Recognizing Criminogenic Ties in Mexico: Children as Collateral Damage
Among the objectives of the Mexican criminal justice system are the protection of the innocent, the restitution of damages, and the fight against impunity. These goals seek to ensure a rightful, fair, and just criminal process. However, problems arise when these objectives are overlooked, often resulting in the neglect of victims—some of whom may go on to replicate the very criminal behaviors they have been exposed to within their environments. Analyzing the involvement of families, communities, and other social institutions is crucial for preventing and reducing crime, particularly in light of the significant influence criminogenic ties exert on individual development. Understanding offenders as former victims provides critical insight into their behaviors and highlights institutional failures to act as protective caregivers. This perspective does not absolve offenders of responsibility for their actions; rather, it emphasizes the importance of identifying risk factors that contribute to a child’s transformation from victim to aggressor. Growing up in an environment where crime is normalized can profoundly affect a person’s development, especially when criminal behavior is a regular part of daily life. To truly understand the root causes of criminal conduct, it is necessary to examine the life experiences and social, emotional, and environmental factors that have shaped an offender’s decision-making processes. Criminogenic ties—such as family members or peers engaged in criminal activities—can create environments where crime becomes not only normalized but, in some cases, glamorized. This normalization fosters pro-criminal attitudes, portraying lawbreakers as heroes or role models, particularly among impressionable youth. Risk factors for criminal behavior have always existed; therefore, it is incumbent upon government institutions and local communities to develop and implement strategies aimed at protecting potential victims, especially children. Children, as members of vulnerable groups, are often targeted by criminal organizations that exploit their lack of protection, care, or guidance, drawing them into illegal activities. The government must assume a proactive role in breaking these criminogenic cycles within families by addressing re-victimization and reinforcing children’s rights. Violence against children must be recognized not only as a direct offense but also as a significant risk factor for future criminal behavior. A child’s best interests are compromised when they are exposed to individuals who have engaged in criminal conduct. We must begin to view these children not merely as potential offenders but as present victims of systemic neglect and social failure. Society as a whole must work to break intergenerational cycles of violence and criminality, enabling children to grow up with access to opportunities rather than being funneled into lives of crime. Every child deserves a safe, nurturing, and dignified upbringing. Protecting children’s rights is not solely the responsibility of the government; it is a shared duty involving parents, educators, neighbors, and society at large. When a child is neglected, it signifies more than just abandonment—it means that their fundamental needs are unmet, affecting them psychologically, emotionally, and physically. To effectively prevent criminogenic ties and uphold children’s rights, we must recognize that victimization can occur long before it becomes visible to the child or to others. Children must not grow up resenting their parents or environments; rather, they should be guided toward paths where education is valued and crime is seen for what it truly is—deeply harmful rather than glamorous. Sources: Olson, E. (July 20, 2018). Familia, niños y delincuencia: La violencia como herencia. Banco Interamericano de Desarrollo. Retrieved from: https://blogs.iadb.org/seguridad-ciudadana/es/familia-ninos-y-delincuencia-la-violencia-como-herencia/ Inter-American Development Bank. (December 12, 2023). Citizen security in Latin America and the Caribbean. Retrieved from: https://www.iadb.org/en/news/citizen-security-latin-america-and-caribbean Cervantes, E. A. (1993). Factores criminógenos sociales en México (Bachelor’s thesis, Universidad Nacional Autónoma de México). UNAM. Retrieved from: https://ru.dgb.unam.mx/bitstream/20.500.14330/TES01000198314/3/0198314.pdf Hikal, W. (2017). Factores de riesgo que provocan la criminalidad. Ciencia, 68(4), 14–19. https://www.amc.edu.mx/revistaciencia/images/revista/68_4/PDF/68_4_factores_riesgo.pdf García Montoya, L. (2021). Factores criminógenos en jóvenes y su integración en la delincuencia organizada. Biolex, 13, 402-428. https://www.scielo.org.mx/scielo.php?script=sci_arttext&pid=S200755452021000100402
The Future of Law is Personal
The legal profession has long been defined by tradition, prestige, and institutional might. For decades, the towering presence of established law firms has shaped the aspirations of legal professionals and the expectations of clients. However, a significant shift is underway. In today’s rapidly evolving world, driven by technological advancements, the rise of artificial intelligence, and ever-changing client demands, the legal landscape is transforming. The future of law is no longer solely about firms´ size or reputation; it’s about the ability to deliver value in new ways. The future of law is personal. The rise of boutique and solo practice A compelling movement is happening within the legal industry. Increasingly, individuals and businesses are turning to boutique and solo practitioners over traditional, large firms. This shift is driven by a desire for cost-effective, tailored solutions and a more client-centric approach. Clients seek legal counsel that is not only highly skilled but also available, affordable, adaptable, and invested in their unique needs. In my extensive experience working with clients across diverse sectors and jurisdictions, I’ve witnessed firsthand how trust and direct engagement have surpassed institutional prestige as primary factors in legal decision-making. Today’s clients are less swayed by a firm’s name and more focused on finding an attorney who truly listens, understands their challenges, and demonstrates the agility to navigate their specific needs. They seek a trusted advisor who treats their legal matters with personalized care, not just as another billable file. AI and automation: A tool, not a replacement There has been much discussion about AI taking over legal work, with some even predicting that it will replace lawyers entirely. While AI has undoubtedly revolutionized tasks such as contract review, legal research, and document drafting, it cannot replace what clients value most: sound judgment, leadership, and empathy. Technology can enhance efficiency, but it cannot replace trust. No algorithm can replicate the nuanced understanding, emotional intelligence, and reassuring presence that a skilled human lawyer provides, especially during times of crisis. Lawyers who thrive in this new era will be those who embrace technology to streamline their work while doubling down on what makes them irreplaceable: empathy, insight, and personalized guidance. Redefining success in the legal profession The definition of success is subjective. A senior partner at a big law firm might have their billable hours and firm prestige as the ultimate measure of achievement. For others, success is about power, impact, flexibility, or the ability to balance career with personal well-being. In the legal profession, there is no single path, only the one that aligns with one’s own values and priorities. For me, for example, the most important meeting of the day is always the one I have with my wife and daughter over dinner. That said, one of the unspoken truths of the legal profession worldwide is the cost of success. Traditional law firms often demand relentless billable hours, grueling work schedules, and personal sacrifices that take a toll on mental