Mexican law is based on civil law, which derives from Roman law.

The Political Constitution of the United Mexican States (Constitución Política de los Estados Unidos Mexicanos, or CPEUM) has established a regime in which the power to regulate matters that are not expressly under federal jurisdiction will be reserved for the local/state level, in accordance with the principle of the distribution of powers.

Mexican law provides two options for FDI:

• opening a permanent establishment (PE); or
• opening a Mexican subsidiary.

For the PE, as branches are regulated by the Mexican Foreign Investment Law (Ley de Inversión Extranjera, or LIE), each new branch needs to obtain authorisation from the Ministry of Economy, which is achieved by submitting the applicable documentation to the Ministry. An alternative and simplified process may apply if there is an international or bilateral treaty between Mexico and the country of origin of the investment.

Regardless of the option chosen for the FDI, several industries are reserved for Mexicans or Mexican companies through a foreign exclusion clause, and some have a maximum participation percentage according to the LIE, such as transportation, broadcasting and newspapers, among others. In the latter industries, foreign investors can request authorisation for a “neutral investment”.

Mexico currently has a predominantly left-centre leaning government. However, one of the government’s commitments at the beginning of its six-year term was the development and promotion of foreign investment. In this sense, no amends to the LIE are expected.

The main methods used for M&A transactions in Mexico are as follows.

Acquisition of Companies

For the acquisition of a Mexican company, foreign investors can opt to purchase the majority or minority shareholding, considering that all Mexican entities must have, at all times, a minimum of two partners or shareholders.

There is only one corporate regime regulated within the Mexican General Law of Commercial Companies (Ley General de Sociedades Mercantiles, or LGSM) that allows individuals that do not hold control of other entities but do have a Mexican electronic signature – which means that they are tax residents in Mexico – to incorporate an entity with a sole shareholder (simplified stock company).

For the acquisition of a shareholding in Mexico, the LGSM provides for the following requirements:

• if applicable, authorisation from the board of directors for the transfer, according to the by-laws of the company;
• holding a shareholders’ or partners’ meeting to approve such transfer;
• proceeding with the applicable annotation within the Shareholders’ or partners’ ledger;
• filing the applicable notices, such as with the Ministry of Economy through the Corporations Portal (Portal de Sociedades Mercantiles, or PSM), the National Foreign Investment Registry (Registro Nacional de Inversiones Extranjeras, or RNIE) and the tax authorities; and
• issuing the shares, for stock companies.

It is important to consider that the meeting required for the transfer is ordinary, unless otherwise provided for by the by-laws of the Mexican company. In this sense, the voting and installation quorums required for the approval are less than an extraordinary meeting, and formalisation before a notary public is not required. However, due to the “certain date” requirement by the tax authorities – meaning that the acts relevant to the corporate life of taxpayers must have an additional validation on the date they were held, by means of registration or notarisation – it is highly advisable to proceed with such formalisation.

There is also a preference right, whereby the other partners or shareholders of a Mexican company will have to be preferred to acquire shares or increase their capital stock before third parties can do so. Nevertheless, the partners or shareholders can refuse such right prior to the transfer or at the time of the meeting.

Acquisition of Assets

Another alternative for FDI in Mexico is the acquisition of companies by means of the transfer of assets. Usually, the decision on these types of transactions is made based on the tax consequences each alternative represents to the companies and investors.

In this sense, FDI can be made through the direct acquisition of assets, unless they are regulated asset or have a specific permit, in which case the acquisition can be made through an agreement, whether purchase, donation, bailment or other.

For the acquisition of assets or shareholdings, in the event of a concentration in terms of the Federal Law of Economic Competition (Ley Federal de Competencia Económica, or LFCE), the participating economic agents must obtain authorisation from the National Antimonopoly Commission (Comisión Nacional Antimonopolio, or CNA) prior to the implementation of the act or series of acts.

