INFORMATION BULLETIN No. 23 – INVALIDITY OF THE DECREE WHICH IS ISSUED THE LAW FOR TRANSPARENCY, PREVENTION AND COMBAT OF IMPROPER PRACTICES REGARDING ADVERTISING CONTRACTING – DEC. 05, 2023.
INVALIDITY OF THE DECREE WHICH IS ISSUED THE LAW FOR TRANSPARENCY, PREVENTION AND COMBAT OF IMPROPER PRACTICES REGARDING ADVERTISING CONTRACTING
On June 8, 2023, the Plenary Session of the Supreme Court of Justice of the Nation (SJCN) resolved the constitutional controversy promoted by the Federal Economic Competition Commission (COFECE), declaring the invalidity of the “Decree by which the LAW FOR TRANSPARENCY, PREVENTION AND COMBAT OF IMPROPER PRACTICES REGARDING
ADVERTISING CONTRACTING” (hereinafter Law) which was published in the Official Gazette of the Federation on June 3, 2021.
In accordance with the explanatory memorandum of the Law, it was intended to promote transparency in the advertising market, as well as prevent and combat commercial practices that constituted an undue advantage in favor of certain sectors, seeking to attack the double charging of advertising agencies. to advertisers and the media and the sale of advertising space by the media to agencies for subsequent resale.
However, this law modified the way in which advertising agencies, advertising space contracting companies and the media operated, establishing a host of obligations for agents.
economic and, above all, strong sanctions such as fines up to the equivalent of 2% of income.
Given this circumstance, the Federal Economic Competition Commission (COFECE) promoted a constitutional controversy, which was resolved by the plenary session of the SCJN, invalidating the decree by which the Law was issued for the following considerations:
• The legislative procedure did not respect the right to participation of all political forces in conditions of freedom and equality, since they were not allowed to express and defend their opinion in a context of public deliberation.
• The deliberative procedure did not culminate with the correct application of the voting rules
• The votes were given without timely and informed knowledge of the opinions: The opinion was distributed on the same day that the session was held, only 24 hours prior to its discussion.
Taking into account the above, the SCJN considered that this accumulation of violations of the legislative process were sufficient to declare the invalidity of the decree by which the Law was issued, without it being necessary to analyze the substantive issues raised by the COFECE.
WHAT DOES THE DECLARATION OF INVALIDITY BY THE SCJN IMPLY?
The SCJN by declaring the invalidity of the decree by which the Law in question is issued, with general effects, this Law for Transparency, Prevention and Combat of Improper Practices in the Matter of Advertising Contracting ceases to be applicable, since it lacks effectiveness legal.
Derived from the above, we consider it relevant, for advertising companies, for advertising agencies and for the media, to carry out a detailed analysis of the possible implications that the aforementioned declaration of invalidity could have within their operations.
As always, we are at your service to analyze the effects that the application of the previous provisions may have in particular.