and physical well-being. Burnout is not an anomaly; it is deeply embedded in the system. As a solo practitioner, I’ve chosen a path that balance client needs with family life and personal well-being. It is not about working less but working smarter, focusing on meaningful client alliances rather than churning through cases to meet billing quotas. Clients benefit from lawyers who are fully present, engaged, and able to offer their best guidance without being overburdened. Beyond NDA´s, trust and confidentiality matter People sign Non-Disclosure Agreements every day. NDAs can enforce confidentiality, but they don’t replace genuine trust. Trust must be earned. Clients don’t just share legal issues with their lawyers; they reveal fears, ambitions, and deeply personal matters, expecting absolute discretion from their lawyers. Earning trust and delivering true confidentiality isn’t just about legal obligations, it’s about close personal connections. Clients need to be certain they are speaking to someone who listens, understands, and personally protects their interests. In a more personalized practice, this bond forms naturally, as clients work directly with the lawyer they trust rather than being filtered through random people. After all, clients confide in their lawyers the same way they do with doctors or priests under a strong principle of trust. Multicultural expertise through personal connections As an international lawyer with clients in multiple jurisdictions, I have seen firsthand that legal expertise alone is no longer enough. In an increasingly multicultural and integrated world, the true added value comes from understanding the diverse cultural and business realities of each client. Legal challenges do not exist in isolation; they are shaped by the customs, values, economic and political landscapes and regulatory frameworks of each country. Clients today seek more than just technical legal knowledge; they want lawyers who understand their unique cultural contexts and can navigate the complexities of cross-border transactions, disputes, and negotiations with top-notch service, sensitivity, and insight. Whether working with multinational businesses, entrepreneurs, or individuals, the ability to bridge legal systems through cultural awareness is an added value that only personal connections can provide. The power of personal alliances The legal profession has long been defined by structure and hierarchy, but today’s solo practitioners are increasingly carving out their own paths. As an independent lawyer, I have the flexibility to be more present, think outside the box, and engage with my clients without being bound by rigid law firm protocols. I take pride in the ability to tailor solutions, provide direct and meaningful counsel, and build trust in ways that go beyond standardized legal services. Clients today value responsiveness. They want someone who understands them, their values, their industry and their unique legal concerns. This is one of the main reasons why large firms struggle to provide the same level of personal service. The future of law is not about the biggest firm or the flashiest office. It is about the lawyer who picks up the phone when their client calls. It is about the practitioner who builds lasting alliances instead of short-term transactions. It is about redefining success in a way that values both professional fulfillment and personal well-being. The future of law is not just changing, it is becoming personal. And that’s exactly what it should be.
Electricity & Industrial Buildings in Mexico
One of the fundamental aspects for a foreign company that has decided to start operations in Mexico is the purchase or lease of an industrial building for its production plant. Therefore, during the selection process, additionally to the considerations of location, labor force available, roads and infrastructure of the area, and recently the availability of sufficient electricity power, it is highly recommended to have an experienced team to advise them throughout the selection, in order to ensure the timely fulfillment of their production plans and financial forecasts. In March 2025 and in continuance with the project of the former President Andrés Manuel López Obrador, President Claudia Sheinbaum enacted a sweeping energy reform package that restructures Mexico’s power sector in favor of state-owned companies (Federal Electricity Commission “CFE” and Petroleos Mexicanos “PEMEX” ), these reforms represent a “reverse” of the 2013 energy reform, implemented during the government of former President Enrique Peña Nieto, which opened the energy sector to private and foreign investment. Under the new laws, at least 54% of the electricity dispatched to the national grid must come from the (CFE) plants, leaving up to 46% for private sector producers, this 46%, combined with other technical and operational restrictions, is insufficient to meet the current needs of the industrial sector in Mexico. The agenda of President Claudia Sheinbaum aims to add 22 gigawatts of new power generation capacity by 2030, meanwhile, there is a lack of electricity generation by the CFE to fulfill the requirements of the industry and homes in Mexico. During the last years, industrial developers have faced the lack of capacity of the Federal Electricity Commission (CFE). The later has become a serious problem for either companies and industrial developers, because even if there are industrial buildings available, in many cases they can’t guarantee the supply the electrical demand required by their clients, which in certain cases becomes a determining factor when choosing an industrial building and sometimes involves the relocation of their establishments. Once the parties have reached an agreement to lease or buy an industrial building, it is very important that the company knows the amount of energy available at the property, and if it’s under a lease before the signing of the lease agreement. Typically at the time of the negotiation of the Letter of Intent, the parties must reach out the terms and conditions under which the electricity will be supplied to the leased property. Although the landlord may have sufficient KVA’s rights to fulfill potential tenant’s requirements, this cannot be understood as a guarantee that the Federal Electricity Commission (CFE) will supply to the tenant all the KVA offered by the landlord. Therefore, it is advisable to include some considerations in the lease agreement: Ensure that the landlord has the KVA´s rights offered under the letter of intent and lease agreement; if applicable, include the obligation of landlord to assign the KVA’s rights in favor of the tenant. Tenant must take into consideration that, as mentioned before given the limited availability of KVA’s, the Federal Electricity Commission (CFE) will request the tenant an engineering study that demonstrates the use by the tenant of the KVA’s required before granting the full load. If the tenant cannot prove use of the full load, CFE will only authorize up to the load that can be demonstrated. Another important issue that must be considered within the lease agreement is the specific work required by the Federal Electricity Commission (CFE) to supply the required load; specific works are understood as the construction of infrastructure from a specific point to the location of the leased property (poles, wiring, etc.) this can be a distance of a few miles. The parties must determine who will pay and be responsible for the specific work. Industrial leases are long-term business relationships, in which both parties are interested in a win-win negotiation. It is essential to establish achievable commitments from the beginning in order to avoid future problems, therefore in the specific case of the supply of electricity, the lessor must provide certain information about the amount of KVA that can be guaranteed to the lessee, and the lessee must provide a calendar with the demand for electricity that will be required for its project to establish the necessary agreements .