Merger

In a merger, all assets, liabilities and capital of the applicable companies will be absorbed by one entity, which is newly incorporated as a result of the merger or by the merging company. According to the LGSM, a merger requires a merging agreement as well as the holding of an extraordinary meeting of each of the companies involved, plus the applicable registration and notices being filed with the authorities. In such case, please note that the merger will have full effects for internal purposes at the time of adoption of the applicable agreements, but against third parties at the following points:

• at the time of registration, if all debts of all companies involved are paid, the amounts owed are deposited into a credit institution, or the consent of all creditors is obtained; or
• three months after the last registration/publication is made, so creditors have a term in which to object, if they deem that their rights might be affected as a result of the merger.

The specific strategy is usually determined based on the tax implications of both scenarios. Nevertheless, some antitrust regulations might also apply if the entities belong to the same sector or are dominant players in the same market.

For public or highly regulated entities, additional authorisations from the supervisory authority might apply.

In general terms, the following regulations can be relevant for M&A transactions.

Antitrust

In the event of a concentration in terms of the LFCE, the participating economic agents must obtain authorisation from the CNA prior to the implementation of the act or series of acts. This authorisation might apply in the acquisition of a company already incorporated in Mexico, or in the acquisition of its assets.

Such concentration usually happens in the case of mergers, acquisitions of shareholdings, acquisitions of assets or joint ventures.

Foreign Investment

As mentioned in 1.2 Regulatory Framework for FDI, certain activities are reserved for Mexicans or Mexican companies through a foreigner’s exclusion clause and certain activities have a maximum participation percentage according to the LIE, such as transportation, broadcasting and newspapers, among others. If a foreign investor is looking to participate in such industry in a higher percentage than is allowed, the company will have to obtain a neutral investment authorisation (this only applies to those industries that do allow foreign investment, and not to those that are reserved exclusively to Mexican nationals or the State).

Such neutral investment will imply that the foreign investment will participate for economic purposes within the company but with highly limited corporate rights, and the management of the company will be solely on the Mexican investment.

Ultimate Beneficial Owner

Mexican law requires all Mexican companies – and any other analogue legal figure – to report and keep an ultimate beneficiary owner (UBO) file.

For UBO purposes, two different figures are currently regulated:

• one for anti-money laundering (AML) purposes; and
• a second tax UBO.

In this sense, for both cases the law requires companies to identify their individual UBOs, and the regulation also requires them to provide supporting documentation such as IDs, Tax IDs and Social Security numbers, among others.

For AML purposes, each company is obliged to file a report of the identification, as well as the document stating the control chain that enables the identification of such individuals as UBOs; for tax UBOs, the file must be disclosed only if the tax authorities specifically request it.

Regulatory

In regulated industries such as finance, hydrocarbons/energy and environmental, additional authorisations from regulatory bodies may be required.

Mexican regulations permit business to be carried out in the national territory via the following methods.

Incorporation of a Mexican Commercial Company

The following company types, and their corporate regimes, are regulated by the LGSM:

• company in collective name;
• limited partnership;
• limited liability company;
• stock corporation;
• partnership limited by shares;
• co-operative company; and
• simplified stock company.

Investors tend to choose to incorporate a Mexican limited liability company or a stock corporation as these types of companies adjust better to their needs.

The LGSM also regulates the modality of “Variable Capital”. All corporate regimes can adopt this modality, which allows an addition of a “variable part” to the capital stock which, according to the law and the by-laws of each entity, requires fewer formalities for its increase or decrease (it only requires the approval of an ordinary meeting) compared to the formalities required for a change of the fixed part of the capital, which requires an amendment to the by-laws and may therefore only be resolved and approved by an extraordinary meeting.

Other modalities of the corporate regimes are incorporated into other laws – for example, investment promotion stock corporations and public stock corporations are regulated by the Mexican Securities Market Law (Ley del Mercado de Valores, or LMV).

Opening of a Branch

Opening a branch in Mexico does not require the incorporation of a new company (“newco”). Instead, a foreign entity will require authorisation from the foreign investment authorities to carry out business/commercial transactions in Mexico. This allows investors to have a presence in the national territory without the need to open a newco.

