Key takeaways:

• • • The deal isn’t dead, but it’s not settled either 鈥� USMCA stays in force for now, but the refusal by the US to confirm a 16-year extension triggers rolling annual reviews, with a hard expiration in 2036 if no resolution is reached.

    • Auto rules of origin are the central battleground 鈥� Washington is pushing to raise North American content requirements well above the current 75% threshold, with a specific push for more US-based final assembly and parts production.

    • Uncertainty itself is a cost 鈥� Automakers make multibillion-dollar, multi-decade plant and supply-chain investments, and not knowing what the rules will look like next year (let alone in 2036) makes those bets harder to justify.

On July 1 鈥� the sixth anniversary of the United State-Mexico-Canada Agreement听(USMCA), taking effect 鈥� the United States, Mexico, and Canada were required under the agreement’s to jointly decide whether to extend the pact for another 16 years. The U.S. Trade Representative, Jamieson Greer, announced that the Trump Administration would not agree to renew USMCA in its current form, citing persistent US trade deficits with both neighbors and what the administration considers 鈥渦nresolved shortcomings鈥� in the deal. The move by the US pushed the North American trade pact into a new period of annual reviews and extended negotiations over tariffs, market access, and manufacturing rules.

This isn’t a withdrawal; indeed, the agreement will remain in force for another decade, providing that none of the three countries exits the agreement. However, the lack of a clean renewal opens the door to years of contentious negotiations over the rules governing continent-wide supply chains. Both Canada and Mexico had favored a straightforward 16-year extension, but the US was unwilling to sign off without changes.

Why automakers are ground zero

No sector is more exposed to this outcome than automotive manufacturing. Vehicles and parts routinely cross the borders of the US, Mexico, and Canada multiple times before final assembly, a pattern built up since the North American Free Trade Agreement (NAFTA) first opened North American auto trade in 1994, and the sector alone accounts for roughly 18% of all trade among the three countries.

At the heart of the dispute is the 鈥� the share of a vehicle’s value that must originate in North America to qualify for duty-free treatment. USMCA currently sets that threshold at 75% for passenger vehicles and light trucks, up from 62.5% under the old NAFTA rules. The Trump administration is reportedly seeking to push that figure to 82%, with half of that value required to come specifically from the United States 鈥� a change aimed squarely at pulling more engine, transmission, and assembly work back across the border.

That shift likely would ripple through the industry unevenly. The annual from American University’s Kogod School of Business, which tracks US content in vehicles annually, found that only 109 models are estimated to hit 51% or more US content for its upcoming index, down from 123 the year before 鈥� a sign of how far the current supply chain sits from any tightened standard. As one researcher involved in that analysis explains, automakers will ultimately have to weigh absorbing new tariff costs against relocating engine, transmission, and component production 鈥� or even entire assembly plants 鈥� into the United States.

have largely tried to protect the status quo rather than push for disruption. General Motors, Ford, and Stellantis have publicly urged Washington to extend the existing agreement, arguing it’s essential to American production, even as they privately brace for the possibility of major changes. Stellantis has also warned regulators about a separate risk: If US rules don’t keep pace with vehicles imported from outside North America, American-built models will keep losing ground to Asian imports, to the detriment of US autoworkers.

Managing the uncertainty tax

Perhaps the most immediate effect isn’t a specific rule change 鈥� it’s the absence of a deadline forcing one. that the decision doesn’t immediately change the flow of goods and services across North America, but it could weigh on business planning, particularly in industries that depend on long-term capital commitments.

Scott Lincicome of the Cato Institute, for example, pointed to exactly this risk, telling that the resulting uncertainty could weigh on investment decisions, which matters enormously for an industry that plans plant investments, supplier contracts, and vehicle platforms on five- and ten-year horizons.

There’s also a geopolitical wrinkle shaping the negotiations reflected in a growing concern in Washington over Chinese-made components entering North American supply chains through Mexico. Lawmakers have already proposed legislation directing US trade officials to prioritize protecting USMCA from Chinese investment during the review, which could translate into rules disqualifying vehicles that use components tied to Chinese state actors.

What happens next with the USMCA?

Formal bilateral talks between the US and Mexico are continuing, while US-Canada negotiations have barely begun. The US and Mexico are set to meet again the week of July 20 for a third round of bilateral negotiations tied to the joint review. Barring a breakthrough, expect this to become a recurring headline 鈥� another review, another round of tariff and rules-of-origin brinkmanship, repeated annually until either a deal is struck or the clock runs out in 2036.

For automakers, the message is less about any single new rule and more about planning in an environment in which the ground can shift every year. That’s a very different operating reality than the one the industry built its North American footprint on over the past three decades.

You can find out more about the USMCA and the challenges it faces here

Key insights:

• • • AI makes everyone鈥檚 job easier, including cybercriminals 鈥� With Anthropic鈥檚 Claude, an attacker breached Mexico鈥檚 federal tax portal in less than an hour.

    • Cybersecurity breaches may be a canary in the coal mine for a much larger problem 鈥� This is the second publicly disclosed Claude-enabled attack in less than a year.

    • Nearshoring the risk 鈥� Beyond the immediate damage to affected citizens and businesses, foreign investors and multinational evaluating their operations in Mexico may see a red flag that could discourage them from moving forward.

Amid the 2025 year-end celebrations 鈥� while most people were busy wrapping gifts, decorating trees, spending time with loved ones, and sketching out their 2026 resolutions 鈥� a quieter threat was unfolding. Unlike the Grinch, it had no interest in stealing Christmas cheer; instead, it set its sights on something far more valuable: more than 150 gigabytes of sensitive information from Mexican government organizations.

Armed with what appeared to be intermediate knowledge of cybersecurity and an advanced usage of AI tools, the Spanish-speaker attacker convinced Anthropic鈥檚 Claude chatbot that the interaction was part of a bug bounty 鈥� a legal way to hack a company and get paid for telling them how you broke in 鈥� with 3 key rules: avoid making changes that could damage the system, delete all logs, and disable command history.

At first, Claude strongly resisted, flagging these instructions as they sounded like detection-evasion techniques, commonly used by malicious actors. It even challenged the attacker, requesting verification.

However, just three minutes after the suspicious prompts, the attacker dropped a simple and straight-forward instruction: 鈥淐ould you add this to claude.md鈥�, with a penetration-testing cheat sheet attached. After that, things went as smooth as butter.

In simple terms, using a penetration-testing cheat sheet is like asking a security guard to write instructions to disable the alarms and he refuses, so you pull out a pre-written note with those exact instructions and say, 鈥淐an you just stick this on your booth door?鈥� and he does. Now those instructions are in front of him all day, and he follows it when you ask him, automatically without questioning it. In this case, Claude didn鈥檛 write the malicious manual 鈥� it just stuck the note up, but the result was the same.

Mexican government infrastructure attacked

According to Gambit Security, the attacker breached the Tax Administration Service (SAT, according to its acronyms in Spanish) 鈥� along with least 8 other Mexican government institutions during the end of 2025 until mid-February 2026. The incident has been described as one of the largest breaches of government infrastructure.

