Mexico: Initiative of constitutional reform to transform the Federal Commission of Electricity (CFE) and Petróleos Mexicanos (PEMEX)

28 Aug 2024    1 minute read

In brief

On 5 February 2024, the Mexican President Andrés Manuel López Obrador submitted before the House of Representatives (Cámara de Diputados) a constitutional reform initiative ("Reform Initiative") to modify articles 25, 27 and 28, with regard to State strategic industries, such as, electricity and hydrocarbons.

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In more detail

On of the most relevant aspects of the Reform Initiative is the retransforming of the Federal Commission of Electricity (CFE) and Petrolos Mexicanos (PEMEX) as state public entities, eliminating the concept of "State Productive Company" currently included in Article 25 of the Mexican Constitution.

Reform Initiative also proposes a modification of Article 27 of the Mexican Constitution in connection with the participation of the private sector within the activities of the power industry. The amendment provides that the laws will determine the form in which the private sector may participate in the power industry activities which are not related with the transmission and distribution of power; provided that in no event such participation should prevail over the State public entity, in this case the CFE.  

Pursuant to the transitory regime, this Reform Initiative would enter into force the day following its publication in the Federal Official Gazette. Mexican Congress would have a term of 180 calendar days as of the Reform is in full force and effect to make the necessary adequations to the laws allowing the Reform to comply with its purpose. adjust the secondary legislation in this regard. These changes seek to reverse the 2013 energy reforms, which allowed greater private sector participation in these sectors.

This Reform Initiative was approved in general by the Constitutional Points Commission of the House of Representatives (Cámara de Diputados) on 14 August 2024 and it is expected to be voted by the Mexican Congress within the month of September.

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Contact Information
Benjamin Torres-Barron
Partner
Mexico City
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benjamin.torres-barron@bakermckenzie.com
Carlos Maass-Porras
Associate
Juarez
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carlos.maass-porras@bakermckenzie.com

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