Mechanisms to Mitigate the Impacts of the Brazilian Consumption Tax Reform on M&A Transactions
With the recent enactment of Complementary Law No. 214, which regulated the Brazilian Consumption Tax Reform, mergers and acquisitions (M&A) transactions in Brazil are already being analyzed in light of the new system’s implications on valuation processes. The new system introduced several structural changes that are expected to impact economic activities and alter the dynamics of consumption in Brazil. Destination-based taxation, a limited number of rates and exceptions, gross-up taxation, and a broad non-cumulative regime are some of the features of the new system that will shape consumption taxation in Brazil in the coming Years. For this reason, this article seeks to examine three key points of attention that should be considered in such transactions: (i) the timing effects of the Brazilian Consumption Tax Reform, (ii) a clear understanding of how the new system will affect company valuation processes, and (iii) the existence of alternatives to mitigate the Brazilian Reform’s impacts on the target company’s activities. In the conclusion, we will analyze potential mechanisms that may be used to allow transactions to move forward despite uncertainties related to the new rules. Timing Effects of the Brazilian Consumption Tax Reform The implications of the new system on variables that are sensitive to company valuation processes may be mitigated during the transition period, which will end only in 2033. This is because the current system will remain partially in effect during those years. Several effects of the new rules will be softened during the transition period. For instance, the impact of the elimination of ICMS state tax benefits — which can account for a significant portion of a company’s EBITDA — will be more strongly felt only after 2033, not immediately. This should be considered in the valuation process, so that the tax benefits in effect until 2033 are reflected in the company’s market value. Understanding the Impact of the New System on Valuation Processes The new tax rules may cause various tax impacts across different sectors, including a potential increase in the overall tax burden. Examples include sugary drinks, gambling, and vehicles, which not only did not benefit from reduced IBS (State and Local VAT) and CBS (Federal VAT) rates under the new system but will also be subject to an Excise Tax. As such, these sectors may face a higher tax burden. Other examples of sectors likely to be significantly impacted are sanitation services and leasing of goods. Under the current system, these activities are subject only to PIS and COFINS (current federal Tax on Revenues), with no ISS (current Tax on Services) or ICMS (current State VAT). Under the new system, both will be subject to the standard IBS and CBS rate, estimated by the Ministry of Finance at 28%, representing a significant change in taxation. Therefore, it is essential to understand the new system’s impact on the target company’s operations to assess whether the new rules will affect sensitive variables in the valuation process, such as profit margin, EBITDA, among others — which could ultimately impact the conclusion of the M&A transaction. Existence of Alternatives to Mitigate the Brazilian Reform’s Impact on the Target Company It is also important to evaluate whether the impacts of the new system can, to some extent, be mitigated. Returning to the example of ICMS tax benefits: with taxation shifting to the destination, states that previously adopted aggressive tax benefit policies to attract businesses may see a decrease in revenue. Although the Brazilian Consumption Tax Reform created the National Fund for Regional Development (FNDR) to reduce regional and social inequalities, there is no certainty that the amounts states will receive will fully offset the loss of regional tax incentives. However, states have other revenue sources that may help offset such losses. In addition to revenue from IPVA (Tax on Property of Vehicles) and ITCMD (Tax on Donation and Estate Tax) — both of which were amended by the Reform with the potential to increase collection — states may also raise funds through new contributions, asset revenues, service fees, and credit operations. Thus, it remains uncertain whether states will adopt alternative mechanisms to maintain their revenues, even if in formats other than tax incentives — which could affect the pricing of companies that rely on state tax benefits. Accordingly, understanding whether measures are being implemented to mitigate the effects of the new system is essential in the valuation process of the target company and may prove decisive in the success of a merger or acquisition. Mechanisms to Ensure Completion of M&A Transactions Finally, despite the uncertainty surrounding the impact of the new consumption tax system on certain sectors, in our view, mechanisms can be created to make M&A transactions viable through conditional arrangements. The inclusion of contractual provisions for conditional additional payments (earn-outs) may be the most effective way to overcome uncertainties regarding the new tax system’s impact on the target company’s business. If buyers and sellers disagree on part of the company’s value due to the potential impacts of the Brazilian Consumption Tax Reform, the agreement may include an earn-out clause requiring an additional payment if the company manages to maintain its profit margin despite the increased tax burden. The earn-out clause may also require an additional price payment if the company maintains its EBITDA despite the elimination of ICMS tax benefits — or if these financial indicators are sustained during the transition period, which will end in 2033. Therefore, even though the new Brazilian consumption tax system may create uncertainty regarding its impact on certain business segments, providing for conditional price adjustments may be a viable path to ensure the successful completion of M&A transactions. Conclusion In conclusion, the Brazilian Consumption Tax Reform has introduced structural changes that directly impact the valuation processes of companies in mergers and acquisitions. During the transition period, which will last until 2033, some of these impacts will be mitigated — such as the end of ICMS tax benefits, which will continue to influence company valuations for several more years. Accordingly, it is essential that these temporary effects are properly reflected in asset pricing. Furthermore, it is crucial to
Anti-Money Laundering (AML) trends: Adapting to an evolving Digitalized landscape
AML regulations are designed to prevent, detect, and report financial crimes, ensuring that financial institutions and businesses are not unknowingly facilitating illegal activities. In today´s financial landscape, compliance requirements and Anti-Money Laundering (AML) regulations are constantly evolving, demanding businesses to stay ahead of new threats, emerging technologies, and stricter regulatory frameworks. The risks associated with financial crime and terrorism financing are growing exponentially across the globe. This article intends to explore the most significant AML and compliance trends and how financial institutions and businesses can adapt and thrive in the changing AML landscape to reduce risks, safeguard their operations and ensure compliance with applicable rules and regulations. Several key trends in AML risk management have been already shaping the landscape during the past years, making it essential for businesses to adopt robust, efficient measures to prevent money laundering: Global Standardization and Regulatory Alignment: With money laundering being a global threat, the AML landscape is constantly changing, with new regulations and emerging threats and therefore, countries are pushing towards aligning AML regulations with global AML international best practice standards to create a more consistent and transparent framework across multiple jurisdictions. The Financial Action Task Force (FATF) through its 40 Recommendations set out a