Recently, it is increasingly common to hear that companies are implementing the practice of compliance within their structures, and this is not a matter that should come as a surprise.

Legislation in Mexico, particularly that which applies to companies, regardless of the activities they perform, tends to impose a series of obligations that are not necessarily being constantly monitored by an authority, as is the case of tax obligations.

However, many of them are subject to revisions and in case of not complying with all the requirements and forms established by law, such companies could automatically be subject to different types of sanctions, such as administrative and criminal, as this could generate a commercial and/or reputational damage to them, and in some cases, the companies are not able to overcome such damages.

Therefore, it is becoming more common for companies to have an internal compliance procedure and even a compliance officer whose function is exclusively to ensure the company's compliance in all its aspects.   

Compliance can be understood as the set of procedures and practices adopted by companies in order to reduce or eliminate the possible risks inherent to their corporate practice.

WHAT AREAS ARE INCLUDED IN COMPLIANCE?

As already mentioned, compliance is in charge of foreseeing and implementing procedures for regulatory compliance in all areas that correspond to the development of the business activity.

It will depend on the predominant activities of each company to define exactly how many areas or sub-areas a specific compliance program has to cover, however, there are many other areas that can be inferred to apply to most companies, such as the followings:

a. Criminal Compliance.- In charge of verifying compliance with criminal regulations and the implementation of procedures to prevent the commission of possible crimes in accordance with state and federal regulations.

b. Tax Compliance.- Aims to control the risks that may arise from non-compliance with tax acts.

c. Compliance in labor matters.- Aims to ensure that the company complies with the labor regulations applicable to its employees, as well as to verify that all the necessary documents are updated, including Confidentiality Agreements and Privacy Notices.

d. Environmental compliance.- Aims to prevent the commission of environmental crimes in accordance with the Federal Criminal Code, as well as the Federal Law of Environmental Responsibility, and to comply with the principles of social welfare and sustainability of the environment for the benefit of society.

e. Technological compliance.-The purpose is to comply with the regulations applicable to new technologies in companies, which are constantly being updated.

f. Compliance in corporate matters.- Aims to implement procedures and avoid risks in terms of compliance with annual corporate obligations, as well as with the appropriate documentation to provide legal support to all capital movements and loans that exist in the company.  

g. Compliance in contractual matters.- The objective is to have an updated database with respect to all the contractual obligations that are in force within the company, as well as to analyze those that have to be renewed (in time and form), those that will be terminated, and to be very clear about the contingencies in the event of non-compliance with any of the obligations stipulated therein. Likewise, identify the rights acquired through the same.

WHAT ARE THE CONSEQUENCES OF NOT HAVING A COMPLIANCE PLAN WITHIN THE COMPANY?

The consequences of not having a compliance plan within the company are non-compliance with criminal, tax, labor, regulatory and sanitary acts, which could lead to violations, fines and even the dissolution of the company, resulting in financial and consequently reputational losses.

WHAT ARE THE ADVANTAGES OF THE IMPLEMENTATION OF COMPLIANCE WITHIN COMPANIES?

The implementation of a compliance program in companies reduces or eliminates possible operational and legal risks that are inherent to the business activity, such as civil, administrative or criminal liability of companies.

By implementing policies and procedures that provide a better performance in its development.

Also, it is important to point out that compliance provides legal certainty to its clients, which improves the reputation and image of the company, giving added value to its function and giving it a competitive advantage over other companies that do not have these regulatory parameters.

In this matter, the services that Vila can offer to its clients in relation to compliance are the following:

a. Analysis of the current business situation, in order to detect possible non-compliance and latent risks.

b. Elaboration of a matrix of regulations applicable to the company.

c. Design of Compliance Program for the companies.

d. Assistance in the establishment of the procedures and practices based on the Compliance Program.

e. External audit service to audit the Compliance Officer's processes.

f. Advice to the Compliance Officer

g. Training on corporate issues to the Compliance Officer

We are always grateful for the trust you have placed in us, and we remain at your disposal for any questions or comments.
For more information, please contact: 
Thais.bejar@vila.com.mx