Canceling the Constellation Brands plant would be a violation of the Free Tra...

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Following the results of the consultation held last weekend on the construction of a Constellation Brands brand brewery in Mexicali, Baja California; The Mexican government has declared that the factory will be denied a water permit, thus causing the cancellation of the company's work in the area. With data from The Economist , despite this, the Business Coordinating Council argued that the plant would use only 0.2% of the town's water resources, in addition to having mechanisms to treat and return the water used for agricultural use. The situation became controversial under the understanding that the actions undertaken by the Mexican government would imply a violation of the investment chapter of the North American Free Trade Agreement, which covers direct and indirect acts of all the sectors covered. Considering an expropriation as a direct act and the performance of acts inherent to preventing the operation of a business by municipal authorities as an indirect act. Alejandro Gómez Strozzi, American consulting partner Foley Gardere Arena, stated: Although there is no expropriation decree, there would be an impediment to continuing with the business – which apparently already has all the authorized permits – due to a subsequent act.


Until there is an act of authority on the part of the government, it would be equivalent to an indirect expropriation, which would conflict with Article 1,110 of the NAFTA, which establishes that neither party may nationalize or expropriate, directly or indirectly, an investment. of an investor from another party in its territory, nor adopt any measure equivalent to the expropriation or nationalization of that investment (expropriation), unless it is for reasons of public utility, on America Cell Phone Number List non-discriminatory bases, in accordance with the law and through compensation, among other assumptions. It remains to be determined whether this controversy would be resolved under NAFTA or its substitute, the Treaty between Mexico, the United States and Canada (T-MEC), in whose chapter 14 of the investment section it was agreed to remove a certain level of protection for investments in the sector. of manufacturing, leaving protection only to “direct means of investment” and certain activities or services in the energy, telecommunications and infrastructure sectors. The Mexican government bases its decision on the results of the vote in which 36,781 citizens participated in the 10 voting stations that were installed in the urban area and the other 17 that operated for rural areas in which 27,973 (76.1%) were registered.



votes against, 8,545 (23.2%) votes in favor and 261 null votes in the two days that the consultation lasted as detailed by Diana Álvarez Maury, undersecretary of Democratic Development, Social Participation and Religious Affairs. For his part, through his official Twitter account, President Andrés Manuel López Obrador indicated that: The federal government promotes and provides guarantees for private investment, while protecting the environment and the rights of the population. We respect the results of the consultation held in Baja California. Our duty is to maintain the balance between market, State and society. He also said that, if necessary, he would meet with business representatives to explain that the people's decision must be respected, in addition to ensuring that they are not against foreign investment, so the government will look for a way to grant them facilities. If you wish, put the plant in other regions where there is water.