As branches are regulated by the LIE, each new branch needs to submit the applicable documentation to the Ministry of Economy, and obtain authorisation therefrom. An alternative and simplified process may apply if there is an international or bilateral treaty between Mexico and the country of origin of the investment.

Mexican Joint Venture

A Mexican joint venture or association is regulated in Chapter XIII of the LGSM, and involves the parties agreeing to provide goods or services and share in the profits and losses of the commercial business or several commercial operations.

As it is an agreement, a Mexican joint venture does not have legal personality, nor does it have minimum contributions. It is sufficient that the agreement is in writing and that it stipulates the terms, proportions of interest and other applicable conditions. There is no legal relationship between the third parties, the partners (who provide the goods and services) and the partner acting on their own behalf.

Vis-à-vis third parties, the assets will be the property of the associate. This means that he/she/it will be able to dispose of or transfer the assets freely, except for those that require additional formalities or that are stipulated in the agreement within the association contract.

For the distribution of profits or losses, the general terms applicable to commercial companies apply – ie, distribution will be proportional to contribution and, for associated partners, the losses that correspond to them may not exceed the value of the goods or services they contributed.

Finally, if it is not stipulated in the agreement, a Mexican joint venture will operate and be liquidated in accordance with the corporate regime of the “company in collective name” (Sociedad en Nombre Colectivo), which, broadly speaking, implies that the association will automatically be dissolved upon the death, incapacity, exclusion or retirement of any of the associates, unless otherwise agreed.

Individuals

Individuals may be considered as merchants and carry out commercial transactions, which requires their registration as such before the Mexican authorities.

The specific alternative for investing in Mexico is usually determined according to the specific needs of the investor and the tax implications of each option.

There are no specific laws on minority investors, but the LGSM and LMV state several rights for minority shareholders, such as the right to:

• appoint a member of the board of directors;
• appoint a statutory auditor;
• oppose resolutions of general meetings;
• call a meeting if deemed appropriate; or
• start a liability claim against the directors.

Such rights are subject to specific percentages of shareholding, depending on the corporate regime.

In addition, regardless of the shareholding they have, shareholders or partners will have a preference right to be favoured against third parties in case of an increase of capital stock or a sale of shares/partnership equity.

Direct and indirect foreign investment requires a quarterly or annual notice to be filed with the RNIE.

Quarterly

A foreign investment notice must be submitted within ten business days after the end of the quarter when there are any changes tothe company’s name, its corporate purpose or economic activity registered with the Tax Administration Service (SAT) or its registered office or tax domicile. Notice must also be filed in the event of movements in the following assets, liabilities or capital accounts exceeding MXN20 million.

• The share capital and/or shareholding structure that implies a change in the share capital held by foreign individuals or legal entities.
• Assets – accounts receivable from subsidiaries residing abroad or shareholders residing abroad and/or companies residing abroad that are part of the corporate group and do not participate as partners or shareholders.
• Liabilities – accounts payable to subsidiaries residing abroad or shareholders residing abroad and/or companies residing abroad that are part of the corporate group and do not participate as partners or shareholders.
• Stockholders’ equity – contributions for future capital increases.
• Stockholders’ equity –share capital reserves or results from previous years.

Annual

A foreign investment notice must be submitted according to the calendar provided by the authority, usually in April and May, when any of the following exceed MXN110 million:

• initial total assets;
• final total assets;
• initial total liabilities;
• final total liabilities;
• income in the country and abroad; or
• costs and expenses in the country and abroad.

All RNIE notices are made online through the account of the legal representative in Mexico,( who requires a Mexican electronic signature – e.firma – to proceed with his/her registration), attaching the supporting documentation, including the financial statements duly signed by such legal representative.

In the case of neutral investment, the company must obtain authorisation from the Ministry of Economy for any amends or change of shareholding, prior to such change.

Under Mexican law, funding can be private or public.

Private

Private funding includes all traditional options, such as intercompany or bank loans, capital funding by the shareholders, capitalisation of liabilities and capital fundraising, among others. Such alternatives are usually preferred by companies as they do not involve a high regulatory burden.