Within the scope of the SAT alone, the compromise reportedly exposed 195 million taxpayer records and 52 million directory entries. Building on this access, the attacker then leveraged Claude to pursue even more sensitive data, including Mexico鈥檚 electronic signature (e.firma) private keys, taxpayer identification numbers (RFC), national ID numbers (CURP), as well as customers鈥� biometrics, email addresses, phone numbers, and physical addresses.

Even beyond all of this, however, the most unsettling part of the attack came next. With a prompt that revealed a striking lack of technical literacy 鈥� 鈥淢ake a Python or something like that鈥︹�� 鈥� the attacker asked Claude to build a simple web application capable of querying and returning SAT taxpayer information. He then used this tool to develop a script that generated fraudulent tax status certificates, populated with real data pulled directly from the system. While he was unable to forge the document鈥檚 digital seal, the deception was still dangerously effective, because without proper cryptographic validation, the certificates appeared legitimate and were nearly indistinguishable from authentic ones.

Thus, the commercial relevance of the SAT hack is not secondary or collateral 鈥� it鈥檚 central. SAT is not merely a fiscal institution, it is the central nervous system of Mexico鈥檚 formal commerce, and its database holds information that companies provide under legal obligation, not only with a reasonable expectation that the government will protect it, but because they have no option but to do so.

When that information is compromised, the damage is not limited to the privacy of the affected taxpayers, it extends to a foreign investor or a company鈥檚 compliance team that may be evaluating a nearshore move for the establishment of operations in Mexico. And with all of that, it would be understandable for them to wonder:

If the government cannot protect the data that companies have little choice but to provide, what guarantee exists that it will be safe? And with that, in case of a danger, will the Mexican government have enough tools to investigate and sanction the attackers?

The hack spreads mistrust and apprehension

Within that calculus, weaknesses in government cybersecurity become more than a technical concern 鈥� they evolve into a tangible barrier to investment, a contradiction made even sharper amid the ongoing renegotiations of the United States-Mexico-Canada Free Trade Agreement (USMCA).

The last version of the USMCA establishes a framework for cybersecurity cooperation among member countries. Its legal architecture rests on three pillars: i) the recognition that cyber-threats represent a risk to digital commerce; ii) the commitment of the parties to develop capacities to identify and manage those risks; and iii) the promotion of cooperation between the public and private sectors in this area.

However, it never mentions a minimum-security standard that governments are required to meet, but that is not the only loose thread, since the USMCA was negotiated in a technological context radically different from the present one 鈥� back when generative AI (GenAI) was still science fiction rather than a browser tab. Indeed, the cybersecurity framework implicitly assumes that threat actors are organized structures.

And that鈥檚 where the case analyzed by Gambit Security could jeopardize everything, as the breach in which AI functioned as a primary operational tool, according to their document. More worrisome, what previously required months of specialized work and considerable resources by a potential network of hackers can today be executed in days by a much smaller unit, or singular person, with monthly subscription tools 鈥� and maybe less technical knowledge than you think.

That said, the push for stronger cybersecurity standards may extend beyond USMCA concerns and evolve into a broader industry imperative, particularly in places in which the agreement itself may fall short.

Claude as the mechanism

This attack marks the second known incident involving the use of Anthropic鈥檚 Claude 鈥� the first having been linked to a Chinese state-affiliated group 鈥� and it is unlikely to be the last. Without clearer regulation and stronger security standards, such misuse will not remain an exception but rather become an increasingly recurring threat not only in Mexico but also in Canada and the United States. Even in the US, which maintains comparatively advanced cybersecurity frameworks, experts acknowledge that defenses are still struggling to keep pace with an increasingly complex threat landscape.

The US is not the only one taking the lead, however, as the European Union has already introduced the first comprehensive AI regulatory framework, requiring systems to be resilient against misuse (including for cyberattacks) and obligating companies to report and address vulnerabilities. However, these rules primarily apply to AI developers rather than those who weaponize the technology. By contrast, the US has begun to address this gap by enacting laws that treat the use of AI in criminal activity as an aggravating factor, leading to harsher penalties.

As such, this is not only an alert for Mexico to improve its own cybersecurity practices but is certainly a broader call to action for all three countries. Regulating a technology that evolves faster than legal processes is both urgent and challenging 鈥� but not impossible.

You can find out more about the challenges facing Mexico on several different fronts here

Key highlights:听

• • • The scale of risk demands urgent attention 鈥� The World Cup’s five-week span across three nations creates a human trafficking risk profile far beyond any previous North American sporting event.

    • Geographic exposure extends far beyond host cities 鈥� Unlike the Super Bowl, where risk is concentrated in one metro area, the World Cup’s national identity-driven fan engagement means every city in the US, Canada, and Mexico is effectively a participant city.

    • Cross-sector preparation is the most critical investment 鈥� Cutting down siloed operations among law enforcement, financial institutions, and NGOs is required, that means establishing financial institution task forces, training frontline bank branch employees to recognize trafficking indicators, sharing cross-sector information, and amplifying public awareness campaigns before the tournament begins is crucial.

The 2026 FIFA World Cup will be the largest sporting event ever hosted on North American soil, a tournament with 104 matches spanning more than five weeks across three nations and drawing an estimated 6.5 million visitors from around the world. While the United States hosts large sporting events like the Super Bowl each year, the World Cup brings with it the unique challenges of length of time, fan influx from around the globe, and geographic expansion.

Assessing the scale of human trafficking risk

To understand the magnitude of the human trafficking risk involved in events such as this, it is useful to apply a framework that accounts for three variables: i) the likelihood of a trafficking event; ii) the potential extent of damage; and iii) the duration of exposure. When that framework is applied to the 2026 World Cup, the human trafficking risk associated with the event registers high due to numerous factors.

For more on this, tune into the 成人VR视频 Institute’s latest “Clarity” podcast

The most significant differentiating factor of the World Cup is its time duration. The Super Bowl is a single-day event, and the Olympics run approximately two weeks. The 2026 World Cup spans more than five weeks across three nations, a duration that has no modern sporting equivalent. The last three World Cups, held in Brazil, Russia, and Qatar, offer limited comparative value given the substantial differences in legal frameworks, cultural contexts, and infrastructure. For purposes of risk assessment, this is why the Super Bowl represents the most relevant domestic benchmark, even though it falls considerably short as a true comparison.

Human trafficking evidence from the most recent Super Bowl

The most recent Super Bowl, held in the San Francisco Bay Area in February 2026, illustrates the scale of the human trafficking challenge. A coordinated anti-trafficking campaign conducted across 11 Bay Area counties resulted in the recovery of 73 sex trafficking victims, including 10 minors, and 29 arrests, all in connection with a single-day event.

Sex advertisement data from that period further substantiates the scale of human trafficking concern. In the months preceding the event, advertisement volume rose steadily before spiking dramatically during Super Bowl weekend and declining sharply in the days that followed. Analysis that was restricted to advertisements referencing the Super Bowl by name showed trend lines that remained essentially flat until the event itself, at which point volume surged significantly.

