(Updates with details, context)
MEXICO CITY, Feb 3 (Reuters) - Mexico's Supreme Court on Wednesday voted to uphold an antitrust challenge to federal measures seeking to strengthen the national power utility, the Comision Federal de Electricidad (CFE), which private companies say hurt their businesses.
The ruling is a setback for the administration of President Andres Manuel Lopez Obrador, who is trying to roll back the previous government's liberalization of the energy sector.
The Federal Economic Competition Commission (COFECE), Mexico's antitrust regulator, submitted the challenge to the court in mid-2020, shortly after the energy ministry issued new regulations giving the government more power over the electricity sector and benefit the CFE.
The policy modified rules on who can generate electricity and in what quantity, and set new rules for renewable power plants that private companies have since also challenged.
Lopez Obrador argues the last government's opening of the energy sector skewed the market in favor of private companies, and has cast the debate as a matter of national sovereignty.
However, his policies have upset some of Mexico's main allies, including the United States, Canada and European countries, and angered investors who believe the government is violating their rights under trade agreements Mexico signed.