Competing Against Those Who Break the Law

If your company's strategy for taking on a competitor has always been to hire more salespeople, cut prices, or spend more on marketing, you may have been fighting the wrong battle.

There is an idea deeply rooted in the business world: if a competitor sells more, holds a larger market share, or dominates an industry, it must be doing something better. Not always.

In some markets, leadership is not built solely on better products, greater efficiency, or innovation. It can also be built through improper exclusivity arrangements, tied sales, refusals to supply, discounts designed to exclude competitors, price discrimination, or any other conduct prohibited by the Federal Economic Competition Law (FECL).

When that happens, the problem stops being purely commercial. It becomes a competition law problem.

Yet many companies keep responding the same way: they cut prices, increase commercial spending, or accept that "this is just how the market works." What few consider is that the law itself provides tools to restore competitive conditions and eliminate advantages obtained illegitimately.

Economic competition law is not only useful for avoiding fines. It can also become a strategic tool for competing on equal terms.

The Question Few Companies Ask Themselves

Compliance programs tend to focus on a single question: Are we complying with the Federal Economic Competition Law?

That is an essential question, but an insufficient one.

There is a second question that may be just as important for business growth: Are our main competitors complying with it too?

The difference seems subtle. It completely changes the perspective.

If a competitor is winning clients because it forces its distributors to work exclusively with it, refuses to do business with you without an apparent reason, ties discounts to not purchasing rival products, or unjustifiably denies access to an essential input, the problem is no longer the quality of your product or the capability of your sales team. The problem may lie in a conduct that Mexican law prohibits.

Detecting it in time can mean recovering commercial opportunities that seemed lost.

The Signs You Shouldn't Ignore

Relative monopolistic practices rarely present themselves in obvious ways. They usually surface as situations that sales teams hear every day:

"We'd like to work with you, but we'd lose our discounts."

"We have a contract that prevents us from distributing another brand."

"Our supplier won't sell to us if we also do business with you."

"We were offered a price we can't possibly match, but only to push you out of the market."

A single comment doesn't prove a violation. But when those responses start repeating across different clients, distributors, or suppliers, they stop being isolated anecdotes and can become evidence of anticompetitive conduct.

That is why a good economic competition strategy doesn't start with litigation. It starts with listening to the market.

The Best Evidence Is Usually Already Inside the Company

One of the most common mistakes is thinking an investigation begins when lawyers get involved. In reality, the strongest case files are usually built long before that.

Emails, quotes, contracts, price lists, client messages, commercial policies, distributor responses, sales presentations, or public statements can all become critical elements for identifying patterns of conduct.

For that reason, commercial, procurement, business development, and customer service teams are often the first to detect possible restrictions on competition.

Training them to recognize these signals can be as valuable as any traditional compliance program.

Precedents That Changed the Market

This is not theory. Mexico has a documented history of companies that identified a relativel monopolistic practice, filed a complaint, and, as a result, recovered ground they had been losing for years.

The most cited case in telecommunications involves Telcel. Axtel, Alestra, Marcatel, Megacable, Protel, and Telefónica filed a complaint with the then-Federal Competition Commission alleging that Telcel charged its competitors higher interconnection rates than it charged itself for calls within its own network, artificially raising the cost of service for any rival carrier. The authority concluded that a relative monopolistic practice existed and, in 2011, imposed a historic fine of more than 11,989 million pesos. The precedent reshaped how interconnection is regulated in Mexico, as the CFC revoked the fine in exchange for Telcel making immediate commitments that benefited the public.

Something similar occurred with Cancún International Airport, a more recent and perhaps more illustrative example. For several years, the airport systematically prevented new SCT permit holders from providing taxi service at the terminal, issuing negative opinions to the transportation authority and, in at least one case, refusing to sign the access contract even after an applicant already held the corresponding permit. In 2016, an affected company filed the complaint. In 2019, COFECE's Plenary ruled that this constituted a refusal to deal, imposed a fine of 72.54 million pesos, and, most significantly, ordered the airport to grant access to concession holders with valid permits. A market closed for nearly a decade opened through a well-documented complaint. The fine was upheld by the judiciary in 2025.

In 2020, Chedraui filed a complaint with COFECE challenging certain commercial contributions Walmart required from its suppliers. Following a four-year investigation, the authority concluded that one of these practices constituted a relative monopolistic practice, imposed a fine of 93.4 million pesos, and ordered conduct remedies aimed at preventing Walmart from using this mechanism to limit the commercial terms suppliers could offer to other competitors.

Three cases, three industries, one same pattern: a company identified prohibited conduct, documented it, and filed a complaint. The authority didn't just impose a fine. It ordered the conduct to stop. And that order, more than the financial penalty, was what restored competitive conditions to the market.

One important clarification is worth making: the 2025 reform to the Federal Economic Competition Law eliminated COFECE as an autonomous constitutional body and created the National Antimonopoly Commission (CNA), housed within the Ministry of Economy, as the authority that now handles this type of complaint. The precedents above remain valid as a guide to what the law can achieve; what changed is which door you now have to knock on to try.

From Defensive Compliance to Strategic Compliance

For years, we have understood compliance as a tool to reduce risk and avoid sanctions. That approach remains correct.

But in the field of economic competition, there is an additional opportunity that many companies are still not taking advantage of.

A well-designed compliance program doesn't just prevent a company from engaging in anticompetitive conduct. It also allows the company to identify when third parties are illegally undermining its ability to compete, document that conduct, and evaluate the legal tools available to restore competition.

That shift in perspective transforms compliance from a purely preventive function into a business intelligence tool.

Competing on Equal Terms

Free competition doesn't protect consumers alone. It also protects companies that want to grow through innovation, efficiency, and better products.

When a competitor gains an advantage by breaking the law, the answer is not always to sell cheaper, invest more, or accept that "this is just how the market works." Sometimes, the best strategy is to demand that everyone play by the same rules.

Because competing will always be difficult. Competing against someone who breaks the law shouldn't be.