Likewise, examination of phone numbers associated with those advertisements revealed organized and purposeful movement. Nearly 500 unique numbers that had posted sex advertisements in other states in the preceding weeks appeared in San Francisco during the event.

The risk of human trafficking expanding beyond the host city is one additional insight uncovered during the anti-trafficking operation during the Super Bowl. Advertisements referencing the Super Bowl spiked simultaneously in Boston and Seattle, the home cities of the two competing teams. In the context of the World Cup, every city in the United States, Mexico, and Canada is effectively a participant city, and national identity rather than team affiliation drives fan engagement. The geographic distribution of risk is therefore exponentially greater than anything observed around the Super Bowl.

Hotspots of sex ads

What anti-trafficking partners should do now

Those organizations and institutions that take action in advance of the World Cup will be substantially better positioned to detect exploitation and protect vulnerable individuals. More specifically, these organizations should:

• Establish financial institution task forces in advance of the event 鈥� Convening local financial institutions to align on existing practices and identify gaps will aid in ensuring all parties are on the same page. It also establishes relationships and procedures that cannot be built effectively during a five-to-six-week surge in cross-border transactions. Activating established information-sharing mechanisms, such as the processes supporting the filing of and the , will be essential for detection and pattern recognition.
• Institute branch-level employee training at local financial institutions 鈥� Frontline employees possess local knowledge that no centralized system can replicate. A branch employee in a high-traffic urban location understands the patterns of their customer base and is often the first to recognize when something is amiss. What they frequently lack is the context in which to interpret that instinct and the guidance to act upon it. Addressing that training gap before the World Cup represents one of the highest-value preparedness investments available to financial institutions at this time.
• Dismantle institutional silos 鈥� Siloed operations, in which law enforcement, financial institutions, and non-governmental organizations (NGOs) each operate independently, represent the least effective organizational posture for an event of this scale. Institutions that establish cross-sector relationships and information-sharing commitments in advance will be meaningfully better equipped to respond.
• Develop and amplify public awareness campaigns 鈥� Research demonstrates that sustained public awareness campaigns and visible law enforcement presence reduce demand. Host cities, law enforcement agencies, and NGOs should treat this as actionable guidance in planning their response strategies.

The 2026 FIFA World Cup is not simply another major sporting event. The institutions, agencies, and organizations that approach it as such will find themselves unprepared for a scale of human trafficking risk that North America has never previously encountered.

You can find more about the resources, tools, and information that cities and organizations need to address听human trafficking around large-scale sporting events at听the 成人VR视频 Institute鈥檚 Large-Scale Public Events Toolkit here

Key takeaways:

• • • The FIFA World Cup is a catalyst, not the root cause 鈥� Mexico City’s housing affordability crisis predates the coming tournament. Rental prices have been rising uncontrollably for years, displacing thousands of families annually. The World Cup will accelerate and amplify an already existing problem.

    • The 2024 rental reform is a step in the right direction, but it has significant limitations 鈥� Capping rent increases at the annual inflation rate was a necessary measure, but its impact has been limited by grey areas in the law.

    • The real battle is formalization 鈥� No housing regulation can be fully effective if a large portion of the market operates outside of it. Until authorities find ways to make formal rental agreements genuinely attractive and accessible for both landlords and tenants.

On the eve of the 23^rd playing of the FIFA World Cup, Mexico stands as one of three host countries for one of the most significant sporting events in the world. It will feature matches in Mexico City, Guadalajara, and Monterrey, and it will be co-hosted alongside the United States and Canada.

Organizing such an event carries notable financial benefits, including a surge in tourism, job creation, and substantial foreign investment 鈥� all of which generate a local economic spillover that strengthens the national marketplace. At the same time, Mexico’s major capitals鈥� especially its World Cup host cities 鈥� have been undergoing a level of urban transformation that has significantly altered the daily lives of its residents. Chief among these changes is the sharp rise in rental costs, which has been pushing residents toward the cities鈥� outskirts. According to government figures, are displaced each year due to the uncontrolled increase in housing prices in Mexico City alone.

Mexican authorities had to get to work

Legal changes to real estate regulation in Mexico City are not isolated, and what is implemented in the capital often sets a precedent for the rest of the country. Time and again, Mexico City has served as a laboratory for new policies, and when these are proven effective, they become models for nationwide reform.

According to government figures, more than 20,000 households are displaced each year due to the uncontrolled increase in housing prices in Mexico City alone.

That said, in August 2024 鈥� after the city’s head of government noted that rentals costs in none of the boroughs of Mexico City fall below the city鈥檚 minimum wage, and that 9 out of 13 boroughs average rents that exceeded twice the minimum wage 鈥� the Official Gazette of Mexico City published a decree amending Articles 2448-D and 2448-F of the Civil Code for the Federal District, imposing limits on rent increases for residential properties. Previously, the monthly rent increase could not exceed 10% of the agreed-upon rent. That paragraph was amended to establish that rent increases shall never exceed the inflation rate reported by the Bank of Mexico for the previous year.

It is worth noting that the prior 10% cap was nearly three times the general annual inflation rate calculated by the Bank of Mexico in 2025, which stood at 3.69%.

More than a year after these reforms took effect, however, 2025 closed with an average increase in rental prices of . With the FIFA World Cup approaching, prices are expected to continue rising uncontrollably due to the influx of tourists drawn by the event. This concern is well-founded: Ahead of the 2022 World Cup in Qatar, empowered landlords to raise rents by more than 40%.

Mexico City鈥檚 rental reform also introduced additional measures. For example, a digital registry for lease agreements was established, to be immediately authorized and managed by the Government of Mexico City. Landlords now are required to register lease agreements within 30 days of their execution. Furthermore, landlords are prohibited from refusing to rent to tenants on the grounds that they have children or pets.

The registration requirement carries real consequences: Should a landlord fail to register a contract within the stipulated period, their ability to invoke legal protection mechanisms in the event of a dispute with a tenant becomes significantly more complicated.

Regardless of the efforts, it鈥檚 not all smooth sailing

That said, the reform contains certain grey areas that limit its scope. For instance, it only applies under specific conditions 鈥� most notably when a lease has been in place for three years or more. A landlord can effectively circumvent the cap by choosing not to renew an existing contract and instead requiring the tenant to sign a new one at a higher price.

A separate but equally significant obstacle to the reform’s effectiveness is the rapid growth of short-term rental platforms. In recent years, the proliferation of temporary accommodation services has steadily reduced the supply of traditional long-term rentals, as more properties are listed on platforms such as Airbnb, Vrbo, or others. Indeed, every 48 hours, three housing units in Mexico City are . And from a national perspective, the Tourism Gross Product reached approximately US $151.5 billion, equivalent to 8.7% of Mexico鈥檚 GDP.

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Every 48 hours, three housing units in Mexico City are converted into Airbnb listings.

This problem is further compounded by the scale of informal rental arrangements. According to the National Housing Survey conducted by Mexico鈥檚 National Institute of Statistics and Geography (INEGI), there are more than 200,000 informal rental agreements in Mexico City 鈥� none of which involve formal contracts.

