What Mexico's Water Reform Took Away From Industrial Concession Holders

In short

Mexico's water reform of December 2025 is being read as a water-scarcity measure. For a foreign manufacturer holding a national water concession, it is something more specific: the clause that protected your invested capital was deleted, the window to renew was cut nearly in half, and the standard your renewal will now be judged against does not yet legally exist.

Start with the news, because it points the wrong way

On 15 July 2026 CONAGUA published an Acuerdo opening the first stage of a program to regularize expired water concession titles. It has been covered as relief for water rights holders.

Read the text and the program does not reach a manufacturing plant. It covers only domestic, urban public, agricultural, livestock and aquaculture use, and only three categories of holder: irrigation districts, irrigation units and ejidos; states and municipalities that directly provide water supply; and individuals, up to one million cubic metres per year. It expressly carves out agro-industrial volumes.

Several summaries describe the Acuerdo as “excluding industrial use.” It does not exclude industrial use. Industrial use was never within its subject matter, and a sociedad is not among the eligible holders. Two independent reasons, either one sufficient. There is no exception to argue.

That matters mainly because it sends plant operators looking in the wrong place. The provisions that actually changed their position are in the December 2025 amendments to Article 24 of the Ley de Aguas Nacionales.

1. The renewal window was cut from five years to three

Before: an extension had to be requested “within the last five years prior to the end of its term, at least six months before its expiry.”

As amended on 11 December 2025: “between the three years prior to the end of its term and six months before its expiry.”

For a title expiring on 30 June 2030, the window now opens on 30 June 2027 and closes on 30 December 2029. Under the previous rule it would have opened on 30 June 2025.

The sanction did not change and is absolute: “Failure to file the request referred to in this Article within the established period shall be deemed a waiver of the right to request the extension.”

2. The investment-recovery protection was deleted

This is the change that should concern a capital-intensive operator, and it has gone almost unremarked.

The prior text read: “In deciding on the granting of the extension, consideration shall be given to the full recovery of the investments made by the concessionaire.”

That clause is gone. In its place: “In deciding on the characteristics of the granting of the extension, consideration shall be given to water responsibility and to compliance with obligations regarding payment of water duties.”

Two things moved at once. The criterion changed — from protecting the holder's sunk capital to assessing water conduct and duty payments. And its object changed: where it previously informed whether the extension was granted, it now informs the characteristics of the grant.

For a plant whose water title underwrites a nine-figure capital investment, deleting an express instruction to consider recovery of that investment is not a drafting refinement.

3. The standard you will now be judged against has not been defined

Article 24 now turns on responsabilidad hídrica — water responsibility — a concept defined in Article 3, section XLV BIS of the Law.

But the decree's own Seventh Transitory Article instructs the water authority to regulate the sources, criteria and procedures by which it will be identified what constitutes “responsible water management” and what “good practices” mean on the part of concessionaires.

The legislature created the standard and instructed the authority to define it. That definition has not been issued. Applications filed today are decided against a criterion whose content is pending regulation.

4. The notification rule was rewritten — but administrative silence still means denial

The prior final paragraph of Article 24 did four things: it obliged the authority to notify personally; it cross-referenced Article 35 of the Ley Federal de Procedimiento Administrativo (LFPA); it stated that if the authority failed to communicate its resolution the request would be deemed denied; and it noted that failure to resolve could trigger liability for the responsible public servants.

The amended paragraph is shorter. The authority will notify personally “or through electronic means provided by the applicant,” within the period set by Article 22. The other three elements are gone from the text.

That does not mean silence has become meaningless. It is worth being precise here, because the opposite reading is circulating:

• CONAGUA is an administratively decentralised body — órgano administrativo desconcentrado — of the Ministry of Environment (Articles 3.XII and 9 of the Ley de Aguas Nacionales), and therefore part of the centralised federal public administration.

• Article 1 of the LFPA applies that law to the acts, procedures and resolutions of the centralised federal public administration. Water is not among the excluded subject matters. Article 2 of the LFPA adds that it applies supplementarily to the various administrative laws. Two independent routes to the same place.

• Article 22 of the Ley de Aguas Nacionales sets the applicable deadline: the authority must answer applications within sixty business days from filing, provided the file is duly complete. The amended Article 24 still expressly refers to “the period established in Article 22.”

• Article 17 of the LFPA provides that, once the applicable period elapses, “resolutions shall be understood in a negative sense to the applicant,” unless another general provision states otherwise. That is negativa ficta, and it can be challenged before the Federal Administrative Justice Court.

So the mechanism survives. What the reform removed from Article 24 is the express restatement of it, the procedural cross-reference, and — this one has no equivalent elsewhere in the article — the express note on public-servant liability for failing to resolve.

Two practical cautions.

The sixty-day clock runs from filing “and once the file is duly complete.” That condition is where the authority has room to move, and it deserves attention in how an application is assembled and documented.

And configuring silence is not the end of the analysis — which is where who you filed with becomes decisive.

