of the Securities Market Law; 95 of the General Law of Organizations and Auxiliary Activities of Credit; 140 of the General Law of Insurance and Mutual Societies and 112 of the Federal Law of Surety Institutions are also raised.

In view of the above and based on what is established in article 71, fraction I, of the Political Constitution of the United Mexican States, I allow myself to submit to the Honorable Congress of the Union, through the worthy channel of you, the following:

STATEMENT OF REASONS
(Decree of January 18, 1999) 1
STATEMENT OF REASONS
(Decree of May 17, 1999) 2

1 See Parliamentary Gazette of the Chamber of Deputies, LVII Legislature, Year II, number 178, of December 12, 1998, in which the statement of reasons of the "Law for the Protection and Defense of the User of Financial Services", published in the Official Journal of the Federation on January 18, 1999, is contained, which in its second transitory article repeals articles 102 and 103 of the General Law of Organizations and Auxiliary Activities of Credit, relating to the procedures to protect the interests of the public.

2 See Parliamentary Gazette of the Chamber of Deputies, LVII Legislature, Year I, number 132, of October 8, 1998, which contains the initiative of "Decree by which various provisions of financial laws in matters of crime are reformed, added and repealed" presented by the Parliamentary Group of the National Action Party.

It should be noted that in said Gazette it is specified that the Parliamentary Groups of the Institutional Revolutionary Party, National Action Party and Labor Party also presented several initiatives of Decree of reforms and additions to various financial laws in matters of crime, with dates April 29, July 1, October 8 and December 3, 1998, for which reason the Commissions of Finance and Public Credit and Justice devoted themselves to holding meetings of analysis and exchange of points of view, for the discussion, approval or modification in its case of said initiatives. The report of the Decree in question is contained in the Parliamentary Gazette of the Chamber of Deputies, LVII Legislature, Year I, number 179, of December 13, 1998, turning the Board of Directors of the Plenary of the Chamber of Deputies with this same date to the H. Chamber of Senators, the draft Decree of reforms to various financial laws in matters of crime, which was approved with modifications by the Plenary of the same Chamber of Senators on April 20, 1999. The reasons for the reforms in question can also be consulted in the publication that the CNBV made of the Credit Institutions Law, Fourth Edition, September 2003.

STATEMENT OF REASONS
(Decree of January 5, 2000) 3

Currently, various entities that have been acting and act as Commercial Companies in everything related to the usual and professional purchase and sale of currencies and metals, have seen their rights diminished, due to the unilateral and arbitrary attitudes of Brokerage Houses and Banks.

Banks and Exchange Houses are having these attitudes with the purpose of monopolizing the market, so these acts that exceed the limits of the right must be restricted, since even some Banks have canceled the checking accounts of Currency Centers, arguing that these are "money launderers".

The public and social interest, is overridden in an important way, to the private and particular interest, therefore, there must be a control of illicit activities, especially when it comes to drug trafficking and money laundering, but this should not represent any violation to the interests of individuals who had been exercising a lawful commercial activity in the performance of their functions, and thus, the normative proposal that is presented today is essential.

This proposal does not oppose the provisions that tend to control, limit and in its case extinguish money laundering. It is not intended in any way to contravene or counteract the norms related to the control of money laundering and everything related to drug trafficking, but on the contrary, it complements the legal security of that type of economic operations, so that its regulation remains well defined within the legal framework.

Likewise, we consider that it must be avoided that a few parts unilaterally appropriate themselves of the usual and professional purchase and sale of currencies and metals, for this reason, it is considered that without the reforms proposed here, the Currency Centers will be left out of this economic universe, thus limiting the activity to the exclusive benefit of Banks and Exchange Houses.

In addition, there is a risk of the closure of this type of companies (approximately 1,800); causing, at a given moment, the dismissal of approximately 50,000 people and the people who depend on them.

On the other hand, it is very important to point out that Currency Centers have been unable to buy "Money Orders" from low-income Mexicans, who receive them from their relatives in the United States, due to the lack of Exchange Houses or Banks that want to buy them for fear of forgery, losses and other reasons, leaving that group of citizens without immediate resources to subsist.

It must be very clear that under no concept with this initiative is it intended to limit in any way the current provisions that regulate the operations of purchase and sale of currencies and metals, in order to detect illicit money or money from drug trafficking, but neither should we neglect, the fact that with the operation manuals the Commercial Companies that had been performing in this trade are unprotected. That is why the proposed modifications and additions tend to continue with these measures to prevent illicit money.

For the foregoing, the undersigned deputies of the Parliamentary Group of National Action, we present to this Assembly the following initiative of Decree by which the General Law of Organizations and Auxiliary Activities of Credit is reformed and added.

STATEMENT OF REASONS
(Decree of December 29, 2000) 4

3 See Parliamentary Gazette of the Chamber of Deputies LVII, Year III, number 406-I of December 9, 1999, which contains the Reasons of the "Decree by which fraction IV is reformed and a fraction V is added to article 81-A of the General Law of Organizations and Auxiliary Activities of Credit". The Statement of Reasons corresponds to the initiative of reforms and additions to the General Law of Organizations and Auxiliary Activities of Credit, presented on April 30, 1998 by deputies of the Parliamentary Group of the National Action Party in the Chamber of Deputies of the H. Congress of the Union.

