39325 Doing Businessin COMPARING ousi es ing s M exico 2007 REGULATION INTHE31STATESAND DBinMnexico MEXICO 2007 CITY COMPARING ousi es ing s REGULATION INTHE 31 STATES AND DBinMnexico 2007 MEXICO CITY A copublication of the World Bank and the International Finance Corporation ©2006 The International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org E-mail: feedback@worldbank.org All rights reserved 1 2 3 4 5 09 08 07 06 A copublication of the World Bank and the International Finance Corporation This volume is a product of the staff of the World Bank Group. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank Group does not guarantee the accuracy of the data included in this work. 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Copies of Doing Business 2007: How to Reform, Doing Business in 2006: Creating Jobs, Doing Busi- ness in 2005: Removing Obstacles to Growth, and Doing Business in 2004: Understanding Regulation may be obtained at www.doingbusiness.org. Doing Business in Mexico 2007 was printed in November 2006 by IMPRIME TUS IDEAS, S.A. DE C.V. Horacio No. 340, Polanco, C.P. 11560, México, D.F. www.imprimetusideas.com This edition includes 1,150 copies Contents Doing Business in Mexico 2007 is the second subnational Overview 1 report in the series Doing Business in Mexico In 2005, quantitative indicators on business regulations and their Starting a business 5 enforcement were created for 12 cities and states. This year, Doing Business in Mexico 2007 covers all 31 states of Registering property 9 the Mexican Republic and measures the progress of the Getting credit 13 12 states analyzed last year. Comparisons with Mexico City and the rest of the world are based on the indicators Enforcing contracts 15 in Doing Business 2007: How to reform. Comparisons with Doing Business in the South-Southeast Region 19 the Brazilian states are based on the indicators in the report Doing Business in Brazil. Data notes 23 Doing Business investigates the scope and manner of regulations that encourage business activity and those that Doing Business indicators 29 constrain it. The indicators cover four areas of business State tables 32 regulation and their enforcement: starting a business, registering property, getting credit (registering collateral) Case studies--Starting a business 39 and enforcing contracts. These indicators were selected Case studies--Registering property 62 because they cover areas of state and municipal jurisdiction. The indicators are used to analyze the economic outcomes Acknowledgments 77 of the regulations and to identify what reforms have been successful, where and why. This project is the result of a request from the Mexican Other areas important to business, such as proximity to Association of Economic Development Secretaries major markets, the quality of infrastructure services, the (AMSDE), the Ministry of the Economy (SE) through securityofpropertyfromtheftandlooting,thetransparency the Federal Regulatory Improvement Commission of government procurement, macroeconomic conditions (COFEMER), and the Ministry of Foreign Affairs (SRE) or the quality of institutions, are not studied directly by through the Plan Puebla Panama General Coordination Doing Business. In order to make the data comparable (CGPPP). The project was directed by the Foreign across countries, the indicators refer to a specific type of Investment Advisory Service (FIAS), a multidonor service company--generally a limited liability company. of the World Bank Group. Overview If you were to open a new business in Mexico City, the it. The results for the 31 Mexican states and Mexico start-up procedures would take 27 days on average, 8 City are presented here (table 1.1). Mexico City, as the days fewer than in Shanghai. If you decided to open a country's most populous city, represents Mexico in the business in Guanajuato or Aguascalientes, you would global Doing Business series which compares regulatory have to wait 12 days--only one day longer than your practices in 175 economies. Doing Business in Mexico competitor in Amsterdam. But if you needed to take 2007 finds that Mexico City does not always rank high- a customer to court for a simple debt default in Gua- est among states in the four indicators measured. The najuato, resolving the dispute would take 304 days--far 12 days it takes to open a business in Aguascalientes or longer than the 217 days it takes in Dublin,1 but sig- Guanajuato, for example, compare favorably with the nificantly shorter than in Baja California Sur where it 27 days needed in Mexico City. The same holds true for takes 581 days. These examples illustrate two patterns. property registration, where Mexico City is ranked 26 First, some Mexican states compare well with the best out of 32. in the world. Second, many states need much reform to But even the best Mexican states are not interna- become globally competitive. tionally competitive in some indicators--18 days for Doing Business measures the ways in which govern- property registration in Aguascalientes and 21 days in ment regulations enhance business activity or restrain Sonora and Zacatecas compare poorly with Thailand, TABLE 1.1 Doing business in Mexico: where is it easiest? Rank State (City) Rank State (City) Rank State (City) 1 Aguascalientes (Aguascalientes) 12 Durango (Durango) 23 Veracruz (Coatzacoalcos)* 2 Guanajuato (Celaya) 13 Coahuila (Torreón) 24 Chiapas (Tuxtla Gutiérrez) 3 Nuevo León (Monterrey) 14 Chihuahua (Cd. Juárez) 25 Oaxaca (Salina Cruz) 4 Sonora (Hermosillo) 15 Hidalgo (Pachuca de Soto) 26 Tabasco (Centro/Villahermosa) 5 Campeche (Campeche) 16 Tamaulipas (Reynosa) 27 Nayarit (Tepic) 6 Zacatecas (Zacatecas) 17 Jalisco (Guadalajara) 28 Puebla (Puebla) 7 Querétaro (Querétaro) 18 Baja California (Tijuana) 29 Estado de México (Tlalnepantla de Baz) 8 Michoacán (Morelia) 19 San Luis Potosí (San Luis Potosí) 30 Guerrero (Acapulco) 9 Sinaloa (Culiacán) 20 Yucatán (Mérida) 31 Morelos (Cuernavaca) 10 Distrito Federal (Mexcio City) 21 Baja California Sur (La Paz) 32 Quintana Roo (Benito Juárez/Cancún) 11 Colima (Colima) 22 Tlaxcala (Tlaxcala) *Doing Business en México (2005) measured the city of Veracruz. In Doing Business in Mexico 2007 Veracruz was replaced with Coatzacoalcos. Source: Doing Business database. 2 DoIng BusIness In MeXICo 2007 FIGURE1.1 Reform in Latin America lagging behind Africa and the America is in fifth place, behind Eastern Europe, the Middle East OECD, the Middle East, and Sub-Saharan Africa. Only Countries that made at least one positive reform in 2005/06 (%) Asia performed worse (figure 1.1). Three Latin Ameri- Eastern Europe can countries--Mexico, Peru and Guatemala--made & Central Asia 89 the list of the top-10 reformers across 175 economies. In OECD high income 83 contrast, Bolivia and Venezuela made it more difficult to Sub-Saharan do business. Africa 67 Middle East Mexico, represented by Mexico City, holds the third & North Africa 61 place among the top-10 reformers after Georgia and Latin America & Caribbean 58 Romania (table 1.2). A new securities law defines for the East Asia first time the duties of company directors, replacing an & Paci c 35 obligation to "take care of the business as if it were your South Asia 25 own" with a specific list of activities that violate that duty. The law also increases scrutiny of related-party transac- Source: Doing Business database. tions. It requires full disclosure before any deal benefit- where it takes only 2 days. Another interesting com- ing a company insider can take place. Other reforms parison is that of Mexican states versus their regional reduced the time to start a business in Mexico City from competitors in Brazil. In general, Mexican states have 58 to 27 days. And the corporate income tax rate was faster procedures. However, doing business is generally cut from 33% in 2004 to 30% in 2005, and 29% in 2006. more expensive in Mexico. A Brazilian firm must pay These reforms helped Mexico climb 19 ranks to number on average 10­13% of Gross Domestic Product (GDP) 43 on the ease of doing business--proof of the gains that per capita to open a business while the same type of are possible when a country reforms. firm in Mexico has to pay 20.4%. In addition, Mexican Watch out, Mexico: China is a top-10 reformer as companies have to put up minimum capital, while their well. The government sped up business entry, increased competitors in Brazil do not. investor protections and reduced red tape in trading Doing business became easier in most Latin Ameri- across borders. China also established a credit informa- can countries between January 2005 and April 2006. tion registry for consumer loans. These reforms will 27 regulatory reforms in 13 economies in the region make China a more formidable competitor for Mexico. reduced the time, cost and hassle for businesses to comply with legal and administrative requirements. But other regions are progressing faster. Last year, Latin America ranked third in regional reforms. In this year's report--Doing Business 2007: How to Reform--Latin TABLE 1.2 The top 10 reformers in 2005/06 Economy Starting a Dealing with Employing Registering Getting Protecting Paying Trading Enforcing Closing a business licenses workers property credit investors taxes across borders contracts business Georgia 3 3 3 3 3 3 Romania 3 3 3 3 3 3 Mexico 3 3 3 China 3 3 3 3 Peru 3 3 3 3 7 France 3 3 3 3 3 Croatia 3 3 3 Guatemala 3 3 3 Ghana 3 3 3 Tanzania 3 3 3 3 Note: economies are ranked on the number and impact of reforms. First, Doing Business selects the economies that reformed in 3 or more of the Doing Business topics. second, it ranks these economies on the increase in rank in the ease of doing business from the previosus year. The larger the improvements, the higher the ranking as a reformer. "X" indicates a negative reform. Source: Doing Business database. oVerVIew 3 Comparing business regulations in Mexican states state to state, depending, for example, on the strength of notary associations and competition from commercial All states share the same legal and regulatory framework brokers known as corredores públicos, who offer similar affecting businesses. The Company Law (Ley General de services at a lower price. Legal fees are the most expen- Sociedades Mercantiles) guides business start-ups, the sive element of contract enforcement, as there are no Law on Negotiable Instruments and Credit Operations court fees in Mexico. The longer judicial processes drag (Ley General de Títulos y Operaciones de Crédito) deals on, the more the entrepreneur has to pay. with collateral, and the Commercial Code (Código de States can take actions to become globally com- Comercio) and Civil Procedures Code (Código Federal petitive without changing federal laws. If a virtual state de Procedimientos Civiles) define the steps necessary to "Mexicana" were to adopt the best existing business enforce a contract. regulations within Mexico, this state would climb the Despite the shared laws, municipal and state re- global ranks on the ease of doing business in each of quirements vary and affect the number of procedures, the four areas measured (table 1.3). "Mexicana" could the time and--to a lesser degree--the cost to register a adopt Guanajuato's speedy procedures and Campeche's business in a specific location. Obtaining an operational cost structure to make business start-up easy. As a re- license may take up to 4 weeks in Acapulco (Guerrero). sult, entrepreneurs would spend 1 day less than in Italy And some municipalities require inspections that are to open a business and pay less than their competitors not required in other locations for the same type of in the Netherlands. Aguascalientes and Veracruz could business. This explains why an entrepreneur in Colima share their know-how regarding timely and inexpensive (Colima) spends only 1 day to comply with all munici- property registration--making "Mexicana" comparable pal requirements, while in Cancún (Quintana Roo) she to Spain, where it takes 17 days to register property. needs 18 days. Studies like Doing Business identify these Without having to change any laws, court procedures differences and help policymakers review them from a could be borrowed from Zacatecas and Aguascalien- comparative perspective. tes in order to make "Mexicana" similar to the United Municipal and state regulations dominate property Kingdom, where it takes 228 days to enforce a contract. registration. The result is different requirements depend- Finally, "Mexicana" could foster easier access to credit by ing on the location. Registering property requires any- copying Michoacán and Colima's collateral registration where between 4 and 10 procedures across the 31 states mechanisms. and Mexico City. In addition to increasing the burden on businesses, each point of contact is an opportunity TABLE 1.3 for corruption. Campeche, Colima and Hidalgo prove Best practices in Mexico Global ranking that registering property can be easy in Mexico, as only (175 economies) 4 procedures are necessary. It takes 18 days to meet all Days to open a business legal requirements on the outskirts of Aguascalientes Aguascalientes, Guanajuato (12 days) 17 (Aguascalientes) and 21 days in Hermosillo (Sonora) Cost to open a business or Zacatecas (Zacatecas). Things are more difficult in Campeche (6.0% of GDP per capita) 37 Quintana Roo and Baja California Sur, where entrepre- Days to register property Aguascalientes (18 days) 32 neurs have to wait between 4 and 5 months to complete Cost to register property the process. Veracruz (2.1% of property value) 36 When it comes to enforcing a contract, all states have Days to register collateral to comply with the federal commercial code. A firm seek- Michoacán, Zacatecas (8 days) n.a.* ing to resolve a dispute with its customer has to follow Cost to register collateral identical procedural steps in all states. However, the trial Colima (0.8% of loan value) n.a.* takes over 1½ years in Baja California Sur, compared to Days to enforce a contract less than 8 months in Zacatecas. The reason is that not all Zacatecas (230 days) 32 state courts are equally efficient or enforce federal proce- Cost to enforce a contract Aguascalientes, Zacatecas (14% of debt) 46 dures the same way--strictly, or with some flexibility. *n.a.=not available The largest cost components across the four indica- Nota: The registering collateral indicator was not included in Doing Business 2007: How to Reform. tors are fees charged by private legal professionals, espe- Comparisons in the enforcing contracts indicator use the global ranking in Doing Business in 2006: Creating Jobs (155 economies) due to changes in the methodology. cially notaries. But the amounts differ significantly from Source: Doing Business database. 4 DoIng BusIness In MeXICo 2007 Who is reforming? TABLE 1.4 9 of the 12 states benchmarked in 2005 and Mexico City In 2005, the first sub-national study on the ease of doing reformed in at least one Doing Business indicator business in Latin America compared 12 Mexican states Starting Registering Enforcing a business property contracts and Mexico City.2 The study created fierce competition Aguascalientes 3 3 3 to build the best business environment. The reason for Querétaro 3 3 3 the competition was that with almost identical federal Yucatán 3 3 3 regulations, mayors and governors had difficulty explain- Guanajuato 3 3 ing why it took longer or cost more to start a business, Nuevo León 3 3 3 3 register property, register collateral or enforce a contract San Luis Potosí Chihuahua 3 in their city or state as compared to their neighbors. The Coahuila 3 study also showed that there was no need to wait for Mexico City 3 Congress to reform federal legislation--simple admin- Puebla 3 istrative reforms could make their states and cities more Note: reforms took place between August 2005 and June 2006. This year the city of Veracruz was competitive. And many good practice reforms were rela- replaced with Coatzacoalcos in the state of Veracruz. Source: Doing Business database. tively straight-forward to replicate among states. Globally, governments are less likely to implement both in the ease of registering collateral to access credit, reforms during an election year. Mexico has been the as well as in the ease of enforcing contracts, where it is exception. Despite recent presidential elections, as well the top performer. as state and municipal elections in a number of locations, Publishing comparative data on the ease of doing regulatory reform has been brisk. The states have simpli- business inspires local governments to reform. However, fied business regulations, strengthened property rights more reforms are needed to keep up with the rest of the and improved access to credit. Aguascalientes was the top world's economies, two-thirds of which made at least performer last year. State and city officials have success- one reform to improve their business environment last fully used their high benchmark as a promotional tool year. During the past 3 years, nearly 85% of reforms to compete for business at home and abroad. Simultane- in the top reforming countries took place in the first ously, they have continued to press ahead with reforms. 15 months of a new government. The message: for a As a result, Aguascalientes earned the top rank again recently elected government (as in Mexico), the time to this year. Querétaro, the lowest ranked overall performer push through federal reforms is now. In the words of one last year, created a public-private task force dedicated to reformer, "Reform is like repairing a car with the engine improving its benchmarks. The task force systematically running--there is no time to strategize." studied bottlenecks, proposed reforms and measured Reform can ease the bureaucratic burden on all progress. The reforms helped Querétaro climb 9 ranks businesses: small and large, domestic and foreign, rural over last year. Now the state holds rank number 7 out of and urban. Whatever reformers do, they should always 31 states and Mexico City on the ease of doing business in ask, "Who will benefit the most?" If reforms are seen to Mexico. The lesson: what gets measured, gets done. benefit only foreign investors, large domestic companies, Like in the rest of the world, the most popular or bureaucrats-turned-investors, they reduce policy le- reform in Mexico in 2005-2006 was easing the regula- gitimacy. By creating simpler business start-up require- tions on starting a business. But reforms also took place ments and stronger property rights, all businesses can in property registration and enforcing contracts. Other thrive. This way there is no need to guess where the next reforms are ongoing (table 1.4). boom in jobs will come from. The various reform initiatives were widely discussed throughout the year. States and cities not included in the survey took note. They requested to be benchmarked, 1 The methodology for enforcing contracts was revised in and this year's study includes all 31 states. Three of the Doing Business 2007: How to Reform to reflect a typical top 6 performers this year are "new" states: Sonora, contractual dispute over the quality of goods rather than which ranks fourth, Campeche in fifth place and Za- a simple debt default. Doing Business in Mexico 2007 uses the previous methodology. Comparisons with 154 coun- catecas in sixth. Sonora and Campeche are especially tries are based on Doing Business in 2006: Creating Jobs. efficient when it comes to property registration, ranking 2 World Bank, 2005. Doing Business in Mexico. Washing- first and second in that indicator. Zacatecas stands out ton, D.C. 5 Starting a business Pedro wants to set up a company to sell souvenirs in necessary steps--including all registrations, inscriptions, Cancún. But complying with all the requirements will licenses and verifications--to operate legally. It is easiest take over two months and cost him 12% of GDP per in Aguascalientes and Nuevo León and most difficult capita. Instead, Pedro decides to sell the merchandise in Veracruz (table 2.1). Opening a business takes only informally on the beach. His business pays no taxes or 12 days in Aguascalientes and Guanajuato compared social security contributions. It will also have difficulties to 69 days in Quintana Roo (figure 2.1). Aguascalientes growing and accessing credit. and Guanajuato are faster than the OECD average--16 Procedures to start a business in Mexico are similar days--and would rank number 17 compared to 175 across states. It takes on average 9 procedures, 36 days economies in the time to start a business. The state and 20.4% of GDP per capita. However, in practice, there where it takes the longest would rank number 146. are wide differences in the time and money that a domes- Registering the company statutes is the source of the tic small or medium enterprise spends to complete all longest delays in most states, followed by the time to ob- tain the tax identification number (RFC). Since October TABLE 2.1 Where is it easy to start a business--and where not? 2005, notaries have been able to issue the tax number via the Internet, provided that they are authorized to do so 1 Aguascalientes (easiest) 17 Yucatán by the tax authority (SAT). In the cities of Aguascalien- 1 Nuevo León (easiest) 18 Sinaloa 3 Querétaro 19 Morelos FIGURE 2.1 4 Campeche 20 Durango Aguascalientes and Guanajuato--fastest for starting 5 Mexico City 21 Puebla a business 6 Coahuila 22 Zacatecas Days 36 7 Guanajuato 23 Tabasco 12 8 San Luis Potosí 24 Colima Aguascalientes 9 Sonora 25 Hidalgo Guanajuato 12 10 Michoacán 26 Tlaxcala Michoacán 19 Average 5 31 States & Mexico City fastest 11 Baja California Sur 27 Chiapas Querétaro 19 12 Baja California 28 Estado de México San Luis Potosí 19 13 Chihuahua 29 Guerrero Nayarit 48 14 Tamaulipas 30 Nayarit 15 Jalisco 30 Oaxaca Morelos 50 5 16 Quintana Roo 32 Veracruz (most difficult) Guerrero 54 slowest Colima 66 Note: The ease of starting a business is a simple average of the state rankings on the number of procedures, the associated time and cost and minimum capital (as % of the state's gDP per Quintana Roo 69 capita) required at the start of the business. see the Data notes for details. Source: Doing Business database. Source: Doing Business database. 6 DoIng BusIness In MeXICo 2007 FIGURE 2.2 Nayarit--high cost to start a business mies--similar to Thailand and Belgium--while Nayarit would rank number 123. On top of these costs, there is Cost (% of GDP per capita) 20.4 a minimum capital requirement of MXN 50,000 (US$ Campeche 6.0 4,525) to set up a limited liability company (sociedad Aguascalientes 6.8 anónima), of which the entrepreneur must prove to have Average Querétaro 9.1 5 31 States & lowest at least 20% in cash. Such a requirement makes it costly Nuevo León 9.7 Mexico City for entrepreneurs to establish this type of companies. Sonora 10.3 Notaries generally conduct many procedures on be- Tabasco 30.7 half of their clients. On average they charge MXN 6,550 Oaxaca 31.0 (US$ 593) to draw up and authenticate the company Chiapas 38.3 5 highest statutes--but the costs are lower in Guerrero, Michoacán Estado de México 44.0 and Oaxaca and higher in Nayarit, Quintana Roo, Baja Nayarit 65.8 California Sur and Tabasco. There is no clear relation- ship between a state's income and notary costs. Notaries Source: Doing Business database. charge on average more in Chiapas than in Nuevo León, despite the GDP per capita in Chiapas being five times tes (Aguascalientes), Celaya (Guanajuato), Mexico City, lower. The differences in notary costs, as well as in the Monterrey (Nuevo León), Morelia (Michoacán), San time to complete procedures at the notary, seem to be Luis Potosí (San Luis Potosí) and Querétaro (Querétaro), more related to the number of notaries and commer- most notaries have signed up to the new system, cutting cial brokers (corredores públicos) competing with each the time to start a business by 15 days. other. Delays at the registry decrease when electronic Registry fees also vary widely across the states. systems are available and staff is well-trained. Several They amount to 0.3% of GDP per capita in Campeche, states such as Aguascalientes have introduced electronic 0.6% in Aguascalientes, 4.5% in Baja California, 12.8% records. Some notaries in Guanajuato, Jalisco, Nuevo in Chihuahua and 23.3% in Estado de México. In most León and San Luis Potosí already register the company states, registration fees increase proportionally with the statutes via the Internet, but the system still needs to be share capital of the company. The third main source of expanded to include all notaries. The registry of Baja costs is the municipal license. In cities like La Paz (Baja California is ISO 9002 certified and can be consulted California Sur), the only requirement is a notification at online. It also allows electronic payments. no cost. But obtaining the operational license is costly Costs stem mainly from notary charges, registration for entrepreneurs in Colima (Colima), Salina Cruz fees and municipal permits. As a percentage of the state's (Oaxaca), Tijuana (Baja California) and Tepic (Nayarit). GDP per capita, they vary widely across Mexico--from Mexico is reforming business start-up fast, follow- 6% in Campeche to 65.8% in Nayarit (figure 2.2). Glob- ing an international trend. 