MEXICO Law and Practice Contributed by: Alejandro Stamoglou, Jesús Pérez Alcántar and Julio Jiménez Manrique, Bello, Gallardo, Bonequi y García, S.C.
6.2 Foreign Law and Jurisdiction The choice of a foreign law as the governing law of the contract and the submission to a foreign juris - diction are generally valid and enforceable in Mexico, provided that such choices do not contravene Mexi - can public order ( orden público ), such as due process principles or laws applicable to certain assets, includ - ing real property, which is governed by the law of its location. These provisions must also be expressly agreed upon by the parties in the relevant contracts. Waivers of sovereign immunity by governmental enti - ties or state-owned enterprises are generally enforce - able under Mexican law, provided they are express and unequivocal. However, enforcement may still be subject to constitutional principles and public interest considerations. 6.3 Foreign Court Judgments A judgment rendered by a foreign court or an arbi - tral award against a company may be enforceable in Mexico without a retrial of the merits, provided that the requirements set forth in the applicable law are met. These include: • compliance with the formalities established in inter - national treaties executed by Mexico regarding let - ters rogatory and recognition of foreign judgments; • that the foreign court or arbitral tribunal had proper jurisdiction in the original proceedings; • that the defendant was duly served and granted due process rights; • that the judgment or award is final and conclusive under the law of its jurisdiction; • that the matter is not pending before Mexican courts; and • that the obligation does not contravene Mexican public order ( orden público ). 6.4 A Foreign Private Credit Lender’s Ability to Enforce Its Rights Other matters that might impact a lender’s ability to enforce its rights under a loan or security agreement in Mexico include:
ignation. If the parties fail to reach an agreement on the appointment of the expert or the authorised third party for valuation purposes, the competent court will make the appointment. It is important to note that only if expressly agreed in the contract may the trustee or the pledgee obtain possession of the assets subject to the security interest. If the obligor refuses to deliver possession of the col - lateral or if the parties fail to agree on the valuation of the assets, judicial enforcement proceedings may be initiated. To commence judicial enforcement, the credit must be evidenced in a public or private document and must be due and payable either under the agreed terms or pursuant to applicable legal provisions. Once the claim has been filed and admitted, the court will require the obligor to pay the secured obligations, warning that if payment is not made, the obligor must deliver possession of the collateral to the creditor or to a third party designated by the creditor. In the same order in which payment is requested, the court will serve the obligor with process so that, if the obligor fails to pay or deliver possession of the collateral, the obligor may respond to the claim within the applicable statutory period. If the lender chooses to sell the assets and the sale price exceeds the amount of the debt, the lender must deliver the surplus to the obligor after deducting the amount of the loan, including interest and any expens - es incurred in connection with the sale. The enforcement of security documents and the valid - ity of certain actions may be limited or affected by statutory priorities or provisions established by: • tax laws imposing federal, state, or municipal taxes, including social security contributions and similar obligations; • labour laws regarding compensation owed to employees; • insolvency and restructuring laws, including insol - vency, bankruptcy, moratorium, or similar proceed - ings affecting creditors’ rights.
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