comprehensive and consistent framework of measures which countries should implement to combat money laundering and terrorist financing, as well as the financing of proliferation of weapons of mass destruction. Many countries will need to stay updated with changes to these regulations, which may include stricter customer due diligence (CDD) requirements and enhanced reporting obligations, amongst others. This shift will prompt organizations to ensure that their compliance programs are aligned with both regional and international standards. While the trend toward harmonization grows, country-specific AML regulations will still play a significant role in shaping compliance strategies. Foster a Compliance Culture: A culture of compliance starts at the top (Tone @ the Top) and should permeate through every level of the organization. Moreover, it involves fostering a proactive approach to AML compliance, where all staff members understand their role in preventing money laundering through the business. AML detection and reporting capabilities are being enhanced by Artificial Intelligence (AI) and Machine Learning (ML): Manual AML compliance processes and routine tasks can be error-prone, costly and time-consuming and this is where AML technology steps in. As money laundering schemes are becoming harder to detect, and more complex, the use of ML and AI technologies have been crucial and one of the most transformative trends in AML compliance to proactively detect suspicious activities more effectively by improving the efficiency of AML operations, reduce operational costs and stay compliant. Machine Learning algorithms also enables businesses to handle large volumes of data with higher accuracy, reducing false positives and focusing attention on genuine threats and/or high-risk activities. Know Your Customer (KYC) and Customer Due Diligence (CDD) Innovations: Gone are the days of a one-size-fits-all verification process. Businesses and Financial Institutions must adapt and ensure robust KYC and CDD processes and control implementation, including sophisticated risk-based approach methods, in order to tailor their KYC and CDD procedures. Financial institutions will direct investments towards innovative technologies as digital interactions and online banking expand to improve the electronic identity verification process (E-KYC). Choose the right partner (Third-Party Risk Management): A heightened focus on third-party and supply chain risk management is critical for AML compliance. Businesses will increasingly rely on continuous monitoring tools to assess third-party relationships in real time, ensuring that any suspicious activities related to money laundering are detected early. Businesses and Financial Institutions must adopt Enhanced Due Diligence (EDD) processes to assess the AML risks associated with third-party vendors and supply chains, including monitoring the vendors’ AML policies, compliance records, and business operations to ensure they don’t inadvertently contribute to money laundering activities. Balancing innovation with Compliance: The rise of technology such as blockchain and cryptocurrencies presents both opportunities and challenges for AML compliance. Blockchain-based KYC new technologies will enable financial institutions to quickly and accurately verify customer identities through biometric technologies like facial recognition and voice identification while minimizing fraud risk and providing clearer detection of possible illegal activities. Additionally, Regulatory Technology (Reg-Tech) facilitates compliance efficiency and real-time regulatory reporting, allowing financial institutions and businesses to efficiently report suspicious activities (SARs), ensuring timely and compliance with regulatory authorities. Transparency in financial transactions are becoming even more critical and businesses and financial institutions are expected to provide clear and comprehensive records of transactions, to regulatory bodies. Increased Penalties and Enforcement: AML penalties for financial institutions have been increasing globally, reflecting a stricter enforcement from Regulatory entities and the evolving financial crime landscape, resulting in financial losses, reputational damage, and trust deficits with customers and stakeholders. Financial Institutions must invest in robust AML compliance programs and adopt comprehensive GRC (Governance, Risk, and Compliance) Programs integrating risk assessments, monitoring, and reporting, to mitigate the risk of facing financial penalties and reputational damage. Navigating the complexities of the modern AML landscape is no small task. The pressure of tightening regulatory scrutiny and sophisticated criminal networks have placed a burden on the financial sector. However, it’s a challenge that also presents opportunities to financial institutions. In this ever-evolving landscape, the urgent call to action for financial institutions is clear – adapt and be flexible to the shifting landscape or fall behind. By embracing the transformative potential of technology, they can transform the challenges posed by AML into opportunities for operational efficiency and risk mitigation, financial institutions can position themselves not just to survive but to thrive amidst these changes. In conclusion, the importance of proactive, forward-thinking AML strategies cannot be overstated. The new era of financial crime prevention lies in an organization’s ability to anticipate changes, leverage technology by adopting tech-driven solutions (real-time monitoring), and implementation of a robust risk-based compliance framework that can adapt to the complexities of tomorrow’s financial landscape and ensure they remain one step ahead in the fight against financial crime.
STABLECOINS, TOO BIG TO FAIL
Throughout history, the main options for sending money from one country to another have included Western Union, which started as a telegraph service in 1871 and later expanded its operations to money serrvice business. Additionally, SWIFT (Society for Worldwide Interbank Financial Telecommunication), established in 1973, has been fundamental for the exchange of financial transactions, such as payments, guarantees, and information between entities globally. These two platforms have dominated the international transfer landscape for decades. This duopoly ended with the first transaction of Bitcoin, which occurred in 2009 between Satoshi Nakamoto and cryptographer Hal Finney. This new system allows for the electronic transfer of funds from person to person without intermediaries, leveraging the benefits of blockchain technology. However, the problem of Bitcoin’s volatility became evident, leading to the search for alternative solutions. Thus, the concept of stablecoins was born, designed to offer stability in a market where value can be unpredictable. In this article, we will focus on those stablecoins whose issuance is conducted by private companies, structured to maintain a stable value relative to the dollar (“USD”) or any fiat currency, meaning that the issuance of a stablecoin is backed by a dollar or another fiat currency, which is considered low risk and easily liquidated. The first stablecoins were Tether, launched in 2014 by entrepreneur Reeve Collins, along with Omni Foundation executives Brock Pierce and Craig Sellars. Later, in 2018, USDC was introduced, created by Centre, a consortium co-founded by Circle and Coinbase. Both stablecoins were established with the goal of addressing the issue of volatility in the market. Thanks to blockchain technology, all transactions are nearly instantaneous and secure, facilitating both domestic and international payments. Additionally, mobile applications have been developed to allow for quicker access, reducing friction and significantly improving the customer experience. “Not everything is hunky-dory.” When looking at the big picture, it’s important to note that, in most countries, banks offer a “deposit insurance” that guarantees customers’ savings and deposits up to a certain limit. This insurance is activated automatically and free