Businesses considering moving offshore and manufacturing in Mexico should be well informed of the country's environmental regulations. This is especially important considering the dramatic steps Mexico has taken to reduce its environmental footprint and combat climate change. Bloomberg Business reported in March that Mexico became the first developing nation to formally promise to cut pollution tied to climate change - the country pledged to cut carbon emissions 25 percent by 2030.
Environmental protection is important to the Mexican government, and manufacturers in Mexico are wise to stay informed of evolving regulations.
According to Practical Law, the General Law on Ecological Equilibrium and Environmental Protection, enacted in 1988, is the primary environmental law governing Mexico. Under this law, the Federal Congress can grant federal, state and municipal leaders the authority to regulate protection of the environment, as well as preservation and restoration of the ecological balance within their jurisdiction. Under this law, a variety of regulations have formed governing water pollution, air pollution and hazardous waste:
- Water pollution - Under the National Waters law, key functions in the water sector are the responsibility of the federal government, through the National Water Commission (CNA). Extraction of national waters, discharge of wastewater and occupation of federal water zones all require authorization issued by the CNA. Violators can be held financially responsible for breach of permit under this law.
- Air pollution - Under Mexican environmental law, all sources of air pollution are regulated. Additionally, many manufacturing sites will be subject to federal jurisdiction, regardless of the municipality in which they are located. As such, all stationary sources of air pollution (such as a factory) must obtain an operating license for emissions. The current law, however, does not outline compensation responsibilities for air pollution.
- Waste - According to the law, the Mexican government defines waste as hazardous waste, special management waste and solid waste. The law prohibits people from generating, storing, transporting or disposing hazardous waste without the appropriate permits. Manufacturers should know that while the storage of self-generated hazardous waste does not require a specific permit, the facility where the waste is stored must meet specifications.
Beyond water pollution, air pollution and waste management, laws governing sustainable energy practices are especially important to consider when manufacturing in Mexico. As noted in Practical Law, the General Law on Climate Change, which came into effect in October 2012, mandates 35 percent of the country's electricity should come from renewable sources by 2024 and requires mandatory emissions reporting from certain air emissions sources registered in the National Emissions Registry.
Manufacturers in Mexico can avoid penalties by obtaining the proper permits. Practical Law states there is an integrated permitting regime in Mexico, which requires sources of emissions subject to federal regulation (automotive manufacturing plants) to obtain an Integrated Environmental License that outlines the source's environmental impact and risk, air emissions, hazardous waste production and potential water pollution.
Additionally, partnering with companies that provide robust legal framework configuration can cut manufacturers' risks and costs related to environmental regulations.