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News Article

Supreme Court Judges LIE: the Law Remains Active

By María José Goytia | Wed, 04/20/2022 - 17:23

The Supreme Court ends its discussion regarding the constitutionality of the Electricity Industry Law of 2021 (LIE). After three different votes, the court reactivated LIE and determined the unconstitutionality actions as res judicata, meaning it is now an open-and-shut case.

After failing to reach the qualified majority of eight votes in favor of the LIE’s unconstitutionality based on a case brought forward by the government’s opposition, the Supreme Court still needed to vote on the other two the unconstitutionality actions promoted by the autonomous agency for economic competition, COFECE, as well as one by the local government of Colima.

The unconstitutional controversy promoted by COFECE was analyzed by the Supreme Court on Monday, April 18, and was declared unsubstantial, as most of the judges agreed that the law does not infringe on COFECE’s constitutional responsibilities as a watchdog.

Out of the 11 ministers, six thought LIE does not attack COFECE's competences, as they considered that COFECE is not the correct body to file such a challenge. COFECE challenged several articles of the LIE that in its opinion violated the principles of free competition.

"COFECE comes to challenge the LIE reform that in no way affects its competences, but instead affects the abstract principle of economic competition. The argument of defending the principle of economic competition in activities related to production and commercialization of electricity would distort the purpose of these constitutional means of control," said Minister Mario Pardo Rebolledo.

Chief Minister Arturo Zaldívar supported Minister Pardo’s proposal, arguing that "What the entity stated is not sufficient, but we have to analyze if its competences or if human rights related to its scope are indeed affected… otherwise, the constitutional controversy is completely distorted.”

The following day, on Tuesday, April 19, the Supreme Court resolved the third unconstitutionality action, filed by the government of Colima. By a majority of seven votes, the Supreme Court declared the controversy unsubstantial as well, considering that the local administration lacked a legitimate interest to challenge LIE. The decision marked the end of the rulings the Supreme Court had pending regarding the LIE’s reform.

After the result of the first vote on the unconstitutionality of the LIE, Congress members from the government’s opposition questioned the result and requested the Supreme Court to rectify the vote count, as they considered a miscount occurred.

After voting on the controversy filed by the government of Colima, the Supreme Court unanimously approved the minutes of the session where it determined to reactivate LIE, after verifying that only seven votes in favor of the unconstitutionality were reached.

The resolution of the Supreme Court has reactivated LIE’s effects. However, since the vote did not reach a qualified majority in favor of the law’s constitutionality, companies may continue to file for amparos.

The data used in this article was sourced from:  
Oil and Gas Magazine, Forbes México, El Heraldo de México, Expansión
Photo by:   Pixabay
María José Goytia María José Goytia Journalist and Industry Analyst