Public

In specific cases, a company can also opt to apply to be listed on the Mexican market. Opting for an IPO usually depends on the business strategy of the company, to be used as an exit alternative. It implies compliance with several regulatory matters that might not be feasible for all private companies, so its viability is determined following a tax, legal and financial analysis.

The LMV regulates securities in Mexico, and such market is overseen by the National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores, or CNBV).

In general terms, securities must be registered with the National Registry of Securities (Registro Nacional de Valores, or RNV). For such purposes, the CNBV reviews and authorises the prospectuses, validating the company’s financial affairs and credit ratings, among other matters.

In addition, there are several transparency and disclosure obligations for participants of the market, including the obligation to publish their financial statements and report relevant events.

Foreign funds will require authorisation from the Mexican government to act as such in the Mexican territory. In general terms, the fund might require authorisation from the Ministry of Economy or the CNBV.

In general terms, the LFCE defines a concentration as a merger, acquisition of control or any act by virtue of which companies, associations, shares, equity interests, trusts or assets in general are joined, carried out between competitors, suppliers customers or any other economic agents, regardless of whether they are national or international investors.

The CNA must authorise a concentration prior to the execution of the relevant acts. If authorisation is not obtained, the acts will be deemed void and liability can arise for the parties involved.

For such purposes, the relevant parties must provide the required documentation to the CNA, which will have the following options in the following timeframes.

• Ten days to prevent the application and request missing information, giving the requestors ten days in which to provide the information or documentation requested. If not provided, the application will be deemed as not having been submitted.
• It can ask for additional information or documentation up to 15 days after receipt of the request, giving the requestors 15 days in which to provide it.
• It can provide a definitive resolution within 30 days after receipt of the request. If a response is not issued in such period, then it will be deemed that the CNA has no objection to the concentration.

Regardless of the above, the CNA can request amends to the supporting documentation of the transaction or subject the authorisation to certain conditions.

Once authorised, such resolution will have a six-month validity, extendable once only for a justified reason.

Some exceptions are available if the concentration derives from a corporate restructuring, from an increase of capital stock from majority shareholders or from a trust in certain conditions, or if thresholds are not met, among other circumstances.

The LFCE establishes that a concentration requires prior authorisation from the Commission when the act or series of acts in question:

• directly or indirectly involves an amount exceeding 16 million Units of Measurement and Update (Unidad de Medida y Actualización, or UMA, with a value in 2025 of MXN113.14) within the national territory – ie, MXN1,810,240,000;
• involves the accumulation of 35% or more of the assets or shares of an economic agent whose annual sales or assets within the national territory exceed 16 million UMAs; or
• involve the accumulation of assets or social capital exceeding 7 million UMAs (MXN791,980,000) and the concentration involves two or more economic agents whose annual sales or assets in the national territory, jointly or separately, amount to more than 40 million UMAs (MXN4,525,600,000).

When authorising a concentration, including mergers, the CNA can request that certain conditions are met, such as:

• carrying out a specific action or refraining from doing so;
• transferring certain assets, rights, equity interests or shares to third parties;
• modifying or eliminating the terms or conditions of the transactions the parties intend to enter into;
• undertaking actions aimed at promoting the participation of competitors in the market, and providing them with access to or selling them goods or services; or
• any other actions intended to prevent the concentration from diminishing, harming or impeding competition or free market access, provided that such measures are aimed at correcting the adverse effects of the concentration and are proportional to the intended correction.

In the case of non-compliance with the resolutions or notices of concentration or other acts supervised by the CNA, such acts will be deemed as non-effective and the CNA can impose the applicable sanctions.

The RNIE and the Foreign Investments Commission (Comisión Nacional de Inversiones Extranjeras, or CNIE) both operate under the Ministry of Economy and are the main authorities in foreign investment matters. As stated in 4.3 Disclosure and Reporting Obligations, certain notices must be provided to the RNIE, and the authorisations for FDI are provided by the CNIE. If deemed necessary, both agencies have the power to request additional information from investors and to oversee compliance with the obligations in the matter.

