Framework Law on Sectoral Authorizations | Four fundamental pillars

The first pillar addresses one of the greatest sources of uncertainty and cost in project development: discretion in processing times.

The LMAS establishes rules for the classification of authorizations and, fundamentally, imposes mandatory maximum deadlines for administrative bodies to issue their rulings.

These deadlines are not mere suggestions; they are legal obligations whose compliance is reinforced by a system of incentives and penalties for officials. The law links compliance with these deadlines to the performance bonuses of public officials and imposes financial penalties in the event of unjustified delays, thus seeking a cultural change in the administration.

The mechanism for closing this pillar is positive administrative silence. If the authority does not resolve a request within the legally established deadline, the project owner can invoke silence, which means that the authorization is understood to be granted for all legal purposes.

To facilitate this process, the new Unified Sectoral Permit Information System will automatically issue a certificate at the request of the interested party, providing reliable proof of approval. This gives companies a powerful tool to combat bureaucratic inertia and demand compliance with the law.

AETs modify the fundamental logic of the permitting system. Instead of requiring explicit prior authorization from the authority, certain projects or activities may be enabled by simply submitting an affidavit or notice. Legally, these techniques have the same effect as a traditional permit.

It is crucial to understand that, although the law establishes ATEs as the “general rule” for the future, their implementation is gradual and, for now, only replaces specific authorizations in expressly modified regulatory bodies, such as the Health Code and the Water Code.

This pillar represents a calculated transfer of risk and responsibility from the public to the private sector. By submitting an affidavit, it is the company, and not the State Administration agencies, that certifies full compliance with applicable regulations.

Any error, omission, or falsehood in such a declaration may result in severe penalties, including project shutdown and fines. Therefore, the rigor of internal verification and due diligence processes must be greater than that previously carried out by the authority itself.

The third pillar introduces two tools designed to attract and protect investment in larger and more complex projects.

• Streamlined Processing of Strategic Investment Initiatives: The law creates a procedure for certain projects to be declared “strategic investment initiatives.” Those that obtain this designation will benefit from a 50% reduction in the processing times for all their sectoral authorizations. This mechanism, which will take effect 14 months after the law is published, will be highly sought after. Obtaining this designation will likely require not only technical and economic soundness, but also a public affairs strategy that demonstrates the project’s alignment with the government’s development priorities.
• Regulatory Stability for 8 Years: This is a powerful risk mitigation mechanism. For projects with a favorable RCA, this regime allows all sectoral authorizations to be governed by the regulations in force on the date they entered the Environmental Impact Assessment System (hereinafter, “SEIA”). This “freeze” on the applicable regulations lasts for 8 years, protecting complex and long-term projects from being affected by regulatory changes that could make them more expensive or unfeasible halfway through. This regime, which comes into effect after 6 months, provides unprecedented certainty that will be a key factor in financial modeling and obtaining financing for large projects.

To orchestrate this complex system, the LMAS creates a new institutional framework. The Office of Sectoral Authorizations and Investment, a new public service, and the Committee on Sectoral Authorizations and Investment, a high-level coordination body, are established.

The role of these entities is to supervise, coordinate, and promote the new regulatory framework across all the services involved. The President of the Republic has one year to issue the Decree with Force of Law establishing the structure and operation of the new office.

The effectiveness of this new institutional framework is critical to the success of the reform. An office with real resources and authority could be a key ally in resolving inter-sectoral conflicts and ensuring the proper operation of the system.

Conversely, a weak institutional framework could become an additional layer of bureaucracy. The practical success of tools such as administrative silence will depend directly on the proper functioning of digital platforms and the coordination capacity of this new office.