The FCC initiated an investigation due to possible abuse of dominance conducts in the distribution of printed magazines (the Investigation) in Mexico City on April 20, 2012.  Companies involved in this industry shall be ready to react or participate in the investigation proceedings.

Implications for the companies involved in magazines distribution

The FCC is empowered to request for any kind of information that is relevant to potential violations of the Mexican Competition Law (MCL) in connection with facts that may be related with the Investigation to any company or individual.

During the investigation procedure, any company involved in the distribution of printed magazines may file with the same FCC another complaint related to the same facts under investigation.

At the end of the Investigation, the FCC may impose a fine to every responsible party of up to 8% of their annual income, in addition to any civil and/or criminal liability that may result.

What is the case under investigation?

The possible abuse of dominance practices under investigation specifically consists in possible resale price maintenance, conditioned sales to the non-dealing with third parties, price discrimination, and other actions which purpose or effect consists in increasing the cost and/or reducing the demand of products distributed by other competitors. The FCC has not yet identified actions that could constitute the abuse of dominance practices, and neither has identified companies or individuals that could be responsible for infringing the MCL.

In the case at hand, the FCC has determined that the market under investigation is the distribution of printed magazine in Mexico City and its metropolitan area.

Actions to consider

The companies involved in the market referred above shall be ready to properly and strategically react to any requirement of information received from CFC.

The MCL, authorize competitors, clients or suppliers involved in the markets related to the distribution services being investigated to file additional evidence or a separate complaint related to the same facts under investigation to protect their interests.

Conclusion

The Mexican FCC is investigating abuse of dominance in the wholesale market distribution of printed magazines at the metropolitan area of Mexico City.  Responsible parties may be fined up to 8% of their annual turnover. Those engaged in businesses involved in the markets under investigation must be prepared to react or participate in such proceedings.