Forcing the real estate market into formalization

This brings us to the central challenge facing city authorities with regard to housing: The need to incentivize the formalization of the real estate market. This is already complicated by the country’s low tax culture and the requirement for landlords to enter a specific tax regime that raises their tax burden. Additionally, rental contracts are not only essential for protecting tenants’ rights, but they also are equally important for landlords 鈥� because without a legally binding agreement, there is no guarantee that the terms of any arrangement will be honored.

Paradoxically, the recent reform may actually push the informal market further underground. By requiring landlords to formally declare their rental income, the regulation inevitably creates a sense of heightened oversight 鈥� one that informal landlords may seek to evade rather than comply with.

To the authorities of Mexico City, the message is clear 鈥� punitive measures alone will not bring the informal market into the fold. Tax benefits for landlords who register their contracts, streamlined and accessible digital registration processes, and legal protections that make formal agreements genuinely advantageous for both parties could go a long way toward building trust in the system.

The 2026 FIFA World Cup will come and go, of course, but the people of Mexico City will remain. They deserve a housing market that works for them 鈥� not one that treats their homes as a commodity to be priced beyond their reach every time the world turns its attention to their city.

You can find out more about the

Key insights:

• • • Big sporting events create perfect cover for sex trafficking 鈥� The World Cup鈥檚 massive crowds, temporary workers, and stretched local infrastructure make it easier for traffickers to blend in and exploit vulnerable people while staying largely out of sight.

    • Money trails and online ads are where traffickers slip up 鈥� Trafficking often leaves patterns, such as payments tied to commercial sex ads, round鈥慸ollar peer鈥憈o鈥憄eer transactions, and repeat phone numbers or language across online ads. Banks and investigators can spot these red flags, if they know what to look for.

    • Early, cross鈥憇ector collaboration is what actually makes a difference 鈥� The strongest prevention efforts happen before kickoff, when law enforcement, financial institutions, and nonprofits share intelligence, use formal information鈥憇haring tools, and build trusted local networks to respond quickly and protect victims.

As millions of soccer fans descend upon stadiums across North America for the 2026 FIFA World Cup in June and July, perpetrators of human rights crimes also are getting ready to operate in the shadows of host cities. Criminal networks are preparing to exploit the crowds, traffic, and chaos during the event by trafficking vulnerable individuals for commercial sex.

Human traffickers and organized crime groups often exploit major sporting events as opportunities to make quick money because the massive influx of visitors, temporary workers, and strained infrastructure creates perfect conditions for traffickers to operate while being largely undetected. At the same time, the stakeholders involved in countering this illegal activity 鈥� including law enforcement, civil society organizations, and financial institutions 鈥� stand ready to detect it, disrupt it, and protect vulnerable individuals who are exploited by criminal actors.

Indeed, close coordination and collaboration among these entities in advance of the games is key. To that end, the Association of Certified Anti-Money Laundering Specialists (ACAMS) and 成人VR视频 are collaborating on a virtual and live event series to support these planning counter-trafficking efforts among stakeholders in several local cities this Spring.

Why major sporting events attract human trafficking activity

Not surprisingly, large crowds draw business opportunities whether they are legitimate or illicit. Collaboration between public and private entities underscore spikes in human trafficking activity. For example, during a recent large sporting event in 2025, 成人VR视频 Special Services partnered with federal law enforcement and other partners to identify nine adult encounters & services offered, which led to the recovery of two juveniles from sex trafficking and three state arrests

Common industries that involve the exploitation of vulnerable individuals include hospitality, construction, illicit massage businesses, escort services, and adult content production. The chaos of events and large influx of people mask the reality that exploitation is happening and makes detection significantly more challenging during these high-traffic periods.

Human traffickers and organized crime groups often exploit major sporting events as opportunities to make quick money because the massive influx of visitors, temporary workers, and strained infrastructure creates perfect conditions for traffickers to operate while being largely undetected.

Critically, understanding human trafficking as a business model depends on the recruitment of vulnerable people and access to money flows. These aspects of the business are also where detection can occur. Financial institutions and money service businesses can identify suspicious transactions related to human trafficking by understanding and recognizing specific transactional patterns, including payments to commercial sex advertisement websites, round-dollar peer-to-peer transactions, and merchant services linked to illicit massage businesses.

This online footprint left by traffickers proves invaluable for detection. Investigators track advertisements across adult services websites, identifying criminal networks through repeated phone numbers, distinctive emojis, and similar wording that may appear across multiple cities. However, smaller-scale operations present significant challenges as well. When the trafficker is an intimate partner or family member with limited transaction volumes, detection becomes exponentially more difficult without external intelligence.

Collaboration is key for prevention and detection

The most critical element for combating human trafficking at major sporting events is collaboration among anti-trafficking experts and employers of these professionals. Effective prevention requires building strong partnerships before these major events occur. Specific actions that can be taken include:

Establishing multi-sector task forces 鈥� The most successful anti-trafficking efforts involve joint task forces that combine federal, state, and local law enforcement with trusted private sector partners and supportive nonprofits or non-government organizations (NGOs) that offer victim services. This toolkit for large scale public events and other anti-trafficking toolkits are excellent resources for local host cities to use to execute these partnerships. These collaborative mechanisms allow different entities to share information in a timely manner.

Leveraging information sharing mechanisms 鈥� Financial institutions can use Section 314(b) authority for peer-to-peer information sharing between banks. This allows financial institutions to piece together fragments of suspicious activity that individually might seem insignificant but collectively reveal trafficking networks. Large federal agencies are consumed by multiple priorities and benefit from information sharing through Section 314(a) and assistance from financial sector partners during special operations to act as a force multiplier. Law enforcement also can benefit from detailed Suspicious Activity Reports (SARs) that contain specific dollar amounts, clear timelines, behavioral observations, and explicit keywords like human trafficking.

Preparing host cities by building networks and outreach in advance 鈥� Some World Cup host cities have already established human rights plans with robust collaborative systems within local task forces, government awareness campaigns, QR codes that link to support services, and multidisciplinary safety plans.

In addition, anti-trafficking professionals across all sectors are accessible and willing to help. Resources include national hotlines, such as the , referral directories on website, and the for cases involving minors. The most important step is simply reaching out to establish connections before crises occur.

Preparing for a safer event

The 2026 World Cup presents a pivotal moment to strengthen collaborative efforts against human trafficking across North America’s host cities. By establishing robust information-sharing networks between financial institutions, law enforcement, NGOs, and host communities before the tournament begins, stakeholders can transform heightened awareness into meaningful action that protects vulnerable individuals.

While traffickers will undoubtedly attempt to exploit the inevitable chaos surrounding a major event like the World Cup, a coordinated, multi-sector response grounded in shared intelligence, victim-centered approaches, and proactive preparation can disrupt their operations and ensure that the world’s celebration of soccer doesn’t come at the cost of human dignity and freedom.

