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Constitutional reform on power and hydrocarbons matters
06 OCT 21   |   LEGAL UPDATES

On Friday, October 1, 2021, the Mexican President submitted before the Chamber of Representatives of the Mexican Congress, an initiative to reform several constitutional articles related with the power and hydrocarbons industries (the “Initiative”).

I. Purpose


The Initiative seeks to revert the 2013 energy reform, which allows the participation of the private sector in the power industry, under the premise that such reform had as main objective granting unlimited benefits to the private sector to get the “fast disappearance of CFE”. In view of the complex challenges faced by the power industry, which had not been solved by the government for more than six decades, and considering the evolution of the industry worldwide, both from a technological point of view as well as from its planning and structure, the 2013 energy reform sought to modernize the sector. Among other characteristics, it complied with the principle of maintaining control and strategic planning in the hands of the State, and allowed the participation of the private sector in the industry, seeking to achieve a model of collaboration between the different sectors of society (public, social and private), to move away from the failed state monopoly scheme and build a more competitive and efficient power industry, in which the role of CFE would be different from its monopolistic position, and where the main beneficiary would be the end user by having better supply options and lower tariffs.


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