Mexico: The restrictive measures imposed on individuals in the field of hydrocarbons continue and arguments of unconstitutionality exist against them

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On June 11, 2021, the seventh resolution of amendments to the general rules of foreign trade (“seventh amendment”) was published in the Federal Official Journal. This seventh amendment included a restriction on the granting or extension of authorizations for the entry or exit of certain types of hydrocarbons from Mexican territory through places other than a customs post, in order to establish that they do not can only be granted to productive state enterprises (for example Pemex) and their subsidiaries.

As of June 12, 2021, only productive state companies and their subsidiaries may be authorized to import hydrocarbons, petroleum products, petrochemical products and their specialties, biofuels, as well as certain chemical precursors. This measure undermined the right of individuals to obtain the extension of authorizations previously obtained and still in progress, and to obtain the additional authorizations necessary for the development of their economic and commercial activities.

This limitation of the rights of private parties is part of a set of measures systematically adopted by the Executive and the Legislature, the ultimate goal of which, in our opinion, is to counter the effects of the energy reform approved in 2013.

In VWYS, we have identified that there are arguments of unconstitutionality against this Seventh Amendment. Various companies are preparing amparo lawsuits and it will be the Federal Judiciary which will determine whether or not it is unconstitutional. Some of the arguments in favor of private parties include (i) violation of Article 1 of the Constitution regarding the general protection of fundamental rights, (ii) violation of the rule that requires this type of restriction to be established by Congress since it is a restriction of rights established by a general administrative rule without legal or constitutional basis, (iii) the violation of article 14 of the Constitution and articles 27 and 28 of the same law since it concerns, respectively, of a reform which could have a retroactive effect detrimental to the governed and a restriction which threatens free enterprise and effective competition, (iv) the possible violation of the principle of legitimate expectations recognized by the federal judiciary, and (v) a violation of the principle of progressivity in the protection of the fundamental rights mentioned by implying a decline in the freedoms guaranteed by the Constitution.

This is not an easy task. In view of the use by some individuals of the now limited authorizations, it is also essential to assess the risks of an immediate revocation of authorizations still in force, as well as the possible contractual violations resulting from a possible immediate revocation or the cancellation. ‘inability to extend an authorization. In addition to the amparo remedy that companies may decide to bring against the Seventh Amendment or its First Implementing Act, it is also important to review the contracts that the companies concerned have entered into with contractors, including force majeure clauses. for acts of authority and for changes in the law. These clauses could require certain actions of the companies affected by the Seventh Amendment.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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