You can find out more about听how organizations are trying to fight against human rights crimes here

Key points:

• • • USMCA at risk 鈥� Rising tariffs, political friction, and the potential 2026 review are creating uncertainty around rules of origin, market access, labor obligations, and dispute鈥憆esolution mechanisms 鈥� areas that are central to legal and tax planning.

    • Economic impact 鈥� Mexico depends on USMCA for exports, investment, and employment; and any disruption would be problematic.

    • Water as a strategic resource 鈥� The conflict over the 1944 Treaty and the new law reflect the critical importance of water usage and water rights in the bilateral agenda.

For almost 25 years before the United State-Mexico-Canada Agreement听(USMCA), it was the North American Free Trade Agreement (NAFTA) that defined the region鈥檚 economic relationship. Enacted in 1994, NAFTA removed most tariffs, encouraged foreign investment, and integrated supply chains across North America, especially in manufacturing, automotive production, and agriculture. This integration helped transform Mexico into a major export platform and contributed to North America鈥檚 emergence as a competitive economic bloc.

Over time, however, NAFTA drew criticism, particularly in the US, where concerns grew about trade imbalances, worsening labor conditions, and the agreement鈥檚 ability to address modern challenges such as . These political pressures set the stage for renegotiation and ultimately produced the USMCA, a more modern but also more politically sensitive framework.

The current chaotic environment around tariffs and trade suggests that these rules in North America may again be subject to revision. Understanding how tariffs, political dynamics, and resource鈥憆elated tensions interact is essential for organizations and corporations as they try to plan for the legal and tax implications that may arise as the 2026 review approaches.

A year of trade tensions

From the beginnings of Donald Trump鈥檚 second administration in January 2025, , marking the start of a more protectionist trade policy.

In March, some of those tariffs were exempted for products that comply with USMCA provisions. However, in December, President Trump declared that the US would allow the treaty to expire or seek to renegotiate it in 2026, alleging that Canada and Mexico have gained advantages to the detriment of US interests.

Not surprisingly, throughout 2025 and saw President Trump accuse Mexico of failing to comply with the 1944 Water Treaty, a historic agreement that regulates the distribution of water resources from the Bravo, Colorado, and Tijuana rivers. According to the US government, Mexico had not delivered the agreed-upon volumes, generating friction amid a political context already marked by trade disputes.

Mexico argued that prolonged droughts between 2020 and 2025 made compliance with the treaty difficult, affecting water availability in its own agricultural and urban regions. However, President Trump warned that if water flow to the US did not increase, he would impose a 5% tariff on Mexican exports, adding pressure to the bilateral relationship. Finally, after negotiations, an agreement was reached: Mexico must supply the remaining amount before 2030, which represents a significant challenge for the country鈥檚 water management.

In this context, the Mexican government promoted a structural reform to ensure compliance with the treaty and guarantee efficient resource management. On December 11, 2025, the and came into force the following day. This regulation establishes a new legal framework with three fundamental pillars:

• • • comprehensive state responsibility for water management;
    • exclusive powers for Conagua in the allocation, supervision, modification, and revocation of concessions; and
    • prohibition of concession transfers between private parties, preventing speculation and resource hoarding.

The law directly impacts strategic sectors such as agriculture, livestock, industry, and rural communities, as well as domestic services. Beyond its internal scope, this reform is interpreted as a mechanism to guarantee compliance with the Water Treaty, reduce the risk of trade sanctions, and strengthen Mexico鈥檚 position in future international negotiations.

Economic impacts and projections

For Mexico, the USMCA is not merely a trade agreement; it represents a strategic pillar for the country鈥檚 economic stability and sustained growth. Since its entry into the USMCA, Mexico has become a reliable partner in the North American region, guaranteeing its preferential access to two of the largest markets in the world. This advantage has driven foreign direct investment into the country, especially in sectors such as automotive, advanced manufacturing, agribusiness, and emerging technologies.

The importance of USMCA lies in the fact that . Without this legal framework, Mexico would face an adverse scenario because the imposition of significant tariffs would reduce the competitiveness of national products, increase supply chain costs, and directly affect job creation. The automotive sector, for example 鈥� and about 30% of manufacturing GDP in Q3 of 2025 alone and employs more than 1 million people 鈥� would be one of the hardest hit by the loss of these preferential conditions.

In addition, USMCA offers legal certainty for investors. Clear rules on intellectual property, digital trade, and dispute resolution reduce risks and encourage the arrival of foreign capital. Without this treaty, Mexico could experience an outflow of investments to other countries with more stable agreements, which would negatively impact job creation and projected economic growth.

The coming USMCA review

The possible renegotiation of USMCA, scheduled for later this year, generates uncertainty. This review process presents several possible paths for Mexico, each with distinct economic, political, and diplomatic implications. If the USMCA is successfully extended without substantial modifications, Mexico would preserve its preferential access to the US and Canadian markets, maintaining the commercial stability that supports most of its exports. This continuity would reinforce investor confidence, support job creation and stabilize diplomatic relations.

However, if no agreement is reached to extend the treaty, this absence of clarity would create uncertainty for businesses operating throughout North America. Investment decisions could be delayed, expansion plans postponed, and operating costs could rise due to increased scrutiny and customs enforcement. Further, diplomatic tensions could begin again, particularly if unilateral measures such as large tariffs are threatened again. In this environment, Mexico would need to adopt a cautious strategy focused on strengthening legal frameworks and offering targeted economic incentives to maintain its own competitiveness.

Another scenario in which the parties fail to reach consensus would activate the formal pathway toward the treaty鈥檚 expiration in 2030. While trade flows would continue in the short term, markets would begin adjusting to the anticipated end of the USMCA. This expectation could trigger a gradual relocation of investments and restructuring of supply chains, particularly in industries heavily integrated with US production networks, such as automotive manufacturing and advanced industrial sectors. Pressure on the peso, slower GDP growth, rising import costs, and early job losses would likely follow; and even if diplomatic efforts emerge to prevent severe disruption, the economic effects for Mexico would become progressively more adverse.

However, the most severe scenario involves one country withdrawing from the USMCA, which would cause the agreement to collapse for all three members. For example, if the US were to withdraw, Mexico would immediately face World Trade Organization tariffs, dramatically increasing export costs for manufactured goods and agricultural products and severely disrupting supply chains.

Clearly, any of these scenarios highlight how critical this year will be for Mexico. While a successful extension of the USMCA would support stability, attract investment, and sustain long鈥憈erm growth, a failure to reach agreements 鈥� or the withdrawal of a partner country 鈥� could reshape Mexico鈥檚 economic landscape for years to come.

You can find out more about the challenges facing Mexico on several different fronts here

Key takeaways:

• • • Real-time oversight and strict compliance 鈥� Mexico鈥檚 SAT now requires digital platforms to provide real-time access to transaction data and withhold taxes at the source, with severe penalties, including service blocking, for non-compliance.

    • Major technological and operational demands 鈥� Platforms must invest in secure, scalable systems for data sharing, billing, and cybersecurity, and small businesses likely will face extra challenges adapting to these requirements.

    • New roles for legal and tax professionals 鈥� Lawyers and accountants will be essential in guiding businesses through compliance, privacy, and operational risks, as well as supporting technology integration and adapting to the demands of Mexico鈥檚 digital tax environment.

