A new Mexican Asset Forfeiture Law (Ley Nacional de Extinción de Dominio, the AFL) has been enacted by virtue of the publication of a presidential decree (the Decree) August 9 in the Federal Register (Diario Oficial de la Federación).
The Decree marks the latest development in Mexico's continued efforts to fight corruption at all levels. In addition to the enactment of the AFL, the Decree:
(i) amends other statutes (such as the National Code of Criminal Procedures (Código Nacional de Procedimientos Penales)) to further harmonize the revamped Mexican anti-corruption and anti-money laundering legal framework; and
(ii) repeals the former Federal Asset Forfeiture Law (Ley Federal de Extinción de Dominio), local asset forfeiture statutes and all other provisions contravening the Decree.
The AFL now expressly adds corruption - both for private parties and public servants - and other activities (such as concealment, transactions with illicit funds and fuel theft) to the catalogue of conducts that will be subject to asset forfeiture proceedings.
Under the AFL, assets subject to forfeiture proceedings include:
(i) assets that result from the transformation (whether in whole or in part, factual or legal) of things, materials or instruments for which legal origin cannot be evidenced and are related to corruption, concealment, crimes committed by public servants, organized crime, vehicle theft, transactions with illicit funds, illegal drug activities (trafficking, production and distribution), kidnapping, extortion, human trafficking and fuel theft;
(ii) assets of legal origin, but used to conceal and/or otherwise combined (whether factually or legally) with the assets outlined in (i) above;
(iii) assets for which good, legal and valid title cannot be evidenced;
(iv) assets used by a third party to commit illicit activities, provided the rightful owner of the assets had prior knowledge and failed to notify the authorities or impede the commission of the illicit activities; and
(v) income, yield, accessories, profits and other benefits derived from the assets outlined above.
Asset forfeiture causes of action will be brought by the District Attorney (Ministerio Público) before specialized courts that will be established, and these proceedings will take part in two stages: (1) a preparatory stage overseen by the District Attorney (where, essentially, the District Attorney will build the case against a defendant); and (2) a proper judicial stage that...