43 countries made entry ally, Campeche would rank number 37 of 175 econo- easier last year. Seven of the 12 states measured for the TABLE 2.2 7 of the 12 states benchmarked in 2005 and Mexico City reformed business start-up RFC obtained Administrative reforms Streamlined Streamlined electronically at the Public Registry procedures to obtain registration at the notary of Commerce the municipal license for payroll tax Aguascalientes 3 3 7 Coahuila 3 Mexico City 3 3 3 Guanajuato 3 3 Nuevo León 3 3 Querétaro 3 3 3 San Luis Potosí 3 3 Yucatán 3 3 Note: The reforms took place between August 2005 and June 2006. "X" indicates a negative reform. Source: Doing Business database. sTArTIng A BusIness 7 second time this year show important reductions in What to reform? start-up time due to reforms (table 2.2). The same is true of Mexico City, where the time to start a business fell Last year's report recommended the introduction of from 58 to 27 days in 2006. Reforms are also underway electronic procedures, the creation of single access at the Registries of Commerce in Jalisco, Yucatán and points, a reduction of taxes and fees and the extension Puebla. Mexican states can learn from each other and of access to online tax registration beyond the notaries. adopt the best practices in the country. These recommendations are still valid for many states. Doing Business in Mexico inspired reformers to ac- In addition, states would benefit from the following: celerate the pace of improvements in the procedures to start a business. In Querétaro, where it took the longest Introduce fixed registration fees based on the ser- after Mexico City last year, the state and municipal vice rendered. In Baja California, Baja California Sur, governments have been working with the notaries and Colima, Durango, Guerrero, and Nayarit, among others, the private sector to simplify business start-up. The ef- company registration fees are calculated as a percentage forts are bearing fruit, cutting 33 days off the time to of the company's share capital. However, the resources start a business. And reforms were not limited to states employed are the same to register a company with a that ranked low last year. Guanajuato and Aguascalien- start-up capital of MXN 50,000 (US$ 4,525) or MXN 5 tes--last year's number 1 and 2--promoted the use of million (US$452,489). Countries with the most efficient electronic systems among notaries and improved the company registration processes, including New Zealand, efficiency of their registries. Torreón (Coahuila), Queré- Canada and Australia, charge fixed fees. So do several taro (Querétaro), Mérida (Yucatán) and San Luis Potosí Mexican states, including Campeche, Guanajuato, Mi- (San Luis Potosí) cut the time to issue the operational li- choacán and Morelos. cense to 1 or 2 days and Celaya (Guanajuato) eliminated the requirement altogether. With 31 states in the race, Streamline licensing requirements. Some munici- competition is even greater. The winners will be the new pal license requirements remain complex and lengthy. employees in the formal sector across México. Cities could, for example, follow the lead of Torreón Federal, state and municipal governments are work- (Coahuila), which streamlined the process to obtain the ing to set up single access points for business start-up. license through SARE and cut time from 10 days to 1. The most widespread is the Rapid Business Start-up Aguascalientes, Colima and Durango are other examples System (SARE), which brings together different agencies of efficient systems. Inspections and costs could be re- and streamlines start up procedures for activities of low duced in many other locations. And the criteria for rapid risk to the public.1 There are now 106 municipalities with start-up procedures (SARE) should be expanded to busi- SARE in Mexico and all but 5 of the 31 municipalities nesses in activities not currently covered by SARE such measured in this study have SARE. Yet, there are differ- as supermarkets or gas stations. States like Guanajuato ences in the effectiveness of SARE across municipali- and Jalisco have introduced single access points for such ties, including the time to issue licenses and inspection types of businesses. requirements. Additionally, some municipalities impose restrictions on the types of activities and the size of the Introduce standardized incorporation documents. firm's premises to qualify for SARE. For those busi- This year's global top reformer in starting a business, nesses that meet the conditions, the municipal license is Portugal, introduced the option for entrepreneurs to use granted faster in municipalities with SARE--2 days on standardized articles of association. This ensures that average compared to 22 days for the same procedure in applications are error-free, do not require the interven- municipalities without SARE. tion of a notary, and can be processed quickly at the registry. Portugal is now one of the fastest economies for business start-up. It only takes 8 days. Abolish the minimum capital requirement. This would require a legal change. Mexican entrepreneurs still face the hurdle of a MXN 50,000 (US$ 4,525) minimum capital requirement. Seven countries (China, 8 DoIng BusIness In MeXICo 2007 Georgia, Japan, Lao PDR, Madagascar, Micronesia and Morocco) reduced or eliminated this requirement over the past year. The argument that minimum capital re- quirement protects creditors makes little sense. High minimum capital requirements are not associated with higher recovery rates for creditors in bankruptcy.2 The countries that first introduced this requirement in the 18th century--France and the United Kingdom--have eliminated it. Reforms to reduce the time and cost to start a busi- ness are simple and not too costly. The introduction of a fast-track system to start a business in Portugal cut the time by 46 days last year. The reform was implemented in five months and cost US$350,000. Often, start-up reforms do not require legislative changes. Experience across the world shows how removing obstacles to busi- ness start-up is associated with new formal businesses, added jobs and increased investment.3 1 SARE includes procedures that allow the firm to start op- erations. The remaining necessary steps can be completed once the firm is operating. 2 World Bank. 2004. Doing Business in 2005: Removing Ob- stacles to Growth. Washington, D.C. 3 World Bank. 2005. Doing Business in 2006: Creating Jobs. Washington, D.C. 9 Registering property The more difficult it is to register property, the more registration. Confirmation is returned within minutes. assets stay in the informal sector. However, informal In Mexico, registering property takes on average 6 titles cannot be used as collateral to obtain loans. Fur- weeks and 3.9% of the property value. These statistics ther, without formal title, property values are lower and compare favorably with Latin America, where the en- property owners invest less.1 A recent study in Argentina trepreneur spends more than 2 months and 6% of the found up to 47% higher investment rates when proper- property value to register. But in OECD countries the ties are formally registered.2 Similar research in Peru same process can be completed in two-thirds of the time showed a 60% increase.3 needed in Mexico. It is easier to register property in New Zealand than Still, the 31 Mexican states and Mexico City make anywhere else in the world. The entire process can be it easier or more difficult to register property, and the completed with 2 online procedures at a cost of 0.1% of cost and time vary considerably within the country. the property value. Lawyers certify land transfer docu- Campeche ranks first--with only four procedures that ments for their clients and submit them electronically for take 22 days and cost 2.5% of the property value--fol- lowed by Sonora and Nuevo León (table 3.1). Registering TABLE 3.1 Where is it easy to register property--and where not? property is most difficult in Quintana Roo, where the entrepreneur spends more than 5 months and 4.3% of 1 Campeche (easiest) 17 Yucatán 2 Sonora 18 San Luis Potosí the property value. 3 Nuevo León 19 Tabasco The number of procedures necessary to register 4 Aguascalientes 20 Querétaro property varies among the 31 states and Mexico City 4 Veracruz 21 Baja California Sur from 4 to 10. The national average of 6 procedures can 6 Guanajuato 22 Durango be compared with some Latin American countries like 7 Chiapas 22 Jalisco 8 Michoacán 24 Puebla Chile, Costa Rica and Salvador or with Russia, Japan or 9 Colima 25 Guerrero Canada. However, registering property takes 9 steps in 10 Tlaxcala 26 Mexico City Guerrero, Morelos and Yucatán, and in Quintana Roo 11 Hidalgo 27 Estado de México 10 procedures are needed. On the other hand, entrepre- 11 Zacatecas 28 Nayarit neurs in Campeche, Colima and Hidalgo only have to 13 Chihuahua 29 Coahuila 14 Sinaloa 30 Oaxaca comply with 4 different procedures (figure 3.1). Sweden 15 Baja California 31 Morelos and Norway--with only one procedure--are the world's 16 Tamaulipas 32 Quintana Roo (most difficult) leaders in this indicator. Note: The ease of registering property is a simple average of the state rankings on the number of Time is measured in calendar days, from the start procedures, and the associated time and cost (as % of property value) required to register a property. see the Data notes for details. of the transaction to the sale-purchase agreement and Source: Doing Business database. finally the registration of the new title at the Public Reg- 10 DoIng BusIness In MeXICo 2007 FIGURE 3.1 4 steps to register property in Campeche and a state law aimed at fostering investment exempts businesses from paying registration fees.4 Most Mexi- Time Cost (days) (% of property value) can states apply a 2.0% transfer tax. The transfer tax of Sinaloa, Morelos, Tabasco and State of Mexico are above 25 2.5 the country's average transfer tax rate. 20 2.0 Other important costs are notary charges. In some cities, state governments set notary fee schedules though 15 1.5 these may be outdated or simply not used. Doing Busi- Cost 58 dias ness in Mexico 2007 recorded the most commonly 10 1.0 charged fees in each state, whether or not they comply 5 Time 0.5 with the official fee schedules. In Mexico, notary fees represent on average 26% of the total cost for registering 0 0 1 property. Nevertheless, there are some states where the Procedures 4 notary costs are low. For example, in Campeche notary Source: Doing Business database. charges are 7% of the total property transfer costs (0.18% of property value). A very different scenario is found in istry and notification to the cadastre. In Aguascalientes, Nayarit where the notaries represent 54% of the total the entrepreneur spends 18 days from start to finish, in cost, or 3.8% of property value. Sonora and Zacatecas she spends 21 days, 22 days in Within Mexico, 8 of the 12 states that were measured Campeche and Michoacán, and 25 days in Baja Califor- in Doing Business in Mexico reformed at least one aspect nia. There is a big difference between these states and of registering property. The reforms included improve- Quintana Roo where the entrepreneur needs more than ments of registration processes, personnel training, in- 5 months to register property. The main bottlenecks are troduction of electronic systems and electronic payment the Public Registries that take up between 73% and 87% of transfer taxes and registration fees (table 3.3). Queré- of the total time for registering property. taro was the top reformer in 2005/06. In addition to the Costs come largely from transfer taxes, notary reforms mentioned, Querétaro opened a single access charges and registration fees; all are determined at point for businesses at the Public Registry of Property the state or municipal level. Veracruz and Guanajuato and Commerce. Although the reforms reduced response are the cheapest states to register property--2.1% of time by almost 40% from last year, Querétaro has a long property value. Tlaxcala and San Luis Potosí are in the way to go in this area. The bottleneck in Querétaro is the middle (3.6%). Nayarit is most costly--7.0% of property registration of the public deed which takes one month, value--followed by Morelos with 6.3% (table 3.2). while in the top-performing states it only takes from 4 Guanajuato has the lowest transfer tax--0.75% of to 7 days. property value. Veracruz charges a 1% transfer tax rate TABLE 3.2 Who regulates property registration the least--and who the most? Procedures (number) Time (days) Cost (% of property value) Fewest Most Least Most Lowest Highest Campeche 4 Estado de México 7 Aguascalientes 18 Coahuila 51 Veracruz 2.1 Zacatecas 4.4 Colima 4 Nayarit 7 Sonora 21 Oaxaca 52 Guanajuato 2.1 Hidalgo 4.5 Hidalgo 4 Puebla 7 Zacatecas 21 Morelos 57 Colima 2.4 Oaxaca 4.5 Chiapas 5 Baja California 8 Campeche 22 Colima 59 Campeche 2.5 Estado de México 4.7 Michoacán 5 Coahuila 8 Baja California 25 Tamaulipas 61 Aguascalientes 3.0 Sinaloa 4.8 Nuevo León 5 Oaxaca 8 Michoacán 25 Puebla 63 Nuevo León 3.1 Durango 5.1 Sinaloa 5 Guerrero 9 Guanajuato 26 Mexico City 74 Chiapas 3.1 Tabasco 5.2 Sonora 5 Morelos 9 Nuevo León 28 Jalisco 112 Baja California Sur 3.1 Mexico City 5.2 Tamaulipas 5 Yucatán 9 Veracruz 28 Baja California Sur 123 Yucatán 3.2 Morelos 6.3 Tlaxcala 5 Quintana Roo 10 Yucatán 29 Quintana Roo 154 Sonora 3.4 Nayarit 7.0 Source: Doing Business database. regIsTerIng ProPerTY 11 TABLE 3.3 8 of 12 states benchmarked in 2005 reformed property registration Registration process Introduction Electronic payments simplification or improvement for transfer tax Personnel or improvement of electronic systems or registry fees training Aguascalientes 3 3 Chihuahua 3 Guanajuato 3 3 Nuevo León 3 3 Puebla 3 Querétaro 3 3 3 3 San Luis Potosí 3 3 Yucatán 3 3 Note: reforms took place between August 2005 and June 2006. Source: Doing Business database. What to reform? Reduce transfer tax rates and registration fees. This Doing Business in Mexico recommended that states does not necessarily imply less tax revenues as evidenced simplify procedures, link and unify the cadastre and the by reforms in other countries, such as India. High costs Public Registry and provide easier access to the Public foster informal transactions and underreporting of prop- Registry. These recommendations are still valid. New erty values. In addition, the constitutionality of charging recommendations for this year are the following: for registration services as a percentage of property value has been successfully challenged in court. Eliminate the requirement of presenting special certificates for water and land tax payment. In states Whatever the motivation for reform, the social problem like Campeche, Colima and Hidalgo, simply showing it addresses is clear: without the ability to legally own the most recent water and land tax receipts serves as land, some people are denied opportunities that others proof that the property has no such debts. Eliminating enjoy. This is not based on their ability or willingness to the need for no-debt certificates in other states would work, but on antiquated and often corrupt government automatically eliminate two procedures. policies. Reforming land laws and related registration requirements goes a long way toward reducing inequal- Keep cadastre records updated. This measure would ity in economic opportunities. It is what many urban eliminate the need for new cadastral valuations each and rural poor people need and governments would be time a property is transferred. If an entrepreneur wants wise to oblige. to transfer a property that is already registered in Co- lima, she does not need a cadastral valuation. Introduce electronic payments for transfer taxes and 1 Deininger, Klaus. 2003. Land Policies for Growth and Pov- registration fees. In Aguascalientes, Chihuahua and erty Reduction. World Bank Policy Research Report. New Querétaro, among others, it is already possible to make York: Oxford University Press. these payments online. 2 Field, Erica. 2005. "Property Rights and Investment in Urban Slums." Journal of the European Economic Associa- tion 3 (2­3): 279­90. Sign collaboration agreements between Public Regis- tries and notaries. Notaries should commit to prepar- 3 Galiani, Sebastian, and Ernesto Schargrodsky. 2006. "Property Rights for the Poor: Effects of Land Titling." ing sales deeds within a specified time period; registries Working paper. Universidad de San Andres and Universi- should keep notaries informed of improvements in pro- dad Torcuato Di Tella, Buenos Aires. cesses and provide online consultation and training. 4 Ley Número 829 de Desarrollo Económico y el Fomento de la Inversión del Estado de Veracruz de Ignacio de la Llave, published in the State Official Gazette in February 2004. 13 Getting credit Lack of access to credit is a major obstacle for entrepre- on the legal rights index, only half of the Latin American neurs, particularly those running small businesses. In and Caribbean average of 4.5 (table 4.1). Mexico, small enterprises play an important role as job The case study utilized in Doing Business in Mexico creators and are often run by women. Weak secured- 2007 is simple. A garment producer applies for loan at a credit legislation and inefficient collateral registries have local bank. The loan will finance the purchase of indus- an impact on how much, or how little, credit flows to trial sewing machines. The entrepreneur uses the sewing these firms. machines as collateral for the credit. In the meantime, Collateral matters because it secures credit. As co- she keeps the sewing machines in her possession in llateral makes a loan less risky for lenders, borrowers order to produce garments to repay the loan (non-pos- benefit from more and larger loans, lower interest rates sessory security right). and longer repayment periods. A transparent and cohe- Once the collateral securing the loan (i.e. the sewing rent legal framework on collateral can improve access to machines) is agreed upon, the bank must ensure that credit and terms for borrowers. In Doing Business 2007: there are no other existing liens on those assets. The best How to Reform, Mexico earned a rating of 2 (out of 10) way to do so is to register the collateral agreement with the collateral registry. In Mexico, the Law on Negotiable Instruments and Credit Operations (Ley General de Tí- TABLE 4.1 Who has the most legal rights for borrowers--and who the tulos y Operaciones de Crédito) allows firms to use assets least? as collateral while keeping them in the firm's possession. Strength of Economy legal rights index (1-10) The indicator measured in this report records the time Hong Kong, China 10 and costs involved in signing the collateral agreement United Kingdom 10 and registering it with the collateral registry. Singapore 9 In Minas Gerais, the best performing Brazilian state Panama 6 on this indicator, it takes 2 days to ensure that collateral is India 5 properly registered and enforceable against third parties, Average, Latin America & Caribbean 4.5 Chile 4 one week less than in Zacatecas or Michoacán, the fastest Peru 4 states in Mexico. The average time across Mexico is 17 Colombia 3 days (table 4.2). The situation is most difficult in Quin- Brazil 2 tana Roo, where collateral registration takes 51 days. "We Mexico 2 need to invest in human capital," says an entrepreneur Note: The strength of legal rights index measures the degree to which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilite lending. see the Data notes from Cancún (Quintana Roo), arguing that the registry for details. needs more skilled personnel "to deal with the registra- Source: Doing Business database. tion demand and high volume of information requests." 14 DoIng BusIness In MeXICo 2007 Delays are primarily due to overburdened and Out-of-court enforcement, which allows creditors outdated registry facilities. The reforms of 2000 and the to seize and sell collateral without court involvement, is Law on Negotiable Instruments and Credit Operations provided for by law. However, creditors cannot enforce provided for the creation of a federal public registry of a non-judicial order if the debtor opposes it. Moreover, commerce for movable property, but today, after 6 years, the debtor is likely to successfully challenge as uncons- the registries continue to be run by the states and there titutional any private enforcement action, even if the is no link between them. Although most states have original agreement expressly provided for it. This debtor initiated modernization programs to create electronic right defeats the purpose of out-of-court enforcement registries, the digitalization process is slow--there are because both parties often end up in court anyway. states where the security agreement is still manually Aguascalientes and Guanajuato continue to be good transcribed on paper. This causes delays in the creation examples of states making information retrieval easier and enforcement of security rights. In addition, the lack by permitting users to search archives online. Other of properly functioning registries makes it hard to esta- states are following suit. However, in the 12 states sur- blish priorities among creditors. veyed last year there have been no significant advances The cost to create and register collateral makes cre- in the ease of obtaining certificates of existing liens on a dit more expensive. Costs include notary fees, taxes and pledged asset. payment of registration rights, all defined at the state or municipal level. In Rio de Janeiro, an entrepreneur What to reform? spends 0.2% of the loan value to register a security right. Conditions are much more difficult in Nayarit, where Make collateral registries more efficient. Collateral registration costs are more than 8% of the loan--94% registries are more efficient when they are unified across of which are notary fees. The least expensive states are regions. In Mexico, they continue to be run by the states, Colima with 0.76% of the loan, and Sinaloa with 0.80%. with each state deciding how to operate the registries Both states also charge comparatively low notary fees. and how much taxes and duties to charge. A good start- ing point would be to link public registries between TABLE 4.2 regions in order to allow lenders to instantly check for Time and cost to create and register collateral existing liens. For the link to be successful, it is crucial to Time (days) harmonize the criteria between states, speed up the digi- Least Most talization of all public registries and permit electronic Michoacán 8 Baja California 18 filing and online retrieval. Zacatecas 8 San Luis Potosí 18 Aguascalientes 9 Baja California Sur 22 Guanajuato 9 Estado de México 22 Enable out-of-court enforcement. Ensuring that out- Veracruz 10 Puebla 23 of-court enforcement does not collapse at the first debtor Durango 11 Chiapas 24 objection cuts enforcement time by three-quarters on Nayarit 11 Tabasco 24 average. If the case does go to court, summary procee- Querétaro 11 Jalisco 26 dings can improve efficiency by limiting the debtor's abi- Sonora 12 Morelos 28 Tlaxcala 12 Quintana Roo 51 lity to delay the process. Decreasing court involvement, or at least expediting execution, would make creditors Cost (% of loan value) more willing to lend in Mexico. Lowest Highest Colima 0.8 San Luis Potosí 2.2 Access to credit is critical to ensure strong business Sinaloa 0.8 Chiapas 2.4 Aguascalientes 0.9 Tamaulipas 2.4 growth, and lack of access affects small businesses the Nuevo León 1.0 Hidalgo 2.6 most. To transform ideas and projects into real opportu- Zacatecas 1.0 Tabasco 2.7 nities for growth and employment, entrepreneurs need to Oaxaca 1.0 Veracruz 2.8 be able to obtain financing from third parties. Weak legal Sonora 1.1 Guerrero 3.3 rights limit access to credit by making it less attractive Guanajuato 1.2 Estado de México 3.4 for creditors to lend. An entrepreneur may have talent Coahuila 1.3 Chihuahua 5.0 Baja California Sur 1.3 Nayarit 8.1 and the willingness to open or expand her business, but without access to credit, business ideas remain only as un- Source: Doing Business database. finished projects. An enormous potential is not realized. 15 Enforcing contracts There is no doubt: without efficient courts, less wealth is In Hidalgo or Coahuila, enforcement takes twice as long created. Fewer transactions take place, and those that do as reaching judgment. On the other hand, businesses in take place generally involve a small group of people who Chihuahua and Estado de México know that once judg- are linked through kinship, ethnic origin or previous ment is reached, the worst part is over. dealings. Businesses that have little or no access to courts Across Mexico, enforcement of the court's decision must rely on social networks to decide with whom to do takes on average one-third of the time that it takes to business. reach a judgment (figure 5.1). Of course, speed and fair- Following a standard debt enforcement case, Doing ness must be balanced. However, if the enforcement of Business in Mexico 2007 measures the time and cost nec- a simple debt contract takes several years, businesses are essary to enforce a contract. Last year, Doing Business in more likely to avoid the court system altogether and not Mexico compared 12 states and Mexico City. The striking risk engaging with new business partners. Business rela- result was that despite a federal commercial code and tions remain exclusive. procedural requirements, the duration, cost and com- Efficiency often goes hand in hand with lower cost. plexity of enforcing a debt contract varied greatly from While the courts themselves are free in Mexico, time is state to state. This year's results covering all Mexican money when it comes to hourly attorney fees. Zacatecas states confirmed this difference in the implementation not only stands out for the fastest process, but it also of rules. has the lowest costs of all states. Enforcing a contract On average, it takes just over one year to enforce a in Zacatecas costs 14% of the debt value compared to contract in Mexico. This is faster than the 546 days needed 28% in Tlaxcala, where it takes twice as long to enforce in São Paulo, the best performing Brazilian state, but still a contract (figure 5.1). Both percentages are still much more than 3 months longer than the 275 days needed in higher than in Norway and New Zealand, where the cost El Salvador or 277 in South Africa.1 However, there is to enforce a contract is 4.2% and 4.8% respectively. On great variation in the time to resolve the same type of case average, Mexican entrepreneurs have to be ready to pay across Mexican states. It takes 581 days in Baja California about one-fifth of the debt value in fees. Sur, the state with the most delays. This is two-and-a-half A procedural complexity index measures how for- times longer than the fastest state, Zacatecas. mal the contract enforcement process is. Overly complex The bottlenecks differ from state to state. The time it procedural requirements can provide fertile ground takes from filing a case until the debtor is notified varies for dilatory tactics, unnecessary delays and more op- from 5 days in Veracruz to two months in Baja California portunities for bribes. States' scores in the procedural Sur. And while it might take only 90 days in Hidalgo to complexity index vary from 70 in Baja California Sur to reach judgment once the debtor is notified, enforcement 89 in Guerrero and Michoacán (figure 5.2), with higher of the final decision may drag on for almost 6 months. figures, in a scale ranging from 0 to 100, indicating 16 DoIng BusIness In MeXICo 2007 FIGURE 5.1 Time and cost to enforce a contract in Mexico Days Filing Judgement Enforcement Cost (% of debt) Zacatecas 371 Aguascalientes 21 14 Chihuahua Average Zacatecas 14 Average Hidalgo 31 States & 5 Colima 31 States & 5 Mexico City fastest 15 Mexico City lowest Colima Michoacán 16 Guerrero Sinaloa 16 Baja California Tamaulipas 25 Veracruz Nuevo León 26 Yucatán 5 5 slowest Oaxaca 27 highest Quintana Roo Quintana Roo 27 Baja California Sur Tlaxcala 28 0 365 Source: Doing Business database. greater complexity of processes. What to reform? Last year, four states reformed contract enforce- ment and therefore reduced delays and the cost of court Allowing a respondent to reply to a charge is fair, but al- procedures. The most popular reforms were investing lowing the dispute to continue indefinitely is inefficient in personnel and infrastructure, creating alternative and costly. In Mexico, the main cause of court delays is the justice mechanisms and