4 See Parliamentary Gazette of the Chamber of Deputies, LVIII Legislature, Year III, number 611 of October 25, 2000, which contains the Reasons of the "Decree by which the Trust is created that will administer the Fund for the Strengthening of Savings and Loan Societies and Cooperatives and Support for their Savers and is added to article 51-B of the General Law of Organizations and Auxiliary Activities of Credit" published in the Official Journal of the Federation

STATEMENT OF REASONS
(Decree of June 1, 2001)

Exchange houses have as their main object the purchase, sale and exchange of currencies with the public in general within national territory, activity that they perform in a habitual and professional manner, as contemplated in article 81 of the General Law of Organizations and Auxiliary Activities of Credit, for which it is required, in accordance with said legal provision, the authorization of the Secretariat of Finance and Public Credit, same authority that must hear the opinion of the Bank of Mexico and of the National Banking and Securities Commission in order to be in a position to grant authorizations for the constitution of societies that dedicate themselves to the aforementioned.

Likewise, they carry out said purchase, sale and exchange of currencies through fund transfers on bank accounts, as provided in article 82, fraction I, subsection c) of the aforementioned law.

On the other hand, the current article 81-A, fraction V of the law in question allows the commercial societies that have been called currency centers, to carry out the purchase and sale of currencies through fund transfers through credit institutions.

In order to limit that the faculty indicated in the two previous paragraphs is proper of the exchange houses, it is proposed to specify in article 81 of the law in question, that authorization from the Secretariat of Finance and Public Credit is required to carry out the operations of purchase, sale and exchange of currencies, which are carried out through transfer or transmission of funds, thereby giving a clear definition to the legal framework that regulates the exchange houses and consequently greater security to the users of their services.

The above, is in line with the proposal for modification to article 81-A, particularly with regard to the repeal of fraction V, in order to eliminate the faculty that currently has the commercial establishments contemplated in said article, to carry out purchase and sale of currencies through fund transfers through credit institutions, since these societies do not require authorization to constitute and operate by the Secretariat of Finance and Public Credit, are not subject to any regulation issued by the Bank of Mexico, lack the supervision of the National Banking and Securities Commission and can be constituted with the minimum social capital established by the General Law of Commercial Societies, which is $50,000.00.

On the other hand, it is proposed to modify fractions I to IV of article 81-A, specifying that the operations carried out by the currency centers must not be greater than ten thousand dollars per client, which implies that the same client cannot carry out transactions, that added exceed the amount of ten thousand dollars of the United States of America, in order to detect operations with resources of illicit origin.

On the other hand, it is proposed to add to article 81-A of the aforementioned Law, paragraphs third and fourth, in order for the Secretariat of Finance and Public Credit to issue general provisions tending to establish measures and procedures to prevent and detect acts or operations with resources, rights or assets that proceed or represent the product of a probable crime, thereby complying with the recommendations applicable to the exchange market, issued by the Financial Action Task Force on Money Laundering (FATF), an Organization to which Mexico entered as a full member in June 2000.

For the above and in exercise of the faculty that confers to the Federal Executive fraction I of article 71 of the Political Constitution of the United Mexican States, through that Chamber of Senators, I allow myself to submit to the consideration of the H. Congress of the Union the following initiative of

of December 29, 2000, as well as the Parliamentary Gazette of the Chamber of Deputies, LVIII Legislature, Year IV, number 654 of December 19, 2000, which contains the report of said Decree, by which article 51-B of the LGOAAC is modified to foresee the possibility that in the auxiliary organizations of credit referred to in article 38-A of the same law, there is a specific budget provision to assume responsibility for the obligations contracted with their partners or with third parties.

STATEMENT OF REASONS
(Decree of June 4, 2001)

Savings and loan societies, as true socio-economic institutions, must face the constant transformations that, progressively occur in the current context.

An adequate legislation of these motivates that the legislator contemplates the need to offer an adequate channel that analyzes the collective needs of citizens who develop activities that generate wealth and derive in stable employment.

In this century, the national-rooted collective solidarity tradition has been enriched with the contributions of universal and particular history and particularly with the cooperative movement and the national "cajista" system that rooted its roots in our country more than a century ago and has evolved to consolidate today thousands of cooperatives and social organizations that integrate approximately two million partners.

The social significance of this economy, with its forms of work and its social organization, exceeds the specific weight they have in the National Product and in the generation of values, in addition to representing the oldest and most original nucleus of the nation, they maintain part of the original identity, show greater capacity to respond to contemporary problems and are characterized by attending basic needs rather than by their profitability. Legislating for them is taking into account their origin and thinking in terms of their social significance, even before their economic dimension.

The general laws and regulations that have been approved contemplate exclusively the agrarian social segment, leaving the cooperative and solidary sector circumscribed to the legal framework of the particular laws that have been dictated about concrete situations of the last decades and, worse yet, commercial law has been applied supplementarily to those figures.

This last aspect, which is explained by the scarce legislative and jurisprudential discussion on the nature and logic of the social sector, is opposed to the spirit of our Constitution, at the same time that it violates the right in its deepest sense of justice contained both in the substantive and procedural normative framework since it encompasses a set of individuals, organizations and activities in a legal framework to which they are alien, different and even opposed.

Currently, there are several types of organizations in Mexico that capture popular savings and grant credits for consumption or for the production of micro and small businesses.

The current regulatory framework that governs the different associative figures of the social financial sector is deficient and contradictory, said legislation not being appropriate to the object it intends to regulate.

An example of the above is article 33 of the General Law of Cooperative Societies, which establishes that the Secretariat of Finance and Public Credit will issue the administrative provisions under which said financial entities will be governed, hearing for this purpose the opinion of the respective National Confederation and that of the Superior Council of Cooperativism; however, these have not yet been issued.

