I. | Affiliated companies; | ||||
II. | Compensation and austerity; | ||||
III. | Acquisitions, leasing, services and work; | ||||
IV. | Property; | ||||
V. | Administrative liabilities; | ||||
VI. | Budget and accounting; | ||||
VII. VIII | Debt; and Sustainability. | ||||
I. | The exploration and extraction of crude oil, solid, liquid or gas hydrocarbons, as well as their collection, processing, including their conditioning and treatment, purchase, sale and marketing, and other activities and services related to the productive chain; | ||||
II. | Refining, transformation, transportation, storage, distribution, purchase, sale, marketing, exporting and importing of crude oil and hydrocarbons and the products obtained from their refining or processing and their residuals and providing related services to the productive chain and all other activities of the hydrocarbon sector; | ||||
III. | The processing, compression, liquefaction, decompression and regasification, as well as the export, transportation, storage, distribution, marketing and sale to the public of natural gas; | ||||
IV. | The formulation, transportation, storage, distribution, import, export, marketing and sale to the public of petroleum products; | ||||
V. | The import, export, marketing, transportation and storage of petrochemicals; | ||||
VI. | Gas processing and industrial and commercial petrochemical activities; | ||||
VII. | Development and execution of engineering projects, research, geological and geophysical activities, supervision, services to third parties and all other activities related to exploration, extraction and its purpose, at market prices; | ||||
VIII. | Research, development and implementation of power sources other than those derived from hydrocarbons that allow it to achieve its purpose, as well as generating and marketing electric energy, in accordance with applicable provisions, the implementation of instruments and actions necessary for the production, transportation, distribution, marketing and formulation with biofuels, as well as the efficient use of renewable energies and lithium, in accordance with the provisions of the Biofuels Law and other applicable laws; | ||||
IX. | Technological research and development required for performing activities in the oil, petrochemical and chemical industries, marketing of technological products and services resulting from research, as well as training highly specialized personnel; it may undertake these activities directly or through the Mexican Petroleum Institute, or through any specialized third party; | ||||
X. | Exploitation and management of real property, industrial property and technology; | ||||
XI. | Marketing products manufactured by it through marketing networks, as well as services related to their consumption or use; | ||||
XII. | Acquisition, holding or interest in the share capital of companies with purposes that are similar, analogous or compatible with its own; and | ||||
XIII. | All other activities necessary for the fulfillment of its nature and purpose. | ||||
I. | A Board of Directors; and | ||||
II. | A General Directorate. | ||||
I. | The central and strategic management of business, economic and industrial activities of Petróleos Mexicanos and affiliated companies, with a focus on social responsibility and sustainability; | ||||
II. | Establishing the guidelines, priorities and general policies relating to production, productivity, marketing, technological development, research, general management, safety, sustainability, health and environmental protection, finances, budgets and other related activities of Petróleos Mexicanos; | ||||
III. | Approving, reviewing and, if applicable, updating on an annual basis the Development Program of Petróleos Mexicanos and its affiliated companies, based on a five-year projection and, pursuant thereto, the annual operating and financial program; as well as verifying its alignment with the Hydrocarbon Sector Development Program; | ||||
IV. | Approving the creation, merger or spin-off of affiliated companies in which Petróleos Mexicanos has a direct participation; | ||||
V. | Approving with the prior favorable opinion of the Sustainability Committee, the guidelines, priorities and general policies in environmental, social and institutional strengthening matters, as well as any other aspect of sustainability related to the operations of Petróleos Mexicanos and its affiliated companies, pursuant to the provisions of this Law; | ||||
VI. | Approving, every three years or earlier, according to priorities, risk and opportunities, the Sustainability Plan of Petróleos Mexicanos, which shall be aligned with the planning instruments issued by the Ministry of Energy, national and international standards, and commitments in sustainability matters; | ||||
VII. | Authorizing the Legal Compliance Program applicable to Petróleos Mexicanos and its affiliated companies, in order to prevent or mitigate risks of non-compliance and corruption; | ||||
VIII. | Approving, guidelines, priorities and general policies relating to the investments of Petróleos Mexicanos and its affiliated companies, to the formation of strategic alliances, mixed development schemes and partnerships with natural or legal persons, indicating those which given their importance or significance shall be authorized by the Board of Directors; | ||||
IX. | Approving, at the proposal of the person acting as the head of the General Directorate, the guidelines, provisions and general policies for the contracting carried out by Petróleos Mexicanos indicating those which, given their importance or significance, shall be authorized by the Board of Directors; | ||||
X. | Approving on an annual basis, with the prior favorable opinion of the Audit Committee on the report of the persons acting as external auditors, the financial statements of Petróleos Mexicanos; | ||||
XI. | Fixing and adjusting the prices of the goods and services produced or provided by Petróleos Mexicanos, with the prior favorable opinion of a special price committee, except for those that shall be determined in accordance with applicable law; | ||||
XII. | Approving the rules for the annual accounting and financial consolidation of the affiliated companies of Petróleos Mexicanos; | ||||
XIII. | Approving the maximum economic projections for negotiating the applicable collective bargaining agreement for Petróleos Mexicanos; | ||||
XIV. | Approving human resources and compensation and austerity policies of Petróleos Mexicanos and its affiliated companies, subject to the applicable provisions of this Law; | ||||
XV. | Approving general policies to cancel debts owed by third parties to Petróleos Mexicanos when an economic or practical impossibility of collection exists, as well as policies for granting credits, guarantees, loans or any other type of credit and for exempting such guarantees; | ||||
XVI. | Approving the building up of accounting reserves of Petróleos Mexicanos and, if applicable, its affiliated companies, as well as their investment requirements; | ||||
XVII. | Approving the criteria and guidelines for granting extraordinary payments, contributions and donations, in cash and in-kind, made by Petróleos Mexicanos and its affiliated companies; | ||||
XVIII. | Approving and issuing, upon the proposal of the person acting as the head of the General Directorate, policies for the payment of indemnities and consideration that Petróleos Mexicanos may make to third parties, in order to fulfill its purpose; | ||||
XIX. | Establishing policies, bases, guidelines and procedures for dismantling, selling or creating guaranties or liens on the industrial facilities of Petróleos Mexicanos or, if applicable, its affiliated companies; | ||||
XX. | Approving and issuing, upon the proposal of the person acting as the head of the General Directorate, the Organic Statute of Petróleos Mexicanos, the basic structure and organization, in order to establish duties that correspond to the different areas that comprise it, as well as the persons who hold the directive positions or persons acting as public officials that shall represent it and those that may grant powers of attorney on behalf of the company, and the rules of operation of the Board of Directors and its committees | ||||
XXI. | Approving the reports submitted by the person acting as the head of the General Directorate, as well as evaluating his or her performance on an annual basis, in accordance, among other things, with the strategies contained in the Development Program of Petróleos Mexicanos; | ||||
XXII. | Monitoring and evaluating the performance of Petróleos Mexicanos, its affiliated companies and their senior management; | ||||
XXIII. | Monitoring that the actions of Petróleos Mexicanos procure its efficient operation and comply with its purpose; | ||||
XXIV. | Issuing, upon the proposal of the Audit Committee, guidelines on audit and performance evaluation matters, applicable to Petróleos Mexicanos and its affiliated companies; | ||||
XXV. | Issuing, upon the proposal of the Audit Committee, guidelines that regulate the internal control system applicable in Petróleos Mexicanos and its affiliated companies, which shall include risk management, and monitoring its implementation, based on the information submitted by the Committee, the person acting as the head of the General Directorate, the Internal Audit or the external auditors, with close attention to the main strategic risks; | ||||
XXVI. | Evaluating and monitoring the accounting, control, security and audit, records, filing and information systems and their disclosure to the public; | ||||
XXVII. | Setting policies and general bases to generate a sustainable profitability upon which Petróleos Mexicanos participates in the bidding rounds for Hydrocarbon Exploration and Extraction Contracts; | ||||
XXVIII. | Approving projects and decisions with characteristics that are strategically important for the development of Petróleos Mexicanos’ purpose, pursuant to the policies and guidelines issued to that effect by the Board of Directors; | ||||
XXIX. | Approving, upon the proposal of the person acting as the head of the General Directorate, the formation of partnerships, alliances and mixed development schemes, in accordance with the terms of the Hydrocarbon Sector Law; | ||||
XXX. | Approving guidelines for the development of mixed contracts derived from the assignments for mixed development. Such guidelines shall regulate the manner and terms under which the basis of the selection process is to be undertaken, the technical and operational terms, the contract model, the financial model and the general terms that the project shall consider for its approval, which shall be published in the Official Gazette of the Federation; | ||||