introducing case management various strategies that the defendant may use to postpone and monitoring systems. a dispute settlement. The defendant may delay the notifi- In Yucatán, the government hired more staff and cation process by simply refusing to answer the door or by invested in technology. This led to a reduction of al- appealing almost every decision taken by the judge dur- most six months in the time to enforce a contract in ing the procedure, from the approval of a witness to the the state. estimated value of the lawyer's fee. However, the federal Another aspect of reforms is offering alternative government determines the commercial and procedural justice mechanisms. For example, Durango introduced laws and change can only be made by legal reform. an "Alternative Center of Justice" in October 2005 with There are simpler ways to improve contract enforce- the objective of reducing the courts' caseload and expe- ment. Last year, Doing Business in Mexico recommended diting judgments. The center has dealt with 700 cases introducing summary proceedings, allowing private en- to date, including 300 commercial cases. The time to forcement of judgments and setting up specialized com- enforce a contract in Durango is two months less than mercial courts. Some states have implemented such sys- the national average. FIGURE 5.2 However, alternative justice mechanisms can only Baja California Sur has the least complex judicial procedures. reduce the burden of courts, and thus reduce the overall time to enforce a contract, if the parties choose to use Procedural complexity index (0-100) these mechanisms. For example, Guanajuato and Vera- Guerrero 89 cruz have recently established similar mechanisms that Michoacán 89 are not yet popular among general public. In response, Colima 88 Most Chiapas complex the judiciary power of Veracruz proposes to launch a 88 Puebla 88 campaign to educate users about the benefits of such an Veracruz 88 alternative. Querétaro 77 Querétaro and Aguascalientes implemented an elec- Tamaulipas 77 tronic system that allows interested parties to manage and Least Quintana Roo 75 Average complex monitor their case through the Internet, following the ex- Morelos 72 31 States ample of Mexico City and Nuevo León. This reduced by10 Baja California Sur 70 82 days the time needed by the judge to decide on a case. Note: The procedural complexity index is not available for Mexico City. See the Data notes for details. Source: Doing Business database. enForCIng ConTrACTs 17 tems. Jalisco and Colima established specialized courts. ward commercial cases like enforcing a debt contract. In Enforcing a contract in those states takes almost 2 states where clients are hesitant to use alternative dispute months less than the national average. In Yucatán, a draft resolution, required pretrial conferences between parties law proposes to centralize notification and enforcement can help. of judgments. Overall, last year's recommendations still apply. Additional necessary reforms include: When contracts are efficiently enforced, businesses are encouraged to expand their trade networks, grow and Introduce case management and monitoring systems. employ more workers. Studies on the effect of reforms Case management in courts reduces delays and increases find that when contracts can be enforced quickly and user satisfaction. It usually involves two changes. First, cheaply, small businesses receive better financial terms judges take responsibility for following a case from start on loans.3 Other research finds that new technologies to finish. Second, an electronic system allows progress are adopted faster when courts are efficient because to be efficiently recorded and tracked from the time most innovation takes place in new businesses which, the case is filed until judgment is reached. The system unlike established firms, do not have the clout to resolve gives a more accurate perspective of judges' caseloads disputes outside the court system.4 in order to better allocate resources. This type of reform does not require much time or money. Reformers in Slovakia spent US$2 million and 6 months to introduce 1 The methodology for enforcing contracts was revised in such a system, cutting the time between filing and the Doing Business 2007: How to Reform in order to reflect first hearing from 73 to 27 days. A few years ago, Mexico a typical contractual dispute over the quality of goods City piloted a case management information system. It rather than a simple debt default. Doing Business in Mex- ico 2007 uses the previous methodology. Comparisons revealed that 60% of cases do not go beyond the initial with 154 countries are based on Doing Business in 2006: filing of a claim.2 Creating Jobs. 2 World Bank. 2003. Doing Business 2004: Understanding Introduce alternative dispute resolution or pretrial Regulations. Washington D.C. reconciliation. Another option is to offer alternative dis- 3 World Bank. 2006. Doing Business in 2007: How to Re- pute resolution mechanisms in order to ease the burden form. Washington, D.C. on the courts and judges, particularly for straightfor- 4 Ibid. 19 Doing Business in the South-Southeast Region In 2000, President Vicente Fox created the Plan Puebla an entrepreneur must spend one day longer than his Panama to promote economic and social development competitor in the United Kingdom, but 9 days less than in the 9 states in South-Southeastern Mexico and in his Chilean counterpart. Veracruz is the cheapest state Central America. The Mexican states are Campeche, in Mexico when it comes to property registration. In- Chiapas, Guerrero, Oaxaca, Puebla, Quintana Roo, ternationally, it ranks number 36 out of 175 economies Tabasco, Veracruz and Yucatán. The region is rich in around the world. The cost of registering property in natural resources and generates the bulk of Mexico's Veracruz compares favorably with countries like Nor- foreign exchange revenues from tourism and oil. It also way, where it costs 2.5% of property value. In Chile, on includes the states with the lowest GDP per capita and the other hand, entrepreneurs only have to pay 1.3% for human development indices in the country. the same service. At request of the Plan Puebla Panama, this chapter Veracruz is also the fastest state in the South- expands on the main text of this report to compare the Southeast for collateral registration. It takes 10 days, performance of the South-Southeastern states amongst a substantial time saving compared to the average 24 themselves in more detail, as well as in the national days necessary in the 12 states measured in Brazil, but 5 and international context. The results show that there times longer than in Minas Gerais, Brazil's best perform- is ample room for reform. Campeche, as the region's ing state. In Oaxaca, the entrepreneur spends the least top performer, holds the fifth position nationwide. Yu- FIGURE 6.1 catán, the region's runner-up, is an average performer. Where is it easy to do business in the South-Southeast The other 7 states rank among the bottom 10 states in and where not? Mexico (figure 6.1). YUCATAN When comparing specific indicators of the South- 20 Southeastern states with the rest of Mexico and 174 CAMPECHE countries around the world, the best performers stand VERACRUZ 5 PUEBLA 23 out. Campeche is the top performer in the South- 28 TABASCO 26 Southeast in both time and cost to start a business. The 32 days needed are three days less than the 35 days an QUINTANA ROO 32 entrepreneur spends in China, but 20 more than in Top 10 neighboring Aguascalientes and Guanajuato. In terms GUERRERO 30 Average of the cost, Campeche--with 6% of GDP per capita--is OAXACA 25 CHIAPAS Bottom 10 relatively more expensive than Germany (5.1% of GDP 24 per capita), but is the most competitive state in Mexico. Note: Rankings on the ease of doing business are the average of the state rankings in the 4 indicators measured in Doing Business in Mexico 2007. See the Data notes for details To register a property on the outskirts of Campeche, Source: Doing Business database. 20 DoIng BusIness In MeXICo 2007 amount of money to have collateral registered compared As expected, Campeche, an oil rich state, is both to the other 8 states in the South-Southeast. Courts in wealthy and a good performer. States with lower GDP Guerrero are faster than their neighbors when enforcing per capita including those in the South-Southeast, gen- contracts. When compared with all Mexican states, only erally have lower rankings. The good news is that low Zacatecas and Chihuahua are faster with 230 and 245 GDP per capita does not need to be a barrier to good days respectively; and the three states perform better regulation. Poor states can and do outperform others, than any country in Latin America.1 In Chiapas, con- if they introduce reforms. Zacatecas, the fourth poorest tract enforcement is less expensive than in the rest of the state in Mexico ranks number 6 out of 32 in the ease of South-Southeast Region and also cheaper than average doing business. This state is a good role model for the when compared to all Mexican states. states in the South-Southeast Region. Starting a business TABLE 6.1 Where is it easy to start a business in the South-Southeast-- On average, entrepreneurs in the South-Southeast spend and where not? 44 days to complete the procedures to start a business--8 South-Southeast Mexico State ranking Ranking days longer than the national average. The cost, 21.8% of Campeche 1 4 GDP per capita, is slightly above the national average of Quintana Roo 2 16 20.4%. But there are wide differences within the region. Yucatán 3 17 Campeche makes it easiest for entrepreneurs to start op- Puebla 4 21 erations, and Veracruz makes it most difficult (table 6.1). Tabasco 5 23 Entrepreneurs in Veracruz must follow 10 procedures, Chiapas 6 27 spending 46 days and 27.6% of GDP per capita to start Guerrero 7 29 Oaxaca 8 30 a business (figure 6.2). Reforms can bring the region Veracruz 9 32 closer to the top national performer, Aguascalientes, where it takes 12 days and 6.8% of GDP per capita to Note: rankings are the average of the state rankings on the procedures, time, cost (as % of gDP per capita) and minimum capital for starting a business. see the Data notes for details. start a business. Source: Doing Business database. Some reforms are underway. Mérida (Yucatán) FIGURE 6.2 cut the time it takes to grant the municipal operational How to start a business in Veracruz? license. Puebla is in the process of creating a rapid start- up system called "SARE Express" that would allow en- Time Cost (days) (% of GNP per capita) trepreneurs to obtain municipal licenses via the Internet within minutes. The system is scheduled to go online in Time 40 40 January 2007. Reforms are also underway at the Regis- tries of Commerce in both Yucatán and Puebla. 30 30 Cost 20 20 10 10 0 0 1 Procedures 10 Source: Doing Business database. DoIng BusIness In THe souTH-souTHeAsT regIon 21 Registering property TABLE 6.2 Where is it easy to register property in the South-South- Gloria, the owner of a retail company in Cancún (Quin- east--and where not? tana Roo), wants to buy a warehouse outside of town to South-Southeast Mexico store her inventory. She has identified the property that State ranking ranking Campeche 1 1 she wants and negotiated a good deal with the owner. Veracruz 2 4 But it will take over 5 months and cost 4.3% of the prop- Chiapas 3 7 erty value to legally transfer the property title. As Gloria Yucatán 4 17 does not have that much time, the deal is put on hold. Tabasco 5 19 The South-Southeast region includes both the best Puebla 6 24 and worst performers in terms of the ease of register- Guerrero 7 25 ing property: Campeche and Quintana Roo (table 6.2).2 Oaxaca 8 30 In Quintana Roo, an entrepreneur must go through 10 Quintana Roo 9 32 procedures and spend a total of 154 days to register his Note: rankings are the average of the state rankings on the procedures, time and cost (as % of property value) to register property. see the Data notes for details. property. On the other hand, in neighboring Chiapas Source: Doing Business database. the same process can be completed with 5 procedures in 36 days. The longest delays are at property registries. Regis- tries are often overloaded and lack sufficient staff. This is changing step by step. States are simplifying registration processes, implementing electronic systems, training employees and allowing for the electronic payment of transfer taxes. Getting credit TABLE 6.3 Who makes it easy to register collateral in the South-South- When the type of security is agreed upon, lenders want east--and who not? to register their right to the asset with the collateral reg- South-Southeast Mexico istry (table 6.3). In Veracruz, it takes 10 days to ensure State ranking ranking Yucatán 1 9 that collateral is properly registered. The average delay Oaxaca 2 12 across Mexico is 17 days. However, it takes 51 days to Veracruz 3 15 do the same in Quintana Roo. The costs to create and Campeche 4 19 register collateral include notary fees, taxes and pay- Puebla 5 22 ment of registration rights, all determined at the state Guerrero 6 24 and municipal level. Oaxaca has the lowest fees in the Quintana Roo 7 27 region with 1% of the loan value, followed by Yucatán Chiapas 8 28 with 1.3%. Registration costs are 3.3% of the loan value Tabasco 9 30 in Guerrero, making credit more expensive. In the words Note: rankings are the averate of the state rankings on the time and cost (as % of loan value) to of one respondent: "If I had the money to pay all these create and register collateral. see the Data notes for details. Source: Doing Business database. fees, I would not need a loan." Some states in the South-Southeast are in the pro- cess of digitalizing their collateral registries. For example, Puebla has been modernizing its collateral registry since last year, and Yucatán started in August 2006. Others are following suit. Lenders look at the borrower's credit history and collateral when extending loans. Where credit registries and effective collateral laws are lacking, banks make fewer loans. 22 DoIng BusIness In MeXICo 2007 Enforcing contracts TABLE 6.4 Who makes it easy to enforce contracts in the South and Although an identical commercial code and code of civil Southeast--and who does not? procedures dictate the process for commercial court South-Southeast Mexico State ranking Ranking cases, there are differences among South-Southeastern Campeche 1 14 states on the efficiency of contract enforcement. The Tabasco 2 15 top performers are Campeche and Tabasco, which rank Oaxaca 3 22 14 and 15 when compared to all Mexican states (table Guerrero 4 23 6.4). In Guerrero, it takes 280 days to enforce a contract Chiapas 5 24 from the time a claim is submitted until a judgment is Quintana Roo 6 27 enforced. In Quintana Roo, however, claimants have to Puebla 7 29 wait twice as long. Yucatán 8 30 There are several reasons for the differences in con- Veracruz 9 31 tract enforcement among states. Tabasco, the second Nota:rankings are the average of the country rankings on the procedures, time and cost (as % of debt value) for enforcing contracts through the courts. see the Data notes for details. best performer in the region, utilizes an electronic case Source: Doing Business database. management and monitoring system similar to that of Mexico City. On the other hand, in Quintana Roo, the The recommendations in the starting a business, judicial authorities complain about case overload and an registering property, getting credit and enforcing con- insufficient number of judges. While the whole contract tracts chapters of this report are valid for the states in enforcement process takes as long as 15½ months in Ve- the South-Southeast. As pointed out at the beginning of racruz, courts efficiently file claims. It takes only 5 days, this chapter, many small businesses in this region face less than anywhere else in Mexico, perhaps as a result complex and lengthy procedures. It is therefore particu- of Veracruz's recently implemented capacity-building larly important to focus on those reforms that streamline program for court clerks (actuarios). procedures and save time in order to ease the regulatory The costs associated with a legal dispute add to the burden. Governors and mayors can follow the lead of burden of resolving it. The main expenses are attorney their neighbors to improve the ease of doing business in fees. Oaxaca and Quintana Roo have the highest costs their cities and states. with 27% of the debt value. The lowest costs are found in Chiapas with 18% of debt value. Korea sets the global standard with 5.5% of the debt value. 1 The methodology for enforcing contracts was revised in Some reforms are ongoing. Yucatán is modernizing Doing Business 2007: How to Reform in order to reflect the court's administrative infrastructure and hiring more a typical contractual dispute over the quality of goods personnel. Initial results can already be felt--the time rather than a simple default on commercial debt. Doing Business in Mexico 2007 uses the previous methodology. to enforce a contract dropped by six months compared Comparisons with 154 countries are based on Doing to last year. Veracruz is experimenting with alternative Business in 2006: Creating Jobs. dispute mechanisms for commercial cases. 2 See also Figure 3.1: Registering property in Campeche. 23 Data notes Starting a business Registering property Getting credit Enforcing contracts The indicators presented and analyzed in Doing Business in answers checked for accuracy. The methodology is inex- Mexico 2007 measure government regulation and the pro- pensive, so data can be collected in a large sample of eco- tection of property rights--and their effect on businesses, nomies--175 published in the global report Doing Business especially small and medium-size domestic firms. First, the in 2007: How to Reform and the 31 states in Mexico for this indicators document the degree of regulation, such as the report. Because the same standard assumptions are applied in number of procedures to start a business or register commer- the data collection, which is transparent and easily replicable, cial property. Second, they gauge regulatory outcomes, such comparisons and benchmarks are valid across countries and as the time and cost to enforce a contract. Third, they mea- states. And the data not only highlight the extent of obstacles sure the extent of legal protections of property, for example, but also help identify their source, supporting policymakers the scope of assets that can be used as collateral according to in designing reform. secured transactions laws. The data for all sets of indicators in The Doing Business methodology has 4 limitations that Doing Business in Mexico 2007 are for July 2006. In this proj- should be considered when interpreting the data. First, the ect, Doing Business indicators have been created for major collected data refer to businesses in the state's selected city cities in the 31 Mexican states-- the complete list is available and may not be representative of regulatory practices in other in page 1. For the indicators starting a business and register- parts of the state. Second, the data often focus on a specific ing property, the data presented in this report for Mexico business form--a limited liability company of a specified City and other countries is based on the global report Doing size--and may not be representative of the regulation on Business in 2007: How to Reform. For the enforcing contracts other businesses, for example, sole proprietorships. Third, indicator, the data is based on the global report Doing Busi- the measures of time involve an element of judgment by the ness 2006: Creating Jobs. The indicator getting credit is not expert respondents. Therefore, if sources indicate different comparable internationally. The data presented in this report estimates, the time indicators reported in Doing Business for Brazilian States is based on the regional report Doing represent the median values of several responses given under Business in Brazil. the assumptions of the case study. Fourth, the methodology Based on the study of laws and regulations--with input assumes that the business has full information on what is re- and verification by more than 150 government officials, quired and does not waste time in completing procedures. In lawyers and other professionals routinely administering or practice, completing a procedure may take longer if the busi- advising on legal and regulatory requirements--the Doing ness lacks information or is unable to follow up promptly. Business methodology offers several advantages. It uses Questions on the methodology and challenges to data factual information about what laws and regulations say may be submitted through the "Ask a Question" function on and allows for multiple interactions with local respondents the Doing Business website at http://www.doingbusiness.org. to clarify potential misinterpretations of questions. Having Updated indicators, as well as any revisions of or corrections representative samples of respondents is not an issue, as the to the printed data, are posted on the website. texts of the relevant laws and regulations are collected and 24 DoIng BusIness In MeXICo 2007 Economy characteristics Region and income group Doing Business uses the World Bank regional and income GDP per capita and population groupings available at http://www.worldbank.org/data/coun- Doing Business in Mexico 2007 reports 2004 Gross Domestic tryclass/countryclass.html. Throughout the report the term Product (GDP) per capita in each of the sample states (current rich economies refers to the high income group, middle MXN). It was estimated from the 2004 GDP by federal entity income refers to the upper middle income group and poor as published by the National Institute of Statistics, Geography economies refers to the lower middle and low income and Information Science--INEGI's Economic Information groups. Bank (BIE) and divided by 2004 projected population figures. Doing Business in Mexico 2007 reports 2004 projected popu- Exchange rate lation figures based on the National Population Council-- The exchange rate used in this report is: 1USD = 11.05MXN CONAPO's projections. Starting a business · Performs general industrial or commercial activities, such as the production or sale of products or services to the Doing Business records all generic procedures that are offi- public. It does not perform foreign trade activities and cially required for an entrepreneur to start up an industrial or does not handle products subject to a special tax regime, commercial business. These include obtaining all necessary for example, liquor or tobacco. The business is not using licenses and permits and completing any required notifica- heavily polluting production processes. tions, verifications or inscriptions with relevant authorities. · Leases the commercial plant and offices and is not a After a study of laws, regulations and publicly available infor- proprietor of real estate. mation on business entry, a detailed list of procedures, time, · Does not qualify for investment incentives or any special cost and paid-in minimum capital requirements is developed. benefits. Subsequently, local incorporation lawyers and government · Has up to 50 employees 1 month after the commencement officials complete and verify the data on applicable proce- of operations, all of them nationals. dures, the time and cost of complying with each procedure · Has a turnover at least 100 times the state's GDP per under normal circumstances. Information is also collected capita. on the sequence in which procedures are to be completed · Has a company deed 10 pages long. and whether procedures may be carried out simultaneously. Assumptions about procedures It is assumed that any required information is readily avail- able and that all government and non-government agencies · A procedure is defined as any interaction of the company involved in the start-up process function efficiently and with- founder with external parties (government agencies, out corruption. If answers by local experts differ, inquiries lawyers,auditors,notaries).Interactionsbetweencompany continue until the data are reconciled. founders or company officers and employees are not considered separate procedures. To make the data comparable across countries, several as- sumptions about the business and the procedures are used. · The founders complete all procedures themselves, without middlemen, facilitators, accountants or lawyers, unless the Assumptions about the business use of such a third party is mandated by law. · Procedures that are not required by law for starting a The business: business are ignored. For example, obtaining exclusive · Is a limited liability company. If there is more than one rights over the company name is not counted in a country type of limited liability company in the country, the most where businesses may use a number as identification. popular limited liability form among domestic firms is · Shortcuts are counted only if they fulfill 3 criteria: they are chosen--in Mexico the form selected was the Sociedad legal, they are available to the general public, and avoiding Anónima. Information on the most popular form is them causes substantial delays. obtained from incorporation lawyers or the statistical office. · Only procedures required of all businesses are covered. Industry-specific procedures are excluded. For example, · Operates in the state's selected city. procedures to comply with environmental regulations are · Is 100% domestically owned and has 5 owners, none of included only when they apply to all businesses. whom is a legal entity. · Procedures that the company undergoes to connect to · Has start-up capital of 10 times the state's GDP per capita electricity, water, gas and waste disposal services are not at the end of 2004, paid in cash. included unless they entail inspections required before starting operations. DATA noTes 25 Time measure costly procedure is used, since an entrepreneur never second- Time is recorded in calendar days. It is assumed that the guesses a government official. In the absence of fee schedules, minimum time required for each procedure is 1 day. Time a government officer's estimate is taken as an official source. captures the median duration that incorporation lawyers In the absence of a government officer's estimate, estimates indicate is necessary to complete a procedure. If a procedure of incorporation lawyers are used. If several incorporation can be accelerated for an additional cost, the fastest proce- lawyers provide different estimates, the median reported dure is chosen. It is assumed that the entrepreneur does not value is applied. In all cases the cost excludes bribes. waste time and commits to completing each remaining pro- Paid-in minimum capital requirement cedure without delay. The