On the other hand, Savings and Loan Societies (SAPs), regulated by the General Law of Organizations and Auxiliary Activities of Credit (LGOAAC) are subject to excessive auditing without it translating into greater operational efficiency, in addition, the LGOAAC violates the constitutional right to free association of Mexican citizens by not allowing SAPs to federate for the defense and representation of their guild interests.

The other existing legal figures also have great deficiencies in their regulation, but especially in the surveillance that the Secretariat of Finance and Public Credit exercises over them, in addition to not presenting any type of security for their partners.

Thus, we find ourselves with a deficient and inadequate legal framework to the solidary nature of the financial organizations of the social sector.

Currently, to the entities that carry out popular savings and loans, the provisions of the banking and commercial law that has nothing to do with the associative and solidary spirit that animates this type of organisms are applied, in a supplementary form.

Taking into account international experience, it has been proven that in countries where there is specific regulation for the activities of Solidary Financial Organizations, they have been able to grow and consolidate as an attractive alternative for millions of people in the world.

The financial reforms in our country have invariably revolved around the structure and functions of the Banking System. However, despite the great attention dedicated to banking, "Banking" in Mexico is very poor compared to that of other countries of similar economic dimension and as a consequence banking services continue to be inaccessible to large sectors of the population.

After the financial crisis, the need to establish more rigorous controls on risk management and operating costs have reinforced the barriers for lower-income population sectors and micro and small businesses to access the services provided by the informal banking system. In addition, with banking functions, the greater participation of international banks and the greater opening of the financial services market in Mexico, the banking system must maintain its orientation towards global markets, limiting its capacity to undertake more aggressive policies for the development and integration of the lower-income and higher-risk sectors.

In this situation, the demand for financial services from lower-income and lower-education sectors has given rise to a wide range of organizations and systems that offer savings and credit services frequently outside the laws that regulate financial entities and without government supervision. The lack of an institutional framework to regulate these intermediaries has resulted in savers and users being exposed to risks and frauds that in many cases have led them to lose their assets.

This Law initiative strengthens trust and credibility in the financial activities that they develop by establishing identical organization, operation and functioning norms for all financial organizations, without any exception.

Without a doubt, the strengthening of Savings and Loan Entities depends largely on the development of joint work experiences, coordination to carry out common actions and the educational work carried out by the leaders of said organizations.

There is a need to create a legal framework that as ordered by our magna carta, "establishes the mechanisms that facilitate the organization and expansion of the economic activity of the social sector", indeed with the present law initiative a fundamental provision of the Constitution is fulfilled that promotes the balance between the public, private and social sectors, establishing for the latter clear provisions that stimulate and strengthen it, in addition to being based on the historical solidary tradition of the Mexican people.

To strengthen popular savings intermediaries, a new figure of commercial society is proposed: the popular savings society. In it, individual initiative is articulated to promote its constitution, the democratization of capital to give its management a wide social base, and the participation of the savers themselves to make their contribution to community development apparent and effective.

With the figure of the popular savings society, it is intended to conserve the principles of solidarity and common good characteristic of savings and credit cooperatives, communicating them in a context of greater openness and social interaction. It would also be to give a new impetus to their associative capacity, promoting that they group themselves in federations and in a national confederation.

Popular savings and credit entities are authorized to provide a range of services similar to that offered by modern banking to their individual and small business clientele. It will be considered that it is crucial not to legally limit the provision of services, but that the legal framework will channel the activity of their intermediaries, to fully satisfy the needs of the lower-income population sectors, dispersed throughout the national territory, with the products and services that will adopt the modalities and conditions that are convenient for the users of the territory attended by each society in particular, taking care of the long-term viability of the intermediaries.

Popular savings societies will provide their services within a defined territory, such as a locality or region, or in terms of a group of people united by a common bond.

The creation of a regulatory fund is proposed as the axis of the system, which will incorporate the regulation and promotion systems designed by the Bank of Mexico.

The popular savings regulatory fund will be the specialized financial authority responsible for attending to popular savings societies, in accordance with the policies and guidelines established by the Ministry of Finance and Public Credit and the Bank of Mexico.

The fund is empowered to exercise direct control over the collection and channeling of resources carried out by each popular savings society. The fund is also empowered, through joint actions with federations and confederations, to provide the technological and service support infrastructure that would allow reducing transaction costs and developing more efficient and competitive savings and credit instruments.

The fund will administer the Deposit Insurance for Popular Savings and Credit Societies in accordance with criteria and projects similar to those currently existing for bank savings.

With the aim of giving operability to the proposed project, in light of the current circumstances of the national economy and in order to establish the necessary instruments and mechanisms that provide certainty and permanence to guidelines for the development of the national productive plant, which in turn allows for the interaction of the public and private sectors, it is decided that to optimize existing organizational resources and to give continuity to already structured and tested programs, they remain under the direction of the National Institute for the Promotion of Micro, Small, and Medium Enterprises.

To fulfill its object, the Institute will embody its objectives and goals in the General Program, from which Regional Development Programs, Complementary Guarantees for the Financing of Micro, Small, and Medium Enterprises, Training, Technology Development, Government Purchases Assurance, etc., will be derived, with the support of professionals and specialized institutions.

With the object of ensuring a permanent source of resources that sustain the programs and support developed in accordance with this Law, as well as for the granting of complementary financing guarantees for the promotion of micro, small, and medium enterprises, the National Fund for the Promotion of Micro, Small, and Medium Enterprises is constituted, which will be integrated with the item approved annually for this purpose in the Expenditure Budget of the Federation. The fund will be constituted as a trust administered by the Institute and will be entirely dedicated to supporting the referred projects.

