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OECD-Mexico
Process for Strengthening Economic
Competition and Regulatory Improvement for
Competitiveness
Jose Antonio Torre Medina
Undersecretary for Competitiveness and Business Regulations
Ministry of Economy, Mexico
November 4, 2011
5th Session of the Regulatory Policy Committee
OECD Conference Centre, Paris
Improve
business
environment
Regulation
simplification
and
modernization
Effective
competition
policies
Cooperation to strengthen competitiveness
2
• Coordination and
cooperation between
Mexico’s Ministry of
Economy and the OECD
based in two pillars:
Regulation and
Competition
• OECD works with national
institutions to provide
recommendations,
strategic advice and
capacity building based
on international best
practices.
Objective: to improve Mexico’s competitiveness through the
reform and modification of the regulatory and institutional
framework.
2007 2008 2009 2010 2011 2012
First Memorandum of Understanding
OECD-Mexico’s Ministry of Economy.
•General cost analysis of
business procedures
•First design of business start-
up one-stop-shop
•Review of CFC’s previous
recommendations, technical
cooperation, capacity
building.
•FDI law review
(digital TV &
radio, public
passengers
transport,
telephony, public
procurement)
Renewal of the MoU.
•Support for the biannual PMR.
• Implementation of multi-level Toolkit
(4 states in 2011).
•Launch of
tuempresa.gob.mx
(business start-up
one-stop-shop)
•Design of zero-
based regulatory
reform. (10 best
practices)
•Standards and
technical
regulations
system review.
•Regulatory
Reform Review
2012.
• tuempresa.gob.mx
2.0.
•Risk Based
Regulation
Workshop
•Legal reform
business start-up.
•9 state-level
regulatory agendas.
•Multi-level toolkit.
•Fiscal simplification
(5 measures)
•Electronic,
agricultural and
medical products
simplification. (12
measures)
•Standards and
technical
regulations.
•Pharmaceutical
products.
•Regressive
effects of
monopolies.
•Credit Institutions
Law Reform.
•Reform of the
Federal Law of
Economic
Competition.
Telecom
interconnection
pricing.
•Pro-competitive
assignation of slots
in Mexico City
Airport.
•Design and recommendation of Tariff simplification program
Regulation projects:
Competition projects:
•Fighting Bid rigging OECD
guidelines (IMSS, CFE, Edomex)
Timeline: reaching 5 years of fruitful work
I. Regulation: Mexico’s Regulatory Reform Strategy
• Build a regulatory framework centered in the
citizen, to increase competitiveness and
promote development.
i. Liberate potential economic value in the
economy eliminating unnecessary
transaction costs and market distortions
generated by the regulation.
ii. Use an approach of economic and business
processes to simplify the normative
framework and regulation formalities.
iii. Facilitate interactions between the citizen
and state’s services by improving certainty,
quality and transparency.
Objective and working premises Action lines
1. Simplification of regulations
with high economic impact:
• Tuempresa.gob.mx
(business start-up one-
stop-shop)
• Zero-based regulation.
• Regulatory Improvement
Program
2. Reduction and simplification
of internal regulations in the
Public Administration.
3. Multi level regulatory
improvement.
4
Mexico’s cooperation with the OECD Regulatory Policy Division has helped
our government to have a clear strategy and implement effective actions.
I. Regulation: main deliverables and key results
tuempresa.gob.mx
(business start-up
one-stop-shop)
Since August 2009
Key results:
Legal Reform: facilitation
of business start-ups
and electronic file.
October 2011
• Launch of tuempresa.gob.mx one-stop-shop.
• Reduction of 65% of average business start-up costs according
to OECD standard cost model.
• Elimination of requirement of minimum capital.
• Consolidation of procedures in the Ministry of Economy.
• Creation of the business electronic file. (inter-operability system)
Zero-based regulation
2009-2010
• Regulatory simplification yield estimated savings for 2.8 billion
USD (5 tax simplification measures and 12 simplification measures
for electronic, agricultural and medical products )
• New RIA improved quality and process efficiency of new
regulations .
• Reduction and simplification of internal regulations (Ministry of
Public Administration):
− >16,000 internal regulations eliminated.
− 9 handbooks replaced more than 7,000 rules.
Biannual Regulatory
Improvement Program
2011-2012
• Raise productivity and accelerate economic growth. Potential to
free resources equivalent to 1.2% of GDP using OECD standard
cost model.
I. Regulation: main deliverables and key results
Multi-level regulatory
improvement. 2009-2012
Key results:
• Elaboration of 9 Multi-level Regulatory
Improvement agendas2: total of 818 specific
recommendations. (2009)
• Publication of the Multi-level Regulatory
Improvement Toolkit: (2010-2011)
− Help states and municipalities to work on regulatory
simplification.
