Mexico’s ruling party looking at changes to judicial reform to calm markets, sources say By Reuters

By Diego Orr

MEXICO CITY (Reuters) – Mexico’s ruling party is considering changes to a proposed judicial reform in an attempt to calm market concerns, including making the election of judges a gradual process over several years to reduce fears of a political takeover of the judiciary, sources familiar with the discussions said.

The original proposal by outgoing President Andres Manuel Lopez Obrador had unnerved investors amid fears that the changes would weaken Mexico’s checks and balances by introducing popular vote for nearly 1,600 judges – including the Supreme Court.

President-elect Claudia Sheinbaum, who will take office in October and is also from the ruling Morena party, defended the proposal, saying she believes judges should be elected.

But Morena will amend the reform so that judges are elected in stages and participants are selected by a technical committee after undergoing suitability tests, four party sources familiar with the discussions said.

In addition, the sources said, lucrative trust funds for judicial workers would be protected. Last year, Mexico’s Senate voted to end 13 trust funds for the judiciary, escalating tensions between the government and the judiciary, although the Supreme Court later overturned the decision.

The Mexican peso fell 8% in the week following the June 2 elections, which also gave Morena a landslide majority in the lower house of Congress.

Lopez Obrador denied that market volatility was linked to judicial reform.

The outgoing president called for the reform, which also proposes reducing the number of Supreme Court justices to nine from 11, as a necessary transformation of a justice system that he said was “not at the service of the people.”

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

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

Concerns about the trade agreement

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

The sources saw the popular election of judges without strict conditions, as originally proposed, as a potential obstacle to the work of Mexico’s labor courts, which were created to comply with the quick resolution of disputes between workers and management under the United States-Mexico-Canada Agreement.

Lawmakers decided to modify López Obrador’s reform so that it does not affect the “clear, transparent and predictable” legal and trade framework, as stipulated in the United States-Mexico-Canada Agreement.

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

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