In the case of opening a PE, the authorisation must be obtained before activities commence in Mexico. The CNIE has a 45-day term to provide a definitive resolution. If a commercial treaty is in place with the country of origin of the company, then the resolution is immediate.

For the RNIE, all the obligations arise at the time that each applicable assumption arises.

The foreign investment regulation applies to Mexican companies with foreign investment, FDI by means of a PE or a trust over shares or partnership equity, real estate or neutral investment, by virtue of which rights are derived in favour of foreign investment or Mexicans who possess or acquire another nationality and who have their domicile outside the national territory.

Additional requirements or amends to the corporate documentation or structure can generally only be requested in the authorisation of a neutral investment from the CNIE.

If there is no authorisation for a neutral investment or the opening of a PE, administrative sanctions and penalties might arise. In the specific case of a PE, additional tax sanctions can arise, as the authorisation requires the company to register with the tax authorities.

The LIE provides for the following limits on foreign participation in the following activities.

• Co-operative production companies: 10%.
• The manufacture and marketing of explosives, firearms, cartridges, ammunition and fireworks, not including the acquisition and use of explosives for industrial and extractive activities, or the manufacture of explosive mixtures for consumption in such activities: up to 49%.
• The printing and publication of newspapers for exclusive circulation in the national territory: up to 49%.
• Series “T” shares of companies owning agricultural, livestock and forestry land: up to 49%.
• Freshwater, coastal and exclusive economic zone fisheries, excluding aquaculture: up to 49%.
• Comprehensive port management: up to 49%.
• Port pilotage services for vessels to carry out inland navigation operations under the terms of the law on the subject: up to 49%.
• Shipping companies engaged in the commercial operation of vessels for inland navigation and cabotage, with the exception of tourist cruises and the operation of dredgers and naval devices for the construction, maintenance and operation of ports: up to 49%.
• The supply of fuels and lubricants for ships and aircraft and railway equipment: up to 49%.
• Broadcasting – factoring in the reciprocity that exists in the country in which the investor or the economic agent that ultimately controls it, directly or indirectly, is incorporated: up to 49%.
• Scheduled and non-scheduled domestic air transport service; non-scheduled international air transport service in the form of air taxis; and specialised air transport service: up to 49%.
• Domestic land transport of passengers, tourism and cargo, not including courier and parcel services: reserved for Mexicans or Mexican companies with a foreigner’s exclusion clause.
• Development banking institutions, under the terms of the relevant law: reserved for Mexicans or Mexican companies with a foreigner’s exclusion clause.
• The provision of professional and technical services expressly indicated in the applicable legal provisions: reserved for Mexicans or Mexican companies with a foreigner’s exclusion clause.

In addition, foreigners cannot directly acquire real estate in the “restricted zone”, which comprises 100 km from the borders and 50 km from the coasts of Mexican territory.

The main federal taxes in Mexico for taxpayers are as follows.

• Income Tax (Impuesto sobre la Renta) – 30% of the tax profit in companies or entities. For individuals, the specific percentage to apply is linked to the income received.
• Value Added Tax (Impuesto al Valor Agregado) – rates of 16% or 0%, as some activities are exempt from such tax.
• Special Tax on Production and Services (Impuesto Especial sobre Producción y Servicios) – this applies to the manufacture and selling of gasoline, alcohol, beer and tobacco, among other specific products. The specific rate applicable to each product varies from 3% to 200%.
• General Import Tax on Foreign Trade (Impuesto General de Importación al Comercio Exterior) – the rate is calculated based on the tariff fraction in which the imported merchandise is classified.

There are some additional special taxes applicable to specific industries, such as hydrocarbon exploration and extraction or mining.

When a business distributes profits, there are two options:

• if the company has sufficient Cuenta de Utilidad Fiscal Neta (CUFIN – the Net Tax Profit Account) balance, there is no need to pay any additional tax; or
• if the company does not have enough CUFIN balance, 30% tax must be paid, applying a gross-up ratio of 1.4286 prior to the 30% tax.