XXXI. | Approving the guidelines to carry out the selection procedure of participants in the assignments for mixed development; | ||||
XXXII. | Approving the contract model, the financial model and the mixed development project; | ||||
XXXIII. | Appointing and removing, upon the proposal of the person acting as the head of the General Directorate, the persons holding executive positions of Petróleos Mexicanos that hold positions two levels immediately below the person acting as the head of the General Directorate, and granting them leaves of absence; | ||||
XXXIV. | Acknowledging and, if applicable, authorizing matters that due to their importance or significance are submitted for consideration by the person acting as the Chairman, at least two persons acting as director through him or her or the person acting as the head of the General Directorate; | ||||
XXXV. | Approving the policies and procedures for executing transactions between Petróleos Mexicanos, affiliated companies or other persons over which they exercise control or significant influence, indicating those that shall be authorized by the Board of Directors; | ||||
XXXVI. | Establishing coordination mechanisms between the Liabilities Unit at Petróleos Mexicanos and the Internal Audit; and | ||||
XXXVII. | Approving the guidelines for austerity in the expenditure and use of resources; | ||||
XXXVIII. | Approving, with the prior recommendation of the Human Resources, Compensation and Austerity Committee, the annual austerity program; and | ||||
XXXIX. | All other duties set forth in this Law, as well as other applicable provisions. | ||||
I. | The objectives, lines and opportunities for development to preserve the Nation's sovereignty, security, sustainability, self-sufficiency and energy justice; | ||||
II. | The main strategies, actions, projects, initiatives, and goals aimed at achieving sustainable and responsible performance of the activities of the State-owned public company, including information on the use of clean and renewable energy sources in the development of its activities, operations, and services to fulfill its purpose; | ||||
III. | The main business, financial and investment strategies, energy transition and technological improvement projects, as well as priority acquisitions; | ||||
IV. | An assessment of its operating and financial position, as well as results and performance indicators; and | ||||
V. | The main strategic and commercial risk scenarios of the company, considering, among other aspects, medium and long-term economic performance, technological innovations, as well as trends in supply and demand and geopolitical changes. | ||||
I. | The person acting as the head of the Ministry of Energy, who shall preside it and have the power to cast a tie-breaking vote; | ||||
II. | The person acting as the head of the Ministry of Finance and Public Credit; | ||||
III. | The person acting as the head of the Ministry of the Environment and Natural Resources; | ||||
IV. | The person acting as the head of the Ministry of Science, Humanities, Technology and Innovation; | ||||
V. | The person acting as the head of the General Directorate of the Federal Electricity Commission; and | ||||
VI. | Three persons acting as independent directors whose appointment is the responsibility of the person acting as the head of the Federal Executive Branch and whose appointment is ratified by the Chamber of Senators; the parity principle shall be procured, who shall exercise their duties on a part-time basis and shall not be considered persons acting as public officials. | ||||
I. | Having a professional degree issued by a competent authority in the areas of law, management, economics, engineering, accounting or specialties related to the hydrocarbon industry, obtained at least five years prior to the date of the appointment; | ||||
II. | Having performed, for at least ten years, activities that provide the necessary experience to comply with the duties of a director of Petróleos Mexicanos, whether on a professional, educational or research level; | ||||
III. | Having not been convicted, based on a final ruling, of a willful crime punishable by imprisonment or a willful crime on property, regardless of the punishment; | ||||
IV. | Is not, at the time of the appointment, debarred or administratively or, if applicable, criminally suspended from exercising commercial activity or holding a position, office or commission in public service; | ||||
V. | Having no pending litigation with Petróleos Mexicanos, or any of its affiliated companies; and | ||||
VI. | Having not been sanctioned following an administrative investigation, for serious infractions, or a criminal investigation, for violations of national or foreign laws, which resulted in any kind of resolution or settlement that expressly implies the admission of guilt or liability, or a final conviction. | ||||
I. | Having been employed by Petróleos Mexicanos or any of its affiliated companies during the two years prior to their appointment, nor previously removed from the position of a person acting as a director, unless the latter was the result of a physical incapacity that has been overcome; | ||||
II. | Having held the position of a person acting as external auditor of Petróleos Mexicanos or any of its affiliated companies, during the twelve months immediately preceding the date of the appointment; | ||||
III. | Having been a person acting as a public officials at any level of government nor having held positions obtained by popular vote or executive positions in any political party, in the two years immediately preceding the date of the appointment; | ||||
IV. | Having been or being, in the two years immediately preceding the day of the appointment, a material client, service provider, contractor, debtor or creditor of Petróleos Mexicanos or any of its affiliated companies, or a shareholder, director, advisor or employee of a legal person that is a material client, service provider, supplier, contractor, debtor or creditor of Petróleos Mexicanos or any of its affiliated companies. A person who has been a client, service provider, supplier, contractor, debtor or creditor is considered material when the revenues derived from its business relationships with Petróleos Mexicanos or affiliated companies, represent more than ten percent of the total sales or assets of the latter, during the twelve months prior to the date of appointment; | ||||
V. | Being related by blood, without limit of degree, and not being a spouse or domestic partner or member of a cohabitation partnership of any of the natural persons referred to in sections I to IV of this article; and | ||||
VI. | Simultaneously belonging to more than four boards of directors or management bodies of different legal persons, public or private, including that of Petróleos Mexicanos; or holding a position, office or commission that prevents the proper exercise of their independent director duties. | ||||
I. | The periodicity of the ordinary meetings. The ordinary meetings shall be held at least once every quarter, pursuant to the agreed calendar, with prior notice of the person acting as secretary, upon instruction of its Chairman. Without prejudice to the agreed schedule for ordinary meetings, the person acting as Chairman of the Board of Directors or at least two persons acting as directors may instruct the person acting as head of the Secretariat of the Board to call an extraordinary meeting. The person acting as Chairman of the Board of Directors shall resolve on the requests that the person acting as head of the General Directorate of Petróleos Mexicanos submits to him or her for the holding of an extraordinary meeting; | ||||
II. | The location where the meetings are to be held. They shall be held at the legal domicile of Petróleos Mexicanos, notwithstanding that, at the discretion of the Chairman of the Board, they may be held at another location; | ||||
III. | The requirements for the validity of the meetings; | ||||
IV. | Quorum for attendance for the meetings of the Board of Directors. Which is with at least five persons acting as directors, provided that at least one person acting as independent director attends and it shall be maintained during the course of the meetings; | ||||
V. | Resolutions and deliberations. They shall on a joint basis and its decisions shall be adopted by a majority vote of the persons present who are members of the Board of Directors. In the event that a majority of votes is not obtained with the affirmative vote of at least one person acting as independent director, within a period not exceeding twenty business days, the dissenting directors may issue their reasoned vote. The matter shall be decided by a simple majority vote of the persons acting as directors that are present in the next meeting held at the end of the aforementioned period; | ||||
VI. | Voting at meetings. All persons acting as directors shall vote in the affirmative or negative, without the possibility of abstaining. When casting a negative vote, a person acting as director shall express his or her reasons in the same meeting, which shall be recorded in the respective minutes. If a person acting as director is in a situation that creates a conflict of interest, that person shall be required to inform the Chairman of the Board and the other persons acting as directors attending the meeting and shall temporarily leave the corresponding meeting in order to refrain from hearing the matter in question and from participating in its discussion and resolution; | ||||
VII. | The periods and terms to call ordinary and extraordinary meetings; | ||||
VIII. | The regulation of the participation of guests in meetings, who has a right to speak but not to vote. The persona acting as head of the General Directorate of Petróleos Mexicanos and the person appointed as Commissioner referred to in this Law shall attend as permanent guests; | ||||
IX. | The use of information technology for calling meetings and remote audiovisual communication media to hold meetings if necessary; and | ||||
X. | The duties of the Chairman and Secretariat of the Board of Directors. | ||||
I. | Damages and losses caused to Petróleos Mexicanos or any of its affiliated companies arising from acts, events or omissions incurred by them; and | ||||