of charge when opening a bank account, providing protection in case the bank faces financial difficulties. However, as of now, there is no equivalent entity to a “Federal Stablecoins Insurance Corporation.” This means that the companies issuing stablecoins, as the only clients receiving fiat deposits from banks, would benefit from insurance only for those amounts. It is absurd to think that this coverage limit could encompass the total volume of deposits from all those possessing stablecoins in their wallets. This situation poses a systemic risk that regulators must tackle, particularly in countries where there is no clear regulation. In the market, some VASP (Virtual Asset Service Providers) directly offer a “deposit insurance” for the cryptocurrencies that clients hold in their wallets. Could this be a potential solution to the existing systemic problem? The reality is that issuers of stablecoins lack visibility over the individuals who have their assets in custody; they only know the amount of coins that are in circulation. These operations are global and require standardization, an objective that BASILEA III aims to achieve through measures from the Basel Committee on Banking Supervision of the Bank for International Settlements (BIS). These regulations will significantly impact stablecoins and can be summarized in three key points: Redemption Risks: There is a focus on addressing the redemption risks during periods of extreme stress, when issuers of stablecoins may face massive withdrawal claims. The regulator suggests limiting exposures to these stablecoins to longer maturities by introducing a maximum maturity for individual reserve assets. Over-Collateralization: Should long-term assets be allowed as reserves, the committee recommends these should be over-collateralized. This means that the amount of additional collateral should be sufficient to cover potential decreases in the value of the assets, ensuring that the stablecoin remains redeemable at its fixed value, even during difficult times and volatile markets. Credit Quality Criteria: It is suggested that stablecoin issuers rely on a list of high credit quality assets for their reserves. These assets could include reserves from central banks, government-backed securities with high ratings, and deposits in high-quality banks. It is important to highlight that these measures apply to banks but are not binding for stablecoin issuers. To put this into perspective, recall that the adoption of BASILEA II took three years, and the information generated by these new regulations will remain in the banks’ hands for communication to financial authorities. Historically, banks and autorithies have not been quick to prevent a financial crisis. There are several concerning similarities between the 2008 financial crisis and the issuers of stablecoins. Below are some of the most notable comparisons: Lack of Transparency in Risk Assessment: During the 2008 crisis, the methodologies used for assessing credit risk were poorly understood, and only a few had access to this information. In the case of stablecoins, there is no fixed limit on the amount that can be minted according to the smart contract governing them, leading many to be unaware of the conditions and terms of their programming. Trust in Auditing Entities: In 2008, rating agencies provided information about credit portfolios; today, it will be auditing firms that are responsible for validating the “Proof of Reserve” of stablecoins. However, doubts arise about the reliability of these auditors, and the reality is that little can be done about trust in this regard. Potential Domino Effect: Lehman Brothers had strong ties with other banks, especially in the realm of investment and financial intermediation. Its collapse triggered a domino effect in the financial system. Currently, stablecoin issuers are forming significant alliances with major players like Blackrock, Robinhood, Visa, and Mastercard. Such partnerships could create an even broader domino effect, given the global nature of these platforms. Incentives for Regulatory Laxity: High fees for loan placements and minimal oversight led to the creation of toxic assets for banks in 2008. Today, the money that banks will receive as collateral from stablecoins is extremely attractive. This could result in a lack of control and a lax approach toward issuing
REGULATION OF SPORTS BETTING IN BRAZIL: after the legal “back-and-forth” a sea of opportunities and risks emerges
The history of gambling and betting regulation in Brazil reflects the complex interactions between social values, economic needs, and political arrangements across different historical periods. From an almost absolute prohibition to a specific authorization for “fixed-odds sports betting”, the legislative trajectory reveals paradigm shifts and the State’s adaptation to new realities and demands. Although recent regulation has increased state revenue and created opportunities for various entrepreneurs, it’s essential to remain mindful of the risks associated with this activity, particularly considering the historical and legislative context in which betting in Brazil is situated. Historical and Legal Overview The Brazilian Penal Code of 1890, enacted during the transitional period from Empire to Republic, criminalized, under Article 369, the operation of “gambling houses where people habitually gather, even if no admission fee is charged, to play games of chance, or establishing them in a place frequented by the public”. Article 370 defined “games of chance” as those whose gains and losses depend exclusively on luck. The criminalization of gambling in the period possibly reflects the influence of republican moralism and the strong Catholic heritage in Brazil, which at the time viewed gambling as a socially deviant practice. Besides the alleged concern for maintaining social and moral order, the sole paragraph of Article 370 created an exception to allow betting (at the time, gambling and betting were referred indistinctly in Brazil) on foot or horse races and similar activities – demonstrating, on a practical analysis, a selective application of the law favoring activities traditionally associated with wealthier social groups. Subsequently, amid economic restructuring and the need to foster strategic sectors, the rigidity of the 1890 Penal Code concerning gambling was softened by Law No. 3897 of 1920. Article 14 of this law permitted the temporary granting and operation of games of chance (gamble), specifically in clubs and casinos located in thermal and climate resort areas, under certain conditions. These conditions— including prior licensing, prohibiting minors, and requiring formal management— sought to channel gambling towards revenue generation and regional development while maintaining monitoring, reflecting a continued ambivalence toward the activity. Notably, no requirement for moral integrity or good reputation was imposed on business administrators, revealing a still cautious approach. With the end of the so-called “Golden Age” of casinos in Brazil, a new wave of restriction came during the “Estado Novo” (New State) dictatorship. Law No. 3688 of 1941 (known as the Criminal Misdemeanors Law) criminalized in Article 50 the act of “establishing or operating a game of chance in a public place or one accessible to the public, whether admission is charged or not.” According to paragraph 3 of this article, a “game of chance” is one whose outcome depends exclusively or primarily on luck; as well as any unauthorized bets on horse races or any other sporting events. This prohibition was reinforced by Law No. 9215 of 1946, which, even after Brazil’s return to democracy in the Populist Republic period, banned the practice and exploitation of games of chance throughout the country. During a subsequent military dictatorship, Decree-Law No. 204 of 1967 established a new framework for the operation of lotteries, positioning them as a public service exclusively under federal jurisdiction and not subject to concession. Accordingly, except for explicitly authorized lotteries, the operation