The Deputies of the Parliamentary Groups of the National Action Party, the Institutional Revolutionary Party, and the Green Ecologist Party of Mexico have worked during the LVII legislature and now in this LVIII, jointly with the federal government, the Ministry of Finance and Public Credit, along with the partners of savings and loan associations, cooperative societies, savings and loan societies, and other interested parties in the realization of this initiative, in order to provide greater legal certainty to companies dedicated to popular savings and credit within a framework of legality.

For the considerations stated, and in exercise of their faculties, the undersigned Deputies of the Nation of the LVIII Legislature of the Honorable Congress of the Union, submit to this Honorable Chamber the Following:

STATEMENT OF MOTIVES
(Decree of June 13, 2003)

Since the beginning of my government, I have set as priorities the promotion of growth with stability and the generation of greater certainty in the various areas of development for Mexicans.

To achieve both purposes, it is fundamental to strengthen two mechanisms. First, better financing conditions for the development of various activities in the production and commerce sectors. On the other hand, conditions of greater certainty through a fair and effective Rule of Law.

One of the basic tools for financing the development and growth of any Nation is credit. Accessing it constitutes a permanent opportunity for improving the level and quality of life, as well as a solid boost to productive and commercial activities. A fundamental element for strengthening access conditions to credit is having a Rule of Law that, through its efficacy and clarity, reduces risks and protects both those who request it and those who grant it, through clear and precise rules.

To strengthen the conditions for access and granting of credits, it is fundamental that the guarantee regime has the confidence of the parties. Such is the importance of said regime that my government considered its review as part of the General Economic Policy Criteria for the fiscal year 2002, which were submitted to the consideration of the Honorable Congress of the Union.

Likewise, norms are required that specify the fundamental elements that integrate credit operations. In the same sense, it is a necessary condition to have dispute resolution procedures that are consistent with the constitutional mandate to access prompt and expeditious justice.

Therefore, without an adequate legal framework that provides confidence to those who are demanders and offerers in credit operations, it would not be possible to have the minimum conditions of confidence to promote it.

During my government, various initiatives to strengthen the legal framework linked to credit have been submitted to the consideration of the Honorable Congress of the Union. Such is the case of the package of initiatives in financial matters approved by that sovereignty. With these reforms, a set of rules entered into force so that credit institutions would have a clearer legal framework for supervision and oversight and more agile in the area of their corporate governance. Thus, the combination of the principles of efficacy and efficiency in this reform constituted a further step in the strengthening of our financial institutions and, consequently, of our institutional framework to generate better conditions for growth.

However, it is necessary to conclude this legal process with a set of reforms that are directly linked to credit operations and the procedures for resolving their disputes.

For the reasons stated, in exercise of the constitutional power granted to the Federal Executive, the present INITIATIVE OF DECREE THAT REFORMS, ADDS, AND REPEALS various provisions tending to contribute to the reactivation of credit is submitted to the consideration of the Honorable Congress of the Union, through your dignified channel.

In particular, this Initiative reforms, adds, and repeals various articles of the General Law of Titles and Credit Operations; the Commercial Code; the Credit Institutions Law; the Securities Market Law; the General Law of Mutual Insurance Institutions and Societies; the Federal Institutions of Surety Law; and the General Law of Organizations and Auxiliary Credit Activities.

The Initiative addresses two fundamental topics. On the one hand, credit operations; and on the other, the norms of commercial trial procedures.

In the matter of credit operations, this initiative considers that one of the fundamental values to strengthen them is the free conventionality of the parties to establish their terms and conditions. In addition, it is substantial that the concepts of the various credit operations be enriched. On the other hand, it is convenient to specify some scopes and limits that financial institutions would have in some of the credit operations proposed for reform here.

It should be noted that within credit operations, the guarantees of credits acquire special importance.

The credit operations that this initiative proposes to reform are the following: a) pledge without transmission of possession; b) trust; c) guarantee trust; d) agricultural and development or feeding credit; e) mortgage; and f) stock exchange surety. Additionally, reforms are proposed to financial leasing and factoring operations.

In the matter of commercial trials, this initiative submits to the consideration of the Honorable Congress of the Union reforms to general rules of commercial trials, the commercial executive trial, and the extrajudicial procedure for the execution of guarantees granted through pledge without transmission of possession and guarantee trust.

In the matter of credit operations, various reforms to the General Law of Titles and Credit Operations are proposed.

In said Law, Article 346 defines pledge without transmission of possession. Although the legislator clearly established that the fundamental element of this figure lies in the fact that the debtor retains possession of the pledged goods, it provided for the exception that it be possible to agree that the creditor or a third party has material possession of said goods. From the current definition, it follows that in the so-called "pledge without transmission of possession," some modality of traditional pledge is also possible, in which ownership is transmitted to the creditor. In view of the fact that the execution procedure of the pledge without transmission of possession indicated in Title Third Bis of the Commercial Code is different from the traditional one, the current article invites the parties to choose, under the regime of traditional pledge, the execution procedure to which they wish to submit in case of default.

Although the spirit indicated here can be understood, it is considered that this ambiguity in the definition of the concept of pledge without transmission of possession derived from the exception established there itself generates confusion and distorts the true meaning of this figure. Therefore, it is proposed in this initiative to suppress the exception that it may be agreed that the creditor or a third party has material possession of the goods, in order to clearly state that this type of pledge starts from the assumption that it is the debtor who retains possession of such goods and that, therefore, it is only governed by the specific provisions for this operation. In virtue of the foregoing, the initiative proposes adding a new second paragraph to Article 346. The only exception to this principle will occur when, in accordance with Article 363 of the current law, the parties designate as an expert a general warehouse of deposit to entrust it with the custody and conservation of the pledged goods.

