Mexico’s ruling party is looking at changes to judicial reforms to calm markets, sources told Reuters

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By Diego Oré

MEXICO CITY (Reuters) – Mexico’s ruling party is considering changes to a proposed judicial reform in an effort to address market concerns, including by making the election of judges a staggered process over many years to ease fears of a political takeover of the judiciary, known sources report. said with the discussions.

The original proposal from outgoing President Andres Manuel Lopez Obrador roiled investors with concerns that the changes would weaken Mexico’s checks and balances by introducing the election of nearly 1,600 judges – including those of the Supreme Court – by popular vote .

Newly elected President Claudia Sheinbaum, who takes office in October and is also a member of the ruling Morena party, has defended the proposal, saying she believes judges should be elected.

However, Morena will tailor the reform so that the election of judges is staggered and participants are selected by a technical committee after undergoing eligibility tests, four party sources with knowledge of the discussions said.

In addition, the sources said, the lucrative trust funds of court employees will be protected. Last year, Mexico’s Senate voted to end 13 judiciary trusts, increasing tension between the government and judicial authorities, although the Supreme Court later reversed the decision.

The Mexican peso plunged 8% in the week after the June 2 elections, which also gave Morena a supermajority in the lower house of Congress.

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

The outgoing president has introduced the reform, which also proposes reducing the number of Supreme Court judges from 11 to nine, as a necessary transformation of a judicial system that he said is “not serving the people”.

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

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

TRADE PACT CONCERNS

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

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

Lawmakers have decided to amend Lopez Obrador’s reform so that it does not affect the “clear, transparent and predictable” legal and commercial framework stipulated in the USMCA.

©Reuters. FILE PHOTO: Mexico's President-elect Claudia Sheinbaum speaks during a press conference in Mexico City, Mexico, July 22, 2024. REUTERS/Luis Cortes/File Photo

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

“We will respect all expressions and views; we will resist internal and external pressure, and we will uphold our principles and our commitments,” Monreal said in an interview.

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