MEXICO Law and Practice Contributed by: Luis Álvarez Cervantes, Adolfo Athié Cervantes, Alejandro Barrera, Jesús Colunga, Eduardo Kleinberg, Juan José López de Silanes, Carlos Martínez-Betanzos and Amílcar Peredo, Basham, Ringe y Correa S.C.
• No minimum capital required by law; however, shareholders must subscribe the authorised capital in full within one year. • May be incorporated as a variable capital entity (SA de CV) for added flexibility in capital increases or reductions without amending the by-laws. • Governance is managed by a sole administrator or a board of directors. • Shareholders’ meetings are the supreme authority. Furthermore, if the company is seeking capital con - tributions while maintaining operational control, SA can adopt the modality of a Sociedad Anónima Pro- motora de Inversión (SAPI) which is more flexible for joint ventures and may allow the shares to be offered to the public if registered with the National Securities Registry. Suitability • Greenfield projects requiring growth and potential capital raising. • Holding companies for corporate group structuring. • Public companies, including those listed on the Mexican Stock Exchange. • Businesses with diverse shareholder bases or • Liability is also limited to capital contributions. • Requires at least two and no more than 50 mem - bers (partners). • No minimum capital required by law. • Capital is divided into equity quotas (not shares), which are not freely transferable. • May be also incorporated as a variable capital company (S de RL de CV). • Governance is conducted by one or more manag - ers. • Certain decisions require unanimous consent of the partners. Suitability • Joint ventures, where control over partner admis - sion is crucial. • Closely held companies or family-owned busi - nesses. • Entities with a limited number of partners seeking simplified governance. plans to attract investors. S de RL or S de RL de CV
Finally, the SAS ( Sociedad por Acciones Simplifi - cada ) is a company structure designed to simplify the incorporation process for micro and small busi - nesses. It allows one or more individual shareholders, with liability limited to their contributions. The regime establishes an administrative process with full legal effects, and the total annual income cannot exceed MXN7,398,448.74 (approximately USD407,000), which is updated annually. 3.2 Incorporation Process The main steps for incorporation are the following. Choice of Corporate Vehicle Both the SA and the S de RL offer limited liability and a flexible governance structure. Corporate Name Before incorporating a company, it is necessary to obtain a name authorisation permit from the Ministry of Economy, which typically takes between seven and 14 business days. Incorporation Procedure The process involves the following key steps: • drafting and approval of the by-laws; • issuance of a notarised and apostilled or legalised power of attorney by shareholders/partners for incorporation; • appointment of directors, managers, officers and statutory auditor (commissary); and • granting of powers of attorney for daily operations. Execution and Issuance of Articles of Incorporation and Post-Incorporation Obligations for Operation of Company Once all previous steps are completed, the notary will execute the articles of incorporation and proceed to register the company before (i) the Public Regis - try of Commerce, (ii) the Federal Taxpayers’ Registry (including obtaining a tax ID and tax e-signature), and (iii) the National Foreign Investment Registry. This stage may take between ten and 60 business days to complete.
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