II. | Damages and losses arising from the violation of their obligations and duties of care and loyalty as provided in this Law. | ||||
I. | Refraining from carrying out, individually or through an intermediary third party, professional or commercial transactions with Petróleos Mexicanos or its affiliated companies, or from using its assets, resources or personnel for private activities, as well as arranging meetings with suppliers or contractors who are on the respective list or who wish to offer goods and services; | ||||
II. | Participating in the committees created by the Board of Directors and performing timely and professionally the matters entrusted or delegated to them; | ||||
III. | Assisting the Board of Directors through opinions, recommendations and guidance derived from the analysis of the performance of Petróleos Mexicanos; and | ||||
IV. | Complying with the duties of care and loyalty provided, respectively, in the two following articles, as well as with the other obligations set forth in this Law. | ||||
I. | Not attending or leaving, without justified reason in the opinion of the Board of Directors, the meetings of the Board of Directors, or of the committees of which they are members; | ||||
II. | Not disclosing, partially disclosing or misrepresenting to the Board of Directors or, as applicable, the committees of which they are members, relevant information of which they have knowledge and that is necessary for the proper decision-making process of such bodies, unless they are legally or contractually bound to maintain the confidentiality or reserve thereof and such reserve does not constitute a conflict of interest with Petróleos Mexicanos or its affiliated companies; and | ||||
III. | Failing to comply with the duties imposed by this Law or other applicable provisions. | ||||
I. | When, without legitimate reason, by virtue of their duties as persons acting as directors, they obtain or procure economic benefits for themselves or for the benefit of third parties; | ||||
II. | By attending meetings of the Board of Directors or its committees when they shall excuse themselves, or when they vote therein or make decisions related to the patrimony of Petróleos Mexicanos or any of its affiliated companies, notwithstanding the existence of a conflict of interest; | ||||
III. | By taking advantage of, for their own benefit or for the benefit of third parties, the use or enjoyment of property of Petróleos Mexicanos and its affiliated companies, in violation of the policies approved by the Board of Directors; | ||||
IV. | By using, for their own benefit or for the benefit of any third party, the information available to them by reason of the exercise of their duties or by disclosing such information in violation of applicable provisions; | ||||
V. | By generating, disclosing, publishing or providing information of Petróleos Mexicanos or any of its affiliated companies, which they know should not be disclosed due to its confidential nature, is false or misleading; or, ordering any such conduct to be carried out; | ||||
VI. | By ordering the omission of transactions carried out by Petróleos Mexicanos or any of its affiliated companies from recordkeeping, or altering or ordering the alteration of records to hide the true nature of the executed transactions, affecting any item of the financial statements; or by ordering, or allowing false data to be recorded in the corresponding accounting, or intentionally carrying out any illegal or prohibited act or transaction that produces a harm, damage or loss to the equity of Petróleos Mexicanos or any of its affiliated companies; | ||||
VII. | By concealing or failing to disclose relevant information that, in accordance with the terms of this Law and other applicable provisions, shall be disclosed or provided to the Federal Executive Branch, the Mexican Congress or any competent body, unless they are bound to maintain confidentiality or reserve thereof under applicable provisions; | ||||
VIII. | By destroying or modifying, directly or through third parties, in whole or in part, accounting systems or records or the documentation giving rise to accounting entries of Petróleos Mexicanos or any of its affiliated companies, prior to the expiration of the legal terms for recordkeeping and with the purpose of concealing its recording or evidence; | ||||
IX. | By destroying, in whole or in part, information, documents or files, including electronic files, in order to prevent or obstruct supervision, or to manipulate or conceal relevant data or information of Petróleos Mexicanos or any of its affiliated companies, to those who have a legal interest in having knowledge thereof; | ||||
X. | By submitting false or altered documents or information to the authorities; and | ||||
XI. | By improperly using information related to Petróleos Mexicanos or any of its affiliated companies. | ||||
I. | They comply with the requirements for approving the matters that the Board of Directors is authorized to hear, or, if applicable, those of the committees on which they serve; | ||||
II. | They adopt decisions or vote in the meetings of the Board of Directors or, if applicable, the committees on which they serve, based on information provided by persons with executive positions of Petróleos Mexicanos or of its affiliated companies, the external audit or the persons acting as independent experts; or | ||||
III. | They elect the most appropriate alternative, to the best of their knowledge, or the negative effects on equity were not foreseeable; in both cases, based on information available at the time of the decision. | ||||
I. | For mental or physical incapacity that prevents the proper exercise of their duties for an uninterrupted period of more than six months; | ||||
II. | Failure to comply, without cause, with the agreements and decisions of the Board of Directors; | ||||
III. | Failure to comply, deliberately and without cause, with the obligations, duties of care or loyalty or responsibilities set forth in this Law; | ||||
IV. | Failure to comply with any of the requirement set forth in this Law to be a person acting as independent director or if any unforeseen impediment arises; | ||||
V. | Failure to excuse themselves from participating and voting on matters in which they have a conflict of interest; and | ||||
VI. | Failure to attend three consecutive meetings, or failure to attend at least seventy five percent of the meetings held in one year. | ||||
I. | Audit; | ||||
II. | Human Resources, Compensation and Austerity; | ||||
III. | Strategy and Investment; | ||||
IV. | Acquisitions, Leasing, Services and Works; | ||||
V. | Affiliated Companies; and | ||||
VI. | Sustainability. | ||||
I. | Proposing to the Board of Directors the compensation mechanism of the person acting as head of the General Directorate and of the officials three hierarchical levels below him or her; | ||||
II. | Proposing to the Board of Directors the hiring policy, performance evaluation and compensation for the rest of the personnel of Petróleos Mexicanos and its affiliated companies, in compliance with the provisions of applicable legislation and collective bargaining agreements and all other applicable regulations in effect; | ||||
III. | Overseeing compliance with the guidelines for austerity in the expenditure and use of resources in accordance with the provisions of this Law and other applicable provisions; | ||||
IV. | Analyzing and recommending annually to the Board of Directors, the report submitted by the administration on compliance with the principles of austerity, in accordance with the guidelines authorized by the Board of Directors; | ||||
V. | Recommending to the Board of Directors the amendment and improvement actions of the austerity guidelines; | ||||
VI. | Assisting the Board of Directors, under the terms ordered by it, in monitoring the approved human resources, compensation and austerity policies; | ||||
VII. | Monitoring compliance with the resolutions, commitments and authorizations in human resources, compensation and austerity matters that are specified by the Board of Directors; | ||||
VIII. | Proposing for approval of the Board of Directors the guidelines for the execution of agreements for training, certification and updating that Petróleos Mexicanos may enter into with national or foreign public and private institutions; and | ||||
IX. | Such as others determined by the Board of Directors. | ||||
I. | Assisting the Board of Directors in the approval of guidelines, priorities and general policies related to the investments of Petróleos Mexicanos; | ||||
II. | Analyzing the Development Program of Petróleos Mexicanos; | ||||
III. | Making recommendations to the Board of Directors related to the Development Program of Petróleos Mexicanos and general policies on the matter; | ||||
IV. | Monitoring investments that, pursuant to section VIII of Article 16 of this Law, have been authorized by the Board of Directors; | ||||
V. | Approving the annual reports of the Technical Committees of the investment trusts, established by Petróleos Mexicanos; | ||||
VI. | Making recommendations to the Board of Directors regarding the acquisition, sale and liquidation of rights and obligations of the investment trusts, established by Petróleos Mexicanos; and | ||||
VII. | Such others as determined by the Board of Directors. | ||||
I. | Making recommendations to the person acting as head of the General Directorate regarding specific items that may be included in the policies and provisions that are proposed by the Board of Directors for contracting matters; | ||||
II. | Providing opinions on proposals submitted by the person acting as head of the General Directorate with respect to policies and provisions on contracting matters; | ||||
III. | Issuing opinions, upon the request of the Board of Directors, on the contracts submitted for consideration of the latter, in terms of the applicable provisions; | ||||
IV. | Monitoring the acquisitions, leasing, services and works that, pursuant to section IX of Article 16 of this Law, have been authorized by the Board of Directors; | ||||
V. | Approving the cases where the exception for open bidding is applicable, in order to allow Petróleos Mexicanos to contract with its affiliated companies; | ||||
VI. | Reviewing the annual acquisition, leasing, services and works programs and making the recommendations it deems pertinent to the Board of Directors; and | ||||
VII. | Such others as determined by the Board of Directors. | ||||
