The Second Collegiate Circuit Tribunal on Administrative Matters, specialized in economic competition, broadcasting and telecommunications (the "Tribunal"), recently dismissed the amparo request filed by Pemex Logística challenging the resolution A/015/2018 (the "Resolution") issued by the Energy Regulatory Commission ("CRE"), which requires Pemex Logística to assign in favor of third parties (subject to the satisfaction of certain conditions) the capacity they may require to transport or store gasoline or diesel, even when the relevant open season (temporada abierta) has expired.

The Tribunal confirmed that Pemex Logística is required to share its storage and transportation capacity with market participants that supply gasoline or diesel to distributors, marketers or service stations, even when such suppliers are not customers of Pemex Transformación Industrial ("Pemex TI"). The most relevant points of the Tribunal’s decision are the following:

i.while Pemex Logística argued that the Resolution violates the principle of legal hierarchy,the Tribunal confirmed the CRE’s regulatory authority by dismissing the argument thatthe Resolution was contrary to this principle, considering that the Mexican Constitutionand the Hydrocarbons Law grant authority to the CRE to regulate third party access totransportation pipelines and storage facilities for hydrocarbons and related products;

ii.Pemex Logística also argued that the Resolution hinders the Mexican State's authority todictate policy over hydrocarbons, as the Resolution imposes on Pemex Logística theobligation to assign capacity based on tariffs that do not take into account costs orprofitability, thus discouraging transportation and storage of hydrocarbons andpetrochemicals. The Tribunal determined that the Resolution does not violate the State´sauthority, as the Constitution allows CRE to regulate non-strategic transportation andstorage activities carried out by all participants, including Pemex Logística;

iii.Pemex Logística also argued that the assignment of transportation capacity does notallow it to recover its costs, as the Resolution issued by CRE prohibits Pemex Logísticato charge third parties for transportation and storage more than what it charges PemexTI. Pemex Logística did not identify the costs of providing fuel transportation and storageservices nor the tariffs that it charges Pemex TI for such services. Pemex Logística wasalso unable to prove that the tariffs it could apply to third parties would have prevented itfrom recovering its costs and from making a profit. Because of this lack of evidence, theTribunal dismissed this claim as unfounded;

iv.the Tribunal rejected that any request for assignment of capacity would discourage theimplementation of open seasons, as argued by Pemex Logística. The Tribunal confirmed CRE’s authority to regulate open and non-discriminatory access to hydrocarbons and petrochemicals storage and transportation services, asserting the right of market participants to have options to access such services;

v.finally, the Tribunal dismissed the allegations of Pemex Logística that the Regulationaffords undue advantages to third parties, thus validating asymmetric regulation topromote the efficient and competitive development of hydrocarbons and petrochemicalstransportation and storage services.

This decision, which may still be appealed by Pemex Logística, is of particular relevance, as the Tribunal confirmed that private companies may, on a case by case basis, request access to Pemex Logística’s transportation and storage capacity. Prior to this ruling, an open season was the only way by which market participants could gain such access.

The foregoing confirms the relevance that competition laws have gained as an effective tool to challenge anti-competitive behavior.