Updated for Relevancy: November 13, 2024

Over the last decade, there’s been a renaissance taking place of manufacturing in Mexico. Changes in free trade agreements and regulations have created a friendly business climate, providing benefits such as highly skilled, low-cost workers, decreased shipping costs, and greater oversight—all of which resulted in an American manufacturing diaspora from China.   Seeing this steady tide of foreign businesses transitioning their operations, Mexican officials have been forced to take all necessary precautions to ensure that such businesses are a boon.

In response to the widespread fear that further manufacturing would only exacerbate the country’s existing environmental issues, various measures have been taken, like levying stiff penalties or revoking permits, to dissuade businesses from acting irresponsibly. As a result, if you’re considering moving your business beyond the border, it’s crucial that you are following Mexico’s environmental regulations. To that end, below, you’ll find an overview of the various Mexican environmental regulations that are placed on the many international and U.S. companies doing business in Mexico.

Mexico Environmental Regulations

The North American Free Trade Agreement (NAFTA) marked a noticeable change in trade relations, particularly between America and Mexico. Many American manufacturers saw that Mexico provided them a place where they could pay much lower costs in labor and circumvent America’s stricter environmental laws.

Mexican officials soon realized they were facing a dilemma. On one hand, this infusion of foreign investment could not only stimulate the dragging economy but transform it into a manufacturing powerhouse; on the other hand, it would lead to even more environmental degradation. Fearing the impacts this would have on both the citizenry and the country itself, Mexican officials scrambled to make Amendments to their constitution in the form of LGEEPA.

LGEEPA

The foundation of Mexico’s environmental regulations was enacted in 1988 with the General Law on Ecological Equilibrium and Environmental Protection (LGEEPA). This amendment to the constitution gave congress the power to create environmental laws for federal, state, and local authorities. It laid out the framework for all environmental law in Mexico, particularly those related to manufacturing. One of its stated purposes was:

To prevent and control pollution generated due to the exploitation of those substances not reserved to the Federation constituting deposits having nature similar to the components of lands, such as rocks or products of their breaking down, which may only be used to manufacture materials for construction or ornament of works. 

This law sought to address a broad swath of environmental matters of concern, including:

• Water resources and pollution
• Ground pollution
• Air pollution
• Environmental enforcement

To that end, the Secretariats of Commerce, Industrial Development, and Health set out standards for manufacturers to follow, including dictating measures on packaging and materials that reduced solid waste production. In addition, there were several other steps they took:

• Increased the environmental enforcement budget from $5bn USD to $75bn USD.
• Drastically increased the number of environmental inspectors at the border.
• Increased environmental compliance inspections exponentially.
• Closed more than 2,000 facilities that were found in noncompliance.

1992 LGEEPA Amendment

The next set of environmental challenges in Mexico involved an amendment to the original law, seeking to give local authorities the power to enforce the regulations. Key regulations that were addressed and still apply today include:

• Air Pollution – Every source of air pollution requires regulation. Further, manufacturing sites, no matter their municipality, fell under federal jurisdiction should they fail to comply. It also requires stationary sources of air pollution such as manufacturers to acquire an operating license for emissions.

Today, if you have a manufacturing or industrial facility, you are required to abide by atmospheric air quality standards by staying below Maximum Permanent Levels as stated by the U.S. EPA’s National Ambient Air Quality Standards. This includes maintaining respectable levels for the six principal pollutants:

• Carbon monoxide
• Lead
• Nitrogen Dioxide
• Ozone
• Particle Pollution
• Sulfur Dioxide

• Water Pollution – The National Waters Law delineated the roles and responsibilities of the National Water Commission (CNA) would perform on behalf of the federal government. In regard to manufacturing, the law sought to regulate:

• Wastewater discharge by factories, whether in cities or agricultural practice.
• The use of toxic material at manufacturing facilities.
• The use of pesticides, fertilizers, or other toxins.
• Discharge ending up in aquifers.
• Solid waste removal.

Currently, those manufacturers who violate these rules could then be found in breach of permit and then fined for damages.

• Hazardous Waste – Mexico’s environmental regulations pertaining to hazardous waste emulated American policy. To that end, a manufacturer must adhere to the following:

• Provide an ecological waybill to document the shipment’s contents and destination.
• Store waste and raw materials according to INE’s regulations.
• Obtain a generator’s license and number from the Attorney General if you produce unsafe waste.
• Maintain a permanent record of all hazardous resources on the grounds and then report those findings every two years with environmental officials.

