How the controversial AMLO decree will cut red tape for priority projects
Mexican President Andrés Manuel López Obrador (AMLO) on Monday published a decree in the Federal Official Gazette ordering the automatic approval of all resolutions, permits or authorizations related to public works considered to have “priority” status by his administration.
Calling it an “agreement” despite its unilateral nature, AMLO defended the decree, saying it is necessary to ensure the completion of major public works on time (and by the time he leaves office in 2024), including the Maya train and the Isthmus. of the Tehuantepec corridor projects.
Critics, however, were quick to attack the movement as an attempt to circumvent the law by decree.
BNamericas spoke with Diego Álvarez Ampudia, senior partner of the Guadalajara-based law firm Ramos, Ripoll & Schuster and specialist in the financing of infrastructure and energy projects, to analyze the legality of the decree, see what it involves investors and getting a prognosis on its future viability.
BNamericas: Are permits, licenses or other rulings even required under the decree, or how will that work?
lvarez: It orders a provisional authorization, for a period of one year, then a final authorization is required. But it seems that this final resolution cannot be denied either. But even if it could be refused, the fact of having obtained a temporary authorization for such a long period creates the risk that irreparable damage may already be caused to the parties concerned.
The intention is clearly to make it impossible to legally cancel project authorizations.
He also says that [the preliminary] the authorization must be issued within five days – any approval, license or permit is very broad. If in five days there is no response, then the response is understood to be in the affirmative.
This deadline is totally unrealistic, insufficient to proceed with the approval of a permit for a project of the complexity of strategic projects.
BNamericas: Why do you think the decree also defines priority projects as strategic for national security?
lvarez: It is very worrying that these projects are classified as matters of national security.
There, what they want to do is restrict access to information on these projects, because there is an exception in the federal law on transparency and freedom of information, which says that information can be withheld on national security issues.
There is an attempt that we do not have access by law to know the plans, the services provided, the contracts, and in general any information related to these projects.
It is an attempt to prevent the legally protected freedom from accessing a project’s plans, services provided, contracts and other information in general.
BNamericas: What do you think will happen with the courts? Will they say something about this statement?
lvarez: It is very likely, just because of the lack of justification and motivation and because there is an apparent unconstitutionality. I did not analyze it in detail, we will analyze it these days, which articles of the constitution it might violate.
But several specialists said they were looking at the rights to health and a healthy environment, among others, which are definitely violated, in addition to violating the separation of powers.
I believe it is likely that we will see appeals and that the courts are very likely to rule against this decree.
If it goes all the way to the Supreme Court, there might be some interesting decisions on what the public interest means and so on, but that would be several months away.
The first time this impacts someone we’ll see an amparo lawsuit [a legal petition to be shielded from a law’s implementation].
I think we will see its implementation suspended very soon, although this will not be the last word … rather a provisional suspension, followed by a definitive one. But to reverse it completely, I don’t know. For that, it will be necessary to see how the courts and perhaps even the Supreme Court weigh on this.
BNamericas: Does the decree specify how a project is designated as “priority”? Can only the president do this or maybe cabinet members within their own ministry?
lvarez: It’s not clear. The decree does not specify which projects enter and which do not, just the sectors, and there are many.
He seems to be saying that if the federal government says it is a priority, then that is all it takes. There is no real objective parameter. We have seen different ministries and as well as the president at his discretion classify the projects as priority or strategic.
BNamericas: Do you think investors will see this as yet another blow to the rule of law in Mexico?
lvarez: It is definitely a blow to the rule of law. It generates uncertainty, reaffirms that this government does not care about the legal order and tries, by simple decrees, to change the rules.
[With investors] I would say it is a delicate situation because there are going to be investors who will benefit from it. Investors involved in these projects will see an advantage. But without a doubt, for all other investors and the rest of the public, this can be seen as a weakening of the rule of law.