MEXICO Law and Practice Contributed by: Roberto Cannizzo, Carlo Cannizzo, Stefano Amato and Mauricio Moreno-Rey, Cannizzo
ownership, and streamlined mortgage debt transactions. Blockchain enhances transpar - ency, reducing transaction risks, costs and pro - cessing time by minimising expenses such as no-lien searches, notary fees and registrations. Smart contracts and fintech have modernised payment solutions, reducing reliance on cash and paper cheques while ensuring secure rent and property transactions. Lenders benefit from data-driven risk assessments, while contech improves financial management and efficiency in construction. Moreover, the Law to Regulate Financial Tech - nology Institutions provides a legal framework for new technologies, and the Mexican National Banking and Securities Commission (CNBV) grants authorisations to operate, so an increase in technology companies entering the market, including the real estate sector, is anticipated. However, due to Mexico’s strict civil law sys - tem requiring notary involvement for property transfers, major industry shifts are unlikely with - in the next year despite ongoing technological advancements. 1.3 Proposals for Reform Mexico City has introduced significant reforms to the Mexico City Civil Code (CCDF) and the Housing Law. As of 29 August 2024, rent increases cannot exceed inflation, and landlords must register lease agreements in a new digital system within 30 days. Existing leases must be registered within 90 days of the system’s launch. Non-compliance can result in: • fines of up to MXN1.2 million; • work suspensions; and • registration cancellations for up to six years.
The government is also mandated to promote affordable rental housing for low-income resi - dents per the Housing Law.
2. Sale and Purchase 2.1 Categories of Property Rights
Mexican Civil Codes provide for several catego - ries of property rights: full ownership, usufruct (the real and temporary right to enjoy the prop - erty of others, which includes the right to receive all the fruits/benefits, whether natural, industrial or civil, produced by the property) and other minor rights, such as use or certain easements. In infrastructure projects, rights of way or other types of easements are used for the construction of roads, gas and oil pipelines. Another type of property is “Ejido property” , which accounts for over 50% of the land in Mex - ico. Ejido property is a landholding in Mexico that is owned collectively by a community and is typically used for agriculture or other similar purposes. It is subject to a special regime, regu - lated by Article 27 of the Constitution and the Agrarian Law. 2.2 Laws Applicable to Transfer of Title The law applicable to transfer of title, if the trans - fer is considered a commercial act by the Com - mercial Code, is the Civil Code of the relevant state where the real estate is located. If at least one of the parties is a merchant (including real estate for industrial purposes, offices, retail and hotels), the applicable law would be the Com - mercial Code and the Civil Code of the relevant state where the real estate is located. In combinations involving corporations (ie, merg - ers, the purchase of shares) or trusts, the Com - mercial Code, General Law of Commercial Com -
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