of all other games of chance remained prohibited, which was justified as a means of preventing criminal exploitation and the diversion of public funds. It is worth noting, however, that even after the reestablishment of the democratic state in 1988, various laws were enacted to alternatively relax or tighten gambling restrictions. For instance, Law No. 8672 of 1993 innovatively authorized, under Article 57, sports governing bodies to operate bingo games or similar activities as a funding mechanism. Similarly, Law No. 9615 of 1998 allowed these sports administration and practice entities to run bingo games but banned gambling machines or electronic amusements in bingo halls. Article 64 of this law also prohibited operational authorizations based on mere indications of the unfitness/unsuitability of sports entities, commercial companies, or their managers. However, due to the proliferation of bingo halls and their alleged association to illegal activities, including money laundering, tax evasion, and organized crime, Law No. 9981 of 2000 was then enacted to re-criminalize bingo, making it once again an illicit activity under Article 50 of the Law of Misdemeanors. After significant pressure from economic actors, political interests, and the rise of an informal and increasingly lucrative betting market, both domestically and abroad, Law No. 13756 of 2018 was enacted to legalize “fixed-odds sports betting”, reflecting the digital and globalized context of the modern gambling/betting industry. Nevertheless, as the law lacked detailed regulatory criteria, exposing the sector to traditional criminal risks such as money laundering and tax evasion, Law No. 14790 of 2023, popularly known as the “Bets Law”, was finally introduced to regulate this highly profitable and somewhat risky sector that had already been operating for several years. Fixed-Odds Sports Betting: Key Concepts and Requirements Although Law No. 14790/2023 regulates exclusively “fixed-odds sports betting”, it is evident that it aims to bring Brazil closer to international models in the matter, such as those of United Kingdom, Germany, and France. For better understanding, it is useful to highlight some of the main definitions set forth in Article 2 of the law, especially because the conduct generally known as mere “gamble” is still prohibited: Betting: the act of risking a certain amount of money in expectation of a prize. Fixed-odds: the multiplier factor of the wagered amount that determines the payout, per unit of currency bet, in case of a win. Real sports-themed event: an event, competition, or act including sports tournaments, games, or trials, either individual or team-based, whose outcome is unknown at the time the bet is placed and which is promoted or organized. Online game: the digital medium enabling virtual betting on games where the outcome is determined by the result of a future random event, using a random number, symbol, figure, or object generator as defined by the
The REPSE Regime in Mexico: Navigating the Complexities of Specialized Labor Services
Abstract: This article delves into the intricacies of Mexico’s Registry of Specialized Service Providers (Registro de Prestadores de Servicios Especializados or REPSE), a pivotal regulatory framework impacting labor outsourcing and the provision of specialized services. Examining its historical antecedents, the legislative framework underpinning its creation, the multifaceted obligations imposed on service providers and contractors, and the potential sanctions for non-compliance, this analysis provides a comprehensive understanding of the REPSE regime and its implications for businesses operating in Mexico. I. Antecedents: The Drive for Labor Reform The introduction of the REPSE in Mexico was not an isolated event but rather the culmination of a long-standing debate and legislative efforts aimed at reforming the country’s labor outsourcing landscape. For years, the practice of subcontratación (outsourcing) had become widespread, often utilized as a mechanism for cost reduction and flexibility by employers. However, this model also faced significant criticism due to its potential for the erosion of workers’ rights, including lower wages, limited benefits, and job insecurity. Moreover, it was argued that certain companies engaged in aggressive outsourcing strategies to evade labor obligations and taxes, creating an uneven playing field and hindering fair competition. Against this backdrop, pressure mounted for legislative intervention to regulate outsourcing and ensure greater protection for workers. Various initiatives and discussions took place over the years, highlighting the need for a more transparent and accountable system. The landmark 2021 labor reform in Mexico represented a decisive step in this direction, fundamentally altering the permissible scope of labor outsourcing and establishing the REPSE as a central pillar of the new regulatory framework. This reform sought to curb abusive outsourcing practices, guarantee workers’ fundamental labor rights, and promote formal employment. The REPSE emerged as the mechanism through which the government aimed to control and monitor the provision of specialized services, ensuring compliance with the reformed labor law. II. Regulatory Framework: The Genesis of REPSE The legal foundation for the REPSE lies primarily within the amendments made to the Federal Labor Law (Ley Federal del Trabajo or LFT) in 2021. These amendments significantly restricted the practice of outsourcing, allowing it only for the provision of “specialized services” or “specialized works” that are not part of the beneficiary company’s core business or primary economic activity. Article 12 of the LFT explicitly prohibits the outsourcing of personnel whose functions are substantially similar to the activities carried out by the beneficiary company’s own employees. Crucially, the reformed LFT mandates that any individual or entity providing specialized services or works must register with the Ministry of Labor and Social Welfare (Secretaría del Trabajo y Previsión Social or STPS) and obtain the corresponding REPSE registration. Articles 13, 14, and 15 of the LFT outline the requirements and procedures for obtaining this registration. The STPS is responsible for maintaining the REPSE registry, verifying the information provided by applicants, and ensuring ongoing compliance with the regulations. Complementary regulations and guidelines issued by the STPS further elaborate on the specific requirements and procedures for REPSE registration. These include details regarding the information that must be submitted, the documentation required to demonstrate specialization, and the criteria used by the STPS to evaluate applications. Additionally, the Mexican Social Security Institute (Instituto Mexicano del Seguro Social or IMSS) and the National Housing Fund Institute for Workers (Instituto del Fondo Nacional de la Vivienda para los Trabajadores or INFONAVIT) play a crucial role in monitoring compliance with social security obligations, which are also a prerequisite for REPSE registration and maintenance. III. Obligations Under the REPSE Regime The REPSE regime imposes a range of significant obligations on both the providers of specialized services and the companies that contract them. A. Obligations of Specialized Service Providers: Registration with the STPS: The most fundamental obligation is to apply for and obtain REPSE registration before providing any specialized services or works. This involves submitting detailed information about the service provider, its legal structure, the specific specialized services offered, and demonstrating compliance with tax and social security obligations. Accurate Description of Services: Providers must clearly and precisely define the specialized services they offer during the registration process. The REPSE registration is specific to these declared services, and providers cannot legally offer services outside the scope of their registration. Compliance with Labor and Social Security Laws: Registered providers are obligated