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Mexican Senate approves bill to limit rail concessions, prices

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MEXICOCITY (Reuters) – Mexico’s Senate on Thursday approved an initiative to limit concessions to run and develop railways in the country to 30 years, and to periodically set a ceiling on prices that operators can charge.

In a statement, the Senate said lawmakers had agreed to lower the length of railway concessions to 30 years from 50 at present. The initiative stipulates that the concessions can be extended subsequently for a maximum of 30 years in total.

Via an addendum, the Senate also agreed that every two years permit and concession holders must register with the industry regulator “the maximum rates applicable” for rail services.

The legislation now passes to the lower house of Congress.

Mexico’s rail network is largely dedicated to freight services and is dominated by U.S. firm Kansas City Southern and the rail arm of mining and transport conglomerate Grupo Mexico.

Industry lobby the Mexican Railroads Association (AMF) condemned the legislation, saying in a statement that it was unconstitutional, undermined legal certainty for investors and violated international agreements Mexico was part of.

(Reporting by Sharay Angulo; writing by Dave Graham; editing by Richard Pullin)

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