− COFEMER and OECD in the process of monitoring
and facilitating implementation in 4 specific states.
• Regulatory Improvement of Citizen Councils:
(2011-2012)
− Capacity building for local citizen and business
councils to oversee and promote regulatory reform.
− Plurality, transparency and alignment with the key
areas of work.
• Support of the study Doing Business at
Subnational level (2011-2012, Cofemer)
1/ Baja California, Chiapas, Colima, Jalisco, Michoacán, Puebla, Sinaloa, Tabasco and Tlaxcala.
I. Competition: promotion of efficient markets
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• Enabling a regulatory and institutional framework to promote competition and
market efficiency.
• Mexico’s cooperation with the OECD Competition Division has helped our
government to have a stronger authority and improve technical capabilities.
i. Discourage infringement of the law, through sanctions
linked to potential damages caused to consumers.
(economic and criminal)
ii. Enable specialized courts in economic and antitrust
matters.
iii. Increase transparency within competition institutions.
Pro-competition culture
promoted by consumers,
businesses and
institutions.
Improved legal and
institutional efficiency and
effectiveness.
i. Promote a consumer-oriented culture.
ii. Offer mechanisms for self-diagnosis in legal topics.
Improve the regulatory
framework with a sectorial
approach.
i. Implementation of high impact recommendations in
horizontal sectors (telecom, financial, transport, energy)
ii. Detect and correct restrictions and barriers to entry in
the regulation.
II. Competition: main deliverables and key results
Key results:
• Standards and technical regulations: (2009)
− Competition issues detected in 15% of a sample of 120 standards.
• Pharmaceutical products (2009):
− Recommendations to promote generic medicines yield potential
yearly savings for consumers of 2.8 US million.
• Regressive effects of monopolies. (2009)
− Study that shows how persistent monopolistic practices affect more
aggressively low income citizens.
Sectorial projects. 2009
Reform of the Federal Law
of Economic Competition. 2010
• More effective antitrust policy.
• Alignment with best international practices.
• Better tools for the competition authority.
• More transparency and accountability.
II. Competition: main deliverables and key results
Key results:
Sectorial studies
with horizontal
impact. 2008-2013
• Review of technical work of the CFC: capacity building. (2007)
• Credit Institutions Law Reform: (2010)
− Improved access to essential financial infrastructure (credit bureau, switches)
− Facilitate financial products choice by consumers.
• Tariff simplification program: (2008-2013)
− Five-year program to eliminate more than 10,000 HTS numbers related with
inputs and capital goods.
− The average tariff is reduced from 9.6% in 2008 to 4.8 in 2011 and 4.3% in 2010.
• Telecom interconnection pricing recommendations: (2010)
− Potential 10 USD billion yearly savings for consumers.
• Pro-competitive assignation of slots in Mexico City Airport: (2011)
− Potential yearly savings estimated of 1 USD Billion.
• implementation of OECD guidelines at IMSS. (social security
institute)
Fighting bid
rigging in public
procurement. 2011
Projects for 2012
Regulation
1. Monitoring and implementation
support for the Regulatory
Improvement Program 2011-2012.
2. Support in the design and launch of
tuempresa.gob.mx 2.0.
3. Institutional Review of:
• Standards and technical
regulations system.
• Regulatory Improvement
Oversight Body.
4. Continuous implementation of the
multi-level regulatory improvement
Toolkit (inclusion of more states).
5. 2nd Risk based regulation workshop.
5. Mexico’s Regulatory Reform Review
2012.
• The following year the cooperation is focused in the consolidation of
successful projects and deal with key remaining challenges.
Competition
1. Fighting bid rigging in public
procurement: implementation of
OECD guidelines:
a. IMSS (social security institute).
b. CFE (electricity state-owned
enterprise)
c. States (OECD template: Estado
de México; other projects include:
Campeche, Zacatecas y Guerrero)
2. Analysis of competition restrictions in
the Law of Foreign Direct Investment:
a. Digital TV and Radio
b. Telephony (other than mobile)
c. Public passenger transport.
d. Public procurement.
Other key activities
• Foreign trade
• Investment
• Innovation and business development
• Sustainable Development
• Consumer protection policy
• Globalization
• Steel
The work between Mexico’s Ministry of Economy and
OECD also includes other areas:
Agenda to strengthen competitiveness
Innovation
Investment
Efficiency
Opportunities
Good jobs
Economic growth
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Productivity Competition
• Building of a regulatory system that promotes competition
enables innovation and productivity.