The initiative submitted to the consideration of the Honorable Congress proposes to clarify the concept of guarantee, so that it is perceived that in reality the object of the contract is a guaranteed obligation. It is for this reason that Article 348 is modified.

The change indicated in Article 350 is due to the conviction that this initiative reiterates that it must be the parties and not the law who primarily fix the scope that the value of the guarantee should have and, therefore, the ordinary interests that derive from the concursal process. This in turn provides the necessary congruence with the spirit current in the Commercial Bankruptcy Law of not establishing by law any prior limit to the value of the amount due for non-payment. This spirit of conventionality around the limits of the value of the guarantee to cover the debt supports the proposal of this initiative to repeal Article 379, so that the parties determine if in the case that the product of the guaranteed asset does not reach to cover the total amount of the obligations charged to the debtor, the latter remains, despite not reaching to achieve such coverage, released from his obligation.

In the reform of Article 361, the possibility is provided for the debtor to transfer possession of the pledged goods. This aims to strengthen the spirit of the reform carried out in this matter in 2000, which is oriented to allow the debtor to efficiently direct the asset towards its greater value.

The purpose is to generate better conditions for the debtor to achieve his own benefit, which will also redound in favor of productivity and economic development. However, such transfer must have the authorization of the creditor himself, in view of what happens with the effect of the transfer in terms of gains or losses for the debtor, which impacts the value of the guarantee. Therefore, it is justified that in this case the creditor has the full right to manifest his will, but only as long as this condition has been agreed upon when constituting this type of pledge.

In view of the fact that the object of the pledge without transmission of possession is to guarantee payment, it is just that the creditor manifests his consent on the disposition that the debtor makes of the good given as guarantee. Therefore, if a third party interested in acquiring the good knows that it is subject to guarantee, he must assume that the debtor cannot fully dispose of the thing unless with the consent of the creditor. In this spirit, it is evident that if a third party acquires the good given as guarantee, it is a sufficient condition to suppose that there was bad faith on the part of the debtor, in view of the fact that this act attacks an essential element of the contract, such as consent, which leaves additional market or commercial practice considerations in a secondary plane.

If the creditor does not authorize the transmission of possession of the pledged goods, the operation carried out without this consent must be null, as established by Article 356 of the current General Law of Titles and Credit Operations. In view of the fact that, in addition, there may be generation of damages and losses, it is convenient to explicitly establish this last effect.

It is proposed in this initiative to reform Article 374 so that the creditor can demand from the debtor the payment of damages and losses caused by such alienation. Likewise, it may be provided in the respective contract that, if alienations are carried out in contravention of what is established by this article, which establishes the cases for which the debtor must request authorization from the secured creditor to alienate goods to certain persons, the term of the credit shall be considered prematurely due.

The trust has been for several years a figure of enormous significance in legal relations. In Mexico, its expansion has been extraordinary. Due to its flexibility and potential to contribute in various ways to the development of multiple areas and activities, due to the benefit this figure allows granting with a patrimony entrusted by any person, it is fundamental that the law expresses with clarity the scopes and limits of this concept.

For this reason, this initiative proposes to establish a definition of trust. First, the trust is defined as a contract, which aims to revalue and consolidate the importance of an agreement of wills and the free conventionality of the parties to achieve certain ends in the terms and conditions they consider most convenient at their choice. Likewise, the clear fact that this figure is a contract allows anticipating the scopes and consequences that it might have when situations that vitiate the consent of the parties arise. In conclusion, by defining the trust as a contract, an equilibrium is reached between the enormous potential that the free consent of the parties themselves can grant to this figure, due to its flexibility, with the legal security that is backed from the moment that every contract is subject to the general principles of law.

In the definition itself that is proposed to be established in Article 381 of the General Law of Titles and Credit Operations, it would be added that by virtue of this contract, the settlor transmits to a fiduciary institution the ownership or title of one or more goods or rights. This point is also fundamental to promote that the trust can have the maximum benefit, for the benefit of the parties. If the ownership or title of the goods or rights is transmitted, the fiduciary institution can fully dispose of them. It is then that the object of the contract can be directed towards its greater value. The conviction that the trust contract is one of transmission of ownership or title of goods or rights is also supported by some jurisprudential theses, such as that issued in 1997 by the Sixth Collegiate Court in Civil Matters of the First Circuit, in 1998, when it established regarding the guarantee trust that the fiduciary is the owner of the entrusted goods affected by the purpose to which they are destined.

Of course, the full disposition of said goods or rights has a purpose established precisely in the contract itself; the settlor transmits the ownership or title of goods or rights to the fiduciary institution only so that they are destined to lawful and determined ends. Thus, it is the agreement of wills itself that establishes the scopes and limits of the right of ownership that the fiduciary institution enjoys fully.