time that the entrepreneur spends on gathering information is ignored. It is assumed that the The paid-in minimum capital requirement reflects the entrepreneur is aware of all entry regulations and their se- amount that the entrepreneur needs to deposit in a bank quence from the beginning. before registration starts. This amount is typically specified in the commercial code or the company law. Many countries Cost measure require paid-in capital but allow businesses to pay only a part The text of the company law, the commercial code and spe- of it before registration, with the rest to be paid after the first cific regulations and fee schedules are used as sources for year of operation. calculating the cost of start-up. If there are conflicting sour- ces and the laws are not clear, the most authoritative source This methodology is originally developed by Simeon Djankov, is used. The constitution supersedes the company law, and Rafael La Porta, Florencio Lopez-de-Silanes and Andrei Shleifer the law prevails over regulations and decrees. If conflicting in "The Regulation of Entry," Quarterly Journal of Economics, sources are of the same rank, the source indicating the most 117, 1-37, Feb. 2002 and adopted with minor changes here. Registering property · Is located in a periurban commercial zone, and no rezoning is required. Doing Business records the full sequence of procedures neces- sary when a business purchases land and a building to trans- · Consists of land and a building. The land area is 6,000 square feet (557.4 square meters). A warehouse of 10,000 fer the property title from the seller to the buyer. Every requi- square feet (929 square meters) is located on the land. red procedure is included, whether it is the responsibility of The warehouse is 10 years old, is in good condition and the seller or the buyer or required to be completed by a third complies with all safety standards, building codes and party on their behalf. Local property lawyers and property other legal requirements. registries provide information on required procedures as well · Will not be subject to renovations or additional building as the time and cost to complete each of them. To make the following the purchase. data comparable across countries, several assumptions about · Has no trees, natural water sources, natural reserves or the business, the property and the procedures are used. historical monuments of any kind. · Will not be used for special purposes, and no special Assumptions about the business permits, such as for residential use, industrial plants, The business: waste storage or certain types of agricultural activities, are · Is a limited liability company (sociedad anónima). required. · Is located in a periurban area of the state's selected city. · Has no occupants (legal or illegal), and no other party holds a legal interest in it. · Is 100% domestically and privately owned (no foreign or state ownership). Procedures · Has 50 employees, all of whom are nationals. A procedure is defined as any interaction of the buyer or · Performs general commercial activities. the seller, their agents (if the agent is required by law) or the Assumptions about the Property property with external parties, including government agen- The property: cies, inspectors, notaries and lawyers. Interactions between · Has a value of 50 times the state's GDP per capita. company officers and employees are not considered. All pro- · Is fully owned by another domestic limited liability cedures that are legally required for registering property are company (sociedad anónima). recorded, even if they may be avoided in exceptional cases. · Has no mortgages attached and has been under the same It is assumed that the buyer follows the fastest legal option ownership for the past 10 years. available. Although the business may use lawyers or other · Is adequately measured and filed in the cadastre, registered professionals where necessary in the registration process, it is in the land register and free of title disputes. assumed that it does not employ an outside facilitator in the registration process unless required to by law. 26 DoIng BusIness In MeXICo 2007 Time measure Cost measure Time is recorded in calendar days. It is assumed that the mi- Only official costs are recorded. These include fees, transfer nimum required for each procedure is 1 day. Time captures taxes, stamp duties and any other payment to the property the median duration that property lawyers or registry officials registry, notaries, public agencies or lawyers, if required by indicate is necessary to complete a procedure. It is assumed law. Other taxes, such as capital gains tax or value added tax, that the buyer does not waste time and commits to completing are excluded from the cost measure. If cost estimates differ each remaining procedure without delay. If a procedure can among sources, the median reported value is used. Costs are be accelerated for an additional cost, the fastest procedure is expressed as a percentage of the property value, assumed to chosen. If procedures may be undertaken simultaneously, it is be equivalent to 50 times the state GDP per capita. assumed they are. It is assumed that the parties involved are aware of all regulations and their sequence from the begin- ning. Time spent on gathering information is not considered. Getting credit Strength of legal rights index Doing Business constructs measures on the legal rights of len- This index, reflecting the legal rights of borrowers and len- ders. This set of indicators describes how well collateral and ders, measures the degree to which collateral and bankruptcy bankruptcy laws facilitate lending. laws facilitate lending. It is based on data collected through study of collateral and insolvency laws, supported by the res- Time and cost to create and register collateral ponses to the survey on secured transactions laws. The index The indicator assesses the ease of creating and registering includes 3 aspects related to legal rights in bankruptcy and collateral. The data are based on research of collateral and 7 aspects found in collateral law. A score of 1 is assigned for insolvency laws and responses to a survey on secured tran- each of the following features of the laws: sactions laws, developed with input and comments from a · Secured creditors are able to seize their collateral when a range of experts including those from the Center for Eco- debtor enters reorganization--there is no "automatic stay" nomic Analysis of Law, the International Bar Association or "asset freeze" imposed by the court. Committee on Financial Law, and the European Bank for · Secured creditors, rather than other parties such as Reconstruction and Development. government or workers, are paid first out of the proceeds Participating lawyers estimate the costs, based on the fol- from liquidating a bankrupt firm. lowing standardized case: An entrepreneur with a medium · Management does not stay during reorganization. An size (100 employees) textile business located in the selected administrator is responsible for managing the business during reorganization. city seeks a loan from a local bank. The loan would finance the purchase of industrial sewing machines worth 10 times · General, rather than specific, description of assets is permitted in collateral agreements. GDP per capita. The entrepreneur secures the loan by pledg- ing the industrial sewing machines as collateral while keeping · General, rather than specific, description of debt is permitted in collateral agreements. both possession and ownership title (non-possessory security right). · Any legal or natural person may grant or take security in the property. Costs include taxes, notary fees and duties associated with creating the security right and registering it in the collateral · A unified registry that includes charges over movable property operates. registry, where such a registry operates. Countries without a registry usually have lower costs, although the secured credi- · Secured creditors have priority outside of bankruptcy. tor is disadvantaged elsewhere because they are unable to · Parties may agree on enforcement procedures by contract. notify other creditors of their right to the collateral through · Creditors may both seize and sell collateral out of court. a registry. The cost measure is presented as a percentage of GDP per capita. The index ranges from 0 to 10, with higher scores indicating that collateral and bankruptcy laws are better designed to expand access to credit. This methodology is developed in "Private Credit in 129 Countries," a working paper by Simeon Djankov and Caralee McLiesh of the World Bank, and Andrei Shleifer, Department of Economics, Harvard University, June 2005; and adapted from "Law and Finance," by Rafael La Porta, Florencio Lopez- de-Silanes, Andrei Shleifer, and Robert Vishny, Journal of Poli- tical Economy, 106, 1113-55, 1998. DATA noTes 27 Enforcing contracts ment of actual payment. This measure includes both the days where actions take place and waiting periods between ac- The data are derived from questionnaires answered by tions. The participating firms make separate estimates of the attorneys at private law firms and judicial personnel at local average duration until the completion of service of process, courts. The questionnaire covers the step-by-step evolution of the issuance of judgment (duration of trial), and the moment a debt recovery case before local courts in the state's selected of payment or repossession (duration of enforcement). To city. The respondent firms were provided with significant the extent that database users are interested in the ability of detail, including the amount of the claim, the location and an ordinary person to use the legal system, these estimates of main characteristics of the litigants, the presence of city re- duration are highly relevant for efficiency. gulations, the nature of the remedy requested by the plaintiff, The third indicator is an index of the degree of formalism, the merit of the plaintiff's and the defendant's claims, and the or complexity, in the procedures to resolve disputes. This social implications of the judicial outcomes. These standardi- index measures substantive and procedural statutory inter- zed details enabled the respondent law firms to describe the vention in judicial cases at lower level civil trail courts, and is procedures explicitly and in full detail. formed by adding the following sub-indices: Assumptions about the case: 1. Professionals or laymen: This sub-index measures whether the resolution of the case provided would rely mostly in · Debt value equals 200% of state's GDP per capita. the intervention of professional judges and attorneys, as · The plaintiff has fully complied with the contract (plaintiff opposed to the intervention of other types of adjudicators is 100% right) and lay people. · Case presents a lawful transaction between residents of 2. Written or oral: This sub-index measures the written or the selected city. oral nature of the actions involved in the procedure, from · The bank refuses payment for lack of funds in the the filing of the complaint, until the actual enforcement. borrower's account. 3. Legal justification: This sub-index measures the level · The plaintiff files a lawsuit to collect the check. of legal justification required in the process of dispute resolution. · The debtor attempts to delay service of process but it is finally accomplished. 4. Statutory regulation of evidence: This sub-index measures the level of statutory control or intervention of the · The debtor raises some opposition to the complaint administration, admissibility, evaluation and recording of (default judgment is not an option). evidence. · The judge decides every motion for the plaintiff. 5. Control of superior review: This sub-index measures the · The plaintiff attempts to introduce documentary evidence level of control or intervention of the appellate court's and to call one witness. Debtor attempts to call one review of the first instance judgment. witness. Neither party presents objections. 6. Otherstatutoryinterventions:Thissub-indexmeasuresthe · The judgment is in favor of the plaintiff. formalities required to engage someone into the procedure · No appeals or post-judgment motions are filed by either or to hold him/her accountable for the judgment. party to the case. For each sub-index, higher values indicate more formalism in · Debt is successfully collected. the contract enforcement process. The study develops three indicators of the efficiency of the judicial system as regards the enforcement of commercial For a detailed description of the methodology, see Djankov, Si- contracts. The first indicator is the cost of going through meon, Rafael La Porta, Florencio Lopez-de-Silanes, and Andrei court procedures, including court costs and attorney fees Shleifer, 2002, "Courts: The Lex Mundi Project," NBER working where the use of attorneys is mandatory or common, or the paper 8890. costs of an administrative debt recovery procedure, expressed as a percentage of the debt value. The second indicator of efficiency is an estimate--in cal- endar days--of duration of the process of dispute resolution by the lawyers who completed the questionnaires. Duration is measured as the number of calendar days counted from the moment the plaintiff files the lawsuit in court, until the mo- 28 DoIng BusIness In MeXICo 2007 Ease of doing business The ease of doing business is the simple average of state ran- kings in each of the four topics covered in Doing Business in Mexico 2007 in 2006. The starting a business ranking averages the state rankings on the procedures, days, cost and mini- mum capital requirement to register a business. The property ranking averages the state rankings on the procedures, time and cost to register property. The credit ranking is based on the state rankings on the time and cost to register collate- ral. And the enforcing contracts ranking averages the state rankings on the complexity of procedures, time and cost to enforce contracts. The ease of doing business measure ranges form 1 to 32, with higher values indicating more efficient regulation and stronger protections of property rights. This methodology is developed by Simeon Djankov, Caralee McLiesh, and Rita Ramalho in "Growth and the Ease of Doing Business," working paper, World Bank, August 2004. TablasdelosesTados 29 Doing business indicators State tables 30 doingbusinessinMeXiCo2007 Starting a business Registering property Ease of Ease of Cost starting Cost registering Number of Time (% of GDP a business Number of Time (% of property property procedures (days) per capita) (rank) procedures (days) value) (rank) Aguascalientes Aguascalientes 8 12 6.77 1 7 18 3.02 4 Baja California Tijuana 9 38 12.96 12 8 25 3.42 15 Baja California Sur La Paz 9 34 14.44 11 7 123 3.14 21 Campeche Campeche 9 32 6.03 4 4 22 2.47 1 Chiapas Tuxtla Gutiérrez 9 34 38.25 27 5 36 3.12 7 Chihuahua Cd. Juárez 9 29 20.54 13 6 35 3.42 13 Coahuila Torreón 9 28 13.00 6 8 51 4.27 29 Colima Colima 9 66 23.00 24 4 59 2.42 9 Distrito Federal Mexico City 8 27 14.20 5 5 74 5.24 26 Durango Durango 9 36 17.59 20 7 31 5.11 22 Estado de México Tlalnepantla de Baz 9 45 43.98 28 7 48 4.68 27 Guanajuato Celaya 8 12 15.10 7 7 26 2.08 6 Guerrero Acapulco 9 54 18.46 29 9 29 4.14 25 Hidalgo Pachuca de Soto 9 40 30.17 25 4 36 4.45 11 Jalisco Guadalajara 9 39 11.41 15 7 112 3.37 22 Michoacán Morelia 8 19 10.60 10 5 25 4.13 8 Morelos Cuernavaca 8 50 14.44 19 9 57 6.33 31 Nayarit Tepic 9 48 65.79 30 7 38 6.98 28 Nuevo León Monterrey 8 24 9.74 1 5 28 3.06 3 Oaxaca Salina Cruz 9 46 30.95 30 8 52 4.54 30 Puebla Puebla 9 42 18.32 21 7 63 3.55 24 Querétaro Querétaro 8 19 9.15 3 6 45 4.14 20 Quintana Roo Benito Juárez (Cancún) 9 69 12.02 16 10 154 4.27 32 San Luis Potosí San Luis Potosí 8 19 15.82 8 7 37 3.63 18 Sinaloa Culiacán 8 35 23.03 18 5 30 4.80 14 Sonora Hermosillo 9 34 10.31 9 5 21 3.36 2 Tabasco Centro (Villahermosa) 9 35 30.73 23 5 43 5.20 19 Tamaulipas Reynosa 9 29 16.96 14 5 61 3.81 16 Tlaxcala Tlaxcala 9 42 28.30 26 5 34 3.60 10 Veracruz Coatzacoalcos 10 46 27.55 32 6 28 2.07 4 Yucatán Mérida 9 38 13.80 17 9 29 3.18 17 Zacatecas Zacatecas 9 31 29.21 22 7 21 4.45 11 doingbusinessindiCaToRs 31 Credit--creating and registering collateral Enforcing a contract Ease of creating and Ease of Cost registering Complexity enforcing Time (% of loan collateral Time Cost index a contract (days) value) (rank) (days) (% of debt) (0-100) (rank) Aguascalientes Aguascalientes 9 0.88 1 290 14 85 5 Baja California Tijuana 18 1.45 16 470 25 82 28 Baja California Sur La Paz 22 1.30 16 581 25 70 25 Campeche Campeche 17 1.61 19 430 19 79 14 Chiapas Tuxtla Gutiérrez 24 2.41 28 422 18 88 24 Chihuahua Cd. Juárez 14 5.00 26 245 18 86 10 Coahuila Torreón 13 1.29 6 386 20 84 19 Colima Colima 18 0.76 9 280 15 88 7 Distrito Federal Mexico City n.d.* n.d.* n.d.* 345 20 62 4 Durango Durango 11 1.91 12 305 17 82 3 Estado de México Tlalnepantla de Baz 22 3.40 30 326 21 79 12 Guanajuato Celaya 9 1.22 3 304 19 83 11 Guerrero Acapulco 15 3.33 24 280 22 89 23 Hidalgo Pachuca de Soto 15 2.55 21 275 20 79 2 Jalisco Guadalajara 26 1.43 22 318 18 83 8 Michoacán Morelia 8 1.92 7 381 16 89 21 Morelos Cuernavaca 28 2.02 29 390 24 72 16 Nayarit Tepic 11 8.07 20 429 17 82 13 Nuevo León Monterrey 15 0.95 5 320 26 85 26 Oaxaca Salina Cruz 16 1.02 12 330 27 82 22 Puebla Puebla 23 1.50 22 445 21 88 29 Querétaro Querétaro 11 1.51 9 290 24 77 9 Quintana Roo Benito Juárez (Cancún) 51 1.49 27 568 27 75 27 San Luis Potosí San Luis Potosí 18 2.17 24 360 20 84 18 Sinaloa Culiacán 17 0.80 8 337 16 82 6 Sonora Hermosillo 12 1.08 4 372 23 80 17 Tabasco Centro (Villahermosa) 24 2.68 30 353 20 83 15 Tamaulipas Reynosa 13 2.42 18 415 25 77 20 Tlaxcala Tlaxcala 12 2.09 14 415 28 85 32 Veracruz Coatzacoalcos 10 2.76 15 470 23 88 31 Yucatán Mérida 13 1.32 9 495 23 85 30 Zacatecas Zacatecas 8 0.97 2 230 14 84 1 *n.d. = no disponible 32 doingbusinessinMeXiCo2007 AguAscAlientes GDP per capita (US$) 7,531 City: Aguascalientes Ease of doing business (rank) 1 Starting a business Registering property Number of procedures 8 Number of procedures 7 Time (days) 12 Time (days) 18 Cost (% of GDP per capita) 6.77 Cost (% of property value) 3.02 Ease of starting a business (rank) 1 Ease of registering property (rank) 4 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 9 Complexity index (1-100) 85 Cost (% of loan value) 0.88 Time (days) 290 Ease of creating and registering collateral (rank) 1 Cost (% of debt) 14 Ease of enforcing a contract (rank) 5 BAjA cAliforniA GDP per capita (US$) 7,703 City: Tijuana Ease of doing business (rank) 18 Starting a business Registering property Number of procedures 9 Number of procedures 8 Time (days) 38 Time (days) 25 Cost (% of GDP per capita) 12.96 Cost (% of property value) 3.42 Ease of starting a business (rank) 12 Ease of registering property (rank) 15 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 18 Complexity index (1-100) 82 Cost (% of loan value) 1.45 Time (days) 470 Ease of creating and registering collateral (rank) 16 Cost (% of debt) 25 Ease of enforcing a contract (rank) 28 BAjA cAliforniA sur GDP per capita (US$) 7,723 City: La Paz Ease of doing business (rank) 21 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 34 Time (days) 123 Cost (% of GDP per capita) 14.44 Cost (% of property value) 3.14 Ease of starting a business (rank) 11 Ease of registering property (rank) 21 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 22 Complexity index (1-100) 70 Cost (% of loan value) 1.30 Time (days) 581 Ease of creating and registering collateral (rank) 16 Cost (% of debt) 25 Ease of enforcing a contract (rank) 25 cAmpeche GDP per capita (US$) 10,204 City: Campeche Ease of doing business (rank) 5 Starting a business Registering property Number of procedures 9 Number of procedures 4 Time (days) 32 Time (days) 22 Cost (% of GDP per capita) 6.03 Cost (% of property value) 2.47 Ease of starting a business (rank) 4 Ease of registering property (rank) 1 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 17 Complexity index (1-100) 79 Cost (% of loan value) 1.61 Time (days) 430 Ease of creating and registering collateral (rank) 19 Cost (% of debt) 19 Ease of enforcing a contract (rank) 14 chiApAs GDP per capita (US$) 2,452 City: Tuxtla Gutiérrez Ease of doing business (rank) 24 Starting a business Registering property Number of procedures 9 Number of procedures 5 Time (days) 34 Time (days) 36 Cost (% of GDP per capita) 38.25 Cost (% of property value) 3.12 Ease of starting a business (rank) 27 Ease of registering property (rank) 7 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 24 Complexity index (1-100) 88 Cost (% of loan value) 2.41 Time (days) 422 Ease of creating and registering collateral (rank) 28 Cost (% of debt) 18 Ease of enforcing a contract (rank) 24 sTaTeTables 33 chihuAhuA GDP per capita (US$) 8,089 City: Ciudad Juárez Ease of doing business (rank) 14 Starting a business Registering property Number of procedures 9 Number of procedures 6 Time (days) 29 Time (days) 35 Cost (% of GDP per capita) 20.54 Cost (% of property value) 3.42 Ease of starting a business (rank) 13 Ease of registering property (rank) 13 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 14 Complexity index (1-100) 86 Cost (% of loan value) 5.00 Time (days) 245 Ease of creating and registering collateral (rank) 26 Cost (% of debt) 18 Ease of enforcing a contract (rank) 10 coAhuilA GDP per capita (US$) 8,463 City: Torreón Ease of doing business (rank) 13 Starting a business Registering property Number of procedures 9 Number of procedures 8 Time (days) 28 Time (days) 51 Cost (% of GDP per capita) 13.00 Cost (% of property value) 4.27 Ease of starting a business (rank) 6 Ease of registering property (rank) 29 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 13 Complexity index (1-100) 84 Cost (% of loan value) 1.29 Time (days) 386 Ease of creating and registering collateral (rank) 6 Cost (% of debt) 20 Ease of enforcing a contract (rank) 19 colimA GDP per capita (US$) 5,759 City: Colima Ease of doing business (rank) 11 Starting a business Registering property Number of procedures 9 Number of procedures 4 Time (days) 66 Time (days) 59 Cost (% of GDP per capita) 23.00 Cost (% of property value) 2.42 Ease of starting a business (rank) 24 Ease of registering property (rank) 9 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 18 Complexity index (1-100) 88 Cost (% of loan value) 0.76 Time (days) 280 Ease of creating and registering collateral (rank) 9 Cost (% of debt) 15 Ease of enforcing a contract (rank) 7 Distrito feDerAl GDP per capita (US$) 15,613 City: Mexico City Ease of doing business (rank) 10 Starting a business Registering property Number of procedures 8 Number of procedures 5 Time (days) 27 Time (days) 74 Cost (% of GDP per capita) 14.20 Cost (% of property value) 5.24 Ease of starting a business (rank) 5 Ease of registering property (rank) 26 Getting credit--Creating and registering collateral Enforcing a contract Time (days) n.d.* Complexity index (1-100) 62 Cost (% of loan value) n.d.* Time (days) 345 Ease of creating and registering collateral (rank) n.d.