Clarifications regarding the suspension of non-essential activities

In the evening edition of the Federal Official Gazette of April 6, 2020, they were published the technical guidelines related to the activities described in paragraphs (c) and (e) of section II of article 1 of the agreement setting forth extraordinary actions to address the health emergency generated by the SARS-CoV2 virus.

As you may recall, on March 31, 2020, the aforementioned agreement was published, setting forth measures to address the health emergency we are facing. These measures included, among others, the immediate suspension of non-essential activities from 30 March (sic) to 30 April 2020.

Within the list of essential activities, there was section II, whose sections c) and e) set forth as follows:

c) Those of the fundamental sectors of the economy: financial services, tax collection, distribution and sale of energy, gas stations and gas, generation and distribution of drinking water, food and non-alcoholic beverages, food markets, supermarkets, self-service stores, grocery stores and sale of prepared foods; passenger and cargo transport services; agricultural, fishing and livestock production, agro-industry, chemical industry, cleaning products; hardware stores, courier services, guards in private security work; day care centres and children’s homes, nursing homes and homes for the elderly, shelters and care centres for women victims of violence and their children; telecommunications and the media; private emergency services, funeral and burial services, storage and cold chain services for essential supplies; logistics (airports, ports and railways), and activities whose suspension may have irreversible effects on their continuation;

e) Those necessary for the conservation, maintenance and repair of critical infrastructure that ensures the production and distribution of essential services, namely: drinking water, electric power, gas, oil, gasoline, turbosine, basic sanitation, public transportation, hospital and medical infrastructure, among others that could be listed in this category.

In terms of the technical guidelines published on April 6, three essential points are clarified.

a) With respect to “activities whose suspension may have irreversible effects for the continuation”, it is clarified that these activities should be understood as steel, cement and glass production companies, and information technology services that guarantee the continuity of information systems in the public, private and social sectors.

Steel, cement and glass production companies shall maintain a minimum activity that avoids irreversible effects on their operation and shall follow the procedure established in the second transitory article of the guidelines before the Ministry of Economy for such purposes.

On the other hand, it is set forth that the steel, cement and glass production companies that have in force contracts with the Federal Government will continue the activities that allow them to comply with the short-term commitments exclusively for the Dos Bocas, Tren Maya, Felipe Ángeles Airport and Transísmico Corridor projects; and the existing contracts considered as indispensable for Petróleos Mexicanos and the Federal Electricity Commission (Comisión Federal de Electricidad).

b) With respect to courier services, it is set forth that they include electronic commerce companies and platforms, as long as they comply with the health practices issued by the health authority; and

c) In relation to the activities necessary for the conservation, maintenance and repair of the critical infrastructure that ensures the production and distribution of indispensable services, it is clarified that the coal mines and the distribution companies will maintain a minimum activity that satisfies the demand of the Federal Electricity Commission and shall follow the procedure established in the guidelines before the Ministry of Economy for such purposes.

We invite our clients and business partners to contact any of our partners or associates to specifically analyze the scenario in which their companies and/or workplaces are facing in order to determine whether the immediate suspension of their activities is appropriate because they are not considered essential, and additional legal implications in labor and real estate leasing matters.

Sincerely,

Cannizzo, Ortiz y Asociados, S.C.