Mexico ordered to pay $15.8 million in Vulcan Materials arbitration

An international arbitral tribunal has ruled that the Mexican government violated the North American Free Trade Agreement (NAFTA) by failing to provide fair and equitable treatment to the investments of Legacy Vulcan LLC. However, the final award issued by the International Centre for Settlement of Investment Disputes (ICSID) significantly limits the compensation to approximately $15.88 million, a figure representing less than 1% of the $1.7 billion originally claimed by the company.

The compensation specifically covers damages resulting from the closure of the El Corchalito site in the Riviera Maya, including $14.38 million for loss of business value and $1.5 million for drilling and blasting costs. The tribunal denied other claims, such as those regarding the La Adelita site, port fees at Punta Venado, and double taxation.

The Mexican government has released the final award to the public, urging a direct reading of the text rather than the interpretation provided by Vulcan Materials. Mexican authorities emphasized that only one of the company's claims was found to be incompatible with NAFTA and rejected any suggestion that the ruling impacts broader investment relations between Mexico and the United States.