Mexico’s ruling party mulling changes to judicial reform to calm markets, Reuters sources say

By Diego Oré

MEXICO CITY (Reuters) – Mexico’s ruling party is considering changes to a proposed judicial reform in an attempt to assuage market concerns, including making the selection of judges a staggered process over several years to ease takeover fears politics of the judicial system, familiar sources. with the said discussions.

Incumbent President Andres Manuel Lopez Obrador’s initial proposal raised concerns among investors that the changes would weaken Mexico’s checks and balances by introducing the election of nearly 1,600 judges – including the Supreme Court – by popular vote.

President-elect Claudia Sheinbaum, who takes office in October, also of the ruling Morena party, defended the proposal, saying she believed judges should be elected.

Morena, however, will adjust the reform so that the selection of judges is staggered and participants are selected by a technical committee after undergoing fitness tests, sources in four parties with knowledge of the discussions said.

In addition, the sources said, the lucrative trust funds of judicial workers will be protected. Last year, Mexico’s Senate voted to dissolve 13 trusts held for justice, increasing tension between the government and the judiciary, although the Supreme Court later overturned the decision.

The Mexican peso fell 8% in the week after the June 2 election, which also resulted in a super-majority in the lower house of Congress for Morena.

Lopez Obrador has denied that market volatility is linked to judicial reform.

The incumbent president pushed the reform, which also proposes reducing the number of Supreme Court justices to nine from 11, as a necessary transformation of a justice system he said “does not serve the people.”

Critics argued that electing judges by popular vote would politicize the justice system in favor of Morena and his allies.

Spokesmen for Lopez Obrador, Sheinbaum and Morena did not immediately respond to a request for comment.

TRADE AGREEMENTS

The four Morena sources said the new changes also took into account an upcoming 2026 review of the US-Mexico-Canada Agreement, the trade pact that came into force in 2020.

The popular election of judges without strict conditions, as originally proposed, was seen by sources as a potential stumbling block in the functioning of Mexico’s labor tribunals, which were created to comply with quick resolutions of labor-management conflicts in USMCA compliance.

Lawmakers decided to adjust Lopez Obrador’s reform so that it would not affect the “clear, transparent, and predictable” legal and trade framework as stipulated in the USMCA.

Senator Ricardo Monreal, who is expected to lead Morena in the lower house when the new Congress begins in September, said it was the role of lawmakers to include “issues that can improve, enrich or modify the presidential proposal.”

“We will respect all expressions, points of view; we will resist internal and external pressures and maintain our principles and commitments,” Monreal said in an interview.