GC ALERT | The Chamber of Deputies rejects the Constitutional Reform on energy matters and approves the initiative to amend the Mining Law

On September 30, 2021, President Andrés Manuel López Obrador submitted a bill to amend Articles 25, 27, and 28 of the Mexican Constitution regarding the energy sector (the “Bill”). The fundamental focus of the Bill was the strengthening of the Federal Electricity Commission (“CFE”) and the disappearance of the Coordinated Regulatory Bodies in energy matters, i.e., the Energy Regulatory Commission (“CRE”) and the National Hydrocarbons Commission (“CNH”).

On Sunday, April 17, 2022, the Bill was discussed in a plenary session of the Chamber of Deputies for its vote.

The Bill did not obtain the affirmative vote of two-thirds of the deputies (qualified majority), securing only 275 affirmative votes, out of 498 present in the session. As a result, the Bill was rejected.

Consequently, the Bill cannot be discussed again any sooner than during the 2023 congressional period, in which case, the process dictated by the Constitution must be restarted, and the Bill will again require affirmative vote of the qualified majority of the legislative representatives comprising each of the Chambers of the Congress. Subsequently, if approved by the Legislative Branch in such terms, the Bill must also be ratified by the absolute majority (half plus one) of the states’ Congresses. Finally, the Bill must be published in the Federal Official Gazette.

As a result of what seemed to be an imminent failure to secure the required majority during the voting session, the Mexican President presented a new initiative before the Chamber of Deputies to amend the Mining Law concerning the exploitation of lithium (the “New Initiative”). This New Initiative intends for the exploration, exploitation, and use of such mineral to be considered a public use activity and, therefore, exclusively for the Mexican State through the decentralized public agency that will be created for such purposes.

This New Initiative was approved by the Chamber of Deputies on April 18, 2022, obtaining 275 favorable votes. The next step is for the New Initiative to be voted in the Senate and, for its approval, it will be necessary to have a simple majority.

As the New Initiative has the nature of a regulatory law, if approved by the Mexican Congress, it may be challenged by different means. Therefore, once published in the Federal Official Gazette, the terms for the filing of Amparo trials, controversies, and constitutional actions will begin to elapse.

González Calvillo is prepared to provide advice in connection with the Bill, the New Initiative, and its possible implications. We remain at your disposal for any questions or clarifications regarding the scope contained herein.

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