The arrival of a new director to the office of Mexican Consumer Protection (Profeco) and his take on the organization’s role has the normally quiet tapatio business sector up in arms.
A former federal vice prosecutor and attorney general for President Enrique Peña Nieto when he was governor of Estado de Mexico, Alfredo Castillo Cervantes has made big changes during just a few months in office.
In the past weeks Profecto has fined 150 major hotels in Mexico, 11 of those in Guadalajara for not posting their rates. According to the law, a list of rates and extra charges for incidentals must be posted in public view, and be perfectly clear. Hotels that do not comply face fines from 600 pesos up to 2.5 million pesos.Last week, a variety of hotels including Camino Real, Hilton, Westin, Crowne Plaza, NH, Fiesta Americana, Holiday Inn and Quinta Real showed huge “suspension” signs at their reception areas. No services or areas were actually closed as the sanctions were only fines, not closures. But hotel chains complained that their incomes where affected as much as five percent because of the signs and bad press.
In the past month, Profeco has fined or warned major companies including Bimbo, Coca Cola and McDonalds for misleading or confusing information about their products. McDonalds had to pay a 684,000 peso fine for using images suggesting fresh fruit in their Happy Meals, for example showing four slices of melon but only giving one slice in the box.
Last wednesday in Guadalajara, Francisco Benkmann President of the local branch of the National Chamber of Comerce, said Mexican authorities should be fighting informal commerce and the sales of pirated products on city streets instead of harassing and closing legal business. Since the campaign started some 300 business have been fined or closed by Profeco in Guadalajara due to poor or misleading informational practices.
Five local automobile dealerships were closed with fines ranging from 440 to three million pesos. Included in the dealerships were Country Motors, Puegot, Roca Automotriz, Ferrari Guadalajara and Nueva Autotriz Occidental.
Two nightclubs were also closed. According to the law, food and drink establishments must list if tips are included on the check and the quantity of any beverage (in ounces) served must be listed in the menu.
Benmann argued that Profeco’s actions are not clearly informing businesses about the reasons for sanctions and closings. He complained that Profecto should be doing more important things like closing bars selling adulterated alcohol instead of closing some place for not being perfectly about their prices.
The crusade, criticized by business people country wide, has ample support from Mexican consumers in media forums and social networks. One citizen in a national news forum said “If they don’t want more fines they should respect the law.”