The measure, supported by President Enrique Pena Nieto and already approved in the chamber of deputies, was approved 95-11 with two abstentions late yesterday.
The new scheme maintains a previous restriction limiting the president and state governors are just one six-year term in office.
Under the changes, a new electoral office called the National Electoral Institute will have the legal authority to overturn federal and local election results if there are "grave violations," which includes campaign spending beyond the legal limits.
The political changes are part of Pena Nieto's ambitious reform agenda, which has led to the passage of laws shaking up education, tax collection, banking and telecommunications to boost Latin America's second-biggest economy.
On Thursday, after a heated debate, Mexico's Congress approved the centerpiece of Pena Nieto's overhaul: a historic energy reform aimed at luring foreign oil firms back into the country and ending the state's 75-year-old monopoly.
These proposals modify Mexico's const itution, so to enter into effect more than half of the country's 31 state legislatures must also approve it. Analysts believe that Pena Nieto has enough support to get the measures passed.
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