THE FIDEICOMISO

Firstable , a little bit of history that will reflects when this term was established thus we can understand better the Fideicomiso.

In 1973, recognizing that many Americans would enjoy the rights of ownership, and bring needed dollars to the country, President Echeverria approved the bank trust, fideicomiso, form of ownership which is available to non-Mexicans. This regulation was further expanded in the Foreign Investment Law of 1989.

Article 27 of the Constitution of the Republic of Mexico prohibits foreign ownership of real property located within 30 miles of any coastline or 60 miles of either border. This is referred to as the restricted zone.

The term of the trust is fifty years and can be renewed for additional fifty year periods, after which it must be transferred to "one entitled to hold property" in Mexico. In other words, title to the property may rest in one beneficiary indefinitely, provided that it is renewed within the terms established by the law.

The procedure for establishing the fideicomiso, the bank trust, is as follows: a permit must be obtained from the Secretary of Foreign Relations which includes a description of the property to be placed in trust, the use for which it is intended and personal data on each of the beneficiaries. Once granted the bank draws up the trust document which is recorded in the municipality where the property is located.

For further information on the Mexican trust or real property custom and practice in Mexico, please contact CANCUN ESTATE