Includes steps involved in establishing a local office.
Last Published: 10/17/2019
For U.S. companies interested in establishing a presence in Mexico, the General Law of Mercantile Organizations (or Civil Code) regulates many different forms of business entities. The type of business incorporation that a U.S. company or individual chooses is extremely important, as it determines the operations they may perform in Mexico and, among other liabilities, the amount of taxes owed.

The most commonly used types of business classifications are the Corporation (Sociedad Anónima) identified with ‘S.A.’ at the end of the company name, and the Corporation with Variable Capital (Sociedad Anónima de Capital Variable) identified with ‘S.A. de C.V.’ One of the advantages of the latter is that the minimum fixed capital can be changed after the initial formation.
The Civil Partnership (Sociedad Civil) is the most common organization for professional service providers. It has no minimum capital requirement and no limit on the number of partners, but it is taxable in the same way as a corporation. It is identified with ‘S.C.’ The Civil Association (Asociación Civil) is the form that charitable or nonprofit organizations adopt to operate, and is identified with ‘A.C.’

A Limited Liability Partnership (Sociedad de Responsabilidad Limitada), identified with ‘S. de R.L.,’ is similar to an LLP in the United States and has the option of having variable capital, indicated by ‘S. de R.L. de C.V.’ As this is a partnership structure—in other words, an organization formed by individuals as partners—it has similar characteristics to a Civil Partnership apart from unlimited liability.

A foreign company may open a branch (sucursal) in Mexico as an alternative to incorporating. A branch can provide rights and responsibilities similar to a corporation, including tax liability and access to local courts, but requires the approval of the National Foreign Investment Commission (Comisión Nacional de Inversiones Extranjeras or CNIE).

Consulting with a law firm in Mexico prior to establishing an office in the country is important. A partial list of Mexican law firms with international business focus and experience can be found at the U.S. Commercial Service Mexico Business Providers List. For other types of legal representation, contact our U.S. Commercial Service office in Mexico City to obtain the Embassy’s attorney list.
 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



Mexico Business Registration