to fully comply with all applicable labor laws, including those related to wages, working hours, benefits, and occupational safety and health. They must also meet their obligations regarding social security contributions (IMSS and INFONAVIT) for their employees. Renewal of Registration: REPSE registration is not permanent and must be periodically renewed, typically every three years. Providers must re-demonstrate their compliance and the specialized nature of their services during the renewal process. B. Obligations of Contracting Companies: Verification of REPSE Registration: Companies contracting specialized services are legally obligated to verify that the service provider possesses a valid and current REPSE registration for the specific services being contracted before entering into any agreement. Failure to do so can result in significant penalties. Joint and Several Liability: If a contracting company engages a service provider that does not have REPSE registration or fails to comply with its labor or social security obligations, the contracting company can be held jointly and severally liable for these obligations. This means the contracting company can be held responsible for the provider’s debts and liabilities to its workers. Due Diligence: Contracting companies are expected to exercise due diligence in selecting and overseeing their specialized service providers. This includes ensuring that the provider has the necessary expertise, resources, and compliance track record. Information Sharing: Contracting companies may be required to provide information to the STPS regarding their contracts with specialized service providers. IV. Sanctions for Non-Compliance The REPSE regime is backed by a robust system of sanctions designed to deter non-compliance and ensure adherence to the reformed labor law. These sanctions can be significant and can impact both the providers and the contracting companies. A. Sanctions for Unregistered Providers: Significant Fines: Companies or individuals providing specialized services without the required
Brain Data in India: Taking it From Your Head to the Courtroom and Dealing with All the Legal Stuff
The rapid advancement of neurotechnology, from consumer EEG headsets to implantable brain-computer interfaces (BCIs), is ushering in an era of unprecedented breakthroughs in medicine and human-computer interaction. These modern BCIs and wearable neuro-devices can record, and in some cases even influence, a person’s brain activity. In India, this is no longer a futuristic concept; it is a present-day reality. A nascent market is growing, with Indian startups like Neuphony and Nexstem developing EEG headsets for meditation and gaming, while global firms such as Emotiv market their brain-sensing devices directly to Indian consumers. These devices are capable of capturing highly personal data, including emotions, attention levels, and even buried memories, which raises urgent and novel legal questions about the privacy, consent, and ownership of this “brain” data. This development brings a series of critical challenges to the forefront. Who owns this neural data? How must it be secured, and can it be used as evidence in court? Does an individual retain a fundamental right to cognitive liberty or mental privacy against unwanted “mindreading”? While other countries are moving quickly to provide answers, India’s legal system remains silent. Chile, for instance, has amended its constitution to recognise “neurorights,” a move its Supreme Court has already upheld in a landmark case. In the United States, states like California and Colorado now protect brainwave data under their privacy laws. By contrast, India has no specific regulation for brain data; its existing privacy and IT laws do not explicitly address EEG or BCI devices. This analysis will examine these critical issues—including mental privacy, the admissibility of brainwave evidence, data ownership, and employer misuse—through the specific lens of the Indian legal system, identifying significant gaps and drawing comparisons with international approaches to recommend a path forward for regulating this deeply personal frontier. A Global Perspective on Neurorights Regulation As neurotechnology becomes more accessible, nations around the world are beginning to grapple with its legal implications. The approaches taken by Chile, the United States, and the United Kingdom offer valuable insights into potential regulatory pathways. Chile: A Constitutional Approach to Protecting the Mind Chile has positioned itself as a global leader by taking the groundbreaking step of amending its constitution to explicitly protect “neurorights”. In 2021, the nation amended its constitution to protect “brain activity and information derived from it”. This constitutional safeguard was tested and affirmed in the landmark 2023 Supreme Court case, Girardi v. Emotiv. The case involved a senator, Guido Girardi, who used an “Insight” EEG headset from the U.S. company Emotiv. When Emotiv collected his anonymized brainwave data for research purposes without any specific consent, Girardi sued, claiming a violation of his rights to privacy and psychological integrity. The Chilean Supreme Court sided with Girardi, delivering the world’s first neuroprivacy ruling. The Court’s decision powerfully articulated that “neurodata represent the most intimate aspects of human personality” and mandated that Emotiv delete all of Girardi’s recorded brain data. This ruling established a formidable precedent, treating brain signals like sensitive biometric information demanding the strictest protection and affirming that Chile’s constitution forbids the unauthorized harvesting of mental data. United States: A Patchwork of Emerging State Laws In contrast to Chile’s centralized constitutional amendment, the United States is developing a more fragmented, state-led approach to regulating neural data. While there is no overarching federal neurorights law, several states are taking the initiative. States like Colorado and California have amended their privacy laws to protect brainwave data, treating neural signals as sensitive personal data. This trend indicates a growing recognition among U.S. legislators that neural signals warrant a higher degree of security and user consent than other forms of data. United Kingdom: Relying on Existing Frameworks The United Kingdom has not enacted specific neurorights legislation, choosing instead to rely on its existing medical device and data protection regulations. Under this system, BCIs intended for medical diagnosis or treatment are regulated under the UK’s Medical Devices Regulation (MDR). However, a significant regulatory gap exists for consumer neurotechnology. EEG headsets marketed for non-medical purposes like gaming or wellness often escape the purview of the MDR, leaving them governed only by general product safety laws. On the data protection front, brain data collected in a healthcare context is classified as “health data” — a “special category” — under the UK GDPR/Data Protection Act, affording it extra safeguards. Worryingly, neural data from consumer BCIs might not qualify for these enhanced protections, as it may not be explicitly defined as health or biometric data. Experts have called for interpreting the UK Human Rights Act’s guarantees of privacy (Article 8) and freedom of thought (Article 9) to explicitly protect brain data, a sentiment echoed by public opinion, which views EEG-derived data as exceptionally personal. The Indian Legal Landscape and Its Regulatory Voids In India, the regulation of brain data is not governed by any specific neurotechnology statute. Instead, it falls into the gaps between constitutional rights, data privacy laws, and medical device rules, none of which were designed with neurotechnology in mind. Constitutional and Data Protection Frameworks The foundation for mental privacy in India rests on the Supreme Court’s 2017 landmark ruling in Puttaswamy v. Union of India, which affirmed privacy as a fundamental right under Article 21 of the Constitution. This right to privacy can be interpreted to extend to mental privacy as an element of dignity and bodily integrity. However, no Indian court has yet directly ruled on a case involving neural data. A significant development is the Supreme Court’s 2023 decision in Kaushal Kishor v. State of U.P., which held that fundamental rights can be enforced not only against the state but also against private entities. This “horizontal application” of rights could theoretically allow individuals to sue companies for misusing their brain data. However, this legal doctrine is still evolving, leaving the protection of individuals against corporate neurosurveillance uncertain. Meanwhile, India’s new Digital Personal Data Protection Act 2023 lacks clear categories for neurodata. While neural signals would likely be considered “personal data,” they may not automatically be granted the