* Cost (% of debt) 20 Ease of enforcing a contract (rank) 4 DurAngo GDP per capita (US$) 5,398 City: Durango Ease of doing business (rank) 12 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 36 Time (days) 31 Cost (% of GDP per capita) 17.59 Cost (% of property value) 5.11 Ease of starting a business (rank) 20 Ease of registering property (rank) 22 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 11 Complexity index (1-100) 82 Cost (% of loan value) 1.91 Time (days) 305 Ease of creating and registering collateral (rank) 12 Cost (% of debt) 17 Ease of enforcing a contract (rank) 3 *n.d. = no disponible 34 doingbusinessinMeXiCo2007 estADo De méxico GDP per capita (US$) 4,134 City: Tlalnepantla de Baz Ease of doing business (rank) 29 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 45 Time (days) 48 Cost (% of GDP per capita) 43.98 Cost (% of property value) 4.68 Ease of starting a business (rank) 28 Ease of registering property (rank) 27 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 22 Complexity index (1-100) 79 Cost (% of loan value) 3.40 Time (days) 326 Ease of creating and registering collateral (rank) 30 Cost (% of debt) 21 Ease of enforcing a contract (rank) 12 guAnAjuAto GDP per capita (US$) 4,507 City: Celaya Ease of doing business (rank) 2 Starting a business Registering property Number of procedures 8 Number of procedures 7 Time (days) 12 Time (days) 26 Cost (% of GDP per capita) 15.10 Cost (% of property value) 2.08 Ease of starting a business (rank) 7 Ease of registering property (rank) 6 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 9 Complexity index (1-100) 83 Cost (% of loan value) 1.22 Time (days) 304 Ease of creating and registering collateral (rank) 3 Cost (% of debt) 19 Ease of enforcing a contract (rank) 11 guerrero GDP per capita (US$) 3,265 City: Acapulco Ease of doing business (rank) 30 Starting a business Registering property Number of procedures 9 Number of procedures 9 Time (days) 54 Time (days) 29 Cost (% of GDP per capita) 18.46 Cost (% of property value) 4.14 Ease of starting a business (rank) 29 Ease of registering property (rank) 25 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 15 Complexity index (1-100) 89 Cost (% of loan value) 3.33 Time (days) 280 Ease of creating and registering collateral (rank) 24 Cost (% of debt) 22 Ease of enforcing a contract (rank) 23 hiDAlgo GDP per capita (US$) 3,465 City: Pachuca de Soto Ease of doing business (rank) 15 Starting a business Registering property Number of procedures 9 Number of procedures 4 Time (days) 40 Time (days) 36 Cost (% of GDP per capita) 30.17 Cost (% of property value) 4.45 Ease of starting a business (rank) 25 Ease of registering property (rank) 11 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 15 Complexity index (1-100) 79 Cost (% of loan value) 2.55 Time (days) 275 Ease of creating and registering collateral (rank) 21 Cost (% of debt) 20 Ease of enforcing a contract (rank) 2 jAlisco GDP per capita (US$) 5,882 City: Guadalajara Ease of doing business (rank) 17 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 39 Time (days) 112 Cost (% of GDP per capita) 11.41 Cost (% of property value) 3.37 Ease of starting a business (rank) 15 Ease of registering property (rank) 22 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 26 Complexity index (1-100) 83 Cost (% of loan value) 1.43 Time (days) 318 Ease of creating and registering collateral (rank) 22 Cost (% of debt) 18 Ease of enforcing a contract (rank) 8 sTaTeTables 35 michoAcán GDP per capita (US$) 3,307 City: Morelia Ease of doing business (rank) 8 Starting a business Registering property Number of procedures 8 Number of procedures 5 Time (days) 19 Time (days) 25 Cost (% of GDP per capita) 10.60 Cost (% of property value) 4.13 Ease of starting a business (rank) 10 Ease of registering property (rank) 8 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 8 Complexity index (1-100) 89 Cost (% of loan value) 1.92 Time (days) 381 Ease of creating and registering collateral (rank) 7 Cost (% of debt) 16 Ease of enforcing a contract (rank) 21 morelos GDP per capita (US$) 5,122 City: Cuernavaca Ease of doing business (rank) 31 Starting a business Registering property Number of procedures 8 Number of procedures 9 Time (days) 50 Time (days) 57 Cost (% of GDP per capita) 14.44 Cost (% of property value) 6.33 Ease of starting a business (rank) 19 Ease of registering property (rank) 31 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 28 Complexity index (1-100) 72 Cost (% of loan value) 2.02 Time (days) 390 Ease of creating and registering collateral (rank) 29 Cost (% of debt) 24 Ease of enforcing a contract (rank) 16 nAyArit GDP per capita (US$) 3,424 City: Tepic Ease of doing business (rank) 27 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 48 Time (days) 38 Cost (% of GDP per capita) 65.79 Cost (% of property value) 6.98 Ease of starting a business (rank) 30 Ease of registering property (rank) 28 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 11 Complexity index (1-100) 82 Cost (% of loan value) 8.07 Time (days) 429 Ease of creating and registering collateral (rank) 20 Cost (% of debt) 17 Ease of enforcing a contract (rank) 13 nuevo león GDP per capita (US$) 11,208 City: Monterrey Ease of doing business (rank) 3 Starting a business Registering property Number of procedures 8 Number of procedures 5 Time (days) 24 Time (days) 28 Cost (% of GDP per capita) 9.74 Cost (% of property value) 3.06 Ease of starting a business (rank) 1 Ease of registering property (rank) 3 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 15 Complexity index (1-100) 85 Cost (% of loan value) 0.95 Time (days) 320 Ease of creating and registering collateral (rank) 5 Cost (% of debt) 26 Ease of enforcing a contract (rank) 26 oAxAcA GDP per capita (US$) 2,598 City: Salina Cruz Ease of doing business (rank) 25 Starting a business Registering property Number of procedures 9 Number of procedures 8 Time (days) 46 Time (days) 52 Cost (% of GDP per capita) 30.95 Cost (% of property value) 4.54 Ease of starting a business (rank) 30 Ease of registering property (rank) 30 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 16 Complexity index (1-100) 82 Cost (% of loan value) 1.02 Time (days) 330 Ease of creating and registering collateral (rank) 12 Cost (% of debt) 27 Ease of enforcing a contract (rank) 22 36 doingbusinessinMeXiCo2007 pueBlA GDP per capita (US$) 4,087 City: Puebla Ease of doing business (rank) 28 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 42 Time (days) 63 Cost (% of GDP per capita) 18.32 Cost (% of property value) 3.55 Ease of starting a business (rank) 21 Ease of registering property (rank) 24 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 23 Complexity index (1-100) 88 Cost (% of loan value) 1.50 Time (days) 445 Ease of creating and registering collateral (rank) 22 Cost (% of debt) 21 Ease of enforcing a contract (rank) 29 QuerétAro GDP per capita (US$) 6,885 City: Querétaro Ease of doing business (rank) 7 Starting a business Registering property Number of procedures 8 Number of procedures 6 Time (days) 19 Time (days) 45 Cost (% of GDP per capita) 9.15 Cost (% of property value) 4.14 Ease of starting a business (rank) 3 Ease of registering property (rank) 20 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 11 Complexity index (1-100) 77 Cost (% of loan value) 1.51 Time (days) 290 Ease of creating and registering collateral (rank) 9 Cost (% of debt) 24 Ease of enforcing a contract (rank) 9 QuintAnA roo GDP per capita (US$) 9,817 City: Benito Juárez (Cancún) Ease of doing business (rank) 32 Starting a business Registering property Number of procedures 9 Number of procedures 10 Time (days) 69 Time (days) 154 Cost (% of GDP per capita) 12.02 Cost (% of property value) 4.27 Ease of starting a business (rank) 16 Ease of registering property (rank) 32 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 51 Complexity index (1-100) 75 Cost (% of loan value) 1.49 Time (days) 568 Ease of creating and registering collateral (rank) 27 Cost (% of debt) 27 Ease of enforcing a contract (rank) 27 sAn luis potosí GDP per capita (US$) 4,764 City: San Luis Potosí Ease of doing business (rank) 19 Starting a business Registering property Number of procedures 8 Number of procedures 7 Time (days) 19 Time (days) 37 Cost (% of GDP per capita) 15.82 Cost (% of property value) 3.63 Ease of starting a business (rank) 8 Ease of registering property (rank) 18 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 18 Complexity index (1-100) 84 Cost (% of loan value) 2.17 Time (days) 360 Ease of creating and registering collateral (rank) 24 Cost (% of debt) 20 Ease of enforcing a contract (rank) 18 sinAloA GDP per capita (US$) 4,561 City: Culiacán Ease of doing business (rank) 9 Starting a business Registering property Number of procedures 8 Number of procedures 5 Time (days) 35 Time (days) 30 Cost (% of GDP per capita) 23.03 Cost (% of property value) 4.80 Ease of starting a business (rank) 18 Ease of registering property (rank) 14 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 17 Complexity index (1-100) 82 Cost (% of loan value) 0.80 Time (days) 337 Ease of creating and registering collateral (rank) 8 Cost (% of debt) 16 Ease of enforcing a contract (rank) 6 sTaTeTables 37 sonorA GDP per capita (US$) 6,897 City: Hermosillo Ease of doing business (rank) 4 Starting a business Registering property Number of procedures 9 Number of procedures 5 Time (days) 34 Time (days) 21 Cost (% of GDP per capita) 10.31 Cost (% of property value) 3.36 Ease of starting a business (rank) 9 Ease of registering property (rank) 2 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 12 Complexity index (1-100) 80 Cost (% of loan value) 1.08 Time (days) 372 Ease of creating and registering collateral (rank) 4 Cost (% of debt) 23 Ease of enforcing a contract (rank) 17 tABAsco GDP per capita (US$) 3,838 City: Centro (Villahermosa) Ease of doing business (rank) 26 Starting a business Registering property Number of procedures 9 Number of procedures 5 Time (days) 35 Time (days) 43 Cost (% of GDP per capita) 30.73 Cost (% of property value) 5.20 Ease of starting a business (rank) 23 Ease of registering property (rank) 19 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 24 Complexity index (1-100) 83 Cost (% of loan value) 2.68 Time (days) 353 Ease of creating and registering collateral (rank) 30 Cost (% of debt) 20 Ease of enforcing a contract (rank) 15 tAmAulipAs GDP per capita (US$) 6,771 City: Reynosa Ease of doing business (rank) 16 Starting a business Registering property Number of procedures 9 Number of procedures 5 Time (days) 29 Time (days) 61 Cost (% of GDP per capita) 16.96 Cost (% of property value) 3.81 Ease of starting a business (rank) 14 Ease of registering property (rank) 16 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 13 Complexity index (1-100) 77 Cost (% of loan value) 2.42 Time (days) 415 Ease of creating and registering collateral (rank) 18 Cost (% of debt) 25 Ease of enforcing a contract (rank) 20 tlAxcAlA GDP per capita (US$) 3,399 City: Tlaxcala Ease of doing business (rank) 22 Starting a business Registering property Number of procedures 9 Number of procedures 5 Time (days) 42 Time (days) 34 Cost (% of GDP per capita) 28.30 Cost (% of property value) 3.60 Ease of starting a business (rank) 26 Ease of registering property (rank) 10 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 12 Complexity index (1-100) 85 Cost (% of loan value) 2.09 Time (days) 415 Ease of creating and registering collateral (rank) 14 Cost (% of debt) 28 Ease of enforcing a contract (rank) 32 verAcruz GDP per capita (US$) 3,613 City: Coatzacoalcos Ease of doing business (rank) 23 Starting a business Registering property Number of procedures 10 Number of procedures 6 Time (days) 46 Time (days) 28 Cost (% of GDP per capita) 27.55 Cost (% of property value) 2.07 Ease of starting a business (rank) 32 Ease of registering property (rank) 4 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 10 Complexity index (1-100) 88 Cost (% of loan value) 2.76 Time (days) 470 Ease of creating and registering collateral (rank) 15 Cost (% of debt) 23 Ease of enforcing a contract (rank) 31 38 doingbusinessinMeXiCo2007 yucAtán GDP per capita (US$) 4,996 City: Mérida Ease of doing business (rank) 20 Starting a business Registering property Number of procedures 9 Number of procedures 9 Time (days) 38 Time (days) 29 Cost (% of GDP per capita) 13.80 Cost (% of property value) 3.18 Ease of starting a business (rank) 17 Ease of registering property (rank) 17 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 13 Complexity index (1-100) 85 Cost (% of loan value) 1.32 Time (days) 495 Ease of creating and registering collateral (rank) 9 Cost (% of debt) 23 Ease of enforcing a contract (rank) 30 zAcAtecAs GDP per capita (US$) 3,368 City: Zacatecas Ease of doing business (rank) 6 Starting a business Registering property Number of procedures 9 Number of procedures 7 Time (days) 31 Time (days) 21 Cost (% of GDP per capita) 21.29 Cost (% of property value) 4.45 Ease of starting a business (rank) 22 Ease of registering property (rank) 11 Getting credit--Creating and registering collateral Enforcing a contract Time (days) 8 Complexity index (1-100) 84 Cost (% of loan value) 0.97 Time (days) 230 Ease of creating and registering collateral (rank) 2 Cost (% of debt) 14 Ease of enforcing a contract (rank) 1 EstudiosdEcasos·apErturadEEmprEsa 39 Case studies Starting a business Registering property 40 doingBusinEssinmEXico2007 Starting a buSineSS Procedure 6*. Register the company for the payroll tax (ISN) Aguascalientes Time:1day Standard company legal form: Sociedad Anónima (SA) Cost:Nocost Minimum starting share capital: MXN 50,000 Comments:IftheapplicationismadeviatheInternetitwillbenecessarytomake City: Aguascalientes anappointmenttopresentthesupportingdocuments.Therearethreewaystopay Data as of: July 2006 thepayrolltax:online,withadebitcardoratalocalbank. Procedure 1. Obtain authorization for the company name Procedure 7*. Register the company in the Mexican System of from the Ministry of Foreign Affairs (Secretaría de Relaciones Business Information (SIEM) Exteriores, SRE) Time:1day Time:1-2days Cost:MXN385(theaverageofMXN100andMXN670) Cost:MXN565 Comments:InaccordancewiththeLawofChambersofCommerceandtheir Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean federalprocedure.Thecostisdeterminedinthefollowingway: answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter thistime. Industrialcompanies: Commercialandservicecompanies: 6ormoreemployees MXN670 4ormoreemployees MXN640 Procedure 2. Notarize the company statutes and Register with 3to5employees MXN350 3employees MXN300 the Federal Taxpayers Registry (RFC) 1or2employees MXN150 1or2employees MXN100 Time:2days Procedure 8*. Register with the National Institute of Statistics, Cost:MXN4,100 Geography and Information Science (Instituto Nacional de Comments:ThecostvariesaccordingtotheState.InthecaseofAguascalientes,the Estadística, Geografía e Informática, INEGI) feeisatmost35daystheState'sgeneralminimumwage,MXN45.81,plus0.3%of Time:1day thevalueoftheoperation. Cost:Nocost OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscellaneous Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- FiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF).This includedmodificationstotherulesthatregulatetheRFC'son-lineRegistrationSys- * This procedure is simultaneous with the previous procedure. temusedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsit wasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby Starting a buSineSS fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Baja California Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Standard company legal form: Sociedad Anónima (SA) constitutionofthecompany.However,theapplicantscancarryouttheprocedure Minimum starting share capital: MXN 50,000 forthemselvesattheirlocalSAToffice. City: Tijuana InAguascalientes,74%ofthenotariesareconnectedtotheRFC'sremoteaccess Data as of: July 2006 issuingsystem. Procedure 1. Obtain authorization for the company name Procedure 3. Register the company statutes with the Public from the Ministry of Foreign Affairs (Secretaría de Relaciones Registry of Commerce Exteriores, SRE) Time:3days Time:1-2days Cost:MXN500 Cost:MXN565 Comments:ThefeeforregisteringthecompanystatutesisMXN250,plus3per Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe thousandofthecapitalsharevalue.Ifthecompanystatuteswerelegalizedoutside State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron theStateofAguascalientes,anadditionalfeeofMXN75needstobepaid. thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Procedure 4. Obtain an operational license Procedure 2. Legalize the company statutes Time:1day Time:7days Cost:MXN85 Cost:MXN4,250 Comments:Allbusinessesmustobtainanoperationallicense.Therequireddocu- Comments:Thelegalizationofthestatutesorarticlesofassociation(theconstitu- mentsare:occupancypermit,proofofregistrationwiththeRFCand,ifrequired, tionofthecompany)canbedonebyanotarypublicorbroker/agent.Thefounding approvaloftheenvironmentalprocedure.Thelicensesareclassifiedas: shareholdersmustprovidetheirgeneralinformationandofficialidentifications.The a.Special:Theseareforactivitieswithspecificregulationsashealth,environment, fedatariospublic'sfeeforlegalizingthestatutesvariesaccordingtothecompany's education,etc; startingsharecapital. b.Regulated:Theserelatetoactivitiesthatinvolvesaleofalcoholornightentertain- ment; Procedure 3. Register the company statutes with the Public c.Normal:Allotheractivities. Registry of Commerce Thetimeandcostvarydependingonthetypeoflicense. Time:2days Cost:MXN3,828 Procedure 5*. Register with the Mexican Social Security Institute Comments:AccordingtotheRevenueLawofBajaCaliforniafor2006,thecostis (IMSS) MXN1,700forthefirstMXN50,000ofcapital,forthenextMXN50,000thefeeis5 Time:1day perthousand,and2.5perthousandontheamountexceedingMXN100,000. Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. casEstudiEs·startingaBusinEss 41 Procedure 4. Register with the Federal Taxpayers Registry (RFC) Starting a buSineSS Baja California Sur Time:15days Cost:Nocost Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for City: La Paz 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded Data as of: July 2006 modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Procedure 1. Obtain authorization for the company name announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby from the Ministry of Foreign Affairs (Secretaría de Relaciones fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Exteriores, SRE) Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Time:1-2days constitutionofthecompany.However,theapplicantscancarryouttheprocedure Cost:MXN565 forthemselvesattheirlocalSAToffice.8ofthenotariesandthe6corredores públicos Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe deTijuanausethissystem. State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Procedure 5. Obtain an operational license Time:12days Procedure 2. Legalize the company statutes Cost:MXN2,000 Time:3days Comments:Onceregisteredwiththefiscal,federalandstateauthorities,an Cost:MXN9,000 operationallicensemustbeobtained.Itshouldbenotedthat,havingappliedforthe license,thecompanycanstartoperationswhilethepermitisbeingprocessed.The Procedure 3. Register the company statutes with the Public Municipalitygrantsthistypeoflicenseanddemandsanumberofdocumentsand Registry of Commerce reportstoverifythecompany'soperability. Time:9days Obtainingtheinspectors'reportstakesupthemosttimeintheapplicationprocess forobtainingthefinaloperationallicense.Thisprocedurecanbehandledthrough Cost:MXN2,377 theRapidBusinessStart-upSystem(SARE)inanyofthe7branchofficesoftheBusi- Comments:Thecostisafixedfeeof5timestheminimumwage,plus2.5per nessAssistanceCenter(Centro de Atención Empresarial)inTijuana. thousandofsharecapital.FromJanuary1,2006theminimumwagethroughoutBaja CaliforniaSurisMXN48.67. Procedure 6*. Register with the Mexican Social Security Institute (IMSS) Procedure 4. Register with the Federal Taxpayers Registry (RFC) Time:1day Time:15days Cost:Nocost Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded Procedure 7*. Register the company for the payroll tax (ISN) modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Time:1day announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby Cost:Nocost fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Comments:ThecompanymustnotifytheStateRegisterofTaxpayersattheDepart- Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService mentofPlanningandFinances. (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor Procedure 8*. Register the company in the Mexican System of themselvesattheirlocalSAToffice.Thenewsystemyetisnotusedbymostnotaries. Business Information (SIEM) Procedure 5. Obtain an operational license Time:1day Time:1day Cost:MXN385(averageofMXN100andMXN670) Cost:Nocost Comments:Thisisdoneatthesametimeasprocedure6.Inaccordancewiththe Comments:AllbusinessesshouldbeincludedintheMunicipalTaxpayersRegistryof LawofChambersofCommerceandtheirConfederations,publishedintheDOFon LaPazandobtaintheirmunicipallicense.Theoperationallicensemustberenewed January20,2005,registeringinSIEMisafederalprocedure.Thecostisdeterminedin annually.ThelicenseisobtainedfromtheMunicipalofficesinLaPazandisissued thefollowingway: immediatlywhenthedocumentationiscomplete.Thedocumentsneededare: Industrialcompanies: Commercialandservicecompanies: copyofthecompanystatutes,proofofregistrationwithRFCandacopyofthelegal 6ormoreemployees MXN670 4ormoreemployees MXN640 representative'sidentification. 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Procedure 6*. Register with the Mexican Social Security Institute Procedure 9*. Register with the National Institute of Statistics, (IMSS) Geography and Information Science (Instituto Nacional de Time:1day Estadística, Geografía e Informática, INEGI) Cost:Nocost Time:1day Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:Nocost Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Procedure 7*. Register the company for the payroll tax (ISN) graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time:1day * This procedure is simultaneous with the previous procedure. Cost:Nocost Comments:ThecompanyshouldberegisteredintheState'sTaxpayersRegistryat theDepartmentofFinancetopaythepayrolltax. 42 doingBusinEssinmEXico2007 Procedure 8*. Register the company in the Mexican System of Procedure 5. Obtain an operational license Business Information (SIEM) Time:3days Time:1day Cost:MXN45.81 Cost:MXN385(averageofMXN100andMXN670) Comments:Inordertostarttradingthecompanymusthaveanoperationallicense Comments:InaccordancewiththeLawofChambersofCommerceandtheir fromtheMunicipality.Thecostofthelicenseisequivalenttotheminimumwagein Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa zoneC,currentlyMXN45.81. federalprocedure.Thecostisdeterminedinthefollowingway: Industrialcompanies: Commercialandservicecompanies: Procedure 6*. Register with the Mexican Social Security Institute 6ormoreemployees MXN670 4ormoreemployees MXN640 (IMSS) 3to5employees MXN350 3employees MXN300 Time:1day 1or2employees MXN150 1or2employees MXN100 Cost:Nocost Procedure 9*. Register with the National Institute of Statistics, Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Geography and Information Science (Instituto Nacional de tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Estadística, Geografía e Informática, INEGI) Procedure 7*. Register the company for the payroll tax (ISN) Time:1day Time:3days Cost:Nocost Cost:Nocost Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Procedure 8*. Register the company in the Mexican System of * This procedure is simultaneous with the previous procedure. Business Information (SIEM) Starting a buSineSS Time:1day Campeche Cost:MXN385(averageofMXN100andMXN670) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Standard company legal form: Sociedad Anónima (SA) Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Minimum starting share capital: MXN 50,000 federalprocedure.Thecostisdeterminedinthefollowingway: City: Campeche Industrialcompanies: Commercialandservicecompanies: Data as of: July 2006 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Procedure 1. Obtain authorization for the company name 1or2employees MXN150 1or2employees MXN100 from the Ministry of Foreign Affairs (Secretaría de Relaciones Exteriores, SRE) Procedure 9*. Register with the National Institute of Statistics, Time:1-2days Geography and Information Science (Instituto Nacional de Estadística, Geografía e Informática, INEGI) Cost:MXN565 Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe Time:1day State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Cost:Nocost thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Procedure 2. Legalize the company statutes * This procedure is simultaneous with the previous procedure. Time:3days Cost:MXN5,500 Starting a buSineSS Comments:Thecostcanvarybyabout20%dependingonthenotarythatlegalizes Chiapas thestatutes. Standard company legal form: Sociedad Anónima (SA) Procedure 3. Register the company statutes with the Public Minimum starting share capital: MXN 50,000 Registry of Commerce City: Tuxtla Gutiérrez Data as of: July 2006 Time:7days Cost:MXN300 Procedure 1. Obtain authorization for the company name from the Ministry of Foreign Affairs (Secretaría de Relaciones Procedure 4. Register with the Federal Taxpayers Registry (RFC) Exteriores, SRE) Time:15days Time:1-2days Cost:Nocost Cost:MXN565 Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Procedure 2. Legalize the company statutes announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Time:5days Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService Cost:MXN8,500 (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Comments:Thereisnosetfeescheduledandthereforethenotarycomestoan constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor agreementwiththeclient;thecostcanvary. themselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymostnotaries. Procedure 3. Register the company statutes with the Public Registry of Commerce Time:7days Cost:MXN916 Comments:ThefeeisthestipulatedintheRevenueLawoftheStateofChiapas. casEstudiEs·startingaBusinEss 43 Procedure 4. Register with the Federal Taxpayers Registry (RFC) Starting a buSineSS Chihuahua Time:15days Cost:Nocost Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for City: Ciudad Juárez 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded Data as of: July 2006 modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Procedure 1. Obtain authorization for the company name announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby from the Ministry of Foreign Affairs (Secretaría de Relaciones fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Exteriores, SRE) Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Time:1-2days constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor Cost:MXN565 themselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymostnotaries. Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Procedure 5. Obtain an operational license thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Time:3days Procedure 2. Legalize the company statutes Cost:Nocost Comments:Inordertostartoperationsthecompanymusthaveanoperational Time:3days licensefromtheMunicipality. Cost:MXN5,000 Comments:Thecostvariesaccordingtothenotary.Anindependentnotarycharges Procedure 6*. Register with the Mexican Social Security Institute MXN500toMXN1,500perhour. (IMSS) Procedure 3. Register the company statutes with the Public Time:1day Registry of Commerce Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Time:4days tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:MXN11,437 Comments:Theamountofthefeedependsonthecompany'ssharecapital. Procedure 7*. Register the company for the payroll tax (ISN) ThisprocedureisdoneatoneoftheofficesofthePublicRegistryofPropertyand Commerceandischargedat2%ofthevalueoftheoperation,uptoamaximum Time:1day equivalentto235timestheminimumdailywageinforceinthatgeographicalarea. Cost:Nocost Additionally,theentrepreneurmustpayataxonlegalactsandtheuniversitytax. Comments:TheRevenueLawofChiapasstatesthattheISNis1.5%andshouldbe paidinthestateRevenueCollectionandInternalRevenueoffice. Procedure 4. Register with the Federal Taxpayers Registry (RFC) Procedure 8*. Register the company in the Mexican System of Time:15days Business Information (SIEM) Cost:Nocost Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Time:1day Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for Cost:MXN385(averageofMXN100andMXN670) 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded Comments:InaccordancewiththeLawofChambersofCommerceandtheir modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas federalprocedure.Thecostisdeterminedinthefollowingway: announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby Industrialcompanies: Commercialandservicecompanies: fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService 6ormoreemployees MXN670 4ormoreemployees MXN640 (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe 3to5employees MXN350 3employees MXN300 constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor 1or2employees MXN150 1or2employees MXN100 themselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymostnotaries. Procedure 9*. Register with the National Institute of Statistics, Geography and Information Science (Instituto Nacional de Procedure 5. Obtain an operational license Estadística, Geografía e Informática, INEGI) Time:5days Time:1day Cost:MXN973 Cost:Nocost Comments:Thedocumentsrequiredtoobtainanoperationallicenseinclude:land usedeclarationandacivilprotectioninspectionreport(theresponsibilityofthe Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- proprietor).ThisiscarriedoutundertheRapidBusinessStart-upSystem(SARE)of graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. CiudadJuárez.Thecostdependsonthecompany'sactivity. * This procedure is simultaneous with the previous procedure. Procedure 6*. Register with the Mexican Social Security Institute (IMSS) Time:1day Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Procedure 7*. Register the company for the payroll tax (ISN) Time:1day Cost:Nocost Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired.The formscanbecompletedintheofficesoftheChihuahuaStateDepartmentofFinance 44 doingBusinEssinmEXico2007 oron-lineatwww.chihuahua.gob.mx.Theregistrationisdoneimmediately. fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService Procedure 8*. Register the company in the Mexican System of (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Business Information (SIEM) constitutionofthecompany.However,theapplicantscancarryouttheprocedure forthemselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymost Time:1day notaries. Cost:MXN385(averageofMXN100andMXN670) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Procedure 5. Obtain the commercial operational license Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Time:1daywiththeRapidBusinessStart-upSystem(SARE)and10daysforthe federalprocedure.Thecostisdeterminedinthefollowingway: regularprocess Industrialcompanies: Commercialandservicecompanies: Cost:MXN377 6ormoreemployees MXN670 4ormoreemployees MXN640 Comments:Thefollowingshouldbepresented: 3to5employees MXN350 3employees MXN300 a. Applicationform, 1or2employees MXN150 1or2employees MXN100 b. Officialidentification, Procedure 9*. Register with the National Institute of Statistics, c. ProofofregistrationwithHacienda, Geography and Information Science (Instituto Nacional de d. Companystatutes, Estadística, Geografía e Informática, INEGI) e. Proofofpropertytitleand, f. Receiptofpaymentofthepropertytax. Time:1day Costs: Cost:Nocost a. CommercialinspectionMXN224 Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- b. StampingofthelicenseMXN153 graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. IfitwillbeanindustrialbusinessareportmustbegiventotheEcologicalInstituteof * This procedure is simultaneous with the previous procedure. Coahuila.Evenifitisreportedthatthebusinesswillnotpollutetheenvironment,a municipaloperationallicenseisstillrequired. Starting a buSineSS Coahuila Procedure 6*. Register with the Mexican Social Security Institute (IMSS) Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Time:1day City: Torreón Cost:Nocost Data as of: July 2006 Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Procedure 1. Obtain authorization for the company name from the Ministry of Foreign Affairs (Secretaría de Relaciones Procedure 7*. Register the company for the payroll tax (ISN) Exteriores, SRE) Time:1day Time:1-2days Cost:Nocost Cost:MXN565 Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired. Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Procedure 8*. Register the company in the Mexican System of thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Business Information (SIEM) Time:1day Procedure 2. Legalize the company statutes Cost:MXN385(averageofMXN100andMXN670) Time:3days Comments:InaccordancewiththeLawofChambersofCommerceandtheir Cost:MXN4,201 Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Comments:Thenotarychargesarebasedonthenotaries'feescheduleofCoahuila. federalprocedure.Thecostisdeterminedinthefollowingway: Industrialcompanies: Commercialandservicecompanies: Procedure 3. Register the company statutes with the Public 6ormoreemployees MXN670 4ormoreemployees MXN640 Registry of Commerce 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Time:3days Cost:MXN6,625 Procedure 9*. Register with the National Institute of Statistics, Comments:Theratevariesaccordingtothecompany'ssharecapital, Geography and Information Science (Instituto Nacional de forthefirstMXN10,000ofcapitalthefeeisMXN314, Estadística, Geografía e Informática, INEGI) fromMXN10,000toMXN50,000itisMXN15perthousand, Time:1day fromMXN50,000toMXN100,000itisMXN12perthousand, Cost:Nocost fromMXN100,000toMXN150,000itisMXN8perthousand, Comments:ThisfederalprocedureisrequiredundertheLawofStatisticaland andifthecapitalexceedsofMXN150,000thefeewillbe6perthousandonthe GeographicInformation.However,manycompaniesdonotcomplyandarenot surplus.IfthesharecapitalvalueisindeterminatethefeewillbeMXN44bypageof penalized. thecompany'sstatutes. Procedure 4. Register with the Federal Taxpayers Registry (RFC) Time:15days Cost:Nocost Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby casEstudiEs·startingaBusinEss 45 * This procedure is simultaneous with the previous procedure. Procedure 8*. Register the company in the Mexican System of Starting a buSineSS Business Information (SIEM) Colima Time:1day Standard company legal form: Sociedad Anónima (SA) Cost:MXN385(averageofMXN100andMXN670) Minimum starting share capital: MXN 50,000 Comments:InaccordancewiththeLawofChambersofCommerceandtheir City: Colima Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa federalprocedure.Thecostisdeterminedinthefollowingway: Data as of: July 2006 Industrialcompanies: Commercialandservicecompanies: Procedure 1. Obtain authorization for the company name 6ormoreemployees MXN670 4ormoreemployees MXN640 from the Ministry of Foreign Affairs (Secretaría de Relaciones 3to5employees MXN350 3employees MXN300 Exteriores, SRE) 1or2employees MXN150 1or2employees MXN100 Time:1-2days Procedure 9*. Register with the National Institute of Statistics, Cost:MXN565 Geography and Information Science (Instituto Nacional de Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe Estadística, Geografía e Informática, INEGI) State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Time:1day thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Cost:Nocost Procedure 2. Legalize the company statutes Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time:7days * This procedure is simultaneous with the previous procedure. Cost:MXN6,280 Starting a buSineSS Procedure 3. Register the company statutes with the Public Registry of Commerce Durango Standard company legal form: Sociedad Anónima (SA) Time:30-45days Minimum starting share capital: MXN 50,000 Cost:MXN1,909 City: Durango Comments:TheElectronicRegistrationManagementSystem(SIGER)hasnotbeen Data as of: July 2006 implementedinColima,astheSIGERsoftwareisnotcompatiblewithColima's registrationsoftware.Thecostis0.3%ofthecapital,withaminimumofMXN229 Procedure 1. Obtain authorization for the company name andamaximumofMXN24,737. from the Ministry of Foreign Affairs (Secretaría de Relaciones Procedure 4. Register with the Federal Taxpayers Registry (RFC) Exteriores, SRE) Time:1-2days Time:15days Cost:MXN565 Cost:Nocost Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Procedure 2. Legalize the company statutes announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby Time:3days fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Cost:MXN4,612 Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Comments:Thecostoftheprocedureisthenotarypublic'sfees,accordingtothe constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor NotaryPublicsFeeScheduleoftheStateofDurangowhichstates: themselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymostnotaries. I.-Forspecificvaluesthatdonothaveafeespecifiedinthisschedule,theywill charge: Procedure 5. Obtain an operational license a.Ifthevalueisbetween80and400timestheminimumwage,thefeeis6%of thevalueofthebusiness; Time:1day b.Ifthevalueisbetween400and4,170timestheminimumwage,thefeewillbe Cost:MXN5,500 6%ofthefirstamountplus2.5%oftheadditionalvalue; Comments:TheoperationallicenseisobtainedfromtheMunicipalityandhasto c.Ifthevalueisbetween4,170and8,300timestheminimumwage,thefeeis berenewed.NootherapprovalisneededfromtheMunicipalityasitisimplicitto calculatedaccordingtothepreviousclauses,plus2%oftheadditionalvalue; obtainingthemunicipallicense.Thecostdependsonthezoneandvariesbetween d.Ifthevalueexceeds8,300timestheminimumwage,thefeeiscalculatedac- MXN1,000andMXN10,000. cordingtothepreviousclauses,plus0.75%oftheadditionalvalue;and e.Ifthedeedreferstothepurchaseofpubliclyownedrealestate,providedthat Procedure 6*. Register with the Mexican Social Security Institute itsvaluedoesnotexceed5,000timestheminimumwage,thefeewillbe1.5% (IMSS) ofitsvalue. Time:1day Procedure 3. Register the company statutes with the Public Cost:Nocost Registry of Commerce Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Time:10days tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:MXN4,831 Procedure 7*. Register the company for the payroll tax (ISN) Comments:Thecostofthisprocedureisdeterminedaccordingtoarticles16and52 ofsectionXXIVoftheLawofRevenuesoftheStateofDurango,inthefollowingway: Time:3days Thecostismadeupoftheregistrationfee,0.60%ofthetotalcapitalofthecompany Cost:Nocost (MXN3,578.60),plustheTaxforthePromotionofPublicEducationthatequals35% Comments:ThisisdoneintheRevenueOffice(Dirección de Ingresos)oftheDepart- oftheregistrationfee(MXN1,252). mentofFinance. ThisregistrationfeeandtaxmustbepaidtotheRevenueCollectioncashierinthe PublicRegistrybeforesubmittingthedocumentationtotheregistrationdesk.This procedureisgenerallycarriedoutbythenotarypublic. 46 doingBusinEssinmEXico2007 Procedure 4. Register with the Federal Taxpayers Registry (RFC) Starting a buSineSS Time:15days Estado de México Cost:Nocost Standard company legal form: Sociedad Anónima (SA) Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Minimum starting share capital: MXN 50,000 Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for City: Tlalnepantla de Baz 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded Data as of: July 2006 modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Procedure 1. Obtain authorization for the company name announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby from the Ministry of Foreign Affairs (Secretaría de Relaciones fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Exteriores, SRE) Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe Time:1-2days constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor Cost:MXN565 themselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymostnotaries. Comments:Thisisafederalprocedureandcanbedonebythenotarypublicinthe State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Procedure 5. Register with the Mexican Social Security Institute thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. (IMSS) Time:1day Procedure 2. Legalize the company statutes Cost:Nocost Time:3days Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Cost:MXN8,500 tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Procedure 3. Register the company statutes with the Public Procedure 6. Register the company for the payroll tax (ISN) Registry of Commerce Time:2days Time:20days Cost:Nocost Cost:MXN10,642 Comments:ThisisdoneintheStateGovernment'sDepartmentofFinanceand Comments:UndertheEstadodeMéxicolawsthefeesareupdatedevery6months. Administration. ForthisyeartheDepartmentofFinancedefinedtheupdatingfactortobe1.020. 1.Costsofmaterials:MXN392 Procedure 7. Give notice of starting business 2.Professionalfees(showninprocedure2above) Time:2days 3.Registrationfees: Cost:MXN100 a. Whenthedeedstoberecordeddoesnothaveaspecificvalueorthevalueisup Comments:Generallythemajorityofcommercial,industrialandservicebusinesses, toMXN157,894thefeeisMXN1,061; aregovernedbyarticle28,sectionI,oftheEconomicDevelopmentCodeofthe b.WhenthevalueisbetweenMXN157,894andMXN197,369thefeeisMXN3,186; MunicipalityofDurango,thatstates: c. WhenthevalueisbetweenMXN197,369andMXN236,842thefeeisMXN "Toundertakeanybusinessthatdoesnotrequireanoperationallicenseorpermit 5,309; fromtheMunicipality,theMunicipalAuthoritycanissueaDeclarationofOpening d.WhenthevalueisbetweenMXN236,842andMXN276,316thefeeisMXN (Declaración de Apertura),forwhichtheapplicantshouldcomplywiththefollowing 7,433; generalrule: e. WhenthevalueisbetweenMXN276,316andMXN315,791thefeeisMXN I.ThedeclarationofopeningmustbegiventotheBusinessOpeningUnit(Módulo de 9,558,and Apertura)oftheMunicipalAuthority,inthethreemonthsafterstartingoperations. f. WhenthevalueisoverMXN315,791thefeeisMXN10,642. TheBusinessOpeningUnitwillregistertheopening;" Theexamplebusinessinthiscasestudyisconsideredtobeoflowriskandsoits Procedure 4. Register with the Federal Taxpayers Registry (RFC) applicationwouldbeprocessedwithin48hoursundertheDurangoBusinessStart- Time:15days upSystem(Sistema Duranguense de Apertura de Empresas,SDARE)inthemunicipal Cost:Nocost offices. Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Procedure 8*. Register the company in the Mexican System of Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded Business Information (SIEM) modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem Time:1day usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Cost:MXN385(averageofMXN100andMXN670) announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Comments:InaccordancewiththeLawofChambersofCommerceandtheir Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe federalprocedure.Thecostisdeterminedinthefollowingway: constitutionofthecompany.However,theapplicantscancarryouttheprocedure Industrialcompanies: Commercialandservicecompanies: forthemselvesattheirlocalSAToffice.Thenewsystemisnotyetusedbymost 6ormoreemployees MXN670 4ormoreemployees MXN640 notaries. 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Procedure 5. Obtain an operational license Procedure 9*. Register with the National Institute of Statistics, Time:1day(30daysfortheregulatedactivities) Geography and Information Science (Instituto Nacional de Cost:Nocost Estadística, Geografía e Informática, INEGI) Procedure 6*. Register with the Mexican Social Security Institute Time:1day (IMSS) Cost:Nocost Time:1day Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- * This procedure is simultaneous with the previous procedure. tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. casEstudiEs·startingaBusinEss 47 Procedure 7*. Register the company for the payroll tax (ISN) Procedure 4. Give notice of land use Time:1day Time:1day Cost:Nocost Cost:MXN105 Comments:Toregisterthesocialsecuritynumberoftheemployerisrequired. Comments:Whenthepremisesareleasedanditsusedoesnotchange,onlyaland usenoticeisrequired.Iftheusewillchangeanewlanduselicenseisrequired,which Procedure 8*. Register the company in the Mexican System of isobtainedwithin3daysthroughtheRapidBusinessStart-UpSystem(SARE). Business Information (SIEM) Procedure 5*. Register with the Mexican Social Security Institute Time:1day (IMSS) Cost:MXN385(averageofMXN100andMXN670) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Time:1day Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Cost:Nocost federalprocedure.Thecostisdeterminedinthefollowingway: Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Industrialcompanies: Commercialandservicecompanies: tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Procedure 6*. Register the company for the payroll tax (ISN) 1or2employees MXN150 1or2employees MXN100 Time:1day Procedure 9*. Register with the National Institute of Statistics, Cost:Nocost Geography and Information Science (Instituto Nacional de Comments:Toregisterthesocialsecuritynumberoftheemployerisrequired. Estadística, Geografía e Informática, INEGI) Procedure 7*. Register the company in the Mexican System of Time:1day Business Information (SIEM) Cost:Nocost Time:1day Comments:ThisfederalprocedureisrequiredundertheLawofStatisticaland GeographicInformation.However,manycompaniesdonotcomplyandarenot Cost:MXN385(averageofMXN100andMXN670) penalized. Comments:InaccordancewiththeLawofChambersofCommerceandtheir Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa * This procedure is simultaneous with the previous procedure. federalprocedure.Thecostisdeterminedinthefollowingway: Industrialcompanies: Commercialandservicecompanies: Starting a buSineSS Guanajuato 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Standard company legal form: Sociedad Anónima (SA) 1or2employees MXN150 1or2employees MXN100 Minimum starting share capital: MXN 50,000 Procedure 8*. Register with the National Institute of Statistics, City: Celaya Geography and Information Science (Instituto Nacional de Data as of: July 2006 Estadística, Geografía e Informática, INEGI) Procedure 1. Obtain authorization for the company name Time:1day from the Ministry of Foreign Affairs (Secretaría de Relaciones Cost:Nocost Exteriores, SRE) Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Time:1-2days graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Cost:MXN565 * This procedure is simultaneous with the previous procedure. Comments:Thisisafederalprocedureandcanbedonebythenotarypublic,inthe State'sFederalDelegationorviatheInternet.Thecompanywillreceiveanansweron Starting a buSineSS thesamedayifitappliesbefore11:00,andthefollowingdayifafterthistime. Guerrero Procedure 2. Legalize the company statutes and register with the Standard company legal form: Sociedad Anónima (SA) Federal Taxpayers Registry (RFC) Minimum starting share capital: MXN 50,000 City: Acapulco Time:3days Data as of: July 2006 Cost:MXN5,729 Comments:TheFifthResolutionofAmendmentstotheMiscellaneousFiscalAct Procedure 1. Obtain authorization for the company name from Resolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for the Ministry of Foreign Affairs (Secretaría de Relaciones Exteriores, 2005waspublishedintheOfficialGazetteoftheFederation(DOF).Thisincluded SRE) modificationstotherulesthatregulatetheRFC'son-lineRegistrationSystem usedbyfedatarios(whethernotaryorcorredor).Amongthesemodificationsitwas Time:1-2days announcedthat,fromOctober13,2005,theTaxIdentificationNumberissuedby Cost:MXN565 fedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbeused. Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter constitutionofthecompany.However,theapplicantscancarryouttheprocedure thistime. forthemselvesattheirlocalSAToffice.InCelaya,morethan50%ofthenotariesuse thissystem. Procedure 2. Notarize the company statutes Procedure 3. Register the company statutes with the Public Time:3days Registry of Commerce Cost:MXN2,600 Time:1-2days Procedure 3. Register the company statutes with the Public Cost:MXN734 Registry of Commerce Comments:Thiscanbedonebythenotariesviainternetusingthesecretelectronic signaturethatallowsthemtofileregistrationsatthePublicRegistryofCommerce. Time:4days Cost:MXN2,309 Comments:Thecostis0.64%ofthesharecapital. 48 doingBusinEssinmEXico2007 Procedure 4. Register with the Federal Taxpayers Registry (RFC) Starting a buSineSS Hidalgo Time:15days Cost:Nocost Standard company legal form: Sociedad Anónima (SA) Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- Minimum starting share capital: MXN 50,000 cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución City: Pachuca de Soto Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation Data as of: July 2006 (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese Procedure 1. Obtain authorization for the company name modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- from the Ministry of Foreign Affairs (Secretaría de Relaciones tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber Exteriores, SRE) wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis Time:1-2days taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan Cost:MXN565 carryouttheprocedureforthemselvesattheirlocalSAToffice.Thenewsystemis Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, notyetusedbymostnotaries. intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Procedure 5. Obtain an operational license thistime. Time:30days Procedure 2. Notarize the company statutes Cost:MXN800 Comments:TheMunicipalityissuestheoperationallicensewhenithasapproval Time:5days reportsfromtheCivilProtectionDepartment,theFireDepartment,theEnvironment Cost:MXN6,750 andEcologyDepartment,andtheMunicipalHealthDepartmentifthebusinesswill involvefood.Thecostofthelicensevariesdependingonthecapitaldeclaredand Procedure 3. Register the company statutes with the Public thetypeofactivity.Theinspectionisfree. Registry of Commerce Procedure 6*. Register with the Mexican Social Security Institute Time:13days (IMSS) Cost:MXN2,750 Time:1day Procedure 4. Register with the Federal Taxpayers Registry (RFC) Cost:Nocost Time:15days Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:Nocost Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- Procedure 7*. Register the company for the payroll tax (ISN) cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation Time:1day (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line Cost:Nocost RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- Procedure 8*. Register the company in the Mexican System of tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber Business Information (SIEM) wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis Time:1day taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan Cost:MXN385(averageofMXN100andMXN670) carryouttheprocedureforthemselvesattheirlocalSAToffice.Thenewsystemis Comments:InaccordancewiththeLawofChambersofCommerceandtheir notyetusedbymostnotaries. Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa federalprocedure.Thecostisdeterminedinthefollowingway: Procedure 5. Obtain an operational license Industrialcompanies: Commercialandservicecompanies: Time:2days 6ormoreemployees MXN670 4ormoreemployees MXN640 Cost:MXN1,100 3to5employees MXN350 3employees MXN300 Comments:TheMunicipalityhasaRapidBusinessStart-upSystem(SARE),where 1or2employees MXN150 1or2employees MXN100 thelandusereport(dictamen de uso de suelo)canbegeneratedatthesametime. Procedure 9*. Register with the National Institute of Statistics, Thecostincludesthepaymentforbothdocuments.TheSAREalsoallowstheinspec- tionsfromthedepartmentsofcivilprotection(security)andhealth(onlyneededif Geography and Information Science (Instituto Nacional de thebusinesshandlesfood)tobeconductedafterthestartofoperations. Estadística, Geografía e Informática, INEGI) Time:1day Procedure 6*. Register with the Mexican Social Security Institute Cost:Nocost (IMSS) Comments:ThisfederalprocedureisrequiredundertheLawofStatisticaland Time:1day GeographicInformation.However,manycompaniesdonotcomplyandarenot Cost:Nocost penalized. Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- * This procedure is simultaneous with the previous procedure. tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Procedure 7*. Register the company for the payroll tax (ISN) Time:1day Cost:Nocost casEstudiEs·startingaBusinEss 49 Procedure 8*. Register the company in the Mexican System of AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis Business Information (SIEM) taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan carryouttheprocedureforthemselvesattheirlocalSAToffice.Thenewsystemis Time:1day notyetusedbymostnotaries. Cost:MXN385(averageofMXN100andMXN670) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Procedure 5. Obtain the municipal license Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Time:1day federalprocedure.Thecostisdeterminedinthefollowingway: Cost:MXN131 Industrialcompanies: Commercialandservicecompanies: Comments:Thefollowingtypesoflicensesexist: 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 A-15to20minutes 1or2employees MXN150 1or2employees MXN100 B-5workingdays C-10workingdays Procedure 9*. Register with the National Institute of Statistics, D-30workingdays Geography and Information Science (Instituto Nacional de ThegreatmajorityoflicensesissuedinGuadalajaraaretypeA.Obtainingofthe Estadística, Geografía e Informática, INEGI) operationallicensedependsontheactivityofthebusinessandmayinvolveother Time:1day aspectsleadingtoadditionalcostssuchas:thelandusereport,theconditionsof Cost:Nocost operation,thepublichealthandcivilprotectionpermit,aswellastheagreement ofneighborsorresidents'associationswhereapplicable,ifthebusinessistobe Comments:ThisfederalprocedureisrequiredundertheLawofStatisticaland establishedinresidentialzone. GeographicInformation.However,manycompaniesdonotcomplyandarenot TheMunicipalityofGuadalajaraintroduceda"pre-license"(prelicencia),forwhich penalized. theRegulationofCommercialBusinessesandServiceDeliverywasmodified.This * This procedure is simultaneous with the previous procedure. involvessubmittingabusinessopeningnoticebyInternet,andenablesabusinessto startoperationsifitslandusereportisvalidanditfulfilstheminimumrequirements. Starting a buSineSS AccordingtotheMunicipality'sRevenueLawthecostofthiscompanyactivitydecla- Jalisco rationisMXN23anditcanbepaidwithcreditcard.Thereisatimelimitof3months inwhichtofulfiltheoutstandingrequirementsorhalttheprocedure. Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Procedure 6*. Register with the Mexican Social Security Institute City: Guadalajara (IMSS) Data as of: July 2006 Time:1day Procedure 1. Obtain authorization for the company name Cost:Nocost from the Ministry of Foreign Affairs (Secretaría de Relaciones Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Exteriores, SRE) tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Time:1-2days Procedure 7*. Register the company for the payroll tax (ISN) Cost:MXN565 Time:1day Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean Cost:Nocost answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired. thistime. Procedure 8*. Register the company in the Mexican System of Procedure 2. Notarize the company statutes Business Information (SIEM) Time:3days Time:1day Cost:MXN5,000 Cost:MXN385(averageofMXN100andMXN670) Comments:Notariesorcorredores públicos,whoareregisteredwiththeprogram, Comments:InaccordancewiththeLawofChambersofCommerceandtheir canalsorequesttheTaxIdentificationNumberviatheInternet. Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa federalprocedure.Thecostisdeterminedinthefollowingway: Procedure 3. Register the company statutes with the Public Industrialcompanies: Commercialandservicecompanies: Registry of Commerce 6ormoreemployees MXN670 4ormoreemployees MXN640 Time:14days 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Cost:MXN1,335 Comments:Inaccordancewitharticle15oftheJaliscoStateRevenueLawforthe Procedure 9*. Register with the National Institute of Statistics, fiscalyear2006,thefeeforregisteringthecompanystatutesincreasedtoMXN Geography and Information Science (Instituto Nacional de 1,335.Registerednotariesandcorredores públicoscancompletetheregistrationvia Estadística, Geografía e Informática, INEGI) theInternetthroughFEDANETandSIGERinanaverageof2to5workingdays.How- ever,inpracticetheaveragetimeforthePublicRegistryofCommercetocomplete Time:1day thisprocedureandissuetheregistrationis10workingdays. Cost:Nocost Comments:ThisfederalprocedureisrequiredundertheLawofStatisticaland Procedure 4. Register with the Federal Taxpayers Registry (RFC) GeographicInformation.However,manycompaniesdonotcomplyandarenot Time:15days penalized. Cost:Nocost *This procedure is simultaneous with the previous procedure. Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax 50 doingBusinEssinmEXico2007 Starting a buSineSS Procedure 7*. Register the company in the Mexican System of Michoacán Business Information (SIEM) Standard company legal form: Sociedad Anónima (SA) Time:1day Minimum starting share capital: MXN 50,000 Cost:MXN385(averageofMXN100andMXN670) City: Morelia Comments:InaccordancewiththeLawofChambersofCommerceandtheir Data as of: July 2006 Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Procedure 1. Obtain authorization for the company name federalprocedure.Thecostisdeterminedinthefollowingway: from the Ministry of Foreign Affairs (Secretaría de Relaciones Industrialcompanies: Commercialandservicecompanies: Exteriores, SRE) 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Time:1-2days 1or2employees MXN150 1or2employees MXN100 Cost:MXN565 Procedure 8*. Register with the National Institute of Statistics, Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Geography and Information Science (Instituto Nacional de intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Estadística, Geografía e Informática, INEGI) thistime. Time:1day Cost:Nocost Procedure 2. Notarize the company statutes and register with the Federal Taxpayers Registry (RFC) Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time:5days * This procedure is simultaneous with the previous procedure. Cost:MXN2,740 Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- Starting a buSineSS cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Morelos Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line Standard company legal form: Sociedad Anónima (SA) RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese Minimum starting share capital: MXN 50,000 modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- City: Cuernavaca tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber Data as of: July 2006 wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis Procedure 1. Obtain authorization for the company name taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan from the Ministry of Foreign Affairs (Secretaría de Relaciones carryouttheprocedureforthemselvesattheirlocalSAToffice.Ofthe34notariesin Exteriores, SRE) thecityofMorelia,18theyareregisteredwiththenewsystem. Time:1-2days Procedure 3. Register the company statutes with the Public Cost:MXN565 Registry of Commerce Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Time:7days intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Cost:MXN183(ordinary)andMXN386(urgent) thistime. Comments:InaccordancewiththeRevenuesLawoftheMunicipalityofMorelia, Michoacán,article12,sectionIII,clauseA. Procedure 2. Notarize the company statutes Procedure 4. Obtaining the operational license and to give notice Time:3days of starting business Cost:MXN6,080 Time:2days Comments:ThecostisMXN3,500plus0.50%ofthevalueofthesharecapitalover MXN50,000. Cost:Nocost Comments:Allthebusinesseshavetogiveanoticeofstartingbusiness.Depending Procedure 3. Register the company statutes with the Public ontheactivityofthebusinesstheyshouldalsoobtainalandusecertificate,environ- Registry of Commerce mentalandcivilprotectioncertificates. Time:25days Procedure 5*. Register with the Mexican Social Security Institute Cost:MXN1,145 (IMSS) Comments:Thecostis25timestheminimumdailywageintheStateofMorelos, Time:1day MXN45.81forthefiscalyear2006. Cost:Nocost Procedure 4. Register with the Federal Taxpayers Registry (RFC) Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Time:15days Cost:Nocost Procedure 6*. Register the company for the payroll tax (ISN) Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- Time:1day cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation Cost:Nocost (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan carryouttheprocedureforthemselvesattheirlocalSAToffice.Thenewsystemis notyetusedbymostnotaries. casEstudiEs·startingaBusinEss 51 Procedure 5. Obtaining the operational license and to give notice a. IfthevaluedoesnotexceedMXN100,000thefeewillbe10%ofthevalue of starting business b. IfthevalueisfromMXN100,000.01toMXN500,000.00thefeewillbe7.5%ofthe value; Time:5days c. IfthevalueisfromMXN500,000.01toMXN1,000,000.00thefeewillbe5%ofthe Cost:Nocost value; Comments:ThecompanyappliesfortheoperationallicenseintheMunicipalityof d. IfthevalueexceedsMXN1,000,000.00thefeewillbe4%onthefirstpartand Cuernavaca.Thefollowingdocumentationshouldbepresented:theformprovided 2.5%ontheremainderofthevalue." bytheBusinessAssistanceCenterofMorelos(CAEM),formR-1,personalidentifica- tion,thetaxidentification(RFC),thecompanystatutes,therentalagreement,and Procedure 3. Register the company statutes with the Public photographsofthebusiness. Registry of Commerce Procedure 6*. Register with the Mexican Social Security Institute Time:7days (Instituto Mexicano de la Seguridad Social, IMSS) Cost:MXN3,406 Comments:Accordingtoarticle13,sectionIIIoftheLawofRevenuesofNayarit Time:2days Stateforthefiscalyearof2006,thefeeis0.9%ofthevalueoftheinitialsharecapital. Cost:Nocost ThisfeeispaidintheRevenueCollectionDepartmentoftheStateGovernment.The Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- PublicRegistryofCommercemustbepresentedwiththeoriginalandacopyofthe tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. companystatutesandproofofpaymentofthefee. Procedure 7*. Register the company in the Mexican System of Procedure 4. Register with the Federal Taxpayers Registry (RFC) Business Information (SIEM) Time:15days Time:1day Cost:Nocost Cost:MXN385(averageofMXN100andMXN670) Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- Comments:InaccordancewiththeLawofChambersofCommerceandtheir laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). federalprocedure.Thecostisdeterminedinthefollowingway: ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications Industrialcompanies: Commercialandservicecompanies: itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued 6ormoreemployees MXN670 4ormoreemployees MXN640 byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger 3to5employees MXN350 3employees MXN300 beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration 1or2employees MXN150 1or2employees MXN100 Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe Procedure 8*. Register with the National Institute of Statistics, procedureforthemselvesattheirlocalSAToffice.Thenewsystemisnotyetusedby Geography and Information Science (Instituto Nacional de themajorityofnotaries. Estadística, Geografía e Informática, INEGI) Time:1day Procedure 5. Obtain an operational license Cost:Nocost Time:18days Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Cost:MXN1,850 graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Comments:ThisprocedureisdoneattheDepartmentofLicensesoftheMunicipal- * This procedure is simultaneous with the previous procedure. ity.Thefollowingdocumentsareneeded:copyoftheRFC,originaloftheauthoriza- tionissuedbythepublichealthauthority(Salubridad)ifthebusinessisarestaurant, meatmarketorchickenseller(doesnotapplyinthiscase),originalofthelanduse Starting a buSineSS licenseforbars,tortilleríasorcasinos(doesnotapplyinthiscase),sanitaryinspec- Nayarit tionreportdependingonthebusinessactivity,andtheinspectionreportofthe Standard company legal form: Sociedad Anónima (SA) Municipality'scivilprotectiondepartment(doesnotapplyinthiscase). Minimum starting share capital: MXN 50,000 City: Tepic Procedure 6*. Register with the Mexican Social Security Institute Data as of: July 2006 (IMSS) Time:1day Procedure 1. Obtain authorization for the company name Cost:Nocost from the Ministry of Foreign Affairs (Secretaría de Relaciones Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Exteriores, SRE) tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Time:1-2days Cost:MXN565 Procedure 7*. Register the company for the payroll tax (ISN) Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Time:1day intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean Cost:Nocost answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Comments:Thetaxis2%ofthevalueofthecompany'sstaffpayroll.Registrationis thistime. doneintheState'sDepartmentofFinanceandthefollowinginformationshouldbe provided: Procedure 2. Notarize the company statutes ·Totalnumberofemployees, Time:6days ·Employer'sregistrationnumberwiththeMexicanSocialSecurityInstitute(IMSS), Cost:MXN18,690 ·RFC, Comments:Thiscanbecarriedoutwithanotaryorcorredor público. Thetimeand ·Stateregistration, costforthisprocedurearesignificantlylowerifthecompany'sstatutesarelegalized ·Typeoftaxdeclaration(normalorcomplementary), byacorredor públicobut,astheratioofcorredorestonotariesis1to9,theestimation ·Generalinformationontheemployeesandthecompany, ofthetimeandcostrequiredrefertonotaries'standards. ·Category(singlesite,headquarters,orbranchoffice,etc.), Accordingtothearticles2,sectionXIX,16,firstandfourthprovisionsofthecurrent ·Taxpayer'ssignatureorthatofitslegalrepresentative, NayaritStateLawontheNotarialProfession,connectedwitharticle133ofthe1987 ·Statutesofthecompanyoraccreditationdocumentofthelegalrepresentative, NayaritStateLawontheNotarialProfession,notariesfeesarecalculatedasfollows: ·Identificationnumbersoftheworkers,and "Forthestatuesofaspecificvalue,thatdoesnothaveaspecialrategiveninthis ·IMSSregistrationoftheemployerandemployees. tariff,thefeewilbe: 52 doingBusinEssinmEXico2007 Procedure 8*. Register the company in the Mexican System of Procedure 5*. Register with the Mexican Social Security Institute Business Information (IMSS) Time:1day Time:1day Cost:MXN385(averageofMXN100andMXN670) Cost:Nocost Comments:InaccordancewiththeLawofChambersofCommerceandtheir Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. federalprocedure.Thecostisdeterminedinthefollowingway: Industrialcompanies: Commercialandservicecompanies: Procedure 6*. Register the company for the payroll tax (ISN) 6ormoreemployees MXN670 4ormoreemployees MXN640 Time:1day 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Cost:Nocost Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired. Procedure 9*. Register with the National Institute of Statistics, Geography and Information Science (Instituto Nacional de Procedure 7*. Register the company in the Mexican System of Estadística, Geografía e Informática, INEGI) Business Information (SIEM) Time:1day Time:1day Cost:Nocost Cost:MXN385(averageofMXN100andMXN670) Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Comments:InaccordancewiththeLawofChambersofCommerceandtheir graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa federalprocedure.Thecostisdeterminedinthefollowingway: * This procedure is simultaneous with the previous procedure. Industrialcompanies: Commercialandservicecompanies: Starting a buSineSS 6ormoreemployees MXN670 4ormoreemployees MXN640 Nuevo León 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Procedure 8*. Register with the National Institute of Statistics, City: Monterrey Geography and Information Science (Instituto Nacional de Data as of: July 2006 Estadística, Geografía e Informática, INEGI) Time:1day Procedure 1. Obtain authorization for the company name Cost:Nocost from the Ministry of Foreign Affairs (Secretaría de Relaciones Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Exteriores, SRE) graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time:1-2days * This procedure is simultaneous with the previous procedure. Cost:MXN565 Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Starting a buSineSS intheState'sFederalDelegationorviatheInternet.Thecompanywillreceiveanan- Oaxaca swerthesamedayifitappliesbefore11:00a.m.;thefollowingdayifafterthistime. Standard company legal form: Sociedad Anónima (SA) Procedure 2. Notarize the company statutes and register with the Minimum starting share capital: MXN 50,000 Federal Taxpayers Registry (RFC) City: Salina Cruz Data as of: July 2006 Time:7days Cost:MXN8,000 Procedure 1. Obtain authorization for the company name Comments:Oncetheauthorizationofthecompanynamehasbeenreceived,the from the Ministry of Foreign Affairs (Secretaría de Relaciones notaryfinalizesthestatutes.OnOctober12,2005,theFifthResolutionofAmend- Exteriores, SRE) mentstotheMiscellaneousFiscalActResolution(Quinta Resolución de Modificacio- nes a la Resolución Miscelánea Fiscal)for2005waspublishedintheOfficialGazette Time:1-2days oftheFederation(DOF).Thisincludedmodificationstotherulesthatregulatethe Cost:MXN565 RFC'son-lineRegistrationSystemusedbyfedatarios(whethernotaryorcorredor). Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Amongthesemodificationsitwasannouncedthat,fromOctober13,2005,theTax intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean IdentificationNumberissuedbyfedatarioswouldbedefinitiveandtheprovisional answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter numberwouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedby thistime. theTaxAdministrationService(Servicio de Administración Tributaria, SAT),canobtain thistaxnumberaspartoftheconstitutionofthecompany.However,theapplicants Procedure 2. Notarize the company statutes cancarryouttheprocedureforthemselvesattheirlocalSAToffice.Morethan50% ofthenotariesinMonterreyusethenewsystem. Time:5days Cost:MXN3,500 Procedure 3. Register the company statutes with the Public Comments:Thecostsdependonthenotaryorcorredorpúblico,withsomenotaries Registry of Commerce charginguptoMXN10,000.Forthecompanytobeallowedtooperateitmustbeon theFederalTaxpayersRegistry(RFC).AtpresenttheMinistryofInternalRevenueand Time:10days PublicCredit(Secretaria de Hacienda y Crédito Público,SHCP)allowsnotariesorcor- Cost:MXN3,112 redorestoissuetheregistration.Somenotariesandcorredoreschargeapproximately Comments:IfthesharecapitalisMXN50,000,thefeeisMXN141andiftheshare MXN1,000formanagingthereportingandproceduresattheSHCP. capitalexceedsthisthefeeisMXN2.50perthousandorfraction. Procedure 3. Register the company statutes with the Public Procedure 4. Obtain the use of building license (licencia de uso de Registry of Commerce edificación) Time:14days Time:2days Cost:MXN1,184 Cost:Nocost Comments:Thecostofregistrationis75%of5.5perthousandofthesharecapital, Comments:Businessesinactivitiesoflowriskshouldobtainauseofbuilding withaminimumof13.20timesthecurrentminimumwage. licensethroughtheRapidBusinessStart-upSystem(SARE),whichtakes2days. casEstudiEs·startingaBusinEss 53 Procedure 4. Register with the Federal Taxpayers Registry (RFC) Starting a buSineSS Time:15days Puebla Cost:Nocost Standard company legal form: Sociedad Anónima (SA) Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- Minimum starting share capital: MXN 50,000 laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- City: Puebla celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). Data as of: July 2006 ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications Procedure 1. Obtain authorization for the company name itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued from the Ministry of Foreign Affairs (Secretaría de Relaciones byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger Exteriores, SRE) beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas Time:1-2days partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe Cost:MXN565 procedureforthemselvesattheirlocalSAToffice.Thenewsystemisnotyetusedby Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, themajorityofnotaries. intheState'sFederalDelegationorviatheInternet.Thecompanywillreceiveanan- swerthesamedayifitappliesbefore11:00a.m.;thefollowingdayifafterthistime. Procedure 5. Obtain an operational license Time:10days Procedure 2. Notarize the company statutes Cost:MXN2,000-4,500 Time:2days Comments:Thecostoftheoperationallicensedependsonthespecificactivityof Cost:MXN7,000 thecompany.TheMunicipalCouncilapprovestherates.Toapplyforpermissionto Comments:Thenotary'sfeescanvarybetweenMXN3,000andMXN20,000. openthebusinessthecompany'slegalrepresentativemustsubmitawrittenapplica- tionwith:thecompanyname,thetypeofbusiness,registeredaddressandopening hours. Procedure 3. Register the company statutes with the Public Registry of Commerce Thecostisdeterminedasfollows: *Foraservicescompany:MXN5,000plusanannualfeeofMXN2,500, Time:18days *Foracommercialcompany:MXN2,000plusanannualfeeofMXN1,000, Cost:MXN226 *Foranindustrialcompany:MXN4,500plusanannualfeeofMXN1,800. Comments:Inaccordancewitharticles14,sectionB,sectionI,clauseA,and43 oftheRevenueLawofPueblaStateforthefiscalyear2006thefollowingwas Procedure 6*. Register with the Mexican Social Security Institute determined: (IMSS) Article43 "IndividualsandlegalentitiesthatrequesttheservicesprovidedbytheDepartment Time:1day ofGovernment,throughthePublicRegisterofPropertyandCommercerelatedto Cost:Nocost commercialcompanies,willreceivethefollowingincentives: Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- I.-A75%reductionofthetotalfeestobepaidinaccordancewitharticle14,Para- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. graphB,sectionI,clausea)ofthisLaw,whenthecompanystatutesareregistered. II.-A75%reductionofthetotalfeestobepaidinacordancewitharticle14,Para- Procedure 7*. Register the company for the payroll tax (ISN) graphB,sectionI,clausea)ofthisLaw,forregisteringincreasesinthecompany's Time:1day sharecapital." Cost:Nocost Article14,sectionB Comments:Thecompanyregistersforlocaltaxesasisthecaseforthe2%payrolltax "I.-Foreachregistration,ammendment,ortotalorpartialcancellationoftherecord attheRevenueCollectiondepartmentoftheStateofOaxaca. inthePublicRegistryofPropertyandCommercewithrespecttocommercial companies,thefollowingwillbepaid:a)Forestablishing,reforming,transforming, Procedure 8*. Register the company in the Mexican System of merging,spliting,orincreasingthecapital,sellingordonatingsharesofcommercial Business Information (SIEM) companiesortheirsubsidiaries,whethernationalorforeign;2perthousandofthe totalsharecapital." Time:1day Cost:MXN385(averageofMXN100andMXN670) Procedure 4. Register with the Federal Taxpayers Registry (RFC) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Time:15days Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Cost:Nocost federalprocedure.Thecostisdeterminedinthefollowingway: Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- Industrialcompanies: Commercialandservicecompanies: laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- 6ormoreemployees MXN670 4ormoreemployees MXN640 celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). 3to5employees MXN350 3employees MXN300 ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration 1or2employees MXN150 1or2employees MXN100 Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued Procedure 9*. Register with the National Institute of Statistics, byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger Geography and Information Science (Instituto Nacional de beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration Estadística, Geografía e Informática, INEGI) Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe Time:1day procedureforthemselvesattheirlocalSAToffice.Thenewsystemisnotyetusedby Cost:Nocost themajorityofnotariesandformanyofthemunicipalitiestheprocedurecontinues Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- tobeseparated.InPueblaonly15%ofthenotarieshaveaccesstothissystemand graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. thesechargeanadditionalamountforusingit. * This procedure is simultaneous with the previous procedure. Procedure 5. Obtain an operational license Time:1day Cost:MXN96 Comments:ThecostincludesMXN72forproducingthetarjetónorreinstatement oflicenseandMXN24fortheofficialformsaccordingtotheRevenueLawofthe MunicipalityofPueblaforthefiscalyear2006. 54 doingBusinEssinmEXico2007 Procedure 6*. Register with the Mexican Social Security Institute AlargenumberofnotarieshavethedigitalauthorizationtouseFEDANETandtoissue (IMSS) theRFC.Thelistofthesenotariesisavailablefromchambersofcommerceandother intermediaryorganizationstofacilitatebusinessstart-up.Notariesusuallychargean Time:1day additionalamountfortheRFCprocedure. Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Procedure 3. Register the company statutes with the Public tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Registry of Commerce Time:9days Procedure 7*. Register the company for the payroll tax (ISN) Cost:MXN687.15 Time:1day Comments:ThecostisMXN687.15,basedon12timestheminimumwageinzone Cost:Nocost "C",MXN45.81,plus25%educationtax. Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired. Procedure 4. Obtain an operational license Procedure 8*. Register the company in the Mexican System of Time:2days Business Information (SIEM) Cost:MXN321 Time:1day Comments:Therequirementsincludealandusedeclaration,businessfeasibility Cost:MXN385(averageofMXN100andMXN670) declarationandacivilprotectionandecologyinspection(thisistheresponsibilityof Comments:InaccordancewiththeLawofChambersofCommerceandtheir thebuilder/owner).ThemunicipalityofQuerétaroestablishedasystemthatreduces Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa theseprocedurestoonly2days,withasingleprocedurethroughtheRapidBusiness federalprocedure.Thecostisdeterminedinthefollowingway: Start-upSystem(SARE).InaccordancetotheRevenueLawoftheStateofQuerétaro forthefiscalyear2006,thecostofthelicenseequals7timestheminimumwagein Industrialcompanies: Commercialandservicecompanies: zone"C"(MXN45.81). 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Procedure 5*. Register with the Mexican Social Security Institute 1or2employees MXN150 1or2employees MXN100 (IMSS) Procedure 9*. Register with the National Institute of Statistics, Time:1day Geography and Information Science (Instituto Nacional de Cost:Nocost Estadística, Geografía e Informática, INEGI) Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Time:1day tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:Nocost Procedure 6*. Register the company for the payroll tax (ISN) Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time: 1day * This procedure is simultaneous with the previous procedure. Cost: Nocost Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired. Starting a buSineSS Querétaro Procedure 7*. Register the company in the Mexican System of Business Information (SIEM) Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Time:1day City: Querétaro Cost:MXN385(averageofMXN100andMXN670) Data as of: July 2006 Comments:InaccordancewiththeLawofChambersofCommerceandtheir Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Procedure 1. Obtain authorization for the company name federalprocedure.Thecostisdeterminedinthefollowingway: from the Ministry of Foreign Affairs (Secretaría de Relaciones Industrialcompanies: Commercialandservicecompanies: Exteriores, SRE) 6ormoreemployees MXN670 4ormoreemployees MXN640 Time:1-2days 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Cost:MXN565 Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic, Procedure 8*. Register with the National Institute of Statistics, intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean Geography and Information Science (Instituto Nacional de answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Estadística, Geografía e Informática, INEGI) thistime. Time:1day Procedure 2. Notarize the company statutes and register with the Cost:Nocost Federal Taxpayers Registry (RFC) Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time:3days Cost:MXN5,000 * This procedure is simultaneous with the previous procedure. Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbe used.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministrationService (Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspartofthe constitutionofthecompany.However,theapplicantscancarryouttheprocedurefor themselvesattheirlocalSAToffice. casEstudiEs·startingaBusinEss 55 Starting a buSineSS Procedure 8*. Register the company in the Mexican System of Quintana Roo Businesss Information (SIEM) Standard company legal form: Sociedad Anónima (SA) Time:1day Minimum starting share capital: MXN 50,000 Cost:MXN385(averageofMXN100andMXN670) City: Cancún (Benito Juárez) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Data as of: July 2006 Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Procedure 1. Obtain authorization for the company name federalprocedure.Thecostisdeterminedinthefollowingway: from the Ministry of Foreign Affairs (Secretaría de Relaciones Industrialcompanies: Commercialandservicecompanies: Exteriores, SRE) 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Time:1-2days 1or2employees MXN150 1or2employees MXN100 Cost:MXN565 Procedure 9*. Register with the National Institute of Statistics, Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic Geography and Information Science (Instituto Nacional de intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Estadística, Geografía e Informática, INEGI) thistime. Time:1day Cost:Nocost Procedure 2. Notarize the company statutes Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Time:4days graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Cost:MXN9,300 * This procedure is simultaneous with the previous procedure. Comments:Ifthecompanyisconstitutedbeforeanotarypublicauthorizedbythe TaxAdministrationService(SAT)tohaveaccesstotheFederalTaxpayersRegistry Starting a buSineSS (RFC),thiscanbeobtainedin1day.Somenotarieschargeanadditionalamountfor San Luis Potosí issuingtheRFC. Standard company legal form: Sociedad Anónima (SA) Procedure 3. Register the company statutes with the Public Minimum starting share capital: MXN 50,000 Registry of Commerce City: San Luis Potosí Time:30days Data as of: July 2006 Cost:MXN2,291 Procedure 1. Obtain authorization for the company name from the Ministry of Foreign Affairs (Secretaría de Relaciones Procedure 4. Register with the Federal Taxpayers Registry (RFC) Exteriores, SRE) Time:15days Time:1-2days Cost:Nocost Cost:MXN565 Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications thistime. itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger Procedure 2. Notarize the company statutes and register with the beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration Federal Taxpayers Registry (RFC) Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas Time:5days partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe procedureforthemselvesattheirlocalSAToffice.InQuintanaRoo,themajorityof Cost:MXN5,600 thenotarypublicsdonotyetusethissystem. Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Procedure 5. Obtain an operational license Miscelánea)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Time:18days Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications Cost:MXN500 itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued Comments:Industrial,commercialorservicesbusinessesmustberegisteredwith byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolongerbe theMunicipalTaxpayersRegistryandrequestanoperationallicenseinthemonth used.Similarly,asaresultofthesechanges,thefedatariospublicwillnotbeableto followingtheirregistrationwiththeRFCandtheStateTaxpayersRegistry.Theopera- usetheon-lineregistrationsystemuntiltheyhavebroughtuptodatetheirfedatario tionallicenseisfreeandshouldberenewedannually. públicoregistrationsoftwareandhaveobtainedfromtheLocalTaxpayersAssistance ServicethefirstbatchofdefinitiveTaxIdentificationNumberforms. Procedure 6*. Register with the Mexican Social Security Institute Thesedefinitivenumbersareobtainedthesamedayastheyarerequestedandthe (IMSS) businesscanoperatewiththem.ThemajorityofthenotariesinSanLuisPotosíuse thenewsystem. Time:1day Cost:Nocost Procedure 3. Register the company statutes with the Public Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Registry of Commerce tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Time:7days Procedure 7*. Register the company for the payroll tax (ISN) Cost:MXN1,469 Comments:Theregistrationfeeisthesumof0.2perthousandofthesharecapital, Time:2days plusafixedfeeofMXN283,plus10%forsocialaid. Cost:Nocost Comments:ThebusinessshouldbeenteredintheStateTaxpayersRegistrytopay thePayrollTax. 