Mexican court issues new decision on the rescission of a commercial purchase and sale contract.
Background In a purchase and sale agreement one party undertakes to transfer goods or property, and the other party agrees to pay a specified price for them. [1] When the sale and purchase contract is business-oriented, it is regarded as a commercial purchase and sale agreement, in addition to those commercial acts contemplated in the […]
Is it necessary to include in a promissory note a competent court in case of a lawsuit?
Background Pursuant to article 170 of the General Negotiable Instruments and Credit Transactions Law (the “Law”) a promissory note is a negotiable instrument that must contain the following elements to be valid: I. The word pagaré (promissory note) inserted in the text of the document. II. An unconditional promise to pay a given sum of […]
Is the Insurer’s obligation to pay capitalized interests to insured parties constitutional?
Capitalized interests [1] in commercial agreements is a term permitted by the Mexican Constitution as long as it is not used in an abusive manner on someone else’s property, nor does it generate excessive interest on the debtor’s part. Article 276 paragraph II of the Law of Insurance and Bonding Institutions (the “Law”) provides for […]
Mexican court determines the form in which consent can be granted in a promissory agreement.
Background Through a promissory agreement one or both parties agree to execute within a period of time, a given contract that the parties do not want or may not execute at the moment. It is also known as preliminary agreement, promise of contract, promise to enter into a definitive agreement.[1] Therefore, promissory agreements may be […]
Challenges arising from the new rules in Mexico allowing the holding of partners’ virtual meetings
On September 12, 2023, the Mexican senate approved the amendments to the General Corporations Law (the Law) to allow the holding of shareholders and partners’ meetings through instant communications platforms (the Amendments). The document containing the Amendments was sent to the Mexican president for his approval (promulgation) before it is published with the Federal Official […]
Consequences of lying to your insurer under Mexican law
The good faith principle in insurance contracts In accordance with the Mexican law, an insurance contract has a specific condition to become effective: the good faith of the parties. This is confirmed by article 8 of the Mexican Insurance Contract Act (“ICA”) that sets forth the insured party’s obligation to disclose in writing all the important […]
Airlines must compensate passengers, in any case, for overbooking a flight: Mexican Supreme Court
The First Chamber of the Mexican Supreme Court of Justice (SCJ) confirmed that air carriers must compensate passengers if they are denied boarding due to overbooking of a flight. In recent days, an extract of the judgement of the constitutional trial in review 401/2023 containing the above criterion was made public. Due to overbooking of […]
3 points to know on the fast track procedure to liquidate a company in Mexico
Liquidating a company in Mexico is not an easy task to accomplish. Sometimes, it takes several months to dissolve and liquidate an entity. The General Corporations Law (“GCL”) seeks to strike a balance between, on the one hand the interests of those wanting to close business operations for good, and on the other hand, their […]
A notice is published in the Mexico’s Official Journal to transfer three airport entities in Mexico City to the Mexican Navy Department
Three airport entities in Mexico City will be transferred to the Mexican Navy Department (ND). Grupo Aeroportuario de la Ciudad de Mexico, Servicios Aeroportuarios de la Ciudad de Mexico and Aeropuerto Internacional de la Ciudad de Mexico will be grouped under the coordinated sector of the ND. The notice announcing the above transfer, was published […]
Mexican president sends bill to regulate crimes commited with the use of Drones
Mexican president has just submitted a bill to the Congress’ permanent commission aimed at amending the Federal Criminal Code as well as the Firearms and Explosives Act (the Laws), to punish improper use of Remotely Piloted Aircraft (RPA). According to the bill, the amendment of the Laws is intended to establish aggravating circumstances for crimes […]
Court decision confirms that an article of the Anti-money laundering law that establishes the imposition of fines is constitutional
An entity challenged the imposition of fines by the Tax Administration Service (“SAT”). The fines were imposed because the entity did not comply with certain obligations established in the Mexican Anti-money Laundering Law [1]: As a result, the company was imposed with fines in accordance with article 54 first paragraph, subparagraph III of the Anti-money […]
Whose responsibility is it to prove the existence of hidden product defects in a sale in Mexico?
What are hidden product defects? They are non-visible defects prior to the sale of a product that prevent or diminish its use for the intended purposes. In case that the buyer has known them he would not have bought the product or have paid less for it. What does the law state as to hidden […]