Establishing UAE Foundations for Wealth Management, Succession Planning, and Philanthropy
An independent legal entity, a foundation allows wealthy families and high-net-worth individuals (HNWIs) to segregate their personal and commercial wealth. It is a long-term holding structure used for asset structuring, succession and estate planning, and philanthropic purposes. Foundations, governed by council members and a guardian, are responsible for managing activities, allocating resources, and ensuring compliance with legal requirements and the founder’s intentions. The establishment of UAE Foundations in the Abu Dhabi Global Market (ADGM), Dubai International Financial Centre (DIFC), and Ras Al Khaimah International Corporate Centre (RAKICC) has facilitated their use for various purposes, including family business succession, asset consolidation, real estate ownership, philanthropy, employee incentive schemes, and co-investment. It allows the inclusion of all kinds of UAE & worldwide assets and is enforceable once the assets are moved to the foundation. A foundation, often referred to as a “self-owned entity” or “orphan structure”, operates without shareholders or members, thereby creating a clear separation between the founder and the Foundation‘s assets. Unlike private companies, where individual shareholders personally hold shares and are exposed to third-party arrangements, debts, and potential probate or estate planning complexities, Foundations are typically established with a non-profit status. Their primary objective is not to generate profit for owners or founders but to utilize resources to achieve specified goals. The legal requirements for foundations vary depending on the jurisdiction in which they are established and may include obligations such as filing annual reports, maintaining accurate records, and adhering to specific financial and operational standards. In ADGM and DIFC, foundations can be established under common law, providing investors with a well-defined legal framework that enhances certainty and predictability in legal disputes, thereby allowing for greater flexibility in structuring. RAKICC offers the option to select common law jurisdictions, enabling entities to choose between the courts of ADGM or DIFC. Administration and Governance The administration of a foundation is managed by council members chosen by the founder. These members are responsible for overseeing property management and executing the foundation’s objectives. The foundation’s assets, selected by the founder, adhere to the foundation’s Charter and By-laws, serving to benefit specific beneficiaries or support particular causes. Legal Characteristics Foundations can operate indefinitely without a fixed or specified duration for its establishment. Additionally, a foundation does not issue shares and has no shareholders, only council members, and beneficiaries. Foundations aim to safeguard wealth and ensure legacy continuity for future generations. A foundation’s purposes are varied, including the management and preservation of private wealth, succession planning, strategic tax planning, charitable activities, asset protection, corporate structuring, and creditor protection. These aspects are outlined in the foundation’s constitution, comprising the Charter, which establishes the foundation, and the By-laws, which detail the internal governance framework and any additional powers granted to the founder and council members. Composition and Establishment A foundation can be established by a founder, who may be a natural person or a legal entity. Upon the establishment of the foundation, the founder typically forfeits any rights to the foundation or its property unless otherwise specified in the By-laws. The foundation must have a council with at least two members to manage its affairs in accordance with its Charter and By-laws. The founder is permitted to serve as a council member. While the above-mentioned foundations share some similarities, there are notable differences in their governance requirements. For instance, the DIFC mandates that foundations have at least one natural person as a founder or council member, whereas RAKICC requires a minimum of two. Both ADGM and RAKICC permit corporate entities to serve as founders and council members. Moreover, the ADGM states that at least two council members must reside in the UAE. This requirement ensures that the foundation maintains a significant connection to the UAE and can form meaningful partnerships with local organizations. In contrast, the DIFC does not impose a residency requirement for council members, recognizing that the most qualified individuals may not reside in the UAE. Additionally, a guardian, either an individual or a legal entity, must be appointed by the founder. The guardian oversees the council and ensures it fulfills its functions properly. However, the appointment of a guardian is not always mandatory. In DIFC, if a foundation has a charitable or specified non-charitable object, it must have a guardian for that object. The founder cannot serve as the guardian, and the appointment of a person as a council member is void if that person is also a guardian. Powers may be reserved to the guardian in the By-laws to approve or reject council actions. Further, each foundation must have a registered agent, licensed by the relevant regulatory body, who acts as the point of contact for the foundation. The registered agent is responsible for maintaining the foundation’s records and facilitating communication with the regulatory authorities. The basic structure of the foundations are: Advantages of Establishing a Foundation Foundations are distinct legal entities, separate from their founders and other individuals or entities but is restricted from engaging in business activities beyond fulfilling its designated purpose. They can hold assets in their own name, ensuring the separation of legal and beneficial ownership. Foundations serves as a wealth fortress, providing protection from personal liabilities and external claims from third parties seeking to extort monetary benefits or settlements from the founder and their family. Foundations such as DIFC typically feature a well-defined governance structure that dictates their operations, decision-making processes, and asset management. This ensures transparency, accountability, and adherence to the foundation’s objectives. As vehicles for managing and preserving wealth, foundations enable individuals to structure and safeguard their assets, providing a robust framework for long-term wealth management strategies. Assets held within a foundation such as DIFC may be protected from creditors and legal claims, including those arising from divorce, thus contributing to shielding them from certain financial risks. In the UAE, Sharia law dictates the distribution of an individual’s estate among heirs. However, a foundation can be structured to mitigate the impact of these rules, offering a level of control over the distribution of assets. Foundations can own a wide range of assets, including real estate, in the UAE’s free zones. This flexibility allows for the structuring of diverse investment portfolios. Foundations in the UAE benefit from a favorable tax environment, with a 0%