The lawful and determined ends to which the goods that are the object of the trust are destined will be entrusted for their realization to the fiduciary institution itself, as proposed in this initiative in the reform of Article 381. With these concepts, it is intended that first, the principle of trust deposited in whoever will act as fiduciary for the achievement of the trust's ends be revalued. More than an actor interested in the direct benefits derived from the goods or rights, the fiduciary is the party in the contract that facilitates their administration in favor of whom is determined in the contract. By the trust with which he is entrusted -and which constitutes a value

fundamental to the trust itself - the role of the trustee in the contract consists of assuming a unique responsibility to act as an impartial agent of the interests involved in the contract itself and, therefore, to safeguard its mission as if it were a good head of household.
The fact that the goods or rights that are transferred - by virtue of the celebration of the trust contract - to the hands of the trustee in their capacity as owner, with the limitations derived from the specific purpose that has been established, this initiative considers it important to establish in article 386 a rule that obliges the fiduciary institution to account for said goods or rights, but keeping them separate from its freely available assets. With this, it is intended to avoid confusion between the main heritage of the trustee's patrimony and registered by virtue of its role in the trust, with the objective of guaranteeing that the goods or rights in trust are indeed not destined for any other purpose than that indicated in the contract itself. With the purpose of making the regulations governing the trust congruent with the new definition proposed, this initiative plans to suppress the circumstance that currently makes it possible not to nominally designate the fiduciary institution, according to what is provided in the second paragraph of article 385 of the General Law of Titles and Credit Operations. Therefore, if this initiative is approved, every trust must have in its constitution the signatures of the settlor and the trustee. Thus, the importance that this initiative accords to the fiduciary institution within the trust is ratified. Its significance is such that this initiative proposes in article 387 to establish that the constitution of the trust must always be in writing. Likewise, it also proposes the modification to fraction V of article 392, with the object of clarifying that if there is an express agreement to extinguish the trust, not only the settlor and the beneficiary stipulate it, but the trustee is also included for this case. With the proposed reform to article 382 of the General Law of Titles and Credit Operations, it is intended to regulate the fundamental circumstances surrounding the figure of the beneficiary, who is the one who ultimately benefits from the purposes for which the contract between the settlor and the trustee was stipulated. This initiative maintains unchanged various of the norms on the beneficiary. In the first place, the current circumstance of the flexibility that beneficiaries have the necessary capacity to receive the benefit that the trust implies is maintained. This is congruent with the fundamental principles of the capacity of the person in our law. In addition to this norm, the one that the beneficiary can be designated by the settlor either in the constitutive act of the trust or in a subsequent act remains in force. Therefore, the trust will be valid - as the current law expressly states - even if it is constituted without indicating a beneficiary at the time of its constitution. Likewise, article 383 maintains the possibility that the settlor can designate several beneficiaries to receive simultaneously or successively the benefit of the trust, although maintaining the exception
indicated in fraction II of article 394, which prohibits trusts in which the benefit is granted to various persons successively who must substitute each other by the death of the previous one, unless it is a trust whose substitution is made in favor of persons who are alive or conceived at the death of the settlor; with this, perverse incentives that could generate conflicts that could even lead to attacking the very life of persons, in order to be beneficiaries of the contract, are avoided. Regarding the simultaneity of the trustee and beneficiary in the same person, this initiative maintains the general principle that the trust constituted in favor of the trustee is null, as an elementary concept of the trust contract. However, it has been considered important to maintain the current exception - and therefore allow the simultaneity of trustee and beneficiary in the same person - in the case that the trust is constituted with an object that serves as a payment instrument for unfulfilled obligations in case of credits granted by the institution itself for the realization of business activities. Maintaining this principle is congruent with one of the generic purposes of this reform, which consists of contributing to the reactivation of credit. Despite the fact that this initiative maintains the aforementioned circumstance, it proposes a change consisting of suppressing the obligation of the parties, in case of simultaneity of trustee and beneficiary, to designate a substitute fiduciary institution in the event that a conflict of interest arises between them. Thus, with the spirit of strengthening the conventionality between the parties, it has been considered more convenient that it be established in the new fifth paragraph of article 382, located in the current norm in the fifth of 383, that instead of the parties designating a substitute fiduciary in case of conflict of interest, it is the signatories of the contract themselves who agree on the terms and conditions to resolve said conflicts, instead of assuming that the substitution of the fiduciary is the only path or the most effective to solve them. In the reform of article 384, it is proposed to clarify through a more generic circumstance than the current one, that only persons with the capacity to transmit the ownership or title of the goods or rights subject to the trust, as well as competent judicial or administrative authorities, can be settlors. In the reform to article 385, which deals with the topic related to the intervention of several fiduciary institutions in the same trust contract, only some adjustments of legislative technique are made, so the circumstances regarding the joint or successive performance of several fiduciaries in the same contract remain in force, as well as the need to have a substitute fiduciary institution in case of resignation or removal if there is no trustee, with the consequence that if such substitution is not possible, the trust is extinguished.
Regarding the current norm that contemplates the reversal of the trustee to the settlor of the goods or rights in trust in cases where the trust is extinguished, this initiative proposes a change in article 393, in order to allow the possibility that there is not necessarily a reversal to the settlor, but that it is also possible in the case of the extinction of the contract that the transmission of the goods be made to the beneficiary, as appropriate or agreed. In addition, the possibility is submitted to the consideration of the Congress of the Union that, in case of doubt or opposition regarding the transmission of the goods of the extinguished trust, it is the judge of first instance competent in the place of the domicile of the fiduciary institution that resolves, not without having heard the parties first. This norm revalues the role of the actors of the trust and grants the opportunity to beneficiaries to maintain their benefits if according to the manifestation of will or what corresponds to them by law. Finally, it rescues for all trusts the principle that fiduciary institutions will indemnify settlors for acts of bad faith or excess of the faculties that correspond to them for the execution of the trust, by virtue of the constitutive act or the law, that they carry out to the detriment of these. In article 394 of the current norm, trusts longer than 30 years are prohibited in cases where the beneficiary is designated as a legal person that is not of public order or a charity institution, nor is it destined to maintain museums of a scientific or artistic nature that do not have profit motives. Regarding this topic, the limit of thirty years has been increasingly extended in recent years with respect to requirements requested by various institutions for some legal acts, and even, it has also been informally expanded in some administrative acts such as concessions. Therefore, with the purpose of contributing to make our law more harmonious with respect to the duration of certain acts and to generate better conditions to fulfill in the long term the beneficial purposes of all trusts, it is proposed to modify the time limit of prohibition of trusts, in order to allow them up to a maximum duration of 50 years, although maintaining the current exceptions with respect to public trusts, of charity or in favor of museums with the characteristics mentioned above. The guarantee trust constituted a fundamental novelty in our law in the reform of the year 2000. Its purpose was to create an instrument that explicitly allowed to reconcile the debtor's need to have the ease of having possession of the good to protect and boost its productive activities, with the creditor's priority to have legal certainty of having quickly a response that ratified the preference in the payment to be received for the credit granted. Despite the spirit of the 2000 reform, it emerges from the experiences of both debtors and financial intermediaries that this figure has