Mexico鈥檚 digital tax overhaul is more than a regulatory update 鈥� it鈥檚 a fundamental shift that will reshape how businesses in that country operate online. By granting the Tax Administration System (SAT) real-time access to platform data, the government aims to curb tax evasion and strengthen collection in the digital economy. This means platforms like Amazon, Uber, Netflix, TikTok, DiDi, and Mercado Libre must now share transaction details as they happen, which will mean unprecedented compliance, technology, and operational challenges for companies and professionals alike.

Platforms must also 鈥� 2.5% for income tax (ISR) and 8% for value added tax (IVA). If a seller does not give a tax ID number (RFC), the platform will keep up to 20% of the payment; and, if the platform does not comply, SAT can block the service in Mexico until the problem is fixed. That means users will not be able to access the platform until it follows the law.

The goal of all this is to make tax collection fair and stop fake invoices and false transactions. The law also adds ; now, selling fake tax documents online can lead to two to nine years in prison.

These new tax measures also raise questions about with the United State-Mexico-Canada Agreement (USMCA or T-MEC), because some proposals 鈥� such as increased data access and stricter penalties for digital platforms 鈥� could conflict with the treaty鈥檚 provisions on cross-border data flows and platform liability.

Indeed, this shift is part of a wider digital transformation in Mexico, as seen not only with the new biometric CURP for identity verification, but also with SAT鈥檚 adoption of AI-driven smart auditing 鈥� both of which bring new opportunities and challenges for compliance, security, and public trust.

Technological impact on companies

These latest rules mean big changes for tech systems. Platforms must create secure connections for SAT to access their data, although they may use APIs or that send transaction details in real time.

Companies will need stronger cybersecurity policies because opening a permanent link to SAT creates risks, especially considering the high value of data that will be flowing through the system en masse. At a minimum, businesses will need to invest in heightened encryption to protect data, authentication systems to control access, and monitoring tools to detect unusual activity

Platforms also need to update their . Every sale must include correct tax retention and generate a digital invoice (CFDI). For larger platforms that process millions of transactions daily, this means building high-capacity systems to avoid delays or errors. These platforms will also need data pipelines to handle the huge volumes of information and, in turn, send that to SAT without slowing down the services of SAT or themselves.

Small companies and startups may face extra challenges. They might not have the money or staff to make these changes quickly; and they likely will require the assistance of technology providers or consultants to implement new solutions such as compliance-as-a-service and automated tax reporting software.

Challenges and opportunities for tax and legal professionals

For lawyers, these rule changes will create new work areas. Companies will need legal advice to comply with the new rules and protect user privacy. Lawyers, for example, can help draft policies, negotiate limits on data sharing, and design compliance programs.

There will also be litigation opportunities. Many that real-time accesses could violate privacy rights and even the Mexican Constitution, with legal challenges likely by companies as a result. However, due to the recent amendments to the Amparo Law, many of these lawsuits could be frustrated at the outset, because the new Amparo requirements demand the claim of direct and personal harm and impose stricter limits on judicial suspensions, making it harder for platforms to obtain effective protection against real-time monitoring.

For accountants and tax advisors, the challenge is operational. They must help businesses manage new tax retentions and keep accurate records. Many smaller businesses, especially in retail, will need help registering with SAT, issuing invoices, and recovering taxes withheld. Accountants will also need to plan for their clients鈥� as a result of the retentions potentially reducing liquidity.

Both professions are likely to see more demand for their respective services. Lawyers will focus on compliance and defense matters, while accountants will handle routine tax activities; however, both will be involved in technology integration. Professionals who combine legal or tax knowledge with these needed tech skills will have a big advantage.

Adapting to Mexico鈥檚 real-time tax landscape

Real-time tax monitoring is a major shift for Mexico鈥檚 digital economy, and it aims to increase tax collection and reduce fraud, but it also brings big risks and costs. And the success of this big fiscal change depends on balance. Authorities must ensure strong security and clear limits on data access, and they should also offer support to small businesses, either in educational or instructional fashion, to help those enterprises that may have fewer resources at their disposal to navigate this turbulence.

If implemented well, however, this system could make Mexico鈥檚 tax collection more efficient and fairer. If not, these changes could lead to privacy violations, higher costs, and even less participation in the digital economy by smaller entities.

Indeed, Mexico is entering new territory with these rule changes, and the world will be watching carefully as this could become a model for other countries鈥� digital tax compliance 鈥� or it could become a cautionary tale of what happens when technology and regulation collide without enough safeguards.

You can find out more about the听regulatory and legal issues impacting Mexico听here

Key takeaways:

• • • Legal professionals face tighter procedural constraints 鈥� The shift to legitimate interest and stricter suspension rules limit the scope of litigation, requiring claims of more precise harm and reducing early judicial intervention.

    • Stricter judicial suspension powers 鈥� Judges now face tighter rules when granting suspensions and need to prioritize public interest and order over individual or corporate requests.

    • Compliance and financial counsel must prepare for UIF scrutiny 鈥� Expanded authority for Mexico鈥檚 Financial Intelligence Unit (UIF) means frozen assets may remain inaccessible despite amparo filings, necessitating stronger defense strategies and deeper expertise in financial legality.

In Mexico, the Amparo Law is one of the most important legal tools for protecting individual rights. For legal professionals, amparo has long been a key tool to challenge government actions that impact clients鈥� operations or compliance. This legal action acts as a mechanism to enforce constitutional protections, preventing public authorities from being unfair or abusing their power.

In September, Mexico sought reform in many areas of this action, including seeking changes to . The update in Article 5 of the Amparo Law refines the definition of 鈥渓egitimate interest鈥� (inter茅s leg铆timo) while maintaining the concept of 鈥渓egal interest鈥� (inter茅s jur铆dico). Under the previous standard, which was introduced in the 2011 reform and formalized in 2013, practitioners could initiate amparo proceedings on behalf of clients who were affected in a general way 鈥� for example, by pollution, lack of access to public information, or harm to indigenous communities. Now, the law only allows a filing of an amparo when individuals are .

Judicial limits and augmented authority for UIF

Another important change in the 2025 reform relates to suspensions. In Mexico鈥檚 Amparo Law, a suspension is a temporary court order that stops administrative measures while the judge reviews the case. Before the current reform, judges had , even in cases that affected the public or large groups using their evolving jurisprudence.

Now, judges must follow stricter rules; for example, they cannot allow suspensions if these affect. This shift has direct implications for law firms because legal teams will need to reassess the likelihood of obtaining suspensions in cases involving administrative actions, especially those tied to public infrastructure or financial enforcement.

In Mexico, the Amparo Law is one of the most important legal tools for protecting individual rights. For legal professionals, amparo has long been a key tool to challenge government actions that impact clients鈥� operations or compliance.

The reform also limits suspensions, including investigations by the Federal Executive Branch, tax credit cases (unless the person pays a financial guarantee), preventive detention, and cases in which the country鈥檚 Financial Intelligence Unit (UIF) is involved. The UIF works on cases in which individuals or entities are suspected of .

