Mexico’s foreign investment framework is governed primarily by Mexico’s Foreign Investment Law.  As a general rule, this Law allows foreign investors to own and control Mexican companies.  There are, however, certain industries in which foreign investment is prohibited or restricted for national security or strategic reasons.

The most common types of corporate entities used by foreign and national investors in Mexico are the Sociedad Anónima or “S.A.”, which is similar to the U.S. Corporation, and the Sociedad de Responsabilidad Limitada or “S. de R.L.”, which is similar to a U.S. limited liability company.

Other, perhaps more specialized, types of legal entities include: (a) the Sociedad Anónima Promotora de Inversión or “SAPI”, which is similar to an S.A. but with more flexible corporate and economic rights; (b) the Sociedad Anónima Búrsatil or “SAB”, which are entities that issue shares listed in the Mexican stock Exchange; and (c) the Sociedad Anónima Promotora de Inversion Búrsatil or “SAPIB”, which is a SAPI capable of issuing shares to be listed on the Mexican Stock Exchange.

This legal framework is attracting new foreign investors or larger investments from existing ones. For instance, the following foreign investors made the following announcements last September:    

  • Audi - Will invest US$1.3 billion.
  • General Motors de México – Will invest US$215 million.
  • Nissan Mexicana – Will invest US$150 million.
  • Mazda - Will invest US$500 million.
  • Ternium - Will invest US$1.1 billion.
  • Cal-Comp Electronics, a maquila company from Taiwan – Will invest US$60 million.
  • Delta Air Lines and Grupo Aeroméxico – Will invest US$50 million.
  • American Airlines – Will close 2012 with growth above 10% in passenger movement in Mexico.

While the legal framework may be foreign investor friendly, American investors shall exercise proper judgment and consult with an attorney capable of seeing, understanding and navigating through the restrictions, complexities and interplay of U.S., Mexican and international laws.