On the other hand, the receiver of the profits has the following scenarios:

• if the receiver is a corporation that is Mexican resident, there is no withholding tax (WHT);
• if the receiver of the profit is an individual residing for tax purposes in Mexico, 10% WHT must be applied; and
• if the receiver is a foreign resident for tax purposes, 10% WHT must be applied or it must be determined whether it is possible to claim the benefits of a Double Tax Treaty to avoid double taxation in order to decrease the WHT to 5% or whether the participation exemption regime applies.

The specific tax strategy will depend on the nationality of the parties involved, as well as the specific transaction.

However, there are several governmental incentives that are used by investors to lower their tax burden. For example, in the case of maquiladoras and service exportation, there is a Manufacturing, Maquila and Export Services Industry Programme (IMMEX), which allows the business to carry out temporal imports of products with a productive process and/or services for the export of goods or export services, deferring the payment of the general import tax, the value added tax and, if applicable, compensatory fees for the goods that are necessary for such industrial process or a service process intended for the production, transformation or repair of goods of foreign origin temporarily imported for export or for the provision of export services.

Another example of a tax incentive is the denominated “Plan México”, which entered into force in January 2025 and the taxpayer the option to make the immediate deduction of the investment in new fixed assets acquired between January 2025 and the end of September 2030, deducting in the fiscal year in which the investment is made the applicable amount that results from applying to the original amount the percentage that corresponds according to the specific category of fixed assets (eg, for property considered as archaeological monuments, a deduction of 72% for 2025 and 2026 will apply, and 67% for 2027 to 2030). This incentive also provides an additional deduction of 25% of the increase in the expense incurred for the training of each employee in the fiscal year or 25% of the expenses related to innovation.

There are also some local incentives in each state for specific industries. Regional incentives in the north border are of Mexico, such as the “Decree of tax incentives for the northern border region”, apply for taxpayers with a tax address, establishment or branches (registered with the tax authorities) within the northern border region. This tax incentive is also applicable to the southern border region, and both incentives allow certain taxpayers to apply an income tax credit and a value added tax reduction.

The Mexican Income Tax Law (Ley del Impuesto sobre la Renta) states that, in the sale or disposal of shares, partnership equity or any title that represents the property of assets that will have its source of wealth within the national territory, when the person who issued them is a resident of Mexico or when the book value of said shares or securities derives directly or indirectly from more than 50% real estate located in the country, a 25% rate will be applied over the total amount of the transaction, without any deduction.

However, if the taxpayer has a representative in the country and is resident abroad for tax purposes, and its income is not subject to a preferential tax regime, or if the taxpayer is resident in a country with a territorial taxation system, then they can apply for a 35% rate over the net gain.

For individuals residing abroad who receive income from the sale of real estate, income is considered to be obtained in Mexico when the goods being sold are in Mexico and the tax must be calculated by applying the rate of 25% on the total amount, without deduction.

Mexican regulations impose a clear and robust anti-evasion regime, with the Federal Tax Code (Código Fiscal de la Federación, or CFF) stating that tax authorities have the power to “reclassify” a transaction when it lacks a business purpose and generates a direct or indirect tax benefit. In this sense, such act will have tax effects corresponding to those that would have been carried out to obtain the economic benefit reasonably expected by the taxpayer.

In addition, there are several procedures contained in the tax regulations to avoid and discourage the issuance of false invoices or the simulation of non-existent transactions, as well as the UBO regulation (see 3.2 Regulation of Domestic M&A Transactions).

Labour relationships can be individual or collective, and are regulated within the Federal Labour Law (Ley Federal del Trabajo, or LFT).

In both cases, the minimum employment rights and compensation for workers include the following.

• Minimum wage – the general minimum wage is MXN315.04 daily and the Northern Border Free Zone minimum wage is MXN440.87 daily. The minimum wage can vary according to the specific profession/job/occupation.
• Holidays – workers with more than one year of service are entitled to a minimum period of 12 working days of paid annual leave per year, which will be increased by two working days for each subsequent year of service, up to 20 working days. Subsequently, the vacation period will be increased by two working days for every six years of service.
• Working hours – the maximum duration of the working day is eight hours during the daytime, seven hours during the night-time and 7.5 hours during the mixed workday. The worker shall be granted at least a half-hour break outside of the workplace (at the discretion of the worker). For every six days of work, the worker shall enjoy at least one day of rest with full salary paid. In Mexican law, labour exploitation is classified as a crime, defined as subjecting a person to work hours above the limits stipulated by the LFT.

