Administrative Sanctions to Developers: PROFECO, SEDETUS and SEMARNAT

Administrative Sanctions on Developers: PROFECO, SEDETUS and SEMARNAT

Real estate developers in Quintana Roo operate under a tripartite regulatory regime that concentrates the greatest sanctioning risk in the sector: the Federal Consumer Protection Attorney’s Office (PROFECO), the Secretariat of Sustainable Territorial Development (SEDETUS) of the State of Quintana Roo, and the Secretariat of Environment and Natural Resources (SEMARNAT). Each acts with differentiated competencies, distinct procedural timelines and sanctioning powers that, when they concur over the same project, generate cumulative exposure that can paralyze operations or compromise the financial viability of the development.

PROFECO: Consumer Protection in Adhesion Contracts

PROFECO’s competency over developers derives primarily from the Federal Law for Consumer Protection (LFPC), published in the DOF on December 24, 1992 and with reforms in effect through 2025. Articles 73, 73 Bis and 73 Ter of the LFPC require suppliers that offer real property to the public to register their adhesion contracts with PROFECO before using them. Non-compliance activates the infractions procedure provided for in article 127, with fines that can reach up to 2,500,000 times the value of the Unit of Measurement and Adjustment (UMA) pursuant to article 128 of the same law.

The conciliation procedure established in articles 111 through 117 of the LFPC precedes the infractions procedure. Unjustified refusal to conciliate, or non-compliance with the agreement executed before PROFECO, constitutes an autonomous aggravating factor. Additionally, article 98 Bis empowers PROFECO to act ex officio when it detects practices that affect groups of consumers, a tool frequently used in pre-sale projects with deferred delivery.

The Collegiate Courts have repeatedly held that sanctions imposed by PROFECO enjoy a presumption of legality and that the burden of overturning the infraction rests with the supplier during the nullity proceeding before the Federal Administrative Justice Court (TFJA). The First Chamber of the SCJN has consolidated the criterion that the mandatory registration of adhesion contracts does not violate contractual freedom, as it is a proportional measure of economic public policy.

SEDETUS: Territorial Planning and Construction Licenses

At the state level, the Law on Human Settlements, Territorial Planning and Urban Development of the State of Quintana Roo (LAHOTDU-QR), with reforms published in the State Official Gazette in 2024, assigns to SEDETUS the inspection, verification and sanctioning of works that contravene urban development programs or that are executed without the corresponding authorizations. Article 219 of said law establishes the infractions applicable to owners and developers, including construction in non-permitted land uses, unauthorized modification of approved executive projects and occupation of mandatory cession areas.

The sanctions contemplated in article 221 include: fines calculated on the cadastral value or commercial value of the work as applicable; demolition of what was constructed in contravention; suspension of works; and revocation of licenses. License revocation is the sanction with the greatest operational impact for the reasons explained below.

When SEDETUS revokes the construction license of a project, the developer that continues marketing units through adhesion contracts incurs concurrent exposure to PROFECO whose legal basis is not merely operational but structural. Sustained commercialization of real property belonging to a project with a revoked license constitutes, with high probability, a deceptive practice within the terms of articles 32 and 42 of the LFPC, by inducing the consumer to execute a contract on the basis of a legal and material situation that the developer knows or should know is compromised. Additionally, the valid license and the legality of the work are implicit conditions of liceity of the contract registered with PROFECO pursuant to article 73 Ter: their supervening disappearance affects the validity of the conditions under which the contract was registered, which activates PROFECO’s authority to act ex officio under article 98 Bis. This chain of consequences converts state license revocation into an autonomous trigger of federal liability before PROFECO, regardless of whether or not individual consumer complaints exist.