been little used to guarantee credits. For debtors, it has become an expensive instrument due to higher interest rates and wider appraisals required to guarantee credits compared to what a market equilibrium could indicate. For the parties to the guarantee trust, it is perceived that the regulation unnecessarily inhibits the possibility of privileging conventionality that allows establishing various conditions that favor the interests of those who are actors in this figure. In this way, it has been preferred in the last two years to celebrate other types of trusts to guarantee payments, which are normally regulated under the sphere of the traditional trust. With this, the benefits that debtors could receive from the flexibility contemplated by the guarantee trust in the disposal of the good by the debtor themselves are evaded, making its application impossible in practice. By the context we live around this figure, this initiative proposes to make some adjustments to the guarantee trust, in order to revitalize its use under more accessible conditions for debtors, with greater legal certainty for trustees and creditors, as well as a greater space of conventionality such that it generates in the parties their willingness to agree to maximize the value of what is sought here, which is the reactivation of credit. By virtue of the proposed reforms, some current articles would be relocated, in order to provide the necessary congruence to the normative drafting of the guarantee trust. Despite the reform that will be described, this initiative preserves in the guarantee trust various advantages for debtors. The first of them consists of the possibility that the same trust can be used to guarantee simultaneously or successively different obligations that the settlor incurs, either with the same or with different creditors. This allows taking advantage of and valuing the extraordinary institutional capacity of the figure of the trust. By virtue of the relocation of articles, the one that corresponds to this circumstance, which is the current article 398, would become 397. As the only change to this figure, it is worth highlighting that it is proposed to eliminate the ten-day term with which the beneficiary still has to exercise its rights. In this sense, this initiative assumes that it is clear that the obligation in its favor is extinguished at the same moment of payment of the obligation. Otherwise, the debtor settlor could be compensated for damages and losses committed by the trustee. As a second set of norms that favors the interests of debtors, this initiative intends to leave unchanged the possibility that in guarantee trusts on movable goods, the parties can agree, with the consent of the beneficiaries, that the debtor settlors make use of the goods in trust, combine them or employ them in the manufacture of other goods, as long as the value of the good affected in trust does not decrease. Likewise, the right of the settlor to perceive and use the
fruits and products of the goods in trust is preserved. Finally, its right to instruct the trustee to alienate the goods in trust is preserved, without responsibility for the latter and as long as it is in accordance with the normal course of its activities. These three circumstances are maintained, by virtue of the fact that they respond to the logic of the economic dynamism of today, in which debtors require the possibility of being able to transform goods, in order for them to be destined towards their greater value, and therefore, allow making credit more effective in various productive activities, but also that the guarantee of payment maintains its value. The circumstances mentioned here are proposed to become part of article 398, by virtue of which the current article 402 in force would pass. In conjunction with the advantages that this figure preserves for debtors, this initiative raises the need to reinforce the conventionality of the trust, particularly with respect to the conditions and procedures to be followed in case the debtor's payment to the creditor is not carried out, and therefore, to make effective the guarantee contemplated in the trust. In order to fulfill the previously described purpose, this initiative raises various proposals. The first of them consists of establishing in article 395 the elements that distinguish the guarantee trust from others. In this sense, the proposed reform indicates that this type of trust has as its purpose to guarantee the beneficiary the fulfillment of an obligation and its preference in payment. In addition to this spirit, the reform proposed to article 395 consists of relocating the institutions authorized to act as trustees of guarantee trusts, which in the current legislation are enumerated in article 399. Regarding the institutions and societies authorized to be trustees in guarantee trusts, this initiative proposes adding brokerage houses, in addition to credit institutions, insurance institutions, surety institutions, limited object financial societies, and general warehouses. The fundamental purpose of this addition proposal is to open options to guarantee operations for those who go to the securities market. As a second important reform proposal of this initiative, the one proposed in article 396 stands out, which would in turn relocate some of the circumstances of the current article 400, consisting of allowing the simultaneity that institutions are trustees and beneficiaries when it comes to trusts that have as their purpose to guarantee obligations in their favor. This is proposed to be maintained in view of the dynamism that credit markets themselves have. However, by virtue of the susceptibility of the generation of conflicts of interest and acts of bad faith, this initiative proposes that the parties have as an obligation to agree on the terms and conditions under which they will resolve conflicts of interest and indemnities. A third reform proposal of this initiative that
intends to reinforce the conventionality of the parties in matters of guarantee trust is reflected in article 399 and whose circumstances are mostly those that are current in article 406, relative to the elements that the parties must agree upon at the time of constituting the guarantee trust. In its fraction V, this initiative proposes that the way to evaluate the goods in trust be left absolutely to the free will of the parties to the contract. With this, it would then be unnecessary for the norm to mention the possibility of referring to value indices or reference parameters, by virtue of which all of this can be done conventionally. Likewise, in fraction VI, it is proposed to eliminate the condition to agree on the review of the agreed appraisal that the increase in the value given as guarantee be substantial. It will suffice in reality for the parties to agree on the terms to carry out said review, given any increase in the value of said goods. The initiative proposes that the parties freely fix in the contracts if in case the product of the goods subject to the guarantee does not reach to cover the total amount of the obligations guaranteed by the debtor, whether he is in any case released from the debt or if, on the contrary, the creditor's rights to demand the differences are agreed from the beginning. In any case, the advantage of conventionality in this point lies in the fact that the parties can choose - and in particular the debtors - between a credit with limited guarantee expensive and with large appraisals, or a more flexible credit, with a rapid response to the creditor for the execution of the guarantee, but with more accessible interest rates for the public. The multiple advantages enjoyed by the debtor under the regime of guarantee trust by the disposition that of movable goods can be freely agreed, does not exempt him from the responsibilities he must fulfill, by virtue of the fact that the good in question is oriented to guarantee the payment of an obligation. For this reason, the present initiative puts forward the proposal to clarify in the article, which would be 400, and in the current law is 405, that if the settlor or a third party has material possession of the goods, it is recognized that it is in the quality of deposit. This particularity is congruent with the fact that, despite the settlor or third party holding material possession of the good, the ownership is full of the trustee, who has the right that the possessor give use to the goods as if they were their own, in addition to not using them for an object different from that which has been agreed with the beneficiary, as well as to respond for damages caused to third parties when using them. Although all the characteristics of the latter statement are already in force in article 405, it is necessary to clarify the condition of the deposit. Within the same proposed article 400, the proposal to agree that the possession of the goods in trust be held by one or
several depositaries is put forward, who will be subject to the corresponding responsibilities, even in the case of the settlor. This will allow expanding the flexibility of the guarantee trust, with respect to the subjects that can be part of it. Finally, by virtue of the quality of depositary that the settlor or whoever has possession will have and this one refuses to return the deposited goods to the trustee, it is proposed to reform article 402 so that its restitution is processed in accordance with what is established in Title Third Bis of the Code of Commerce. This implies that the first way to oblige whoever materially possesses the good in guarantee to return it in case of default is through the extrajudicial procedure of execution of guarantees granted through pledge without transmission of possession and guarantee trust. This situation allows that in a first moment of default, in which the depositary is not even willing to return the good, a procedure previously (sic) and formally established in law is applied. Once the default of the obligation agreed between the settlor and the beneficiary within the guarantee trusts has been presented, it is a logical consequence that the fiduciary institution must proceed to alienate for value the goods or rights in said trust. Regarding this, one of the greatest advances that this initiative presents in matters of guarantee trust is that of establishing in article 403 the possibility that the parties be the ones who freely agree on the form