A Mexican federal collegiate court has held that even where the three elements of negativa ficta are formally satisfied — a written filing, silence, and elapse of the legal period — it does not follow that the silent authority was materially competent to decide the merits. Competence, the court reasoned, is an indispensable element of validity of any act of authority, within the legal-certainty guarantee of Article 16 of the Constitution. Where deciding the matter fell outside the authority's powers, the negativa ficta is lawful and the challenge fails.

Read the other way round — and this is our reading — the proposition is the operative one for a concession holder: where the silent authority was competent to decide and failed to do so, the resulting negativa ficta does not satisfy Article 16, and the applicant can take it to the merits. Competence is what converts institutional silence from an obstacle into a reviewable act.

That turns a doctrinal point into a filing instruction. The July 2026 Acuerdo itself distributes functions among the Subdirección General de Administración del Agua, the Organismos de Cuenca and the local offices. Filing before the wrong unit does not merely delay the matter; it can leave the applicant with silence that is lawful and therefore unassailable on the merits. Identifying the competent authority before filing is not a formality — it is what preserves the remedy.

Isolated thesis I.8o.A.114 A (10a.), digital registry 2015440, Eighth Collegiate Court in Administrative Matters of the First Circuit, Gaceta del Semanario Judicial de la Federación, Book 47, October 2017, Vol. IV, p. 2503. An isolated thesis is persuasive authority, not binding precedent.

A 2025 law applied through a 2014 regulation

The decree's First Transitory Article for the Ley de Aguas Nacionales required the corresponding regulatory provisions to be issued or amended within 180 calendar days of entry into force. The decree was published on 11 December 2025 and entered into force on 12 December 2025. That deadline fell on 10 June 2026.

It was missed, and the point is sharper than a missed deadline. The Reglamento de la Ley de Aguas Nacionales currently in force was issued in 1994 and last amended on 25 August 2014. As of 13 August 2026 — 64 days past the deadline — a law substantially rewritten in December 2025 is being administered through regulations last touched eleven years before the reform they must now implement.

The Second Transitory Article provides that, until that framework is issued, “the provisions in force before the entry into force of this Decree shall continue to apply, with the exception of transfers and changes of use.” The reach of that grace period is a live question. The carve-out is not: transfers of rights and changes of use are governed by the new regime immediately.

Two further dates have already passed: the reassignment mechanism in new Articles 37 BIS 1 and 37 BIS 2 became applicable 180 calendar days after publication — 9 June 2026 — and CONAGUA had six months from publication to make regulatory adjustments and design the procedure for reassignment requests.

The transitional rule that protects filings, not deadlines

The Third Transitory Article provides: “Procedures pending resolution by the National Water Commission at the time of publication of this Decree shall be resolved under the rules in force at the time they were filed.”

A request already filed before 11 December 2025 is decided under the old rules — including the old investment-recovery criterion.

But note what it does not say. It protects filings already made. It says nothing about a holder who had not yet filed and was sitting inside the old five-year window — four years from expiry, say, intending to file the following year. That holder was inside the window on 10 December 2025 and outside it on 12 December 2025, with no transitional provision addressing the change.

The decree protects procedures already begun. It does not protect windows already open.

And a deadline running right now, unrelated to use or holder type

Article EIGHTH of the July 2026 Acuerdo reaches beyond the regularization program itself.

CONAGUA must publish on its website a list of pending resolutions awaiting notification — on procedures filed before 12 December 2025 that had not been served. Under the Acuerdo's Third Transitory Article that list is due within 30 calendar days of entry into force: 16 July 2026 plus 30 days is 15 August 2026.

Once published, affected users have 90 calendar days to appear in person to be served. After that, notification is effected by estrados — posting on the authority's physical and digital boards, due by 14 September 2026.

Service by estrados is valid service. It starts appeal clocks. A company with a water filing pending since before December 2025 can be legally notified of an adverse resolution without anyone at the plant seeing it. This provision is not limited by use or holder type.

What to do

1. Recalculate your window. Three years before expiry to six months before. If your calendar was built on the five-year rule, it is wrong.

2. Check for anything on file with CONAGUA from before 11 December 2025. It is decided under the old rules — and it may be on the pending-notifications list due on or before 15 August 2026.

3. Get current on water duties and be able to prove it. Under the amended Article 24 this feeds the extension decision itself.

4. Assemble the file to be complete on filing. The sixty-business-day clock depends on it.

5. Document actual use. Metering and evidence of extraction now sit at the centre of the regime; the decree separately instructs CONAGUA to promote an official standard on measurement systems.

6. Treat transfers and changes of use as already governed by the new rules. They are the express exception to the transitional grace period.

What remains open — stated plainly

The Reglamento in force dates from 1994 and was last amended in August 2014; no post-reform version has been issued. Nor has the regulation defining responsabilidad hídrica. Until both exist, the criterion governing extension decisions has no published content, and the reach of the Second Transitory Article's grace period is open to argument.

We would rather say that than pretend the framework is settled.

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