I. | Providing opinions to the Board of Directors regarding the creation, merger or spin-off of affiliated companies in which Petróleos Mexicanos has a direct participation; | ||||
II. | Assisting the Board of Directors in the establishment of guidelines, policies, directives, procedures and other provisions related to the operation, surveillance, performance evaluation and monitoring of the operating and business results of the affiliated companies; | ||||
III. | Evaluating the matters that due to their importance and significance are submitted for consideration of the Board of Directors derived from the operations carried out in particular by the affiliated companies, as well as such matters that have a significant financial impact both on the affiliated companies, and on Petróleos Mexicanos; | ||||
IV. | Evaluating the ownership structure, organizational structure, policies to mitigate potential conflicts of interest, regulatory compliance, and alignment with the Development Program of Petróleos Mexicanos, as well as the capabilities and experience of the directors and, if applicable, the officers of the affiliated companies; | ||||
V. | Acknowledging the annual reports of the affiliated companies, which shall include, among other elements, the strategies aligned with the Development Program of Petróleos Mexicanos; | ||||
VI. | Reviewing the report containing the transactions between related parties within the ordinary course of business and different to them between Petróleos Mexicanos and its affiliated companies, and | ||||
VII. | Such others as determined by the Board of Directors. | ||||
I. | Proposing to the Board of Directors, for its approval and transversal application, the strategies, guidelines, priorities and general policies in environmental, social and institutional strengthening matters, as well as any other aspect of sustainability linked to the operations of Petróleos Mexicanos and, if applicable, its affiliated companies; | ||||
II. | Analyzing and evaluating the main risks and opportunities in environmental, social and institutional strengthening matters, as well as any other aspect of sustainability, and proposing actions to address them, in accordance with internationally and nationally accepted frameworks and standards, in accordance with applicable regulations and aligned with the Development Program of Petróleos Mexicanos; | ||||
III. | Proposing to the Board of Directors recommendations for the adoption and monitoring of best international practices, standards and certifications in environmental, social and institutional strengthening matters, or any other aspect related to sustainability in order to meet the regulatory requirements of the financial authorities which, in turn, allow access to better financing conditions; | ||||
IV. | Reviewing and providing opinions on the sustainability reports for submission to the Board of Directors, as well as issuing observations or proposals for improvement, which shall be submitted annually; | ||||
V. | Promoting transparency of information on environmental, social and institutional strengthening matters, as well as any other aspect of sustainability, in alignment with that established in the frameworks and standards on the subject accepted nationally and internationally; | ||||
VI. | Reviewing and providing opinions on the Sustainability Plan of Petróleos Mexicanos, as well as ensuring its alignment with the commitments in environmental, social and institutional strengthening matters and the frameworks and standards accepted at a national and international level; it shall be updated at least every three years; | ||||
VII. | Proposing to the Board of Directors the approval of the Annual Sustainability Report in accordance with the applicable regulations, and | ||||
VIII. | Such others as determined by the Board of Directors. | ||||
I. | To manage and legally represent the company, in accordance with the terms of this Law, with the broadest authority for acts of ownership, administration, litigation and collection, including those that require authorization, power of attorney or special clause pursuant to applicable provisions, including employer representation and authority necessary for labor matters; to make criminal complaints in cases of crimes that may only be prosecuted upon the request of the affected party; to grant pardons; to exercise and withdraw judicial and administrative actions, including constitutional writs; to submit to arbitration and settlement; as well as exchange powers to issue, guarantee, endorse and negotiate credit instruments, and to grant and revoke all kinds of general or special powers of attorney; | ||||
II. | To implement the resolutions and decisions of the Board of Directors; | ||||
III. | To prepare and submit to the Board of Directors the Development Program of Petróleos Mexicanos and the annual operating and financial work program; | ||||
IV. | To formulate and submit for authorization of the Board of Directors the Development Program of Petróleos Mexicanos and the annual operating and financial work program; | ||||
V. | To send to the Ministry of Finance and Public Credit, pursuant to the provisions of Chapter VI of Title Four and other applicable provisions of this Law, the budgetary and financial information relating to Petróleos Mexicanos and its affiliated companies; | ||||
VI. | To authorize extraordinary payments, contributions and donations in cash or in-kind that Petróleos Mexicanos and, if applicable, its affiliated companies grant pursuant to the guidelines issued by the Board of Directors; | ||||
VII. | To manage the equity of the company and to dispose of its assets as provided in this Law and pursuant to the policies and authorizations issued to such effect by the Board of Directors; | ||||
VIII. | To conduct the policy and establish the guidelines for scheduling, implementing and evaluating the actions Petróleos Mexicanos and its affiliated companies in support of sustainable community development, which make production activities viable; | ||||
IX. | To agree to and execute the collective bargaining agreements and union administrative agreements that regulate the employment relationships of Petróleos Mexicanos, in accordance with the maximum projections previously approved by the Board of Directors, as well as to issue the work regulations for non-union workers pursuant to article 123, Part A, of the Political Constitution of the United Mexican States and the Federal Labor Law; | ||||
X. | To oversee the implementation and administration of the security systems of the properties and facilities of Petróleos Mexicanos and, if applicable, its affiliated companies, in coordination with the participating agencies of the three levels of government; | ||||
XI. | To implement and manage the security, health and protection and industrial security mechanisms of Petróleos Mexicanos and, if applicable, affiliated companies, as well as the mechanisms and procedures for quality control and continuity of industrial and commercial operations; | ||||
XII. | To oversee the design and implementation of prevention programs on oil spills, environmental contingencies, surface and water remediation and all other programs related to operational safety, ecological balance and environmental preservation; | ||||
XIII. | To create, terminate and determine the duties of work groups or advisory commissions required for compliance with the company’s purpose, as well as establishing the guidelines for their operation; | ||||
XIV. | To submit to the Board of Directors an annual report on the performance of Petróleos Mexicanos and its affiliated companies, including the exercise of income and expense budgets and the corresponding financial statements. The report and supporting documents shall include a comparative analysis on the goals and commitments set forth in the Development Program of Petróleos Mexicanos and the results obtained; | ||||
XV. | To release to the general public, under the terms provided by the Board of Directors, the financial statements under International Financial Reporting Standards; | ||||
XVI. | To establish measures for technological development and to ensure the quality of its products; | ||||
XVII. | To propose to the Board of Directors the adjustments to the general operating policies as it deems necessary; | ||||
XVIII. | To disclose relevant information and events that shall be made public pursuant to the applicable provisions; and | ||||
XIX. | All other duties provided for in this Law, and those assigned by the Board of Directors, the Organic Statute or those provided in other applicable statutory provisions. | ||||
I. | The Audit Committee; | ||||
II. | The Internal Audit; and | ||||
III. | The External Audit. | ||||
I. | Proposing to the Board of Directors the appointed of the person to act as head of the Internal Audit, issuing policies for the development of its activities and evaluating its performance; | ||||||||||
II. | Monitoring the management of Petróleos Mexicanos and affiliated companies; reviewing documentation pertaining to the financial and operating performance — in general and by activity — of the company, as well as submitting reports related to such matters to the Board of Directors; | ||||||||||
III. | Verifying compliance with goals, objectives, plans, programs and priority projects, including deadlines, terms and conditions of commitments assumed, as well as establishing objective and quantifiable indicators to evaluate performance; | ||||||||||
IV. | Verifying and certifying the reasonableness and sufficiency of accounting and financial information; | ||||||||||
V. | Overseeing processes to formulate, integrate and disclose the accounting and financial information, as well as audits made on the financial statements in accordance with applicable accounting principles and audit standards; | ||||||||||
VI. | Proposing for approval by the Board of Directors, upon prior opinion or request of the person acting as the head of the General Directorate, modifications to accounting policies; | ||||||||||
VII. | Issuing an opinion on the sufficiency and reasonableness of the external audit’s opinion on the financial statements; | ||||||||||
VIII. | Authorizing the contracting of the external auditor for activities other than external audit services, in order to avoid conflicts of interest that could affect the independence of its actions; | ||||||||||
IX. | Submitting for approval by the Board of Directors, upon the prior proposal of the person acting as the head of the General Directorate and opinion of the Internal Audit, the internal controls system, as well as the guidelines that regulate it; | ||||||||||
