Trucking Industry Urges Government to Rescind Operating Permit for Subsidiary of U.S.-Based Carrier

SourceMex Economic News & Analysis on Mexico, November 1, 2000 | Go to article overview

Trucking Industry Urges Government to Rescind Operating Permit for Subsidiary of U.S.-Based Carrier


The Mexican trucking-industry chamber (Camara Nacional del Autotransporte de Carga, CANACAR) has launched a campaign to force President Ernesto Zedillo's administration to rescind a permit for US-Mexican trucking company Transportes EASO, which may be operating in Mexico in violation of the North American Free Trade Agreement (NAFTA).

CANACAR contends that EASO, a subsidiary of US-based MS Carriers, should not be allowed to conduct domestic cargo operations because a clause in NAFTA reserves these activities for Mexican companies.

US trucking companies Schneider National and Celadon Group have also established subsidiaries in Mexico, but almost all their shipments are destined for export.

In contrast, EASO ships more than 85% of its cargo between Mexican cities, making the company the principal target of the CANACAR protests.

"We are requesting the immediate revocation of permits awarded to Transportes EASO SA de CV for providing services reserved exclusively for Mexicans," CANACAR said in an open letter published in Mexican newspapers in early October.

The letter also objected to the Zedillo administration's use of "neutral investment" to circumvent Mexico's foreign- investment laws. Under this scheme, foreign companies are allowed to invest in some areas of the economy that traditionally have been restricted, as long as the foreign investors do not gain a controlling interest in a company.

Truckers block highways to press demand

As part of its campaign to pressure the Zedillo administration to take action against EASO, CANACAR organized a protest on Oct. 24 in which more than 200 truckers partially blocked traffic on five major highways in Mexico. CANACAR president Miguel Quintanilla said the protest was a success because it brought national attention to the organization's complaints.

"We really had coverage in all major media outlets," said Quintanilla. "That's what we were looking for, to show the public that authorities have not responded to our requests."

Quintanilla said CANACAR was considering a number of options to further pressure the Secretaria de Comunicaciones y Transportes (SCT) and the Secretaria de Comercio y Fomento Industrial (SECOFI). These options include the possibility of legal action against EASO.

Deputy transportation secretary Aaron Dychter said CANACAR has promised not to organize any more blockades or slowdowns on highways, at least in the near future. "I understand they are going to take the legal route until they either obtain satisfaction or exhaust all options," Dychter told the daily business newspaper El Financiero.

Group also seeks end of US restrictions on Mexican trucks

CANACAR's complaint against EASO is closely related to the US government's refusal to meet its commitments under NAFTA to open its borders to Mexican trucks. …

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