how the alienation will be carried out through extrajudicial means, with the minimum procedural requirements including four fundamental rights for the settlor-debtor: a) their right to be notified of the fiduciary's purpose to alienate for valuable consideration due to payment default against the creditor or beneficiary; b) their right to object, either by showing the amount of the debt, by proving compliance with the guaranteed obligations, or by presenting a document proving an extension of the term or novation of the obligation; c) their right that this extrajudicial alienation agreement be included in a special section of the guarantee trust establishment contract, which must bear their signature and, therefore, ratified and additional acceptance to that manifested when concluding the contract; and d) the timeframes to carry out the aforementioned acts. Therefore, this procedure provides the debtor with the expected defense certainty in an execution procedure for default, while granting the fiduciary and creditor the opportunity to proceed immediately to execute the collateral through alienation for valuable consideration in case of default. For all the elements mentioned, it is additionally worth emphasizing that this process is agile in its terms, balanced in its rights for the parties, and novel and effective given its conventional nature. In summary, the certainty and efficacy offered by this conventional execution process will be sufficient reason for the guarantee trust to be used again, to the benefit of credit reactivation.

As in any conventional legal relationship, in the absence of an agreement between the parties, it is necessary to indicate the supplementary mechanism that will govern. In the case of the previous paragraph, it is proposed that in the absence of such an agreement, the procedure contemplated in Title Third Bis of the Commercial Code be applicable, that is, the execution of the pledge without transmission of possession and of the guarantee trust, to carry out the following acts: a) the processing of the lawsuit by which the fiduciary institution demands the restitution of possession of the assets comprising the trust estate; b) the alienation of the assets in trust, which the fiduciary must carry out if applicable; or c) the processing of the lawsuit promoted to oppose the execution of the trust.

Finally, the initiative proposes that the guarantee trust be governed by its own rules, and only in what does not oppose its nature, the provisions for trusts in general will apply.

In view that this initiative also seeks to strengthen the legal certainty of commercial operations, reforms are proposed to the laws that specifically regulate some of the authorized financial intermediaries authorized to celebrate trusts and guarantee trusts. These institutions are credit institutions, brokerage houses, insurance institutions, and surety institutions. For each of them, it has been considered convenient to establish norms that strengthen the principle of certainty in matters of trust, through measures that, on the one hand, allow some of these institutions to celebrate other types of trusts, but on the other hand, clearly establish the regime of prohibitions in matters of trusts that the aforementioned financial institutions should have. For these reasons, this initiative also proposes reforms to the Credit Institutions Law; the Securities Market Law; the General Law of Insurance and Mutual Insurance Companies; and the Federal Law of Surety Institutions.