Proposal seeks to amend four constitutional articles to open YPFB to new private contracts

Bolivia’s energy crisis has revived a long-running question: can the Constitution be changed to attract investment without dismantling the state’s economic model? Constitutional lawyer Óscar Barrientos says it can, but only through a tightly limited reform.

Barrientos has presented the Legislative Assembly with a proposal covering four articles of the Political Constitution of the State: 320.II, 361, 362 and 366. The initiative focuses on hydrocarbons, arbitration and investment. Its stated aims include strengthening legal certainty, improving YPFB’s governance, allowing new forms of contracts, and creating oversight and transparency mechanisms.

The proposal comes as political forces promote constitutional changes on a much broader scale. Barrientos argues that Bolivia’s Constitution is rigid and cannot be substantially altered through an ordinary law or a partial reform. “We have a rigid Constitution, meaning it is not reformed through an ordinary law. (...) Trying to reform everything through a partial reform is technically not possible,” he said on the EL DEBER program Influyentes.

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We have a rigid Constitution, meaning it is not reformed through an ordinary law. (...) Trying to reform everything through a partial reform is technically not possible.

One of the most sensitive changes would amend Article 320 to allow international arbitration in large state contracts linked to strategic sectors. The proposal would exclude disputes involving sovereignty, state regulation and ownership of natural resources. Arbitration would apply only to financial or contractual disputes arising directly from contract execution. “We are talking about large-scale investments and strategic sectors. We will preserve the state model and the economic model in which natural resources continue to belong to the Bolivian people,” Barrientos said.

The plan also calls for YPFB’s president and executive director to be selected through public competitions based on merit and technical suitability. It would seek greater independence between the state oil company and its regulator. The source text ends while describing the proposal’s treatment of YPFB leadership.

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We are talking about large-scale investments and strategic sectors. We will preserve the state model and the economic model in which natural resources continue to belong to the Bolivian people.