Mexico, Agreements, Flexible Terms

The Unforeseeable Event

In January 2010, Mexico City added articles 1796 Bis and 1796 Ter to its Civil Code. They introduced the teoría de la imprevisión, the doctrine of the unforeseeable event. When an extraordinary and unforeseeable event upsets the conditions of a contract, a party “tiene derecho de pedir la modificación del contrato,” has the right to ask for the contract to be changed.

The request does not by itself allow the party to stop performing. The party who asks for the change may go to a judge to settle the dispute. A change does not apply to what was delivered before the event. According to a UNAM law journal, twelve states, among them Jalisco, the State of Mexico and Veracruz, already had the doctrine.

I Owe, I Do Not Deny It

El Barzón began in August 1993 in Jalisco, as a movement of debtors who could no longer pay their bank loans. Jalisco farmers proposed the name from a revolutionary corrido about sharecroppers and peons who were always in debt to the landowner. A barzón is the leather strap that joins the yoke to the plow.

The movement’s first slogan was Debo no niego, pago no tengo, “I owe, I do not deny it, I have nothing to pay with.” It later became Debo no niego, pago lo justo, “I owe, I do not deny it, I pay what is fair.” The debtors offered to pay the capital and the interest first agreed, but not the interest for late payment.

When Economic Circumstances Justify It

Article 426 of Mexico’s Federal Labor Law allows unions or employers to ask the labor courts to change the working conditions set in a collective contract. The grounds are economic circumstances that justify it, or a rise in the cost of living that upsets the balance between capital and labor. The request is handled as a collective conflict of an economic nature.

The Pipeline Contracts

In February 2019, Manuel Bartlett, director of the Federal Electricity Commission (CFE), questioned the contracts that the commission had signed for gas pipelines. The companies included Grupo Carso, TransCanada and IEnova. Negotiations began in July.

On August 27, 2019, at the president’s morning press conference, with Carlos Slim present, the government announced an agreement. Tariffs fell by roughly 19 to 38 percent. In return, some companies received higher volumes or longer terms, up to 30 years instead of 20. The government said the deal saved 4.5 billion dollars.

The Economic Solidarity Pact

On December 15, 1987, the government of President Miguel de la Madrid, the labor movement and business signed the Pacto de Solidaridad Económica, the Economic Solidarity Pact. Fidel Velázquez signed for labor and Agustín Legorreta for business.

The pact did not stay as signed. A second phase began in March 1988, with a wage increase of 3 percent. The pact was extended to November, and a fourth stage followed the president’s report of September 1, 1988. Under President Carlos Salinas, the government reinforced it with the PECE.

Minutes of Tolerance

The working conditions of Mexico’s Supreme Court grant its staff “una tolerancia de quince minutos,” a tolerance of fifteen minutes, after the start of the working day. Four ordinary late arrivals in a month cost half a day’s pay.

The Mexico City government’s working conditions of 2010 give ten minutes. An arrival up to minute 20 is a minor delay, and up to minute 30 a serious one. After minute 30, the employee may work only with the supervisor’s permission.

A Little Cheaper

¿No me lo deja más barato? “Won’t you let me have it a little cheaper?” Shoppers ask it at Mexican markets and tianguis, the open-air street markets. In 2026, TV Azteca Jalisco traced the custom of haggling to the markets of pre-Hispanic times. It said that the request also creates a bond between seller and customer.

Payment Deferrals

On March 25, 2020, Mexico’s banking regulator, the CNBV, announced that banks could defer payments of capital, interest or both for up to four months, with a possible extension of two more. The measure covered mortgages, consumer loans, credit cards and business loans that were current at the end of February 2020 and whose borrowers had lost income.

According to a CNBV study, deferred business loans made up 16 to 17 percent of the business loan portfolio between March and June 2020.

Postpone the Rent

On March 27, 2020, Claudia Sheinbaum, head of government of Mexico City, asked landlords to postpone the rent of tenants with lower incomes. “Es el llamado a la solidaridad con personas que tienen menores ingresos,” she said, a call for solidarity with people who have lower incomes. She compared the request with the banks, which had postponed payments by four months.

The request had no legal force.

Not in a Position to Pay

On August 20, 1982, Finance Secretary Jesús Silva Herzog told the international financial community that Mexico “ya no estaba en condiciones de cubrir el servicio completo de su deuda externa,” was no longer in a position to cover the full service of its foreign debt. Earlier that month, the Bank of Mexico had only 180 million dollars left, against about 300 million dollars falling due within days.

According to the historian Carlos Marichal, of El Colegio de México, Mexico did not formally suspend payments. Its first moratorium lasted about six months, until January 1983.