• TREATY: If she wanted, Constellation Brands could use of the investor-state dispute settlement mechanism (ISDS) included in the 1993’s North America Free Trade Agreement (NAFTA) or in the new regional trade deal (USMCA) to claim protection after the Mexican Government axed a US $1.3 billion plant in Mexicali.
• REACTION: After a non-binding and legally shaky plebiscite against the plant, water rights groups celebrated the decision to halt the Mexicali brewery. Whether it is NAFTA and USMCA rules, experts and government officials believe the mechanism (ISDS) is available to reclaim investment.
• DISPUTE: “Surely the US government is directly talking to the Mexican Foreign Ministry about this”, an anonymous Mexican official told news wire Reuters about the possibility of Constellation Brands presenting a dispute under investment protection chapters of NAFTA (Chapter 11) or USMCA ( Chapter 14).
• TURMOIL: Amid the global turmoil due to the coronavirus, Mexico’s private sector heavily criticized President Andrés Manuel López Obrador for certifying the results of a controversial exercise in which very few citizens of Mexicali ended up cancelling a major investment on both sides of the border.