X. | Monitoring and reporting to the Board of Directors on the status of the internal controls system, and proposing the relevant modifications, as well as all other measures and actions to correct identified deficiencies; | ||||||||||
XI. | Submitting for approval of the Board of Directors, upon the prior proposal of the Internal Audit, the audit and performance evaluation guidelines; | ||||||||||
XII. | Issuing an opinion on the annual report of the person acting as the head of the General Directorate; | ||||||||||
XIII. | Approving the annual internal audit program upon the proposal of the person action as the head of the Internal Audit; | ||||||||||
XIV. | Assisting the Board of Directors in preparing the reports that the collegiate body has to prepare or submit; | ||||||||||
XV. | Programming and requesting, at any time, investigations and audits deemed necessary, except with respect to the actions of the Board of Directors; | ||||||||||
XVI. | Submitting to the Board of Directors, with the frequency instructed by it, reports on the results of its management, as well as the deficiencies and irregularities detected as a result of the carrying out of its duties and, if applicable, proposing actions to correct them in due course; | ||||||||||
XVII. | Proposing to the Board of Directors criteria for organizing, classifying and handling the reports referred to in this Law; | ||||||||||
XVIII. | Supervising the reliability of, efficiency of and opportunity for implemented mechanisms to handle information requests received by the company, pursuant to applicable provisions, and preparing an annual report on the transparency of Petróleos Mexicanos and its affiliated companies and the disclosure of information in accordance with Article 119 of this Law; | ||||||||||
XIX. | Reporting to the Board of Directors the existing differences of opinion or judgment between the company’s management and the Committee; and | ||||||||||
XX. | All other duties assigned by the Board of Directors or set forth in other applicable legal provisions. | ||||||||||
I. | Evaluating through audits and substantive, procedural and compliance tests, the operations of Petróleos Mexicanos and its affiliated companies, as well as the proper application of the policies established by the Board of Directors and compliance with applicable legal provisions, based on the annual internal audit program approved by the Audit Committee; as well as verifying, in the same manner, the correct operation of the internal controls system; | ||||
II. | Verifying that the control mechanisms implemented entail the proper protection of the assets of Petróleos Mexicanos and its affiliated companies; | ||||
III. | Verifying that the information systems, including the accounting, operating and any other kind of systems, have mechanisms to maintain the integrity, confidentiality and availability of information that prevent their alteration and comply with the purposes for which they were implemented or designed. Also monitoring such systems in order to identify potential flaws and verifying that they generate sufficient and consistent information and properly ensure its availability; | ||||
IV. | Checking that there are contingency plans and measures in place to avoid the loss of information and, if applicable, its recovery or retrieval; | ||||
V. | Ensuring the quality, sufficiency and opportunity of information, as well as its reliability for proper decision-making, and that such information is provided correctly and in a timely manner to the relevant participants; | ||||
VI. | Reviewing the efficiency of internal controls procedures to prevent and detect acts or operations that affect or could affect Petróleos Mexicanos and its affiliated companies, and reporting the results to the relevant participants; | ||||
VII. | Providing to relevant authorities, as well as to external auditors, the necessary information at its disposal as a result of its duties; | ||||
VIII. | Verifying that the structure of Petróleos Mexicanos and its affiliated companies, complies with the principles of independence for the different activities that so require it, as well as the effective segregation of duties and exercise of authority attributable to each area, , and therefore may make the recommendations it deems necessary to the Audit Committee; | ||||
IX. | Providing the Audit Committee the elements that enable it to comply with its duties, and reporting irregularities found in the exercise of its duties, as well as the relevant deficiencies or deviations detected in the operation, in order for the same to be promptly corrected, with the corresponding follow-up; | ||||
X. | Reporting to the Audit Committee and the person acting as the head of the General Directorate the deficiencies and irregularities detected in the performance of its duties and which could constitute a liability in terms of the applicable legal provisions, in order to commence the corresponding actions; | ||||
XI. | Remitting to the Responsibilities Unit at Petróleos Mexicanos the matters where, as a result of the performance of its duties, it detects possible administrative liability; | ||||
XII. | Reporting at least semi-annually to the Audit Committee, or with the frequency determined by it, on the results of its activities; | ||||
XIII. | Submitting for the approval of the Audit Committee, upon prior approval of the person acting as head of the General Directorate, its annual work program; and | ||||
XIV. | All other duties provided for in this Law or determined by the Board of Directors. | ||||
I. | Establishing mechanisms that allow for the prevention, identification, management, monitoring and evaluation of risks that could result from the performance of the activities of Petróleos Mexicanos and its affiliated companies; | ||||
II. | Preventing, detecting and channeling with the relevant participants and authorities, the acts and omissions that could constitute corrupt practices; | ||||
III. | Delimiting the duties and operations among the areas and administrative units, in order to ensure the efficiency and effectiveness in the performance of their activities and avoid conflicts of interest; | ||||
IV. | Assisting in the compliance of applicable legal, accounting and financial provisions; | ||||
V. | Having reliable and timely financial, economic, accounting legal and administrative information, by administrative unit, that contributes to proper decision-making; | ||||
VI. | Fostering the correct operation of information processing systems; and | ||||
VII. | All other duties determined by the Board of Directors. | ||||
I. | If the activities are performed pursuant to an assignment for individual development, it may enter into all types of agreement, among others, for works or services for the best execution and operation of the assignment; | |||||||
II. | If the activities are performed under an assignment for mixed development in which it is required to complement capacities, it may enter into mixed contracts in the assignment, in terms of this Law and the Hydrocarbon Sector Law, and | |||||||
III. | If the activities are performed pursuant to a Hydrocarbon Exploration and Extraction Contract: | |||||||
| a) | Where Petróleos Mexicanos performs the activity exclusively, without entering into a partnership or association with third parties to such effect, it shall not do so through its affiliated companies; and | |||||||
| b) | Where Petróleos Mexicanos is part of a limited partnership or consortium, it may do so through its affiliated companies, companies in which it has a minority interest or through other forms of association permitted under the Hydrocarbon Sector Law, the Hydrocarbon Revenue Law and other applicable provisions. | |||||||
I. | Compensation for personnel shall be calculated in the same manner as those in the relevant existing industry or activity and that allow that the companies have and retain suitable workers most suitable to effectively comply with their purpose, in line with the approved tabulations; | ||||
II. | The human resources policy may provide for the granting of incentives or extraordinary compensation for accomplishing goals subject to performance evaluation; | ||||
III. | The purpose of the compensation policy shall be to recognize the effort and contribution of persons acting as workers in achieving the objectives of the company, pursuant to the approved tabulations; and | ||||
IV. | In exercising the personal services budget, Petróleos Mexicanos shall be subject to Chapter VI of Title Four and other applicable provisions of this Law. | ||||
I. | Promoting the efficient use of public resources and avoid unnecessary expenditures; | ||||
| II. | Transparency in procedures, expenditures and contracting and reporting to the corresponding auditing entities; | ||||
| III. | Prioritizing public benefit and the fulfillment of strategic social objectives; | ||||
| IV. | Prioritizing the rational use of resources and avoiding expenditures that do not generate tangible benefits for the population; | ||||
| V | Simplifying processes that do not affect the continuity of operations, do not violate the safety of Petróleos Mexicanos’ persons acting as workers and facilities, and do not affect environmental protection programs; | ||||
| VI. | Streamline the organizational and occupational structure without increasing the authorized budget, under principles of austerity and rationality and avoiding duplication of functions; | ||||
| VII. | Rationalizing the granting of donations in cash or in-kind; | ||||
| VIII. | Carrying out energy efficiency actions in the use of real estate facilities and vehicles; | ||||
| IX. | Streamline consumption of stationery, office supplies, courier services, and mobile and landline phones services; | ||||
| X | Rationalizing the use of private land, sea and air transportation, without affecting the operation of the company and the safety of the workers; | ||||
| XI. | To dispose of movable and immovable property, considered not useful for the operation of Petróleos Mexicanos; | ||||
| XII. | Rationalizing the contracting of advisory, consulting, studies and research services, as well as social communication, advertising and official communications; | ||||
| XIII | To privilege the use of information technologies in the processes and activities that allow it, to use electronic formats and the electronic management of documents; | ||||