Lawyers and legal counsel, particularly those representing clients in financial and criminal matters, face new hurdles because of this reform. Even if an amparo is filed, bank accounts may remain frozen if there is suspicion of links to criminal organizations. This forces legal teams to develop more robust strategies for contesting UIF actions. Similarly, tax professionals must also adjust to the new reality. The reform limits the use of amparo to delay tax payments or challenge tax credit denials. Clients who previously relied on legal maneuvers to postpone payments or other obligations will now need to provide financial guarantees or face immediate enforcement. This increases pressure on tax advisors to ensure compliance and to anticipate UIF scrutiny.

Another consideration is whether UIF鈥檚 legal counsel itself can verify the legality of resources, a process that requires specialized knowledge. In some cases, public interest and public order may be referenced in general terms rather than supported by specific evidence, thus placing additional burdens on legal professionals to challenge such claims effectively.

In contrast to the concerns about qualified personnel and individual rights, the government explains that the reform helps stop powerful groups 鈥� those that can afford to pay a lawyer and other legal expenses, as opposed to common citizens 鈥� from to avoid paying taxes or slowing down legal actions.

Modernizing the amparo process through digital reforms

The September reform is expected to expand and reinforce the digital modernization initiatives introduced in the and other earlier reforms, much of which focused on using technology to improve the amparo process. For example, lawyers must now adapt to mandatory digital procedures; and Article 3 now allows people to send documents either online or on paper. (According to the reform, however, if someone has an account in the Federal Judiciary鈥檚 Online Services Portal, they must use it to send and receive documents.)

While this shift standardizes communication, it may challenge those firms with limited digital infrastructure or clients in rural areas.

The reform also supports using electronic signatures for all legal steps. Previously, digital signatures were not accepted in the same way by all courts. This change simplifies filings and enhances procedural clarity, but it also requires law firms and tax advisors to update their systems and train staff on secure digital authentication.

Lawyers and legal counsel, particularly those representing clients in financial and criminal matters, face new hurdles because of this reform. Even if an amparo is filed, bank accounts may remain frozen if there is suspicion of links to criminal organizations.

In addition to reforms designed to enhance system functionality, further modifications have been introduced to decrease the number of cases and enable judges to reach decisions more efficiently. In the past, judges had flexible timelines, which often resulted in delays. The reform now sets clearer limits; for example, in indirect amparo cases, judges must give a ruling within 90 calendar days. This accelerates case resolution but also increases pressure on judicial teams to manage caseloads efficiently and consistently.

Adapting to Mexico鈥檚 amparo reform

The September reform could reshape the legal landscape for judges, attorneys, and tax professionals by reversing the progress made since the 2011 changes, which aimed to protect Constitutional rights more strongly. If this happens, the reform may weaken the procedural tools that legal professionals use to defend their clients 鈥� people and companies alike 鈥� against government actions. As a result, we may see a noticeable shift in litigation demand, with fewer opportunities for constitutional defense and more pressure on legal teams to adapt to narrower procedural options. Contributing to this, the new requirements and streamlined procedures could discourage frivolous claims, reducing the volume of cases that firms must manage.

For judges, the reform introduces a more rigid framework. Previously, collective actions based on the prior definition of legitimate interest delayed major infrastructure projects. By requiring direct harm under the new standard, judicial discretion is curtailed, and courts are expected to prioritize administrative efficiency over broad social concerns. In addition, the UIF is now better positioned to freeze illicit funds, which helps lower the chances of situations such as the release of the 27 billion pesos frozen between 2018 and 2025. Legal teams must now prepare for more aggressive enforcement and fewer procedural safeguards.

Finally, the reform has introduced significant elements to enhance transparency and accountability in the amparo process. By introducing requirements for digital submissions and establishing clear deadlines, the changes aim to reduce corruption and confusion, but courts and professionals may struggle with the new digital tools because of their own limited access to technology. Successful adoption of this reform will depend on training judges, UIF staff, and legal teams to ensure procedural compliance and maintain the public trust.

You can find more on the legal and regulatory issues facing Mexico here

Key points:

• • • Technological transformation 鈥� SAT is modernizing its auditing with machine learning and graph analytics to detect fiscal risks and tax evasion networks.

    • Greater operational demands 鈥� Taxpayers and accounting firms must adapt to faster, more precise reviews that will be driven by AI.

    • Efficient and preventive auditing 鈥� AI enables SAT to anticipate irregularities, promote self-correction, and maintain effective tax collection at low cost.

In 2024, Mexico鈥檚 tax authority, the Tax Administration Service (SAT), introduced its Master Plan, marking a new chapter in tax auditing. This plan includes the integration of technologies such as machine learning to identify high-risk taxpayers who potentially could be involved in illicit activities. The aim of the plan is to detect complex structures of tax evasion and avoidance through the analysis of transactional patterns and relationships among entities.

Additionally, the plan seeks to uncover inconsistencies in Digital Tax Receipts (CFDI) that may indicate simulated operations, smuggling, or the use of shell companies, thereby strengthening fiscal oversight and the prevention of financial crimes.

This approach relies on large-scale data analysis, with AI playing a central role. Through algorithms that learn from historical patterns, SAT aims to anticipate irregular behavior and act proactively. Indeed, this represents a profound shift in how tax auditing is understood and executed.

Although AI is a major innovation in the field, it鈥檚 not the starting point. Since 2020, SAT has been consolidating its four-pronged strategy, aimed at i) increasing collection efficiency; ii) reducing tax evasion; iii) combating corruption; and iv) improving taxpayer service. This strategy has supported the development of programs such as Compliance Monitoring, Deep Surveillance, and Coercive Collection, which have enabled the authority to act with greater precision and speed.

To better understand the scope of this transformation, certified public accountant Roberto Iv谩n Col铆n Mosqueda, a member of the Mexican Institute of Public Accountants, shares his expert insights on how these tools are redefining tax auditing and what they mean for taxpayers and professionals in the field.

The role of advanced analytics

SAT鈥檚 2024 Master Plan places special emphasis on machine learning to strengthen auditing. This approach is divided into two main models:

1. 1. 1. Analytical techniques, which allow the review of large volumes of data from CFDIs, tax returns, and audit reports. The goal of this is to detect irregularities in real time, especially in sensitive sectors like fuel distribution, where illegal trade and irregular commercialization are targeted.
      2. Statistical learning models, which enable AI to identify previously detected tax evasion patterns and apply them to uncover new networks or similar schemes. This model is particularly useful for identifying operations linked to fake invoicing companies or importers engaged in irregular practices.

The combination of these models allows SAT not only to react to non-compliance but to anticipate it, resulting in smarter, less invasive, and more resource-efficient auditing.

鈥淭he authority has been closing gaps and tightening controls, and the reality is that electronic invoicing now provides highly reliable information,鈥� explains Col铆n. 鈥淏ased on this, along with tax returns and other data it receives, SAT can implement artificial intelligence to develop analytical and statistical learning models that will undoubtedly continue to deliver strong results.鈥�

Direct impact on taxpayers & accounting firms

SAT鈥檚 technological transformation doesn鈥檛 only affect large taxpayers or strategic sectors. It also has direct implications for ordinary taxpayers and the accounting firms that support them.

