On March 9, 2018, the Law that Regulates the Financial Technology Institutions (the “Fintech Law”) was published in the Federal Official Gazette and became effective on the day following its publication.
The Fintech Law, among other matters, regulates financial services provided by financial technology institutions (the “FTI”), as well as their organization, operation and activities and the financial services provided thereby that are subject to special regulation since they are offered or performed by innovative means. Such law, establishes that the FTI’s are crowdfunding institutions and the institutions engaged in electronic fund payments.
Pursuant to the Fintech Law, upon the entry into force of such law, the persons that are already performing the activities that are now regulated thereby, shall comply with the obligation to request authorization from the CNBV in the terms set forth in the general provisions issued for such effect, within a period not exceeding twelve months counted from the entry into force of such regulations.
In addition, the transitory provisions of such law provide that the National Banking and Securities Commission (the “CNBV”), the Ministry of Finance and Public Credit (the “SHCP”) and the Central Bank of Mexico had a period of six months from the entry into force thereof to issue the first general provisions thereunder.
Within such period, the following regulations were published in the Federal Official Gazette:
(i) the general provisions applicable to the Financial Technology Institutions (the “General Provisions”)
(ii) the general provisions referred to in Article 58 of the Fintech Law (the “Anti-Money Laundering Provisions”)
(iii) Circular 12/2018 addressed to Electronic Payment Funds Institutions, relating to the general provisions applicable to the operations of such institutions (“Circular 12/2018”).
Except for certain accounting provisions, the General Provisions became effective on September 25, 2018. The Anti-Money Laundering Provisions and the Circular 12/2018 became effective on September 11, 2018.
By virtue of the entry into force of the Fintech Law, the General Provisions, the Anti-Money Laundering Provisions and the Circular 12-2018, various FTIs in the market are analyzing the legal framework and designing and preparing their respective authorization processes before the CNBV. Continue reading...