Real Estate Law | Mexico | Global Corporate Real Estate Guide | Baker McKenzie Resource Hub (2024)

Pursuant to the Mexican Constitution and the Foreign Investment Law, to acquire ownership of a real property in Mexican territory it is necessary to consider (i) the place where the property is located, (ii) whether the property will be used for residential purposes and (iii) the nature and nationality of the acquirer.

Regarding consideration (i), the Mexican Constitution divides the national territory into two major areas, each with different requirements for nationals and foreigners to acquire ownership, or the use and enjoyment of real property. Such areas are (a) real estate lying within 50 kilometers of the coastline or within 100 kilometers of the land borders (“Restricted Zone”), which encompasses approximately 40% of the land in Mexico, and (b) any land or property located outside the Restricted Zone.

Regarding consideration (ii), for acquiring real estate, it is also important to determine if the property will be acquired for residential purposes, whereby a “residential purpose” is defined as intended exclusively for housing for the use of the owner or third parties, or for any other nature, such as agricultural, commercial, industrial, etc.

Finally, and in addition to the location and purpose of the property, Mexican law provides different mechanisms for acquiring real estate in Mexico for (a)Mexican companies with foreign investment or (b) foreign nationals or entities.

Based on the foregoing considerations, foreigners can acquire real properties in Mexico subject to the following requirements:

• Mexican companies with foreign investment can acquire ownership of real properties located outside the Restricted Zone, solely if the bylaws of the company contain a provision that in Mexico is known as the “Calvo Clause”. This is an agreement and representation where a foreign national must agree not to seek the protection of their government, otherwise they will forego their rights over the property acquired for the benefit of the Mexican state.
• Mexican companies with foreign investment can acquire direct ownership of real properties located within the Restricted Zone, solely when acquired for nonresidential purposes. In this event, the company must file a notice before the Ministry of Foreign Affairs (SRE) within 60 business days after finalizing the acquisition.
• Mexican companies with foreign investment cannot acquire direct ownership of real properties located within the Restricted Zone for residential purposes. However, they can acquire indirect ownership, use and enjoyment by means of a real estate trust approved by SRE with local banking institutions acting as trustee.
• A foreign national or entity can acquire direct ownership of real properties located outside the Restricted Zone, subject to (1) filing a request before SRE committing to accept the terms of the Calvo Clause and (2) securing a permit from SRE for the acquisition.
• A foreign national or entity cannot acquire direct ownership of real properties located within the Restricted Zone. However, they can acquire indirect ownership, use and enjoyment by means of a real estate trust approved by SRE with local banking institutions acting as trustees.

Pursuant to the Mexican Constitution, the state has direct title with respect to minerals, water and hydrocarbon resources that exist below the land’s surface. The exploitation of mineral and water deposits, excluding hydrocarbon fuels, may be carried out by private parties through a concession from the federal government. Concession rights on minerals are recorded in the Public Registry of Mining, while water rights are registered with the National Water Commission (CONAGUA).

Mexican law permits the acquisition of mining and water concession rights by foreign individuals outside of the Restricted Zone under certain conditions. Individuals may acquire direct title over mining and water concession rights by obtaining a special permit from the SRE and by agreeing to the Calvo Clause.