MEXICO Law and Practice Contributed by: Fernando Todd, Mariana Todd, Jorge Garcia and Silvia Alanis, Todd
taxes on the same income in two different jurisdic - tions. 4.3 Transfer Tax and Capital Gains on the Sale of Mining Projects In Mexico, the transfer or sale of a mining project is subject to taxation, specifically income tax. The tax is mainly levied on gains on the disposal of assets – ie, when a mining project is sold or transferred, any resulting capital gain is subject to income tax. Certain deductions and adjustments may be allowed in the calculation of capital gains that may influence the tax base. Foreign investors may be subject to specific tax rules, and the existence of treaties to avoid double taxa - tion between Mexico and the investor’s home country may be relevant. These treaties may provide certain protections and impact the taxation of capital gains. 5. Mining Investment and Finance 5.1 Attracting Investment for Mining The presence of high-quality deposits improves pro - ject profitability and represents an excellent invest - ment opportunity. Mexico ranks in the top 10 world - wide for 16 different minerals. Notably, it is the world’s leading producer of silver, second in fluorite produc - tion, and third in sodium sulphate. One of the key advantages of mining in Mexico is the enhanced efficiency of productivity and costs. This is largely due to lower prices for supplies and labour compared to many other countries. Furthermore, Mexico has developed a robust sup - porting sector comprising suppliers with a significant capacity to efficiently provide the diverse goods and services required for mining operations. In 2024, the estimated investment in the Mexican min - ing sector reached USD5.06 billion. At the end of the year, 416,663 jobs were registered, and although this figure represents a slight decrease of 0.1% compared to 2023, the number of women employed grew by 3.6%, reaching 77,190 workers,
which raises their participation to 18.5% of the total mining workforce. 5.2 Foreign Investment Restrictions and Approvals in the Exploration and Mining Sectors In Mexico, mining concessions may be granted only to Mexican nationals, Mexican companies, ejidos (land granted by the government to individuals for agricul - tural and ranching purposes), agrarian communities, townships and indigenous or Afro-Mexican peoples or communities. In the case of companies, they must be domiciled in Mexico, and their by-laws shall cover the exploration or exploitation of minerals and substances subject to the Mining Law. Foreign participation in the ownership of such companies must comply with the Foreign Investment Law provisions, which currently Mexico is committed to the development of the mining sector both nationally and internationally, recognis - ing the impact of its participation in key multilateral and bilateral treaties in this field. These include the following. • The North American Free Trade Agreement this was superseded by the United States-Mexico- Canada Agreement (USMCA, known as T-MEC in Mexico) in 2020. The upcoming 2026 joint review of the USMCA is expected to play a critical role in shaping the regulatory and investment landscape for Mexico’s mining industry. The outcome of this review may directly influence investor confidence, market access and long-term competitiveness within the North American region, especially given the growing strategic importance of critical miner - als for energy transition and advanced manufactur - ing. • The United Nations Framework Convention on Cli- mate Change Mexico is a signatory to this agree - do not impose any limitations on mining. 5.3 International Treaties Related to Exploration and Mining ment, which addresses climate change issues – mining activities are therefore subject to regula - tions arising from international efforts to mitigate greenhouse gas emissions.
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