Mexico: Decree To Issue The Law To Regulate Financial Technology Institutions

On September 19, 2017, the preliminary draft of the "Decree to issue the Law to Regulate Financial Technology Institutions, and to amend or repeal several provision of the Credit Institutions Law, the Securities Exchange Law, the General Law of Credit Organizations and Auxiliary Activities, the Law for the Transparency and Regulation of Financial Services, the Law to Regulate Credit Information Societies, the Law for the Protection and Defense of Users of Financial Services, the Law to Regulate Financial Groups, the National Banking and Securities Commission Law and the Federal Law for the Prevention and Identification of Operations with Resources of Illegal Origins" (the "Decree") was published on the website of the Federal Commission for Regulatory Improvement. The proposed Decree aims to regulate Financial Technology Institutions (collective financing companies and electronic payment funds), and companies authorized to operate with "innovative models" and financial entities that intend to carry out operations or activities of their corporate purpose temporarily through tools, models, services or means in new modalities. In addition, the use of virtual assets for the operation of Financial Technology Institutions and other financial entities is authorized, in line with certain regulations issued by financial authorities. The Law sets out a framework to regulate the authorization, operation and regulatory burdens that the above institutions must comply with before the corresponding financial authorities, in the understanding that excessive regulation on this matter could negatively impact the financial market. This Decree will be evaluated by the Mexican Congress and it is anticipated that once it is approved it will enter into force next year.

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