One step ahead

Ricardo Arredondo of Murillo Maldonado Arredondo y Asociados SC chats to Suzanne Starbuck about the challenges and frustrations of being a maritime lawyer in Mexico

DYMANIC and constantly changing is the best way to describe Mexico’s maritime industry. Recent years have seen Mexico’s port facilities, in particular, significantly improve with the arrival of new terminals and new equipment. Many would say Mexico’s ports still have a long way to go to rival their European and US counterparts but they have certainly come a long way of late.

Investment such as this can only be good news for the country’s lawyers and that certainly seems to be the case for Ricardo Arredondo of law firm Murillo Maldonado Arredondo y Asociados SC (MMA). Ricardo has spent his entire career in maritime law and is now a partner in the Mexico-City based firm he helped found. Today the firm offers a whole host of services to its clients from ship arrest and casualties to litigation and government contracts.

One of the areas Ricardo oversees is the incorporation of shipping companies. “Although this may seem simple, in accordance with the provisions established in Mexican legislation, it must comply with certain formalities and, even more importantly, it must comply with certain limits as to the participation of foreign capital, depending on the activity the company intends to carry out,” he says.

Keeping up-to-date with changing requirements in areas such as this is a constant challenge for Mexico’s lawyers and one in which there is still much ignorance, according to Ricardo. “It can often make it difficult to conclude business in a satisfactory manner or carry out a procedure before the Mexican courts,” he says.

One way in which MMA stays one step ahead of the competition is through its close relationship with the various bodies responsible for maritime matters in Mexico. For example, the firm has recently been involved in an extensive audit of the concessions, permits and authorisations granted over the last 20 years for the General Directorate of Ports. “Not only do we try to maintain close communication with our clients so we are aware of their needs, we also maintain a close relationship with the maritime and port authorities, which has proven to be of great help in providing assistance to our clients,” says Ricardo.

Given the extensive development of Mexico’s ports over recent years, it is hardly surprising that Ricardo and his firm are heavily involved in matters related to the rendering of port services as well as the construction, operation and exploitation of maritime terminals, particularly those involved in the distribution of liquefied gas in Mexico.

Mexico’s gas and oil industry is familiar territory to Ricardo and one market that is certainly feeling the pressure these days. In particular, government-owned Petróleos Mexicanos (PEMEX) is under fire from various political groups for not maintaining its infrastructure including over 36,000km of pipelines. “This has caused a series of accidents in various locations throughout the country putting the environment at risk,” says Ricardo. “PEMEX has considered investing approximately $8.8 billion to repair the pipeline network but it is a difficult task due to the fiscal regime the company is subject to.”

Given the threat posed by oil and gas-related activities to the environment, there is an initiative underway by the Chamber of Senators in Mexico to reform the General Law of Ecological Balance and Protection of the Environment as well as Article 27 of the Constitution, particularly the part that refers to the oil sector.

But initiatives are one thing, getting them approved is quite another. According to Ricardo, one of the ways in which maritime lawyers can help improve the maritime industry is to form discussion groups with specialists, academics and professionals from throughout the industry to exchange and share experiences and ideas from which initiatives might arise. Some years ago, this was almost achieved. A Special Commission of the Chamber of Representatives got together the leading players from the maritime industry to help identify the main problems facing the industry and come up with solutions on how to tackle them.

A number of initiatives were proposed including a new Navigation and Maritime Commerce Law and the Law for the Reactivation of the Mexican Maritime Marine. “This was designed to help solve the problem of cabotage traffic in Mexico, a large part of which is carried by foreign ships,” explains Ricardo. To date, however, these initiatives have not been approved. This can be frustrating given the expertise and experience maritime lawyers can bring to the table. For example, Ricardo spent a year with his previous firm setting up an office in Houston, Texas, primarily to provide consultancy services to companies interested in investing in Mexico’s maritime industry. Insight and knowledge such as this could well be called on in 2005 with one of Mexico’s largest banks, BBVA Bancomer, forecasting growth in the Mexican economy of 4.2 per cent, up from previous predictions of 3.8 per cent.

Despite political uncertainty in the country, Mexico’s financial institutions are encouraged by unexpectedly strong consumer demand, which could well mark a buoyant period for the maritime industry and it’s lawyers.