| XIV. | Encouraging the consolidated purchase of goods and services, to take advantage of Petróleos Mexicanos' economies of scale, and | ||||
| XV. | Optimizing the use of the physical space and furniture available and try to reduce the acquisition or lease of real estate for administrative use. | ||||
I. | General provisions may be established to allow for the development of contracting procedures in accordance with the nature of the contracting; | ||||||||||
II. | Consideration is given to, among other aspects: | ||||||||||
a) | The application of equality and transparency conditions among all persons acting as participants; | ||||||||||
b) | The establishment of general requirements as the bases of open bidding; | ||||||||||
c) | The terms and requirements under which the procedures other than open biddings shall be carried out; and | ||||||||||
d) | The objective and measurable criteria for evaluation. | ||||||||||
III. | Considering provisions to ensure that contracting procedures are conducted under the principles of honesty, transparency, maximum publicity, equality, competitiveness, simplicity and their expeditious administration, considering, among other schemes, prequalification stages, subsequent discount bids and price negotiations. The Board of Directors of Petróleos Mexicanos shall establish the cases where, considering the impact or relevance of the contracts, public witnesses may participate during the corresponding procedures conducted by Petróleos Mexicanos and its affiliated companies, as well as mechanisms and requirements for their appointment. The public witnesses shall have the following duties: | ||||||||||
a) | Participating as a person acting as an observer during the different stages of the contracting procedures; | ||||||||||
b) | Issuing a final testimony that includes their observations and, if applicable, recommendations with respect to the relevant contracting; and | ||||||||||
c) | If applicable, giving notice of the irregularities detected to the Internal Audit and the Responsibilities Unit at Petróleos Mexicanos; | ||||||||||
IV. | Publishing on its website the information regarding the contracting procedures carried out by the companies, as provided in the applicable legal provisions on transparency and access to public information; | ||||||||||
V. | Defining the participant responsible for determining the basis for carrying out procedures other than open bidding, as well as the minimum justification included in its decision; | ||||||||||
VI. | Establishing policies that regulate cases where the company shall refrain from considering bids or entering into agreements with persons who, among others: | ||||||||||
a) | Have a conflict of interest with Petróleos Mexicanos or its affiliated companies; | ||||||||||
b) | Are unfit to engage in business or to exercise their profession; | ||||||||||
c) | Are unfit to carry out a position, office or commission in the public service; | ||||||||||
d) | Are debarred by the competent authority, pursuant to the Law of Acquisitions, Leasing and Services of the Public Sector and the Law of Public Works and Services Related Thereto; | ||||||||||
e) | Have outstanding defaults with the company or the latter has proceeded to rescind an agreement; | ||||||||||
f) | Have obtained, in an improper manner, privileged information; and | ||||||||||
g) | Use third parties to avoid the provisions of this Section; | ||||||||||
VII. | Establishing the manner in which the planning, programming and budgeting for contracting shall be carried out, as well as the evaluation of results based on objective indicators; | ||||||||||
VIII. | Establishing the minimum content of contracts, as well as general rules to foster improved and timely execution; | ||||||||||
IX. | Requiring minimum percentages of national content, pursuant to the nature of the contract, and in accordance with international treaties to which Mexico is a party; | ||||||||||
X. | For integrated services contracts for hydrocarbon exploration and extraction and for integrated exploration and production contracts, providing for the manner in which the revenue obtained from such contracts shall be used to cover expenditures derived therefrom; as well as to determine the manner and terms under which the accounting shall be kept separately for each of these contracts; | ||||||||||
XI. | Providing the necessary facilities to carry out the procedures, preferably through electronic media; and. | ||||||||||
XII. | Viable due diligence. | ||||||||||
I. | There are no alternative goods or services or technically reasonable substitutes or there is only one potential bidder in the market. Moreover, in the event that a person has ownership or exclusive licensing of patents, copyrights, or other exclusive rights, or in the case of works of art; | ||||
II. | When national security, public safety or the company’s safety, industrial facilities and pipelines are jeopardized, pursuant to the terms of the laws on the matter; | ||||
III. | When due to acts of God or force majeure, it is not possible to obtain goods or services through an open bidding procedure in the time required to respond to the relevant contingency. In such event the amounts or items shall be limited to what is strictly necessary; | ||||
IV. | A contract entered into through open bidding is rescinded, pursuant to the provisions set forth by the Board of Directors; | ||||
V. | An open bidding has been declared to have failed, provided that the requirements set forth in the summons or invitation for bids were maintained, and whose noncompliance has been considered the cause of the disqualification because it directly affects the solvency of the bids; | ||||
VI. | There are justified reasons for the acquisition or leasing of goods of a specific trademark, or circumstances that may cause losses or additional and justified costs; | ||||
VII. | With respect to used or refurbished goods in which the price may not be greater than that determined by the appraisal undertaken by credit institutions or third parties authorized to do so under the applicable provisions, issued within the previous six months and effective at the time of awarding the respective contract; | ||||
VIII. | In cases of consulting, advisory, engineering studies or studies of another nature, research or training services; | ||||
IX. | In cases of the acquisition of goods for direct marketing or to submit them to productive processes carried out in compliance with their purpose or objectives expressly set forth in applicable provisions; | ||||
X. | In cases of the acquisition of goods from persons that, though not customary suppliers, offer goods under favorable conditions, as a result of being in a state of liquidation or dissolution, or under judicial intervention; | ||||
XI. | In cases of services rendered by a natural person, provided that they are carried out by such person without requiring the use of more than one specialist or technician; | ||||
XII. | In cases of asset maintenance services in which it is not possible to define their scope, establish work quantities or determine the corresponding specifications; | ||||
XIII. | The purpose of the contract is the design and manufacture of a good that serves as a prototype to carry out tests that demonstrate its operation. In such cases, it shall be agreed that the design, use or any other exclusive right, are constituted for the benefit of the contracting party; | ||||
XIV. | In cases of specialized equipment, substances and materials of chemical, physicochemical or biochemical origin to be used in experimental activities required in scientific research projects and technological development, provided that such projects are authorized by the participant determined by the Board of Directors; | ||||
XV. | The acquisition of goods, execution of works or rendering of services is accepted as payment; | ||||
XVI. | Those directly linked with remediation of spills, toxic or hazardous gas emissions, irregular spillage of hydrocarbons or any other incident that puts at risk persons acting as workers, the population, the environment or the facilities used by the company, resulting from accidents, sabotage, theft, other acts of willful misconduct or other events that require immediate attention; | ||||
XVII. | In cases of works that require mainly rural or marginalized urban labor, contracted directly with persons acting as beneficiary inhabitants of the locality or place where the works shall be carried out, whether as natural or legal persons, for which the Board of Directors shall establish the amounts up to which such contracting shall be carried out; | ||||
XVIII. | Services of publicly attesting officials, experts, legal and representation services in judicial, arbitration or administrative proceedings; | ||||
XIX. | In cases of spare parts or services related to the installation, maintenance or conservation of industrial equipment of the original equipment or machinery manufacturer, in order to maintain the technical warranty thereof; | ||||
XX. | In cases of entering into a partnership or strategic alliance, or carrying it out with natural or legal persons engaged in engineering, research and transfer and development of technology, in order to implement technological innovations in the national infrastructure. The provisions of this section shall not apply to the hydrocarbon exploration and extraction activities that Petróleos Mexicanos carries out, or that its affiliated companies carry out, pursuant to a contract that has been granted as a result of a migration from an assignment, in which case the provisions of the Hydrocarbon Sector Law apply; | ||||
XXI. | In cases of the contracting of banking, brokerage, securities custody or trust creation services; | ||||
XXII. | Contracts for the purpose of developing technological innovations related to the purpose of Petróleos Mexicanos; | ||||
XXIII. | Contracts entered into with ministries or entities of the public administration, federal or state, as well as with its affiliated companies; and | ||||
XXIV. | In the case of contracting machinery, equipment, and fuel necessary to guarantee the physical security of Petróleos Mexicanos’ facilities and personnel. | ||||
I. | A motion for reconsideration before the collective body provided in the Organic Statute and pursuant to the procedure set forth in the Regulations of this Law; or | ||||
II. | The corresponding legal action before the Federal Court of Administrative Justice. | ||||