• Labour conditions of the workplace – according to the LFT, all workplaces must comply with all the hygiene and civil protection regulations and conditions for the employees to carry out their activities. For workers that have more than 40% of their working hours at home or the address they have chosen for such purposes (teleworking or home office), the employers must provide, install and maintain the equipment necessary for teleworking, among other requirements. In addition, the Congress has approved some other relevant amends in the matter, including the right of workers to have (and thus, the obligation of the employers to provide) adequate chairs and seats with backrests in service, commerce and similar workplaces for the execution of their jobs or periodic rest.

• Maternity/paternity leave – pregnant women will enjoy a rest period of six weeks before and six6 weeks after childbirth. For paternity leave, the Mexican Labour Law establishes a leave entitlement of five working days with pay for working men for the birth of their children, and likewise in the case of the adoption of an infant.

Besides the minimum established by the LFT, companies can provide additional benefits to their employees, such as stock options and golden parachutes. According to the specific tax, legal and financial strategy for an M&A transaction, it is common practice to opt for the employer’s substitution and/or termination of the labour relationships.

When acquiring a business, the company has the option to transfer the employees, giving notice to them and the labour authorities, or it can opt for their dismissal.

The termination of the labour relationship by the unilateral will of the employer, without verifying any of the causes for termination provided for in the LFT, is considered unjustified dismissal. An employee who has been unjustifiably dismissed will be entitled to indemnification/severance consisting of three months’ salary, plus:

• 20 days’ salary per year worked;
• 12 days’ salary per year worked limited to two times the minimum wage;
• the proportional part of the annual statutory bonus;
• the proportional part of vacation pay;
• the proportional part of the vacation bonus; and
• other benefits included in the employment agreement or in the conditions that regulate the relationship with the company or employer, such as bonuses, commissions, savings fund and utilities.

In the case of a collective agreement, specific benefits can apply depending on the union agreement. According to the LFT, collective termination can be as part of the closure of a business or the reduction of the jobs available, due to force majeure, events not attributable to the employer, notorious unprofitability or bankruptcy, among other situations.

For the employer’s substitution, the change of employer does not affect the labour relations of the company or establishment, as the replaced employer will be jointly and severally liable with the new employer for the obligations towards employees prior to the substitution and for a six-month term after such substitution. Upon the conclusion of such term, only the new employer will be responsible for compliance with the labour obligations, considering that the assets of the company or establishment must also be transferred to the substitute employer in order for the employer substitution to take effect.

The relevance of intellectual property (IP) is usually determined by the importance that each business on it, and by their IP policies. In the case of trade mark or industrial secrets, it is common practice in Mexico for protection to also be sought by investors.

There are no specific sectors that are marked as being difficult for IP matters. All requests are duly reviewed and evaluated by the Mexican authorities, which usually have pro-registration criteria.

There are two regimes for data protection:

• one applicable to governmental bodies; and
• one governing private parties.

Both regulations currently do not have extraterritorial effects.

Several data privacy laws were enacted on 21 March 2025, marking a substantial change in data protection regulation in Mexico. All the major laws on the matter were derogated and enacted, looking to homologate the data protection regulation in views of the extinction of the autonomous constitutional body that acted as guarantor in matters of data protection and transparency at a federal and local level (Instituto Nacional de Transparencia, Acceso a la Información y Protección de Datos Personales, or INAI).

As Mexico is currently in the transition period from the INAI to the new guarantor bodies, whether or not the previously issued criteria will kept or new criteria will be issued is yet to be seen. However, data protection is still a relevant matter for the authorities, which focus mainly on the information of private parties and have several options to exercise their rights on such matters, as well as the power to apply several economic and non-economic sanctions to private parties in case of non-compliance.