The sanctioning procedure before SEDETUS is governed by the Administrative Procedure Law of the State of Quintana Roo. Regarding the deadline for filing arguments following notification of the initiating act, the specific article of said state law regulating that procedural stage must be observed. It is important to clarify that the Federal Administrative Procedure Law (LFPA) is, by mandate of its article 1, applicable exclusively to the organs of the Federal Public Administration, both centralized and parastate; its application to SEDETUS, as an authority of the state public administration of Quintana Roo, does not proceed as direct supplementarity unless the Administrative Procedure Law of the State of Quintana Roo expressly incorporates it by cross-reference. In the absence of such cross-reference, any invocation of deadlines or provisions of the LFPA in proceedings before SEDETUS must be qualified as analogical application and not as normative supplementarity in the strict sense, a distinction relevant for purposes of challenge. The failure to exercise the right to file arguments within the deadline established by state law precludes the possibility of offering evidence at that instance, with direct consequences in the subsequent challenge before the Administrative Court of Justice of the State.

SEMARNAT: Environmental Impact and Federal Zones

Federal environmental competence rests with SEMARNAT through the General Law on Ecological Balance and Environmental Protection (LGEEPA), whose article 28 establishes the general obligation to obtain prior environmental impact authorization (MIA) for the realization of works and activities that the Federal Executive expressly designates by regulation. The specific circumstances that trigger such obligation, including surface thresholds and land use categories in coastal zones, are defined in the Regulation of the LGEEPA on Environmental Impact Assessment (REIA), particularly in its article 5, which exhaustively lists the works and activities subject to the evaluation procedure. In the Riviera Maya, real estate developments in coastal zones, wetlands or mangroves are subject to this regime in accordance with the categories and criteria established in article 5 of the REIA, without being able to assert that the obligation derives from a generic surface threshold attributable to article 28 of the LGEEPA. Article 28 of the LGEEPA operates as the enabling norm of primary order; the application criteria for each type of project must be verified against the REIA.

Violations of the LGEEPA are typified in its article 171 and include the realization of works without environmental impact authorization, non-compliance with the conditions established in the environmental impact resolution, and substantial modification of the project without obtaining a change of conditions. Article 173 of the LGEEPA sets the economic sanctions applicable, including fines that historically were expressed in days of the current general minimum wage. Pursuant to the constitutional reform published in the DOF on January 27, 2016, which introduced the Unit of Measurement and Update (UMA) as a reference for obligations of monetary amount in substitution of the minimum wage, the constitutional transitional regime established that legal references to the minimum wage in matters of fines and administrative sanctions must be understood as referring to the UMA as of the effective date of said reform. Insofar as the current text of article 173 of the LGEEPA has not been legislatively updated to replace the expression “days of current general minimum wage” with “UMA”, the quantification of fines must be carried out in accordance with the constitutional transitional regime, applying the daily value of the UMA instead of the general minimum wage, which produces different amounts given that both units have diverged since 2017. Article 173 additionally contemplates the revocation of environmental authorizations and, in cases of damage to mangrove or reef ecosystems, the application of the environmental liability regime provided for in article 203 of the same law.

The General Wildlife Law (LGVS) and the Mexican Official Standard NOM-022-SEMARNAT-2003, relating to the conservation, sustainable use and restoration of mangroves, add specific restrictions for developments in the coastal zone of the Mexican Caribbean. The Collegiate Courts of the XXVII Circuit have ruled that the failure to obtain the MIA before the start of works constitutes an instantaneous infraction with permanent effects. The practical consequence of this classification for the developer is of special defensive relevance: under the doctrine of permanent effects, the statute of limitations period for SEMARNAT’s sanctioning authority does not begin to run while the illicit situation subsists, that is, while works executed without authorization continue to exist or the irregularity has not been formally remedied or ceased. This means that SEMARNAT retains its sanctioning power indefinitely over unauthorized works as long as these remain standing, without the passage of time operating in favor of the developer. The basis for the statute of limitations of the sanctioning authority in environmental matters must be verified in article 174 of the LGEEPA, which regulates the deadlines applicable to the authority to impose sanctions, in accordance with the provisions of the REIA regarding the effects of continued infraction.