I. | The mechanisms and procedures to identify, systemize and manage risk factors or risk points that may arise or occur during the contracting procedures or in the execution of contracts, as well as procedures and actions to follow upon detection of irregularities in both cases, including their suspension; | ||||||||||
II. | The general bases for determining the minimum requirements to be met by persons interested in contracting with Petróleos Mexicanos, as well as mechanisms for their evaluation, shall include, among others: | ||||||||||
a) | Technical and financial capacity for the execution of the project; | ||||||||||
b) | Prior experience evidencing the capacity to perform their contractual obligations; and | ||||||||||
c) | The status of their tax and labor obligations; | ||||||||||
d) | To have a viable Due Diligence, and | ||||||||||
III. | Mechanisms to implement a system to receive anonymous accusations or complaints through which any interested person may report acts or omissions during the various stages of the contracting process or during the execution of the contract, accompanied by the documentation that proves the irregularity that is the object of the corresponding accusation or complaint. | ||||||||||
I. | Information about the persons acting as suppliers and contractors, including nationality, location, industry, legal organization, economic activity and tax regime, and who shall be responsible for reporting any modification in terms of the applicable provisions; | ||||
II. | Information about the contracts entered into with the companies and the performance thereof, including among other aspects, timely execution, application of penalties, quality of the goods or works; | ||||
III. | Compliance with environmental, industrial and operational safety and labor liability provisions; | ||||
IV. | Certification of compliance with technical standards and quality assurance; | ||||
V. | Results of any evaluations of persons acting as suppliers and contractors conducted by specialized companies; and | ||||
VI. | Due Diligence, if applicable. | ||||
I. | Receiving and responding to accusations and conducting investigations related thereto; and | ||||
II. | Substantiating administrative liability procedures for administrative misconduct classified as serious and non-serious, and | ||||
III. | Imposing the respective sanctions, in terms of the applicable laws. | ||||
I. | They comply with the requirements to approve the respective matters; | ||||
II. | They make decisions or vote based on the information provided by the responsible areas due to the matter; or | ||||
III. | They have selected the most appropriate alternative, to the best of their knowledge, or the negative effects on property were not foreseeable; in each case, based on the information available at the time of the decision. | ||||
I. | That for one time only, for the same event and within a period of one year, the performance of the person acting as an employee in managing, processing or resolving matters under his or her responsibility, shall be referred to a matter of debatable criteria or opinion, in which several solutions may be validly sustained, and there is evidence of the elements taken into account by the person acting as an employee in the decision he or she made; or | ||||
II. | That the act or omission was corrected or cured spontaneously by the person acting as a public official or it implies manifest error. | ||||
I. | In no event shall the employee use his or her influence or obtain any advantage derived from the position he or she held, either for himself or herself or his or her spouse, blood relatives or relatives by affinity without limit of degree, or third parties with whom they have professional, labor or business relationships, or for partners or companies in which such employee or the aforementioned persons are or have been part of; and | ||||
II. | To not use, for their benefit or for the benefit of third parties, the information or documentation to which the employee had access due to his or her position, office or commission and which is not public. | ||||
I. | The Ministry of Finance and Public Credit shall notify Petróleos Mexicanos, no later than June 15 of each year, the preliminary estimate of macroeconomic variables for the following fiscal year, which shall be taken into consideration by the person acting as the head of the General Directorate of Petróleos Mexicanos for the budget draft for the relevant year; | ||||
II. | The person acting as the head of the General Directorate of Petróleos Mexicanos shall send to the Ministry of Finance and Public Credit no later than July 15 of each year, the consolidated budget draft approved by the Board of Directors, including an indicative consolidated scenario of the financial balance goal of the company for the following five years and for the relevant year, as well as the global expenditure ceiling for personal services; | ||||
III. | If the Ministry of Finance and Public Credit considers that the financial balance goal with or without physical investment or the global expenditure ceiling for personal services shall be adjusted, it shall incorporate its proposal and the corresponding adjustments into the Draft Federal Expenditure Budget, notifying Petróleos Mexicanos. In the statement of purpose of the aforementioned Draft, the proposal, as well as the adjustments shall be reasoned and the original proposal of Petróleos Mexicanos shall be attached; and | ||||
IV. | The Chamber of Deputies, in approving the Federal Expenditure Budget, shall authorize the financial balance goal and personal services ceiling of Petróleos Mexicanos. | ||||
I. | The Board of Directors of Petróleos Mexicanos shall authorize, with the prior opinion of Strategy and Investment Committee, the budget calendar and amendments thereto; | |||||||||||||
II. | The Board of Directors of Petróleos Mexicanos shall authorize, with the prior opinion of Strategy and Investment Committee, the corresponding budget for investment programs and projects of the company, observing the following: | |||||||||||||
a) | Petróleos Mexicanos shall have, in accordance with the guidelines approved by its Board of Directors, a planning mechanism to be updated annually, in accordance with the Development Program of Petróleos Mexicanos referred to in Article 17 of this Law, which shall at least establish the short, medium and long-term investment needs, through evaluation criteria that allows the setting of priorities among the projects; | |||||||||||||
b) | The projects in which investment expenditures are exercised shall increase the equity value of the company; | |||||||||||||
c) | Projects whose execution covers more than one fiscal year shall be included, as appropriate, in the specific chapters of the Draft Federal Expenditure Budget regarding commitments and multi-year expenditures for investment projects, referred to, respectively, in subsections g) and ñ) of section II of article 41 of the Federal Law of Budget and Fiscal Accountability and its evolution shall be included in the quarterly reports mentioned in section VI of this article; and | |||||||||||||
d) | Petróleos Mexicanos shall have, in accordance with the guidelines approved by its Board of Directors, a permanent mechanism for evaluating its investment programs and projects, during their execution and once it has concluded. Such mechanism shall be independent of the one mentioned in subsection a) above; | |||||||||||||
III. | The austerity provisions contained in the Federal Expenditure Budget shall not apply nor shall those which, if applicable, are issued by the Federal Public Administration. However, austerity guidelines and programs for expenditures and use of resources shall be implemented, that enable the generation of savings and improve its financial balance, without detriment to the efficiency of their operations pursuant to the provisions approved by the Board of Directors of Petróleos Mexicanos; | |||||||||||||
IV. | The person acting as the head of the General Directorate of Petróleos Mexicanos shall authorize, under the terms established by the Board of Directors, the following aspects: | |||||||||||||
a) | In matters of contracting referred to in Chapter III of the Fourth Title to this Law: | |||||||||||||
1. | The execution of multi-year agreements; and | |||||||||||||
2. | The summons for bids, awarding, and, if applicable, formalization of contracts whose terms commence the following fiscal year, based on the initial budget drafts; and | |||||||||||||
b) | The creation of trusts and the execution of agency agreements or analogous agreements in which public resources are provided. The person acting as the head of the General Directorate of Petróleos Mexicanos, shall be responsible for including in the quarterly reports referred to in section VI below and in the Public Account a compliance report of the mission and purposes of such instruments, as well as the funds spent for such purpose. This report shall be available to the general public on its website. | |||||||||||||
The person acting as the head of the General Directorate of Petróleos Mexicanos or of may delegate the authority set forth in this section to a person acting as a public official one hierarchical level below him or her; | ||||||||||||||
V. | Determine the corresponding adjustments to their budgets in case of a reduction in their income, in order to comply with the approved financial balance goal; | |||||||||||||
VI. | Submit to the Ministry of Finance and Public Credit, for the integration of the monthly and quarterly reports referred to in article 107 of the Federal Law of Budget and Fiscal Accountability, as well as for the integration of the Public Account and other accountability reports, the budgetary, debt and financial information, in the forms and terms established by such Ministry, exclusively to the effect of homogenous presentation of such information; and | |||||||||||||
VII. | With the approval of the Board of Directors, Petróleos Mexicanos shall use its own excess income to increase its physical investment expenditure or to cover, among other obligations, debt service or liabilities owed by it. | |||||||||||||
I. | Their respective budgets shall include in a specific section, all of the expenditures related to personal services expenses, which comprise: | |||||||
a) | Compensation pertaining to persons acting as workers consisting of ordinary and extraordinary compensation; | |||||||
b) | Social security contributions; | |||||||
c) | Fiscal obligations inherent to such compensation; and | |||||||
