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Client Alert | Reliability and Security Policy

02/22/2021

Legal News / Updates

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Mexican Judiciary rules on the unconstitutionality of the Policy for the Reliability, Safety, Continuity and Quality of the National Electric System

On May 15th, 2020, the Mexican Ministry of Energy (“SENER”) published in the Federal Official Gazette the Policy for the Reliability, Security, Continuity and Quality of the National Electric System (the “Dispatch Policy”), to set general guidelines aimed at guaranteeing electricity supply and the reliability of the National Electric System (“SEN”). As such, the Dispatch Policy states the dispatch’s security takes priority over economic efficiency.

Arising from two Amparo proceedings, a District Judge specialized antitrust matters ruled the entire Dispatch Policy as voided and in turn ordered for the previous dispatch policy to remain as the once to be enforced.

Resulting from such Ruling, the Dispatch Policy’ unconstitutionality was declared based on SENER’s omission to comply with the regulatory improvement process. Such compliance aspect is a formal constitutional requirement transpiring the Dispatch Policy as a full, and that in turn was a breach against free market access and competition principles.

On January 19th, 2021, SENER appealed the ruling. However, a higher tribunal dismissed the appeal as it was timed-barred. SENER did not contest such dismissal.

On February 18th, 2021, the District Judge declared that the ruling was final for all purposes and no appeal action could be filed.

Notwithstanding Mexico’s Supreme Court ruling as invalid only certain provisions of the Dispatch Policy, the fact the District Judge’s ruling declaring it unconstitutional for all purposes, it is mandatory for all authorities not to enforce it and it is outside from all norms applicable to individuals.

At González Calvillo we are prepared to provide any advice required in relation these new regulatory provisions. We remain at your disposal for any comments or questions arising out of this ruling.

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