Indeed, Col铆n warns that this new auditing will be more dynamic and demanding. 鈥淚n the daily life of a regular taxpayer, this will mean increased auditing,鈥� he says. 鈥淭he authority will detect non-compliance and omissions more quickly, which will generate more work for both taxpayers and accountants, who will need to constantly review and correct.鈥�

Additionally, accounting firms must adapt to a more sophisticated auditing process that goes beyond numbers to better analyze relationships between data, behavioral patterns, and connections among taxpayers. This implies greater responsibility in validating transactions, ensuring consistency in reported information, and maintaining traceability of digital tax receipts.

鈥淭hese analytical techniques will allow the authority to detect irregularities more quickly. Today we already see reminders before a tax declaration is due, and invitation letters requesting explanations. With artificial intelligence, this pace will intensify,鈥� Col铆n adds.

Efficient collection and preventive auditing

One of SAT鈥檚 most notable achievements is its operational efficiency. Currently, for every 100 pesos collected, the authority spends only 28 cents, compared with the United States鈥� Internal Revenue Service (IRS) which . This figure reflects a modern fiscal management model based on the strategic use of technology to maximize results with limited resources.

Preventive auditing, supported by AI, allows SAT to expand its coverage without significantly increasing its operational structure. By detecting irregularities before they become serious omissions, it encourages taxpayer self-correction, reducing the need for formal audits and improving voluntary compliance.

This proactive approach not only optimizes government resources but also fosters a more transparent and collaborative relationship between the authority and taxpayers.

Preparing for the future of tax compliance

SAT鈥檚 technological evolution presents new challenges for all actors in the tax system. For taxpayers, it means maintaining more rigorous accounting, staying alert to messages in the tax mailbox, and responding quickly to any requests. For accounting firms, it鈥檚 an opportunity to strengthen their services, adopt analytical tools, and provide more strategic advice to their clients.

Smart auditing works to move revenue services beyond enforcement, enhancing the ability of auditors to prevent, educate, and collaborate. In this new environment, transparency, traceability, and cooperation will be key to building a fairer, more modern, and efficient tax system in Mexico.

You can find out more about the regulatory and legal issues impacting Mexico here

Key takeaways:

• • • Legal promise, operational gaps 鈥� The biometric CURP could streamline identity verification in legal and notary contexts but lacks training programs and designated data capture sites.

    • Balancing security and civil liberties 鈥� While intended to help locate missing persons, the CURP raises concerns over government surveillance due to broad access by security agencies.

    • Digital readiness under scrutiny 鈥� Mexico currently lacks the systems and regulatory framework to securely manage biometric data, risking identity fraud and misuse if not properly addressed.

Last July, key reforms to Mexico鈥檚 General Population Law and the General Law on Forced Disappearance were approved, marking the beginning of a transformation in the way people are officially identified in the country.

With these reforms, the biometric Unique Population Registry Code (CURP) becomes an official identification document, which is now mandatory and available in both physical and digital formats that will integrate biometric information such as fingerprints, iris scans, and photographs.

The biometric CURP will be used mainly for identity validation on digital platforms, immigration procedures, access to health services, legal processes, and to support the search for missing persons. With little time left before its implementation, doubts linger regarding how this new system will be implemented and the impact it may have, especially in the judicial and notarial areas.

To provide a professional perspective on the possible impacts, Jos茅 Ra煤l Gonz谩lez Ram铆rez, Master in Notarial Law and aspirant assigned to Notary 1 in Cuernavaca, Morelos, shared his personal perspective on what this mandate will mean for Mexico and its citizens.

Challenges and benefits in the legal and notary fields

In Mexico, there is currently no single official identification document. In the legal and notary field, the passport and voter ID card are mainly used, as they are documents issued by federal institutions that generally use greater security measures. The biometric CURP could represent a solution to this lack of a single document, offering a more reliable tool to validate people’s identity.

However, key parts of the system are still lacking that could have significant consequences. For example, there is no implementation program to train notaries on this document; and while the College of Mexican Notaries is hoping to disseminate training mechanisms in the coming months, so many areas of the system remain undefined that training at this stage could prove difficult.

Further, no designated sites have been reported for the population to go for the official capture of the biometric data that is at the heart of the system鈥檚 methodology. Finally, no official date has been defined for the mandatory use of this new CURP.

Hope or surveillance?

The biometric CURP was approved with the main objective of strengthening the search, location, and identification of missing persons in Mexico. Not surprisingly, this has raised significant government surveillance issues. And while the access to CURP is stipulated to be exclusively for search purposes, access on a consultation basis will be allowed to prosecutors, investigative bodies, and the National Intelligence Center.

This measure has generated divided opinions among Mexicans. On one hand, there is fear that it could become a tool for government surveillance as the National Guard (GN) and the Secretariat of Security and Citizen Protection (SSPC) can access individuals鈥� delicate information that will include bank and telecommunications data. On the other, it represents hope for thousands of families who have been searching for their loved ones in a country in which 42 people disappear daily on average according to the National Registry of Missing and Unlocated Persons (RNPDNO).

Master Jos茅 Ra煤l says he considers the implementation is positive, since its initial purpose is the search for missing persons. The rest of the population鈥檚 concerns, in that sense, would be 鈥渃ollateral damage,鈥� he adds.

“It is going to be an identification that, if done correctly and if the registration is adequate, will strengthen the notary鈥檚 ability to identify the person in front of them and avoid, as much as possible, a false declaration or impersonation at the moment of identification,” Jos茅 Ra煤l explains.

Is Mexico ready?

One of the greatest challenges will be Mexico鈥檚 ability to securely store and manage the vast amount of confidential data required for the biometric CURP. According to Jos茅 Ra煤l, the country currently lacks the necessary systems, infrastructure, and regulatory framework to handle this information effectively.

鈥淚f implemented correctly, this system could provide stronger safeguards against identity fraud,鈥� he explains. 鈥淗owever, without a reliable database and proper data management, it could become a serious problem.鈥�

In addition, there is uncertainty about how the data will be captured, with which population the process will begin (those over 18 years of age, or also minors), and how often the database should be cleaned. The population aged 0 to 18 poses a particularly complex challenge due to its size, which current resources and infrastructure are not equipped to handle effectively.

In the coming months, it will be crucial for the Mexican government to define the implementation mechanisms, the initial target population, and the data cleansing processes, as this will be one of the most important aspects for the success or failure of the biometric CURP.

The road ahead

Although a pilot program is currently underway in Mexico City, it is essential to establish a robust action plan for collecting population data. Likewise, a clear framework must be defined for the management, maintenance, and protection of this data, especially considering the sensitive nature of the information and the critical need to prevent misuse. Further, it is crucial to assess whether the government has the technological infrastructure required to securely store this data, or if investment in such storage capabilities will be necessary.

You can learn more about the challenges of identity verification here