BBVA Deems Government’s Actions as “Discriminatory”By Antonio Trujillo | Thu, 08/26/2021 - 09:45
BBVA Mexico has publicly criticized the López Obrador administration for their “favored” treatment of state-owned PEMEX over the private sector.
BBVA Mexico went public with their criticism of the current administration and its apparent favoritism towards PEMEX and CFE , stemming from its position against former president Peña Nieto´s Energy Reform. In precise terms, they deemed the government’s actions as “discriminatory” and contrary to free market practices, following a change in the energy sector export rules that will see PEMEX benefit over all private energy companies.
“This represents a discriminatory treatment toward private companies, with effects contrary to competition, by generating uncertainty in investments, limiting the possibilities of competing in the market and granting exclusive advantages to PEMEX,” reads BBVA´s announcement.
The ordeal began on June 11 when a modification to the General Rules of Foreign Trade was published by the government. It formally established that only state companies (i.e. PEMEX), could import and export hydrocarbon, petroleum, minerals, and chemical precursor merchandise outside their authorized areas.
BBVA further added that it “restricts private companies from trading goods, be it entrance or exit, in national territory from a point or port different from that authorized, while the state’s productive companies are the only ones that can get authorization to import from any point.”
“To limit the capacity of private companies to decide the most efficient import point affects the competition´s processes, since it artificially raises the costs to supply its network of service stations and serves clients from other industrial sectors,” BBVA stated.
In addition, it warned about a possible USMCA violation, given the measure’s “affectation of private businesses’ investments and adverse effects on the free market in favor of state-owned companies.” Recent increases in oil prices are happening thanks to world economic reactivation, therefore, BBVA warned about supply restrictions and price control.
In addition, BBVA also made a statement against the Service Tax Administration (SAT) for their suspension of 82 companies from the importers and exporters registrar following administrative faults, commenting this was a “discriminatory treatment,” and that suspension of permits go against the principles established at the onset of the opening of the fuel market back in 2017.