Approval of Mexico's controversial judicial reform enters final stretch amid protests

Approval of the controversial constitutional reform to Mexico’s judiciary is entering the final stretch amidst demonstrations and widespread criticism.

On Sunday (Sep 1), the new deputies and senators elected in June assume their seats after the electoral court endorsed a supermajority of the ruling Morena party and its allies in the lower house.

Morena has 257 seats, and together with its allies 364 of the 500 in total. It was also confirmed that Morena choice Ricardo Monreal will be the house’s coordinator.

Ifigenia Martínez (Morena) will be the new president of the chamber of deputies and will hand Claudia Sheinbaum (also Morena) the presidential sash on October 1.

In the senate, as confirmed by electoral authority INE, the ruling coalition will have 85 seats while the opposition, made up of the PAN, PRI, PRD and Movimiento Ciudadano, will have 43 with limited room for maneuver.

The ruling bloc had been three seats short of a qualified majority in the upper chamber, but then PRD members Araceli Saucedo and José Sabino were presented as part of the Morena parliamentary group, a practice which in Mexico is known as chapulineo.

A two-thirds majority is needed in both chambers to approve the reform.

Gerardo Fernández Noroña, also a Morena member, was elected president of the senate.

Monreal told a press conference that the reform to the judicial branch, which includes the popular election of all judges, would not be approved on September 1 but a special session would be held.

"The legislative process can begin and we will set deadlines for dissemination, deliberation, general discussion and specific discussion to broaden the debate and ensure that all Mexicans know what we are approving," he told local media.

The Morena coordinator clarified that president-elect Sheinbaum asked the parliamentary group to strictly observe the law and not rush approval.

Meanwhile, 11 days after a national strike began by members of the judiciary, workers and students have stepped up protests across the country to include employees of the supreme court (SCJN), who in recent days took to the hallways and stairs of the building to protest against the reform and even blocked access to the country’s highest court.

There is extensive criticism from governments, international associations, and players in the financial, private and academic sectors of the initiative to reform the judicial system presented in February by outgoing President Andrés Manuel López Obrador, as part of his so-called Plan C.

Governments:

1. The US ambassador to Mexico, Ken Salazar, said that direct voting of judges represents a major risk to democracy, and that if the elections for judges scheduled for 2025 and 2027 are approved, the historic bilateral trade relationship would be threatened.

2. Canada's ambassador to Mexico, Graeme Clark, said investors from his country are concerned because they want stability and a judicial system that works if there are problems.

3. A group of US senators said in a letter that they were “deeply concerned” about reforms in Mexico that “would undermine judicial independence and risk violating the terms of the US-Mexico-Canada Agreement (USMCA).”

International:

1. Margaret Satterthwaite, the UN special rapporteur on the independence of judges and lawyers, called for reconsideration of the presidential initiative on judicial reform. She stressed her concern about the implications for judicial independence and called on the authorities to give adequate weight to human rights guarantees.

2. The International Association of Judges in Rome spoke out against the reform of the judiciary and emphasized that “it must be consistent with the well-established and universally accepted principles of the independence of justice in order to preserve the right of citizens to access independent courts.”

3. Judges and magistrates asked the Inter-American Court of Human Rights to temporarily suspend the judicial reform due to possible violations of human rights and international treaties.

Financial sector:

1. Morgan Stanley downgraded its recommendation to invest in Mexico over López Obrador's reform in a report to investors. It said that replacing the judicial system would increase risk, increase Mexico's risk premiums and limit capital spending by companies.

2. Citibanamex warned about risks of the judicial reform and overrepresentation of Morena in congress.

3. Bank of America described the judicial reform as “the most significant and worrying” among AMLO’s initiatives due to the risks it entails and expects volatility to remain high until the end of the year.

4. Fitch Ratings said approval of the judicial reform, among other initiatives, could negatively impact institutional quality and checks and balances in Mexico.

5. Swiss bank UBS foresees “conflict” with USMCA obligations and predicts that constitutional reforms will continue to generate instability in the exchange rate.

Private sector:

1. The American Chamber of Commerce of Mexico (AmCham) called on Mexican authorities to maintain a constructive dialogue with the private sector to thoroughly assess the implications of the reform and other legislative initiatives that could affect the rule of law.

2. The Canadian Chamber of Commerce in Mexico, CanCham, expressed the concern of the Canadian business community regarding the constitutional initiative and the disappearance of various autonomous bodies.

3. Organizations from the manufacturing, medical, chemical, energy, industrial, technological, services and mining sectors in the US expressed to the Biden government their concern about the package of constitutional reforms that the Mexican government could enact in the new legislative period.

4. The Business Coordinating Council (CCE) warned that judicial reform and the disappearance of regulatory bodies could generate a negative economic impact of 0.3 percentage points on GDP due to the fall in private sector investment.

5. Global Companies in Mexico expressed concern about the risk that Mexico will lose legal certainty and investment opportunities due to the judicial reform initiative.

6. Industry chamber Canacintra said the judicial reform will impact economic development and MSMEs.

7. International investment demands a serious and in-depth dialogue on the reform of the judicial branch, said Larry Rubin, president of the American Society of Mexico, and made a strong call to the chamber of deputies, particularly to coordinator Ricardo Monreal, to define real and adequate times to debate the issue.

Academia:

Law schools of nine universities came out against the reform. The signatories are Universidad Nacional Autónoma de México (UNAM), Universidad Iberoamericana, Instituto Tecnológico Autónomo de México (ITAM), Universidad Panamericana (UP), Universidad La Salle México, Centro de Investigación y Docencia Económicas (CIDE), ITESO Universidad Jesuita de Guadalajara, Instituto Tecnológico y de Estudios Superiores de Monterrey (ITESM), and Universidad Autónoma del Estado de México.