If AMLO changes national laws and affects investors of the USMCA, it must compensate it says CBI

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Faced with the possible approval of the energy reform, the Center for Binational Institutions said that the USMCA allows the State to make changes, but will have to compensate affected investors

The Agreement between Mexico, the United States and Canada USMCA (T-MEC) allows changes to national laws and regulations under certain conditions, as long as the affected investors are compensated.

Non-resident partner at the Center for Binational Institutions (CBI) and professor at the Texas A&M University school of law, Guillermo García Sánchez, said this can also lead to costly and lengthy litigation.

During the press conference of the Center for Binational Institutions (CBI), García Sánchez referred to the changes in Mexican energy regulations, about which he stated: “At the end of the day, it is how much they are willing to pay (the Mexican government) to implement an energy policy that goes against or can violate the rights of investors.


He explained that “it is not a matter of yielding or not yielding, the USMCA allows states to take certain actions, even if they affect current investments when there is a legitimate interest, a public health issue when there is a media issue. environment, security issues, if you can take them, what you cannot do is not pay ”.

He affirmed that the USMCA“allows the State to make regulatory changes, but it will have to compensate investors. That is my point of view is not necessarily having to give in. Mexico has to make the decision or continue negotiating or it has to litigate and Mexico has to compensate investors under that amount ”.

However, “disputes take many years to resolve, there are disputes that take between 8 and 12 years, probably they will not have to be paid by the current administration ” but it will be the next government.

For his part, the director of the US Mexico Foundation, Enrique Perret, explained that the litigation that currently exists between the Mexican government and investors will take a legal course.

“I do not believe that the Mexican government will end up giving in, the litigation will lead to what is legally there, it is not that the Mexican government will give in, I believe that any treaty should have a win-win as in the USMCA,” he commented

Perret explained that in the USMCA there are clear rules on how to resolve trade and labor disputes.

“Adhering to that institutionality makes us strong. Imagine if the labor chapter did not exist, the small print in the treaty as the United States could coordinate the labor issue is precisely the institutionality that gives us the framework” to resolve differences.

In response to the possible controversies that can be had in labor matters, he said that for the administration of the American Joe Biden “the labor component is enormous”, so in Mexico, you have to work to fulfill the commitments.

CBI’s senior partner, Ambassador Gerónimo Gutiérrez Fernández, assured that in energy matters if there is an arbitrary decision by the Mexican authority, investors will be able to defend themselves. ”.

He said that where there may be differences between Mexico and the United States, it will most likely be in labor and energy matters, but in any case the differences can be resolved.

Source: eluniversal.com.mx

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