Concurrence of Sanctions and Defense Strategy

The most relevant characteristic of the sanctioning system applicable to developers is the legitimate accumulation of proceedings: PROFECO, SEDETUS and SEMARNAT may act simultaneously on the same project, each within its sphere of competence, without this constituting double punishment prohibited by article 23 of the Constitution, inasmuch as each proceeding protects distinct legal interests. The SCJN has consistently held that the non bis in idem principle operates within the same legal order and with respect to the same typified conduct, not between concurrent regulatory systems.

Effective defense requires an articulated strategy that considers: timely challenge of defective inspection visits through indirect amparo, whose constitutional basis is found in article 107, section III(b) of the Federal Constitution, which governs amparo against acts outside of judgment that affect persons in their rights, and whose processing is governed by articles 107 and 108 of the Amparo Law (DOF April 2, 2013); the annulment of sanctioning resolutions before the TFJA or the State Court as appropriate; and the negotiation of compliance programs before SEMARNAT as an alternative to prolonged litigation. The deadline for filing a nullity suit before the TFJA is thirty business days in accordance with article 13 of the Federal Administrative Contentious Procedure Law, a deadline that does not admit informal interruptions.

Operative Conclusion

A developer’s exposure to sanctions in Quintana Roo is not managed reactively. The regulatory audit prior to the start of works, the timely registration of adhesion contracts, strict compliance with environmental conditions and formal documentation of each approval stage are the only instruments that materially reduce the risk of concurrent proceedings. When the proceeding has already been initiated, each procedural act has irreversible preclusive consequences that determine the success or failure of subsequent challenge.

The sequence of authorizations is neither discretionary nor interchangeable: their obtaining in the correct order is a condition for the legality of the project in each phase. The following operative order reflects the regulatory obligations analyzed in this article:

1. Environmental impact authorization from SEMARNAT (EIA), prior to any vegetation removal, earthwork, or commencement of works. Pursuant to article 28 of the LGEEPA and the provisions of article 5 of the REIA, no work in coastal zones, wetlands, or mangrove areas may commence without the environmental impact resolution being issued and notified. The performance of any preparatory act that involves affecting soil or vegetation prior to obtaining this authorization constitutes the instantaneous infraction of permanent effects described in this article, with the consequences of indefinite expiration of SEMARNAT’s sanctioning authority already noted.
2. Authorization for land use and building license from SEDETUS, prior to commencement of works. Once the federal environmental resolution has been obtained, the developer must demonstrate to SEDETUS the consistency of the project with current urban development programs and obtain the corresponding building license. Works executed without this instrument are exposed to the sanctions of article 221 of the LAHOTDU-QR, including demolition and revocation of license with the cascading effect on PROFECO already analyzed.
3. Registration of the adhesion contract with PROFECO, prior to execution of the first pre-sale or purchase-sale contract with consumers. Pursuant to articles 73, 73 Bis, and 73 Ter of the LFPC, no adhesion contract may be used with the public prior to its registration. The commercialization of units without a registered contract activates the procedure for infractions under article 127 and exposes the developer to fines of up to 2,500,000 times the value of the UMA, in addition to PROFECO’s ex officio action under article 98 Bis if the practice affects a group of consumers.

Compliance in this order is not merely a formal legal requirement: it is the only structure that prevents an irregularity in one phase from generating retroactive exposure in the preceding phases and active exposure in the subsequent phases. When the procedure has already been initiated by any of the three authorities, the defense strategy must simultaneously consider the implications before the other two, given the concurrent jurisdiction mechanism analyzed in this article.

Our team has represented developers in concurrent proceedings before the three authorities analyzed in this article, including litigation before the TFJA and the Administrative Court of Justice of Quintana Roo regarding resolutions of SEDETUS and SEMARNAT. Contact us for a regulatory assessment of your project prior to commencement of works or upon receipt of the first inspection notification.