d) | Wage and economic provisions to cover, when they are approved, wage increases, the creation of positions and other labor related measures; | |||||||
II. | The Board of Directors of Petróleos Mexicanos shall analyze and, if applicable, authorize upon the proposal made by its Human Resources, Compensation and Austerity Committee, the compensation tabulations and human resources policies of Petróleos Mexicanos; | |||||||
III. | Contributions based on compensation paid by persons acting as employees of Petróleos Mexicanos shall be withheld and paid to the corresponding fiscal authorities in accordance with applicable law, and may not be paid by the companies as loans, extraordinary compensation or any other concept | |||||||
IV. | The Board of Directors of Petróleos Mexicanos shall authorize, subject to the approved personal services budget, its organic structure. The adjustments made to their organizational, occupational and wage structures shall be carried out through compensated budgetary adjustments, which in no event shall increase the personal services budget for the current fiscal year or subsequent ones, in accordance with the austerity principles and guidelines referred to in this Law; | |||||||
V. | The creation or substitution of positions and new hiring will only proceed when resources are approved to cover all inherent expenses, including obligations for taxes, social security contributions, and other payments and benefits which shall be covered by law. The resources to cover obligations related to hiring which have a future impact on expenses shall be included in reserves that ensure that such obligations are fully financed at all times. The above, considering the austerity principles and guidelines referred to in this Law; | |||||||
VI. | Extraordinary compensation that, if applicable, is paid as incentives, recognitions, rewards and any other equivalent payment thereto, may be exceptionally granted to persons acting as employees of Petróleos Mexicanos, provided that there are specifically approved resources for such purpose and conditioned on the compliance of commitments regarding results subject to evaluation. Extraordinary compensation does not constitute fixed, regular nor permanent income, since it is subject to variable requirements and conditions. These payments shall in no event form an integral part of the basis for calculation of indemnity or severance pay or social security benefits; | |||||||
VII. | Persons hired under the regime for professional services rendered for fees, in no event shall receive compensation corresponding to that of persons acting as employees of Petróleos Mexicanos. Such hiring shall be carried out pursuant to civil law and the aggregate amounts disbursed for the hired services, shall be reported in the quarterly reports referred to in article 107 of the Federal Law of Budget and Fiscal Accountability; | |||||||
VIII. | They shall make permanently available on their website and shall update on a quarterly basis the following information: | |||||||
a) | The collective bargaining agreement and the non-union workers’ regulations; | |||||||
b) | The approved tabulations, breaking down all items and amounts of ordinary and extraordinary compensation; | |||||||
c) | Expenses incurred for retirement and pensions, as well as updates of the actuarial cost of its pension liabilities; | |||||||
d) | Loans or credits, as well as the applicable rates, that may be granted to persons acting as employees, retirees and pensioners; | |||||||
e) | Supporting payments for the performance of duties and other expenses which, if applicable, are granted to persons acting as employees and are not part of their compensation; | |||||||
f) | Monthly amounts expended for temporary or incidental contracting; | |||||||
g) | Guidelines approved by the Board of Directors of Petróleos Mexicanos, pursuant to which the items described in the preceding paragraphs are granted and covered; and | |||||||
h) | The amounts expended in the relevant quarter for each of the items described in subsections b) to f) above. | |||||||
The foregoing, without prejudice to the information that, in terms of the applicable legal provisions on the subject matter, are obligated to be published on such website. Furthermore, Petróleos Mexicanos shall report the donations or any other contribution made to natural or legal persons, regardless of their legal nature or purpose; and | ||||||||
IX. | Shall provide, exclusively for informational purposes, to the Ministry of Finance and Public Credit, on a quarterly basis, information relating to the organizational structure and workforce. | |||||||
I. | Petróleos Mexicanos shall submit on an annual basis, upon prior approval from the Board of Directors, its global financing proposal to the Ministry of Finance and Public Credit in order to incorporate it into a specific section of the draft proposal of the Federal Revenue Law submitted by the Federal Executive Branch to the Mexican Congress, pursuant to article 10 of the General Law of Public Debt; | ||||||||||
II. | Petróleos Mexicanos may carry out, without requiring authorization from the Ministry of Finance and Public Credit, official negotiations, informal or exploratory actions regarding the possibility of accessing domestic or external money and capital markets and raising internal and external financings required for it; | ||||||||||
III. | Petróleos Mexicanos shall be responsible for the following: | ||||||||||
a) | The obligations incurred do not exceed its payment capacity; | ||||||||||
b) | The resources obtained are allocated properly pursuant to the relevant legal provisions; | ||||||||||
c) | The payments made on a timely basis; and | ||||||||||
d) | Oversight of the development of its particular finance program; | ||||||||||
IV. | The obligations that constitute public indebtedness that shall not for any reason or in any case grant or give the persons acting as holders rights over the property, control or patrimony of Petróleos Mexicanos or title over hydrocarbons in the subsoil; | ||||||||||
V. | The obligations that constitute public indebtedness of Petróleos Mexicanos are not obligations guaranteed by the Mexican State; and | ||||||||||
VI. | Petróleos Mexicanos shall coordinate with the Ministry of Finance and Public Credit in its financing transactions, according to the following: | ||||||||||
a) | Once the amounts referred to in section I above are approved, the Ministry of Finance and Public Credit and Petróleos Mexicanos shall agree on the scheduling of the financing transactions of the latter, ensuring that the financing cost for the rest of the public sector does not increase, or that its financing sources are reduced; and | ||||||||||
b) | In order to carry out additional financing transactions or to amend those previously agreed pursuant to the preceding subsection, Petróleos Mexicanos shall notify the Ministry of Finance and Public Credit at least fifteen business days in advance for each transaction the company intends to carry out. | ||||||||||
The Ministry of Finance and Public Credit may order that the relevant transaction be postponed, when any of the circumstances set forth in subsection a) above occurs, until all conditions that motivated the decision to postpone are overcome. If the Ministry of Finance and Public Credit does not render a decision within ten business days following the notice referred to in the first paragraph of this subsection, it shall be understood that the relevant transaction may be carried out; | |||||||||||
VII. | Petróleos Mexicanos shall furnish the Ministry of Finance and Public Credit, all information required by such Ministry in the matter referred to in this Chapter and the Federal Law of Public Debt, and | ||||||||||
VIII. | For purposes of the preceding section, and excepting with is set forth in Article 102, section VI, of this Law, Petróleos Mexicanos shall submit the reports in public debt matters in the formats and terms established by the Ministry of Finance and Public Credit exclusively for the purpose of the homogenous presentation of such information. | ||||||||||
I. | The reduction of greenhouse gas emissions, through the use of renewable energy and clean energy sources in the performance of its business, economic, industrial and commercial activities in terms of its purpose; | ||||
II. | The transition to an economy low in carbon and the observance of the international agreements in which Mexico is party, and | ||||
III. | Monitoring its progress and carrying out the necessary measures for its compliance. | ||||
I. | A report from the person acting as the head of the General Directorate regarding the performance of Petróleos Mexicanos, and its affiliated companies and, if applicable, on the major existing projects. Such report shall be made by line or branch of business, in addition to using indicators or parameters based on international standards, for the correct and timely measurement of results and shall be linked to the purposes and goals set forth in the Development Program of Petróleos Mexicanos; | ||||
II. | The explanation and statement of the main policies and accounting and information criteria used in the preparation of the financial information; | ||||
III. | The statements showing the financial position of Petróleos Mexicanos during and at the closing date of the fiscal year, its changes and results, as well as other information required to complete or clarify the information provided with such statements; | ||||
IV. | A report regarding the exercise of its budget, including the deviations in amounts, time, and scope of execution of the contracts that are carried out; and | ||||
V. | The evaluation of the Board of Directors regarding the execution of annual programs of Petróleos Mexicanos. | ||||
I. | Preparing a global annual evaluation of the course and performance of Petróleos Mexicanos, including an analysis of the operational, programming and financial situation of the company, as well as the organizational structure, process unity and accounting structure. The aforementioned report shall be submitted to the Chamber of Deputies and the person acting as the head of the Federal Executive no later than June 30 of each year; | ||||
II. | Preparing specific recommendations to the Board of Directors and the person acting as the head of the General Directorate of Petróleos Mexicanos; and | ||||
III. | Requesting from the person acting as the head of the General Directorate of Petróleos Mexicanos all the necessary information to render the report referred to in section I above. | ||||