When must a concentration be notified to COFECE?

When the transaction exceeds the asset or annual sales thresholds set by the Federal Economic Competition Law (LFCE) on a nationwide basis. The amounts are updated periodically. If the thresholds are met, notification is mandatory before closing; the authority has a period to review and may condition or prohibit the transaction. Deals below the thresholds do not require notification.

Why does a buyer review COFECE in due diligence?

Because if the transaction is subject to notification and is not filed, COFECE can impose fines and order divestiture of assets. The buyer needs to confirm whether the deal exceeds the thresholds (by combining the parties’ assets or sales) and, if so, build notification and waiting for the resolution into the closing timeline. It is part of the regulatory framework verified in due diligence.

COFECE: what it is and why it matters in M&A | M&A Glossary

COFECE (Comisión Federal de Competencia Económica) is Mexico’s antitrust authority. It reviews concentrations (mergers and acquisitions) that exceed asset or sales thresholds; those that meet the criteria must be notified before closing. For Mexican SME M&A it matters because a deal that crosses the thresholds without notification can be penalized; knowing the criteria and the timeline allows the parties to plan the transaction and when to involve competition counsel.

Due diligence and regulatory framework →

What is COFECE and what does it review?

The Federal Economic Competition Commission (COFECE) is the body that enforces the Federal Economic Competition Law (LFCE). Among its functions is the review of concentration acts: mergers, acquisitions, or combinations of assets or control that may reduce competition in relevant markets. Transactions that exceed certain asset or sales thresholds must be notified to COFECE; the Commission may authorize them, authorize with conditions, or prohibit them. For an SME that is selling or buying, knowing whether the deal is above the threshold determines whether notification is required and how much time to build into the process.

What are the thresholds and concentration notification?

The LFCE sets thresholds based on the value of assets or annual sales of the parties to the concentration, on a nationwide basis. Those amounts are published and updated. When the transaction exceeds the applicable threshold, the parties must file the notification with COFECE before consummating the concentration. The Commission has a period to issue its resolution; if it does not do so in time, the concentration is deemed authorized. Deals that do not reach the thresholds do not require notification. In M&A transactions, legal counsel or the buyer typically verify the calculation using financial statements and the definition of the relevant market.

Why does it matter in M&A?

In the sale or purchase of a business, if the combined assets or sales of the parties exceed the thresholds, notification is mandatory. Failing to file can result in fines and an order to divest assets. That is why in due diligence the parties confirm whether the transaction is subject to notification and build COFECE’s review period into the closing timeline. Knowing the framework allows the parties to plan when to notify and when to get competition advice.

What do buyers and sellers ask about COFECE?

When must a concentration be notified to COFECE?: When the transaction exceeds the asset or annual sales thresholds set by the Federal Economic Competition Law (LFCE) on a nationwide basis. The amounts are updated periodically. If the thresholds are met, notification is mandatory before closing; the authority has a period to review and may condition or prohibit the transaction. Deals below the thresholds do not require notification.
Why does a buyer review COFECE in due diligence?: Because if the transaction is subject to notification and is not filed, COFECE can impose fines and order divestiture of assets. The buyer needs to confirm whether the deal exceeds the thresholds (by combining the parties’ assets or sales) and, if so, build notification and waiting for the resolution into the closing timeline. It is part of the regulatory framework verified in due diligence.

In this glossary:

Due diligence — verification before closing.

LIE (Foreign Investment Law) — foreign investment and restricted sectors.

National Foreign Investment Commission — authorization in restricted sectors.

M&A (Mergers and Acquisitions) — process and context.

Representations and warranties — contractual statements about the business.

Data room — documents the buyer reviews.

Sources

COFECE reviews concentrations that exceed thresholds; in M&A, confirming whether notification applies and building in the review period avoids penalties and closing delays. For what the buyer reviews in due diligence and the regulatory framework in cross-border transactions, see the due diligence in Mexico guide and the frictions in Mexico–US cross-border transactions guide.