SEMARNAP

In 1997, the main federal agency responsible for the regulation of Mexican environmental law, the Secretariat of the Environment, Natural Resources, and Fisheries (SEMARNAP) was formed. Like the EPA, this regulatory body set out to ensure that all environmental laws were being followed and enforced. In order to better enforce its policies, it was split into five decentralized departments:

1. National Water Commission (CAN)
2. National Institute of Ecology (INE)
3. Federal Agency for the Protection of the Environment (PROFEPA)
4. National Institute of the Fishery (INP)
5. The Mexican Institute of Water Technology (IMTA)

Together they form SEMARNAP, and their main roles include:

• Setting official standards for sustainable development programs.
• Implementing and compelling environmental standards and laws.
• Overseeing the use and supply of renewable and non-renewable natural resources.
• Protecting and conserving natural resources.
• Granting licenses, permits, and authorizations.

Mexican Statues and Official Norms (NOMS)

Over time, Mexico has released several statutes meant to supplement LGEEPA. These include:

• National Waters Law
• General Law on Climate Change
• General law on the Prevention and Comprehensive Management of Waste
• Federal Law on Environmental Liability
• The Law of Dumping in Mexican Marine Areas
• Law of the National Agency of Industrial Security and Environmental Protection for the Hydrocarbon Sector

In addition, there are voluntary standards, known as Mexican Official Norms (NOMs) which can be used by manufacturers as guidelines. According to Practical Law:

NOMs are technical standards issued by competent administrative bodies. They set out binding specifications, standards, values and characteristics applicable to any products, processes, facilities, systems, activities, services or methods of production. NOMs set out maximum allowable pollutant limits for contaminants in the air, water and soil, and list hazardous waste, substances, and endangered species.

Mexican Environmental Regulations

If your business is moving to Mexico, there are several rules you’ll need to respect to ensure compliance with local environmental laws. This includes taking the following actions:

• EIA – Any manufacturing business being established in the country for the first time will need to apply for an Environmental Impact Authorization.
• Waste Regulation – Your waste output, particularly hazardous waste, is of great concern. How much action needs to take place depends on the annual volume generated, but you will likely need to:
  • Identify and classify the wastes;
  • Register as a generator with the authority;
  • Register a waste management plan with SEMARNAT or the competent authority;
  • Handle the waste in compliance with legal provisions regarding temporary storage, labeling, containers, and internal logbooks; and
  • Retain companies authorized by SEMARNAT or the competent authority for the transportation, treatment and final disposal.
• Wastewater – Your business must categorize any manufacturing processes that generate wastewater and then see if that exceeds the maximum discharge limit.
• Air Pollution – You must identify the emissions your manufacturing hub releases into the air and comply with maximum permissible limit regulations.
• Documentation – Depending on your business, you may be required to acquire the following authorizations or documentations:
  • Environmental Impact Studies
  • Operating License
  • Hazardous Waste Generator’s Manifest
  • Waste Water Discharge Registration
  • Ecological Waybills for the Importation and/or Exportation of Hazardous Materials and Wastes
  • Monthly Log of Hazardous Waste Generation
  • Treatment or Final Disposition
  • Semi-annual Report on Hazardous Wastes
  • Accidental Hazardous Waste Spill Manifest
  • Delivery, Transport, and Receipt of Hazardous Wastes Manifests

Penalties

Failure to comply with the various rules and regulations or proof of environmental negligence can result in any of the following consequences:

• Monetary fines
• Repair of damage
• Shut down of your facility
• Destruction of your facility
• Government seizure of your facility
• Seizure of toxic materials
• Jail time

Complying with Environmental Regulations in Mexico

Taking all the necessary precautions and steps to meet Mexican manufacturing compliance regulations, particularly environmental regulations, is no simple task. Depending on your specific manufacturing niche, there may be dozens of rules or manufacturing requirements that are particular to your business. Therefore, as you make this operational transition to a foreign country, you’re going to need help in navigating the convoluted system of laws and regulations.

NAPs provides a host of services, including:

• Obtaining relevant permits
• Controlling and disposing of hazardous waste
• Obligatory environmental reporting
• Internal audits to prepare for governmental audits
• Consultation about both current and new environmental laws
• Training and educating employees about environmental impact

There’s no need to navigate the changing landscape of Mexico’s manufacturing business alone. When it comes to environmental regulations, the team of experts at NAPS has you covered.