OECD-Mexico
Process for Strengthening Economic
Competition and Regulatory Improvement for
Competitiveness
Jose Antonio Torre Medina
Undersecretary for Competitiveness and Business Regulations
Ministry of Economy, Mexico
November 4, 2011
5th Session of the Regulatory Policy Committee
OECD Conference Centre, Paris
I. Regulation: main deliverables and key results.
• Programa de Medición del Costo Administrativo
Empresarial en México: Informe de resultados del
costeo de tuempresa.gob.mx.
• Medición del costo administrativo utilizando la
metodología completa del Modelo de Costeo
Estándar con encuestas a empresarios.
• Recomendaciones de diseño del sistema
tuempresa y de simplificación de los trámites a
incluir.
• Medición de los ahorros en costos administrativos
generados por el portal tuempresa.gob.mx.
• Evaluación que refleja un de 65% de ahorros
generados por el portal.
• Conferencias telefónicas con servidores públicos
internacionales encargados de diseñar,
implementar, y operar sistemas similares a
tuempresa.gob.mx
• Reportes de llamadas con oficiales de Portugal,
España, y Brasil.
tuempresa.gob.mx (business start-up
one-stop-shop) Since August 2009
Main deliverables: Key results:
Legal Reform:
facilitation of
business start-ups
and electronic file. October 2011
• Launch of tuempresa.gob.mx
one-stop-shop.
• Reduction of 65% of average
business start-up costs
according to OECD standard
cost model.
• Recomendaciones de reformas legales para
facilitar la creación de negocios y simplificar los
trámites para constituir una sociedad mercantil.
• Elimination of requirement of
minimum capital.
• Consolidation of procedures
in the Ministry of Economy.
• Creation of the business
electronic file.
I. Regulation: main deliverables and key results.
• Organización conjunta, contribución con oradores
internacionales y financiamiento de la conferencia de
lanzamiento del programa base cero.
• Reporte de la conferencia disponible en la página web
de la OCDE.
• 10 puntos clave de las experiencias internacionales para
revisar las regulaciones existentes.
• Resultado de conferencias telefónicas con servidores
públicos internacionales (Canadá, Italia, Corea y
Croacia) encargados de diseñar, implementar, y operar
sistemas ejercicios similares al programa “Base Cero”.
• Lista de criterios para la evaluación regulatoria y su
manual.
• Instrumento basado en mejores prácticas
internacionales que permite evaluar la calidad
regulatoria de regulaciones en aplicación, para su
eliminación o simplificación.
• Plan operacional para la segunda fase de la revisión del
acervo regulatorio.
• Utilizando la experiencia internacional de mejores
prácticas, el plan recomendó líneas de acción sobre la
organización y ejecución de la segunda etapa del
programa “Base Cero”.
• Costeo de trámites incluidos en el Registro Federal de
Trámites y Servicios.
Zero-based
regulation 2009-2010
Main deliverables: Key results:
Ministry of Economy:
• Regulatory simplification yield estimated
savings for 2.8 billion USD (5 tax
simplification measures and 12
simplification measures for electronic,
agricultural and medical products )
• Regulatory Impact Assessment improved
for higher quality of new regulations and
improved process efficiency.
Ministry of Public Administration:
• Reduction and simplification of internal
regulations in the Public Administration:
− >16,000 internal regulations
eliminated.
− 9 handbooks replaced more than 7,000
rules.
Biannual
Regulatory
Improvement
Program 2011-2012
• Tranferencia de conocimientos y desarrollo de
capacidades. • Raise productivity and accelerate economic
growth. Potential to free resources
equivalent to 1% of GDP using OECD
standard cost model.
I. Regulation: main deliverables and key results.
Medidas de corto plazo para mejorar la
competitividad de las entidades federativas de
México:
• El objetivo fue dar a nueve entidades federativas una
agenda de recomendaciones puntuales, concretas,
priorizadas y viables de implementarse en el corto
plazo para mejorar los trámites de alto impacto en la
actividad empresarial. Se elaboraron un total de 818
recomendaciones.
Prácticas y Políticas Exitosas para Promover la
Mejora Regulatoria y el Emprendimiento a Nivel
Subnacional:
• El estudio identifica 34 mejores prácticas nacionales
e internacionales implementadas por gobiernos
regionales, que fortalecen la mejora regulatoria y
facilitan la actividad empresarial.
• Fue el resultado de un estudio a profundidad de las
políticas e instituciones de mejora regulatoria en Baja
California, Jalisco y Puebla, en México, Cataluña en
España, Columbia Británica en Canadá, y Piemonte
en Italia.
Guía para mejorar la calidad regulatoria de trámites
estatales y municipales e impulsar la competitividad
de México.
