MEXICO Law and Practice Contributed by: Fernando Hernández G., Elvia Ríos Saldaña, Ana Karen Inzunza Sánchez and Luis Andrés Estrada Intriago, Vázquez Aldana, Hernández Gómez & Associates (VAHG)
2. Corporate Management 2.1 Principal Bodies or Functions The General Shareholders’/Partners’ Meeting The general shareholders’/partners’ meeting has the maximum authority, with the ability to resolve all acts and operations of the company. The Mexican entities can be fully (100%) owned by foreign companies or individuals, except for the fol - lowing activities which are reserved for the Mexican State: petroleum, the national electricity system, nuclear energy, minerals, telegraphs, the post office, banknotes, minting of currency, airport control, ground transportation (excluding courier services), develop - ment banking institutions, provision of professional and technical services expressly indicated in legal provisions. Foreign investment may participate in any proportion in the capital stock of Mexican companies, acquire fixed assets, enter new fields of economic activity or manufacture new lines of products, open and operate establishments, and expand or relocate existing ones. The Management The management of the entity is entrusted to a man - ager (in the case of an S. de R.L.) or a director (in the case of an S.A.). Each entity must choose between a sole manager/director or a board of managers/board of directors. The managers/directors may be either Mexican or foreign nationals. It is important to note that the non-Mexican directors/managers who are hired and receive remuneration for the performance of their duties must hold an appropriate visa/work per - mit issued by the immigration authorities in Mexico. The Statutory Examiner or Board of Surveillance Figure The statutory examiner or board of surveillance figure, which supervises the management body, is manda - tory for an S.A., and optional for an S. de R.L. 2.2 Types of Decisions The General Shareholders’/Partners’ Meeting The general shareholders’/partners’ meeting has the authority to resolve all acts and operations of the company, including the exclusive authority to annu - ally approve the financial statements of the year prior,
as well as the appointment of the directors/managers and the statutory examiner in the case of an S.A.; also, the general shareholders’/partners’ meeting has the exclusive authority to approve the following by means of a special quorum (majority vote): • extension of the company’s duration; • anticipated dissolution of the company; • increase or reduction of capital stock; • amendment of the company’s purpose; • amendment of the company’s nationality; • transformation of the company; • merger with another company; • issuance of preferred shares; • redemption by the company of its own shares and the issuance of founders’ shares; • the issuance of bonds; • any other amendment to the by-laws; and • any other matter for which the law requires a spe - cial quorum of the shareholders’ meeting. Management The management of the entity has the authority to manage all the operations inherent to the company’s purpose, including the review of financial statements, the compliance of the company regarding tax regula - tions, and the granting or revoking of special authori - ties for specific acts on behalf of the company. The Statutory Examiner or Board of Surveillance The statutory examiner or board of surveillance has the authority to: • supervise that the board of directors/managers has granted the corresponding guarantee to secure their functions, when applicable; • make sure that legal and statutory requirements are met when the shareholders decree dividends; • verify that accounting records are accurately kept; and • ensure that resolutions are accurately recorded at shareholders’ meetings. Committees Lastly, the shareholders may include the possibility of creating committees which have specific authorities and functions. These are generally created to support
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