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11 August 2016
The constitutional energy amendment published in the Official Gazette on December 20 2013 transformed the Mexican energy market into a competitive market that enables private investment. As a result, gasoline and diesel prices will be liberalised after December 31 2017, as established by the new Hydrocarbon Law. In addition, the Hydrocarbon Law has enabled parties outside the Mexican Petroleum (Pemex) franchise model to sell gasoline and diesel since January 2015.
In light of this, the Mexican Federal Economic Competition Commission (MFECC) has issued a series of recommendations to foster competition in the gasoline and diesel market, taking into account legislative concerns and the market's performance.
The MFECC's main concerns were as follows:
Taking into account the above concerns, the MFECC issued the following recommendations.
The MFECC's recommendations were intended to restrict the actions of various players in the gasoline and diesel market ex ante to avoid future competition concerns. In this regard, the relevant authorities should take the MFECC's recommendations seriously. Given that the gasoline and diesel market is transitioning to a liberalised market, the MFECC's intervention will be necessary only when there is a lack of effective competition conditions and free concurrence. However, it is important to establish a mechanism by which the CRE can:
This will ensure that the MFECC has good knowledge of the market and enable it to exercise its powers effectively, including:
Despite the MFECC's recommendations, the following concerns still exist:
For further information on this topic please contact Lucia Ojeda Cardenas at SAI Consultores SC by telephone (+52 55 59 85 6618) or email (email@example.com). The SAI Consultores website can be accessed at www.sai.com.mx.
(2) A 'first-hand sale' is the first sale in Mexico by Pemex or its subsidiary bodies or divisions, or any other state-owned or governed company, to a third party or other first-hand sales body. This must be carried out at processing plants, oil refineries, imported product injection points or production camp hydrocarbons injection points.
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