• La Guía recopila las 24 recomendaciones de más alto
impacto para mejorar los procesos de trámites de
apertura de empresas, permiso de construcción,
registro de propiedad, licitaciones, así como para
mejorar la transparencia regulatoria y la eficiencia en
la gestión de los trámites. Las 24 recomendaciones
son una selección de las 818 recomendaciones de
Medidas de corto plazo – las cuales no son públicas –
y de las 34 mejores acciones de Prácticas y políticas
exitosas.
Multi-level
regulatory
improvement. 2009-2012
Main deliverables: Key results:
• Elaboration of 9 Multi-level Regulatory
Improvement agendas2: total of 818
specific recommendations. (2009)
• Publication of the Multi-level
Regulatory Improvement Toolkit:
(2010-2011)
− Help states and municipalities to work
on regulatory simplification.
− COFEMER and OECD in the process of
monitoring and facilitating
implementation in 4 specific states.
• Regulatory Improvement Councils:
(2011-2012)
− Capacity building for local business
councils to oversee and promote
regulatory reform.
− Plurality, transparency and alignment
with the key areas of work.
• Support of the study Doing Business
Subnational. (2011-2012, Cofemer) 1/ Baja California, Chiapas, Colima, Jalisco, Michoacán, Puebla, Sinaloa, Tabasco and Tlaxcala.
II. Competition: main deliverables and key results
Main deliverables: Key results:
Reform of the
Federal Law of
Economic
Competition. 2010
• Review and proposals to improve the economic
competition federal law in order to improve legal and
institutional efficiency and effectiveness (discourage
infringement of the law, through sanctions linked to
potential damages caused to consumers. (economic
and criminal), enable specialized courts in economic
and antitrust matters, increase transparency within
competition institutions.
• OECD specialists support in the Mexican Congress.
• Media articles supporting the reform package.
• More effective antitrust policy.
• Alignment with best international
practices.
• Better tools for the competition
authority.
• More transparency and
accountability.
II. Competition: main deliverables and key results
Sectorial
studies with
horizontal
impact.
(1/2) 2008-2013
Main deliverables: Key results:
• Review of technical work of the
competition: strengthening of the
technical capacity. (2007)
• Credit Institutions Law Reform
(2010):
− Improved access to essential financial
infrastructure (credit bureau, switches)
− Facilitate financial products choice by
consumers.
• Tariff simplification program: (2008-
2013)
− Five-year program to eliminate more than
10,000 HTS numbers related with inputs
and capital goods.
− The average tariff is reduced from 9.6% in
2008 to 4.8 in 2011 and 4.3% in 2010.
• Telecom interconnection pricing
recommendations: (2010)
− Potential 10 US billion yearly savings for
consumers.
• El proyecto inició con el análisis de las recomendaciones
incluidas en las opiniones existentes de la CFC:
• Telecom: convergencia tecnológica del 31 de octubre de 2005;
y contenidos audiovisuales del 28 de noviembre de 2006.
• Servicios financieros: Sobre el sistema de ahorra para el retiro
del 22 de noviembre de 2006; y servicios bancarios al menudeo
del 24 de abril de 2007.
• Energía: Sobre el reglamento de gas LP del 27 de julio de 2007.
• Transporte: Sobre aeropuertos del 1 de octubre de 2007.
• Comercio exterior: Sobre la regulación de comercio exterior del
19 de mayo de 2008.
• Sectores con impacto horizontal en la competitividad; de
sectores con alta participación en el gasto de los consumidores;
así como regulación horizontal con alto impacto en la
competitividad.
• Banca al menudeo (2 estudios): las propuestas formuladas
sirvieron de base para un paquete de reformas a la Ley de
Transparencia y Ordenamiento de los Servicios Financieros y a
la Ley de Instituciones de Crédito, orientadas a dar acceso a
infraestructura esencial (switches, burós de crédito) y a facilitar
la elección de productos financieros por los usuarios. Este
paquete fue aprobado por el Senado en junio de 2009 y
aprobado por la Cámara de Diputados en marzo de 2010.
• Comercio exterior: Se propuso la simplificación del régimen
aduanero y de estructura arancelaria. Estas medidas dieron
origen a un ambicioso programa de desgravación por parte de
la Secretaría de Economía en diciembre 2008. Las propuestas
en materia aduanera han sido adoptadas parcialmente por
SHCP.
• Telecomunicaciones (tres estudios): la CFC trabaja con la SCT
para asegurar la inclusión de las recomendaciones en la
determinación de tarifas de interconexión en servicios de
telefonía. La implementación de las recomendaciones arrojaría
beneficios estimados por diez mil millones de dólares anuales
para los consumidores. Adicionalmente, las recomendaciones
en materia de espectro radioeléctrico se incluyeron en las bases
de la licitación prevista para el primer semestre de 2010.