Sources and References

Legislation

• Political Constitution of the United Mexican States, articles 23, 107 section III(b); amendment DOF January 27, 2016 (introduction of the UMA as unit of reference for obligations of monetary value).
• Federal Law for Consumer Protection (LFPC), DOF December 24, 1992, last amendment 2025. Articles 32, 42, 73, 73 Bis, 73 Ter, 98 Bis, 111-117, 127, and 128.
• General Law on Ecological Balance and Environmental Protection (LGEEPA), DOF January 28, 1988, last amendment 2024. Articles 28, 171, 173, 174, and 203.
• Regulation of the LGEEPA on Environmental Impact Assessment (REIA), DOF May 30, 2000, with current amendments. Article 5 (works and activities subject to the environmental impact assessment procedure).
• General Law on Wildlife (LGVS), DOF July 3, 2000, with current amendments.
• Law on Human Settlements, Territorial Ordering and Urban Development of the State of Quintana Roo (LAHOTDU-QR), Official Journal of the State of Quintana Roo, amendment 2024. Articles 219 and 221.
• Administrative Procedure Law of the State of Quintana Roo, Official Journal of the State of Quintana Roo, with current amendments. Provisions applicable to the sanctioning procedure and the deadline for submission of arguments before SEDETUS.
• Federal Administrative Procedure Law (LFPA), DOF August 4, 1994, with current amendments. Article 1 (scope of application to the Federal Public Administration); article 70 (arguments). Applicable to federal authorities; its invocation before state authorities such as SEDETUS has an analogous character and not direct supplementary application except express referral by state law.
• Federal Law on Administrative Contentious Procedure, DOF December 1, 2005, with current amendments. Article 13.
• Amparo Law, DOF April 2, 2013, with current amendments. Articles 107 and 108 (indirect amparo against acts of administrative authority).

Official Mexican Standards

• NOM-022-SEMARNAT-2003, which establishes the specifications for the preservation, conservation, sustainable use, and restoration of coastal wetlands in mangrove areas. DOF April 10, 2003, with amendments.

Case Law Criteria

• First Chamber of the SCJN: reiterated criterion regarding the proportionality of mandatory registration of adhesion contracts before PROFECO as a measure of economic public order; does not violate contractual freedom.
• First Chamber of the SCJN: consolidated criterion on the application of the non bis in idem principle, limited to conduct typified within the same legal order; does not prevent the accumulation of sanctioning proceedings from concurrent regulatory orders.
• Collegiate Courts of the XXVII Circuit (Quintana Roo): criterion in environmental matters to the effect that the omission to obtain environmental impact authorization before the start of works constitutes an instantaneous infraction with permanent effects, with incidence on the computation of the statute of limitations for SEMARNAT’s sanctioning authority; the statute of limitations does not commence while the unlawful situation persists.
• Collegiate Courts: reiterated criterion regarding the presumption of legality of PROFECO’s sanctioning resolutions and burden of proof in nullity proceedings before the Federal Administrative Court of Justice.

Official Sources

• Official Gazette of the Federation (DOF), publications and reforms of cited federal legislation, including the constitutional reform decree of January 27, 2016 regarding UMA.
• Official Gazette of the State of Quintana Roo, publications and reforms of cited state legislation.
• PROFECO institutional portal: www.profeco.gob.mx, guidelines for adhesion contract registration.
• SEMARNAT institutional portal: www.gob.mx/semarnat, environmental impact assessment procedure guides.
• Federal Administrative Court of Justice (TFJA): procedural regulations and applicable deadline criteria.

Doctrine

• Delgadillo Gutiérrez, Luis Humberto. Elements of Administrative Law. Editorial Limusa, second edition.
• Brañes, Raúl. Manual of Mexican Environmental Law. Economic Culture Fund and Mexican Foundation for Environmental Education, second edition.
• Carbonell, Miguel and Carpizo, Jorge (coords.). Works on administrative sanctions and constitutional guarantees in Mexican sanctioning administrative law, with specific reference to the non bis in idem principle in concurrent regulatory regimes. Legal Research Institute, UNAM.