US Requests Labor Review at Mine Owned by Mexican Billionaire

The US is asking a panel to review a labor dispute at a mine in Mexico owned by billionaire German Larrea.

(Bloomberg) — The US is asking a panel to review a labor dispute at a mine in Mexico owned by billionaire German Larrea.

US Trade Representative Katherine Tai in June had asked Mexico to review whether employees at a Grupo Mexico SAB mine in Zacatecas were being denied the right of free association and collective bargaining. 

Mexico had a 45-day review period and found no denial of rights, according to a USTR statement released Tuesday.

“The US disagrees with this determination,” it said, and is asking for a panel to review the situation. It’s the first time ever the US has requested a Rapid Response Labor Mechanism panel under the US, Mexico, Canada free trade agreement (USMCA), the USTR said.

Grupo Mexico said the panel review will prove that the company hasn’t violate labor rights at the mine and that it hasn’t prevented its workers from having “decent work and to join the union of their choice”.

The company, owned by Larrea, also operates railroads throughout Mexico. In May, the Mexican government seized a section of its freight railway, ultimately prompting Larrea to scrap a bid to buy one of the country’s biggest retail banks from Citigroup Inc. 

Larrea is worth $31.4 billion, according to Bloomberg’s Billionaires Index. Mexico’s Economy Ministry did not immediately reply to a request for comment.

The USTR in June said it had received a request from unions in the US and Mexico alleging Grupo Mexico had resumed operations at the San Martin mine despite an ongoing strike. The company also engaged in collective bargaining with a workers’ coalition even though a different union holds the right to represent workers, according to the request.

Grupo Mexico said in the statement that there’s no strike going on and that mining workers want to continue operating.

Back in June, Tai directed the Treasury Secretary to suspend the final settlement of customs accounts related to the entries of goods from San Martin’s lead, zinc and copper mine.

–With assistance from Amy Stillman and Eric Martin.

(Updates with Grupo Mexico response in fifth and ninth paragraphs.)

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