II. Competition: main deliverables and key results
Sectorial
studies with
horizontal
impact .
(2/2) 2008-2009
Main deliverables: Key results:
• Pro-competitive assignation of slots in
Mexico City Airport: (2011)
− Potential yearly savings estimated of 1 US
Billion..
• Standards and technical regulations:
(2009)
− Competition issues detected in 15% of a
sample of 120 standards.
• Pharmaceutical products:
− Recommendations to promote generic
medicines yield potential yearly savings for
consumers of 2.8 US million.
• Regressive effects of monopolies.
(2009)
− Study that shows how persistent
monopolistic practices affect more
aggressively low income citizens.
• Normas técnicas: Se diseñó un método de análisis ágil de los
efectos en competencia de las normas, con el fin de detectar
necesidades de modificación. La metodología permitió
encontrar problemas en 15% de una muestra de 120 normas.
Se trabajó con la Dirección General de Normas en la
implementación del esquema.
• Mercado farmacéutico: Se hicieron recomendaciones
orientadas a acelerar la adopción de medicamentos genéricos,
que podrían generar beneficios para los consumidores de 2.8
mil millones de dólares anuales. Las recomendaciones se han
validado a nivel técnico con las dependencias involucradas;
está pendiente la implementación a nivel político.
• Regulación estatal: A partir de la experiencia exitosa de
Australia, se formularon recomendaciones para la
implementación de reformas pro-competitivas a los marcos
regulatorios estatales. Pendiente de implementación.
• Competencia y distribución del ingreso (dos estudios): Se
calculó el efecto de la falta de competencia en el ingreso de los
consumidores y, específicamente, la regresividad de este
efecto.
• Electricidad (en proceso de validación): Se analizaron las
barreras regulatorias a la penetración de esquemas eficientes
de autogeneración y se formularon recomendaciones para
facilitar esta penetración.
• Aerolíneas: Se analizó el efecto sobre los precios de la entrada
de nuevos competidores, así como las barreras a esta entrada.
Se hicieron recomendaciones sobre la asignación pro-
competitiva de slots en el Aeropuerto Internacional de la Ciudad
de México, cuya implementación podría arrojar beneficios a los
consumidores por mil millones de dólares anuales.
• Transporte foráneo de pasajeros (dos estudios, en proceso de
formulación de recomendaciones): Se detectó que el acceso a
las terminales como principal barrera a la entrada.
I. The monthly declaration of IETU is now made once a year.
II. Regarding VAT, duplicity and the obligation of presenting an
aggregated annual declaration are eliminated and the monthly
declaration is kept.
III. The obligation of presenting the financial state for tax regulations as
well as for the obligations before the IMSS are eliminated.
IV. Tax Payers that have a positive balance in the Cash Deposit Tax are
allowed to get a refund with out the need of a rule by a public
accountant.
V. The validity of the Advanced Electronic Firm is extend from two to
four years.
5 tax simplification measures announced last June 30, 2010:
Tax simplification results:
12 measures announced last August 17, 2010:
I. The process to obtain the certificate of origin required when exporting Mexican products to
Europe and Latin America was simplified.
II. The system for the Conciliation of Clarification CONCILIANET was established for Federal
Energy Commission clients.
III. The National Registry of Foreign Investment was automatized.
IV. The services provided by tuempresa.gob.mx were expanded.
V. Equivalence agreements of US and Canada regulations and conformity assessment
procedures with Mexican regulations and procedures for electronic products.
VI. The registry for allopathic drugs sales is now electronic.
VII. The process to obtain the sanitary registry for medical devices was simplified.
VIII.Over The Counter drugs that already have a valid license issued either by FDA or Health
Canada can now enter into a fast track process to obtain the sanitary registry.
IX. A direct interconnection between SAT and COFEPRIS was established for the grant of
sanity permissions for imports.
X. The expedition of the Phytosanitary and Zoosanitary Certificate for National Mobilization
was automatized.
XI. The registry for animal use and consumption products was automatized.
XII. The process for meat, grains, oleaginous and other agricultural products imports was
automatized.
22
1. Audit
2. Acquisitions
3. Internal Control rules
4. Public Works
5. Financial resources
6. Material resources
7. Human resources
8. Information and Communications Technology
9. Transparency and Accountability
Legal instruments that simplify and standardize
processes in 279 Federal Agencies
• This 9 Administrative handbooks are compulsory and applicable to all
The Federal Public Administration