Subscribing for stock shares is not the same as paying for them: a consequence many companies in Mexico discover too late
A company admitted a new shareholder through a capital stock increase, received a promissory note as a guarantee for payment of the issued stock shares, and believed that with that it was in compliance. The Supreme Court of Mexico (the Court) confirmed that it was not. A capital stock increase is not merely an administrative […]
Irregular Share Capital Increases: A Corporate Governance Risk
Dilution and Loss of Control of the Shareholder A share capital increase may modify control of a company and directly affect the equity of its shareholders. What is relevant is that, many times, this occurs without the shareholder perceiving the problem until the transaction has already been formalized. Some shareholders of Mexican commercial companies are […]
The false certainty of choosing a foreign governing law in contracts with effects in Mexico.
When a company operates commercially in Mexico, the question often arises as to whether it is less risky to choose a governing law other than Mexican law for the interpretation of its contracts. This decision is usually based on an assumption that is not always correct: assuming that the choice of a foreign law guarantees […]
Compliance isn’t always enough: new reform and regulatory risks for online suppliers in Mexico
New obligations will be added for companies that sell products and provide services electronically in Mexico in 2026. These new obligations became mandatory on December 13 of last year, following the addition of a couple of sections to Article 76 bis of the Federal Consumer Protection Law (LFPC). As of the date mentioned, any supplier […]
What Aspects Should Be Considered Before Terminating a Commercial Agreement?
Nearly two years after the publication of the landmark case-law [1] decision of Mexico’s Supreme Court, which qualified the principle of free will in commercial matters, also known as freedom to contract, allowing the parties to freely agree upon the terms and conditions governing their contracts, we considered it timely to offer a few reflections […]
Payments by Check: A Silent Risk to Corporate Cash Flow
Does your company receive payments by check? If so, you may be exposed to a hidden risk that can freeze your cash flow without the debtor being subject to any sanction. A Federal Court has recently confirmed that a check remains legally valid even if the drawer’s (debtor’s) signature appears outside the designated signature space. […]
NEW UPDATE FACTOR APPLICABLE TO SIMPLIFIED STOCK COMPANIES
On December 26, an Official Notice was published in Mexico’s Federal Official Gazette announcing the adjustment factor applicable to the total annual gross revenues of a Simplified Stock Company (SAS), in accordance with the provisions of Article 260 of the General Business and Company Law (LGSM). Pursuant to such publication, the adjustment factor applicable for […]
Corporate spin-off: the decisive factor determining its viability
When shareholders, partners, or senior management of a company begin to assess the benefits and challenges of carrying out a spin-off of a company, a variety of questions often arise. Among them, whether the spin-off will meet the objectives set in terms of greater efficiency in the management and investment of resources, in the optimization […]
Civil Liability Risks and Core Duties of Directors in Mexican Companies
Directors of commercial corporations are regarded as their agents and legal representatives according to articles 10 and 142 of the Mexican General Corporations and Partnerships Law (“GCPL”), and have the authority necessary to perform all those activities listed in the company’s corporate purpose unless otherwise stated in the law or in the bylaws of a […]
The DOT’s order against services to AIFA: bilateral and regulatory implications for Mexico
On October 28, 2025, the U.S. Department of Transportation (DOT) notified several Mexican airlines of an order canceling all services between the United States and Felipe Ángeles International Airport (AIFA) and suspending 13 current or planned routes operated by Mexican carriers to the U.S. The DOT considers that operating the services associated with those routes […]
Tensions in the Mexico–U.S. Air Agreement US: DOT measures and AFAC response
On July 19, 2025, the U.S. Department of Transportation (DOT) announced a series of enforcement measures against Mexico, citing violations of the 2015 U.S.–Mexico Bilateral Air Transport Agreement. According to the Department of Transportation, since 2022 Mexico has revoked airport slots from U.S. airlines and forced U.S. all-cargo carriers to relocate from Mexico City International […]
United States suspends routes to AIFA: implications of the Mexico–U.S. bilateral air agreement
On October 13, 2025, the U.S. Department of Transportation (DOT) notified several Mexican airlines of an order canceling all services between the United States and Felipe Ángeles International Airport (AIFA), and suspending 13 current or planned routes operated by Mexican carriers to the neighboring country. The DOT considers that operating the services associated with those […]