Mexico – Court Suspends Amendment to the Electricity Industry Law

Mayer Brown - Energy Forward

Just two days following the controversial publication of the bill to amend the 2014 Electricity Industry Law (the "Amendment"), District Court Judge Juan Pablo Gómez Fierro, specialized in administrative, antitrust and telecom law in Mexico City, granted a temporary injunction against the Amendment, in an amparo proceeding.

Judge Gomez Fierro decided that the injunction should protect all participants of the power market since protection of a single plaintiff would result in competitive advantages to only that plaintiff and disrupt the market.

Generally, amparo proceedings have only inter partes effects, but Judge Gomez Fierro argued, based on Supreme Court precedents and the Inter-American Human Rights Convention, that general effects were in the best interest of the market and society as a whole.

Temporary injunctions are based on a prima facie review of the constitutional questions posed by plaintiffs. The district court's decision held that the Amendment was, at first appearance, contrary to antitrust and environmental protection constitutional provisions.

The temporary injunction is likely to be challenged by the Ministry of Energy (Secretaría de Energía, “SENER”). If the injunction is upheld, the suspension of the Amendment will continue until a final decision is reached. Meanwhile, the 2014 Electricity Industry Law will be in effect until a decision on the merits of the claim against the Amendment is issued.

Plaintiffs have 30 days from the date of publication of the Amendment to challenge its constitutionality. It is likely that additional amparo proceedings will be filed.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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