56 doingBusinEssinmEXico2007 Procedure 4. Obtain an operational license Procedure 3. Register the company statutes with the Public Time:5days Registry of Commerce Cost:MXN308 Time:9days Comments:ThisisobtainedfromtheRapidBusinessStart-upSystem(SARE)inthe Cost:MXN4,158 municipalofficesofSanLuisPotosí.Toobtaintheoperationallicensethecompany Comments:Oncethecompanyisregisteredandhaspaidfortheregistration,the needsthelanduselicensewhichistheresponsibilityofthebuildingowner. companyacquiresitsownlegalandindependentpersonality.Thefeeis0.75%ofthe sharecapitalvalue,plus10%ofthisfee. Procedure 5*. Register with the Mexican Social Security Institute (IMSS) Procedure 4. Register with the Federal Taxpayers Registry (RFC) Time:1day Time:15days Cost:Nocost Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). Procedure 6*. Register the company for the payroll tax (ISN) ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications Time:1day itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued Cost:Nocost byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger Comments:ThisisdoneintheofficesoftheDepartmentofFinanceoftheGovern- beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration mentoftheStateofSanLuisPotosíandis2%ofsalaries.Toregister,thesocial Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberaspart securitynumberoftheemployerisrequired. oftheconstitutionofthecompany.Themajorityofnotariesdonotyetusethenew system;24ofthe53notariesinCuiliacánuseit.However,theapplicantscancarry Procedure 7*. Register the company in the Mexican System of outtheprocedurethemselvesattheirlocalSAToffice.Thiscanbedoneintheoffices Business Information (SIEM) oftheRapidBusinessManagementUnit(URGE),asitrepresentstheSAT.Astartof operationsnoticeshouldbegiventotherepresentativeoftheMinistryofInternal Time:1day RevenueandPublicCredit(SHCP),andtheywillsendregistrationbymailinabout Cost:MXN385(averageofMXN100andMXN670) onemonth. Comments:InaccordancewiththeLawofChambersofCommerceandtheir Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Procedure 5. Register with the Mexican Social Security Institute federalprocedure.Thecostisdeterminedinthefollowingway: (IMSS) Industrialcompanies: Commercialandservicecompanies: Time:1day 6ormoreemployees MXN670 4ormoreemployees MXN640 Cost:Nocost 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Procedure 8*. Register with the National Institute of Statistics, Geography and Information Science (Instituto Nacional de Procedure 6*. Register the company for the payroll tax (ISN) Estadística, Geografía e Informática, INEGI) Time:1day Time:1day Cost:Nocost Cost:Nocost Comments:Thepayrolltaxispaidbimonthlyandis1.5%onthefullsalariestothe employees. Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Procedure 7*. Register the company in the Mexican System of * This procedure is simultaneous with the previous procedure. Business Information (SIEM) Starting a buSineSS Time:1day Sinaloa Cost:MXN385(averageofMXN100andMXN670) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Standard company legal form: Sociedad Anónima (SA) Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Minimum starting share capital: MXN 50,000 federalprocedure.Thecostisdeterminedinthefollowingway: City: Culiacán Industrialcompanies: Commercialandservicecompanies: Data as of: July 2006 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Procedure 1. Obtain authorization for the company name from 1or2employees MXN150 1or2employees MXN100 the Ministry of Foreign Affairs (SRE) Time:1-2days Procedure 8*. Register with the National Institute of Statistics, Geography and Information Science (Instituto Nacional de Cost:MXN565 Estadística, Geografía e Informática, INEGI) Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean Time:1day answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Cost:Nocost thistime. Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Procedure 2. Notarize the company statutes * This procedure is simultaneous with the previous procedure. Time:5days Cost:MXN6,500 Comments:Thecostis1perthousandofsharecapitalvalue. casEstudiEs·startingaBusinEss 57 Starting a buSineSS Procedure 7*. Register the company for the payroll tax (ISN) Sonora Time:1day Standard company legal form: Sociedad Anónima (SA) Cost:Nocost Minimum starting share capital: MXN 50,000 Comments:ThisisdoneattheDepartmentofInternalRevenueoftheStateof City: Hermosillo Sonora. Data as of: July 2006 Procedure 1. Obtain authorization for the company name Procedure 8*. Register the company in the Mexican System of from the Ministry of Foreign Affairs (Secretaría de Relaciones Business Information (SIEM) Exteriores, SRE) Time:1day Time:1-2days Cost:MXN385(averageofMXN100andMXN670) Cost:MXN565 Comments:InaccordancewiththeLawofChambersofCommerceandtheir Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic federalprocedure.Thecostisdeterminedinthefollowingway: intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Industrialcompanies: Commercialandservicecompanies: thistime. 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Procedure 2. Notarize the company statutes 1or2employees MXN150 1or2employees MXN100 Time:5days Procedure 9*. Register with the National Institute of Statistics, Cost:MXN5,000 Geography and Information Science (Instituto Nacional de Estadística, Geografía e Informática, INEGI) Procedure 3. Register the company statutes with the Public Time:1day Registry of Commerce Cost:Nocost Time:7days Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Cost:MXN1,905 graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Comments:Thecostis5perthousandofsharecapital(withamaximumequivalent * This procedure is simultaneous with the previous procedure. to800timesthecurrentgeneralminimumwageinthatarea).A50%discountfor theregistrationofnewcompanies'statutesisbeingconsidered. Starting a buSineSS Documentsrequired: Tabasco a. Thecompany'sstatuteslegalizedbyafedatario público, b. Identificationdocumentsoftheshareholdersorassociates,(voter'sidentification, Standard company legal form: Sociedad Anónima (SA) passportordriver'slicense), Minimum starting share capital: MXN 50,000 c. Copyoftheshareholders'taxnumbers(RFC), City: Villahermosa (Centro) d. Powerofattorneyoftheshareholders'representative,ifapplicable, Data as of: July 2006 e. Receiptforpaymentoftheregistrationfees, f. Pre-filledformsignedandsealedbythenotarypublic,and Procedure 1. Obtain authorization for the company name g. Electromagneticfilestoringthestatutestoberegistered. from the Ministry of Foreign Affairs (Secretaría de Relaciones Exteriores, SRE) Procedure 4. Register with the Federal Taxpayers Registry (RFC) Time:1-2days Time:15days Cost:MXN565 Cost:Nocost Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation thistime. (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese Procedure 2. Notarize the company statutes modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- Time:3days tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax Cost:MXN8,500 AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis Comments:Thecostcanvarybyapproximately20%,dependingonthenotarythat taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan legalizesthestatutes. carryouttheprocedureforthemselvesattheirlocalSAToffice.Itshouldbenoted thatthemajorityofthenotariesdonotyetusethenewsystem. Procedure 3. Register the company statutes with the Public Registry of Commerce Procedure 5. Notify the Municipality of commencement of business activities Time:10days Cost:MXN3,537 Time:1day Comments:ThefeeforregisteringthecompanystatuteswiththePublicRegistryof Cost:Nocost PropertyandCommerceiscalculatedasfollows:25timestheminimumwage,plus Comments:Ifthepreviouslanduselicenseiscompatiblewiththenewbusiness, 0.5%ofthesharecapitalandMXN69.06forthefirstthreepagesandMXN9.16for thisisnotneededandonlythenoticeofoperationisnecessary. eachoftheremainingpagesofthestatutes. Procedure 6*. Register with the Mexican Social Security Institute (IMSS) Time:1day Cost:Nocost Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. 58 doingBusinEssinmEXico2007 Procedure 4. Register with the Federal Taxpayers Registry (RFC) Starting a buSineSS Tamaulipas Time:15days Cost:Nocost Standard company legal form: Sociedad Anónima (SA) Minimum starting share capital: MXN 50,000 Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- City: Reynosa celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). Data as of: July 2006 ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications Procedure 1. Obtain authorization for the company name itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued from the Ministry of Foreign Affairs (Secretaría de Relaciones byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger Exteriores, SRE) beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas Time:1-2days partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe Cost:MXN565 procedureforthemselvesattheirlocalSAToffice.Themajorityofnotariesdonotyet Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic usethenewsystem. intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Procedure 5. Apply for municipal approval to initiate activities thistime. Time:3days Procedure 2. Notarize the company statutes Cost:MXN46 Comments:Businesseswithlowenvironmentalimpactcandothisthroughthe Time:4days RapidCompanyOpeningSystem(SARE)sothattheycanstartoperatingimmedi- Cost:MXN8,500 ately.Ittakes30daystogothroughthenormalprocessandreceiveofficialapproval. Forabusinesswithhighenvironmentalimpact,theprocedurecostsMXN3,000and Procedure 3. Register the company statutes with the Public takes30days. Registry of Commerce Procedure 6*. Register with the Mexican Social Security Institute Time:4days (IMSS) Cost:MXN2,993 Comments:Thecostis4perthousandoftheinitialsharecapitalofthebusiness. Time:1day Cost:Nocost Procedure 4. Register with the Federal Taxpayers Registry (RFC) Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Time:15days tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:Nocost Procedure 7*. Register the company for the payroll tax (ISN) Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- Time:3days celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). Cost:Nocost ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Comments:ThisisdoneattheDepartmentofFinanceoftheStateofTabasco. Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued Procedure 8*. Register the company in the Mexican System of byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger Business Information (SIEM) beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas Time:1day partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe Cost:MXN385(averageofMXN100andMXN670) procedureforthemselvesattheirlocalSAToffice.Themajorityofnotariesdonotyet Comments:InaccordancewiththeLawofChambersofCommerceandtheir usethenewsystem. Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa federalprocedure.Thecostisdeterminedinthefollowingway: Procedure 5. Give notice of operation Industrialcompanies: Commercialandservicecompanies: Time:1day 6ormoreemployees MXN670 4ormoreemployees MXN640 Cost:Nocost 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Procedure 6*. Register with the Mexican Social Security Institute Procedure 9*. Register with the National Institute of Statistics, (IMSS) Geography and Information Science (Instituto Nacional de Time:1day Estadística, Geografía e Informática, INEGI) Cost:Nocost Time:1day Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Cost:Nocost Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Procedure 7*. Register the company for the payroll tax (ISN) graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Time:2days * This procedure is simultaneous with the previous procedure. Cost:MXN250 Comments:ThisisdoneintheStateFiscalOffice. casEstudiEs·startingaBusinEss 59 Procedure 8*. Register the company in the Mexican System of Procedure 6*. Register with the Mexican Social Security Institute Business Information (SIEM) (IMSS) Time:1day Time:1day Cost:MXN385(averageofMXN100andMXN670) Cost:Nocost Comments:InaccordancewiththeLawofChambersofCommerceandtheir Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. federalprocedure.Thecostisdeterminedinthefollowingway: Industrialcompanies: Commercialandservicecompanies: Procedure 7*. Register the company for the payroll tax (ISN) 6ormoreemployees MXN670 4ormoreemployees MXN640 Time:1day 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Cost:Nocost Procedure 9*. Register with the National Institute of Statistics, Procedure 8*. Register the company in the Mexican System of Geography and Information Science (Instituto Nacional de Business Information (SIEM) Estadística, Geografía e Informática, INEGI) Time:1day Time:1day Cost:MXN385(averageofMXN100andMXN670) Cost:Nocost Comments:InaccordancewiththeLawofChambersofCommerceandtheir Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. federalprocedure.Thecostisdeterminedinthefollowingway: Industrialcompanies: Commercialandservicecompanies: * This procedure is simultaneous with the previous procedure. 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Starting a buSineSS 1or2employees MXN150 1or2employees MXN100 Tlaxcala Standard company legal form: Sociedad Anónima (SA) Procedure 9*. Register with the National Institute of Statistics, Minimum starting share capital: MXN 50,000 Geography and Information Science (Instituto Nacional de City: Tlaxcala Estadística, Geografía e Informática, INEGI) Data as of: July 2006 Time:1day Cost:Nocost Procedure 1. Obtain authorization for the company name Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- from the Ministry of Foreign Affairs (Secretaría de Relaciones graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Exteriores, SRE) * This procedure is simultaneous with the previous procedure. Time:1-2days Cost:MXN565 Starting a buSineSS Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic Veracruz intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean Standard company legal form: Sociedad Anónima (SA) answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter thistime. Minimum starting share capital: MXN 50,000 City: Coatzacoalcos Procedure 2. Notarize the company statutes Data as of: July 2006 Time:5days Procedure 1. Obtain authorization for the company name Cost:MXN7,000 from the Ministry of Foreign Affairs (Secretaría de Relaciones Exteriores, SRE) Procedure 3. Register the company statutes with the Public Registry of Commerce Time:1-2days Cost:MXN565 Time:5days Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic Cost:MXN1,878 intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean Comments:Theofficialrateforthisprocedureis0.5%ofthesharecapital. answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter thistime. Procedure 4. Register with the Federal Taxpayers Registry (RFC) Time:15days Procedure 2. Notarize the company statutes Cost:Nocost Time:3days Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMiscel- Cost:MXN8,625 laneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Mis- Comments:Thenotaryorcorredorpublic,thatisauthorizedbytheTaxAdministra- celánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation(DOF). tionService(SAT)tomakeregistrationsintheFederalTaxpayersRegistry(Registro ThisincludedmodificationstotherulesthatregulatetheRFC'son-lineRegistration Federal de Contribuyentes,RFC)canobtainthetaxnumberaspartoftheconstitution Systemusedbyfedatarios(whethernotaryorcorredor).Amongthesemodifications ofthecompany.However,theapplicantscancarryouttheprocedureforthemselves itwasannouncedthat,fromOctober13,2005,theTaxIdentificationNumberissued attheirlocalSAToffice,althoughtheprocedurewilltakeabout15days.Six byfedatarioswouldbedefinitiveandtheprovisionalnumberwouldnolonger fedatarios públicosareauthorizedbytheSATinCoatzacoalcos(theyarelistedinthe beused.Therefore,a fedatario públicowhoisapprovedbytheTaxAdministration NationalRegistryofFedatariosinwww.sat.gob.mxunder"authorizedthirdparties"). Service(Servicio de Administración Tributaria, SAT),canobtainthistaxnumberas Notethatitisnotindispensablethatthefedatariowhowilllegalizethestatuteshas partoftheconstitutionofthecompany.However,theapplicantscancarryoutthe itsregisteredofficeintheMunicipalitywherethecompanywilloperate.Similarly,is procedureforthemselvesattheirlocalSAToffice.Themajorityofnotariesdonotyet notnecessaryforthefedatariotobeinthesamemunicipalitytoregisteracompany usethenewsystem. intheRFC.Forexample,anotaryoftheFederalDistrictcanconstituteacompanyin CoatzacoalcosandregisteritintheRFC,ifheisauthorizedbytheSATtodoit.The Procedure 5. Obtain an operational license costofdoingthisprocedurethroughacorredor públicostartsfromMXN6,500. Time:15days Cost:MXN800 60 doingBusinEssinmEXico2007 Procedure 3. Register the company's statutes with the Public Procedure 9*. Register the company in the Mexican System of Registry of Commerce Business Information (SIEM) Time:20days Time:1day Cost:MXN1,374.30 Cost:MXN385(averageofMXN100andMXN670) Comments:ThiscomesunderArticle140(A)(XI)oftheFinancialCodefortheStateof Comments:InaccordancewiththeLawofChambersofCommerceandtheir Veracruz.Generally,notariesincludethisaspartoftheirtotalfees.Article40ofthe Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa StateLawofPublicRegistrationofPropertystatesthatthisprocedureshouldtakea federalprocedure.Thecostisdeterminedinthefollowingway: maximumof10days,butinpracticeitisestimatedthatsomecasestake30days.The Industrialcompanies: Commercialandservicecompanies: costis30timesthecurrentminimumwage(MXN45.81). 6ormoreemployees MXN670 4ormoreemployees MXN640 Procedure 4. Register with the Federal Taxpayers Registry (RFC) 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Time:15days Cost:Nocost Procedure 10*. Register with the National Institute of Statistics, Geography and Information Science (Instituto Nacional de Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Estadística, Geografía e Informática, INEGI) Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation Time:1day (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line Cost:Nocost RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax * This procedure is simultaneous with the previous procedure. AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan Starting a buSineSS carryouttheprocedureforthemselvesattheirlocalSAToffice.Itshouldbenoted thatthemajorityofthenotariesdonotyetusethenewsystem. Yucatán Standard company legal form: Sociedad Anónima (SA) Procedure 5. Obtain an operational license Minimum starting share capital: MXN 50,000 Time:2days City: Mérida Cost:MXN50 Data as of: July 2006 Comments:Toobtaintheoperationallicensetheentrepreneurneedsafeasibility Procedure 1. Obtain authorization for the company name andlandusecompatibilitydeclarationfromtheMunicipalUrbanDevelopment from the Ministry of Foreign Affairs (Secretaría de Relaciones department,approvalofpublicsafetyandsecuritymeasures,bothissuedbythe MunicipalCivilProtectionAuthority,andnoticeofoperationfromSanitaryDepart- Exteriores, SRE) mentXI. Time:1-2days CompanieswhoseactivityappearsonthelistoftheRapidBusinessStart-upSystem Cost:MXN565 (SARE)canobtaintheiroperationallicensemorequickly.Theseincludebusinesses Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic withlessthen300squaremetersofbuildingandthosethatdonotsellalcoholic intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean beveragesorproductsthatcouldhurtpeople'shealth. answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter thistime. Procedure 6. Obtain a census certificate Time:1day Procedure 2. Notarize the company statutes Cost:Nocost Time:4days Comments:ThisisdonethroughtheMunicipalTreasury.Itscostvariesdepending Cost:MXN6,000 onthenumberofjobsgenerated,investment,andestimatedmonthlyrevenue.The Comments:ThefeesofnotarypublicscanvaryfromMXN6,000toMXN15,000. followingdocumentswillbeneededwiththeapplicationform:proofofregistration Theyshould,however,besetinaccordancewiththefeescheduleofnotariesinthe withtheOfficeoftheMinistryofInternalRevenueandPublicCredit(Secretaria de StateofYucatan. Hacienda y Crédito Público,SHCP),TaxIdentificationNumber,statutesandmunicipal civilprotectionapproval. Procedure 3. Register the company statutes with the Public Procedure 7*. Register with the Mexican Social Security Institute Registry of Commerce (IMSS) Time:12days Time:1day Cost:MXN350 Cost:Nocost Procedure 4. Register with the Federal Taxpayers Registry (RFC) Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Time:15days Cost:Nocost Procedure 8*. Register the company for the payroll tax (ISN) Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- Time:1day cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation Cost:Nocost (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line Comments:ThisisdefinedbythePayrollTaxLawandisrecordedintheVeracruz RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese StateInternalRevenueoffice.Thetaxis2%ofsalaries.Neededforthisare:statutes modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- (originalandtwocopies),powerofattorneyofthelegalrepresentative,officialiden- tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber tificationofthelegalrepresentative,proofoffiscalresidence,RFC,InternalRevenue wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax Number,registrationwiththeIMSSindicatingthenumberofemployees. AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan carryouttheprocedureforthemselvesattheirlocalSAToffice.Itshouldbenoted thatthemajorityofthenotariesdonotyetusethenewsystem. casEstudiEs·startingaBusinEss 61 Procedure 5. Obtain an operational license Procedure 3. Register the company statutes with the Public Time:3days Registry of Commerce Cost:MXN318 Time:7days Comments:ThereisaRapidBusinessStart-upCenterinMérida,wherelowriskbusi- Cost:MXN3,722 nessescanobtaintheirlicensein3days. Comments:Thepaymentisproportionaltothecompany'sinitialsharecapital.A systemisbeingplannedthatwouldenablenotariestodothisregistrationinasingle Procedure 6*. Register with the Mexican Social Security Institute day. (IMSS) Time:1day Procedure 4. Register with the Federal Taxpayers Registry (RFC) Cost:Nocost Time:15days Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- Cost:Nocost tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Comments:OnOctober12,2005,theFifthResolutionofAmendmentstotheMis- cellaneousFiscalActResolution(Quinta Resolución de Modificaciones a la Resolución Procedure 7*. Register the company for the payroll tax (ISN) Miscelánea Fiscal)for2005waspublishedintheOfficialGazetteoftheFederation (DOF).ThisincludedmodificationstotherulesthatregulatetheRFC'son-line Time:1day RegistrationSystemusedbyfedatarios(whethernotaryorcorredor).Amongthese Cost:Nocost modificationsitwasannouncedthat,fromOctober13,2005,theTaxIdentifica- Comments:Toregister,thesocialsecuritynumberoftheemployerisrequired. tionNumberissuedbyfedatarioswouldbedefinitiveandtheprovisionalnumber wouldnolongerbeused.Therefore,a fedatario públicowhoisapprovedbytheTax Procedure 8*. Register the company in the Mexican System of AdministrationService(Servicio de Administración Tributaria, SAT),canobtainthis Business Information (SIEM) taxnumberaspartoftheconstitutionofthecompany.However,theapplicantscan carryouttheprocedureforthemselvesattheirlocalSAToffice.Itshouldbenoted Time:2days thatthemajorityofthenotariesdonotyetusethenewsystem. Cost:MXN385(averageofMXN100andMXN670) Comments:InaccordancewiththeLawofChambersofCommerceandtheir Procedure 5. Register with the Mexican Social Security Institute Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa (IMSS) federalprocedure.Thecostisdeterminedinthefollowingway: Time:1day Industrialcompanies: Commercialandservicecompanies: Cost:Nocost 6ormoreemployees MXN670 4ormoreemployees MXN640 3to5employees MXN350 3employees MXN300 Comments:Thisisafederalprocedure.Theentrepreneurcanmakea"pre-registra- 1or2employees MXN150 1or2employees MXN100 tion"appointmentwiththelocalIMSSofficethroughtheIMSS'sInternetwebsite. Procedure 9*. Register with the National Institute of Statistics, Procedure 6. Register the company for the payroll tax (ISN) Geography and Information Science (Instituto Nacional de Time:2days Estadística, Geografía e Informática, INEGI) Cost:Nocost Time:1day Comments:ThisisdoneintheState'sDepartmentofFinanceoritstaxcollection Cost:Nocost offices. Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. Procedure 7*. Register the company in the Company Information System (SIEM) * This procedure is simultaneous with the previous procedure. Time:1day Starting a buSineSS Cost:MXN385(averageofMXN100andMXN670) Zacatecas Comments:InaccordancewiththeLawofChambersofCommerceandtheir Confederations,publishedintheDOFonJanuary20,2005,registeringinSIEMisa Standard company legal form: Sociedad Anónima (SA) federalprocedure.Thecostisdeterminedinthefollowingway: Minimum starting share capital: MXN 50,000 Industrialcompanies: Commercialandservicecompanies: City: Zacatecas 6ormoreemployees MXN670 4ormoreemployees MXN640 Data as of: July 2006 3to5employees MXN350 3employees MXN300 1or2employees MXN150 1or2employees MXN100 Procedure 1. Obtain authorization for the company name from the Ministry of Foreign Affairs (Secretaría de Relaciones Procedure 8*. Register in the Municipal Registry Exteriores, SRE) Time:1day Time:1-2days Cost:MXN1,700 Cost:MXN565 Comments:ItisobligatorytoberecordedintheMunicipalRegistryofZacatecas. Comments:Thisisafederalprocedureandcanbepresentedbythenotarypublic ThecostisMXN1,700.TheannualrenewalcostsMXN600. intheState'sFederalDelegationorviatheInternet.Thecompanywillreceivean answeronthesamedayifitappliesbefore11:00a.m.,andthefollowingdayifafter Procedure 9*. Register with the National Institute of Statistics, thistime. Geography and Information Science (Instituto Nacional de Estadística, Geografía e Informática, INEGI) Procedure 2. Notarize the company statutes Time:1day Time:2days Cost:Nocost Cost:MXN4,500 Comments:ThisfederalprocedureisrequiredundertheLawofStatisticalandGeo- Comments:Theentrepreneurcanobtainthecompany'sTaxIdentificationNumber graphicInformation.However,manycompaniesdonotcomplyandarenotpenalized. fromthefedatario públicowholegalizesthestatutesorfromtheTaxAdministration Service(SAT). * This procedure is simultaneous with the previous procedure. 62 doingBusinEssinmEXico2007 Registering property Aguascalientes Procedure 6. Register the public deed in the Public Property Property value: $376,570= MXN 4,161,100 Registry City: Aguascalientes Time:4days Data as of: July 2006 Cost:MXN6,890(registrationfee) Procedure 1. Obtain non-encumbrance certificate from, and give Comments:Thesellerisresponsibleforassemblingthefollowingpapers,which preliminary notice to the Public Property Registry mustbedeliveredtothenotarypublic: a. Thetitleofproperty. Time:1day b. Publicrecord(s)containingthememorandumandarticlesofincorporationof Cost:MXN80 thesellingcompany,togetherwithacopyofanyofficialdocument(s)containing Comments:Thenoticeisvalidfor30days.Herethepartiesobtaintheoutlineplan amendmentstothecompanydeedsofthesellingcompany. (lineamiento catastral)ofthepropertyandthenumberofthepropertytogivetothe c. Officialdocument(s)showingthepowerofattorneygrantedtotheseller'srepre- notary. sentatives. d. Receiptsshowingthepaymentoftherealestatetaxesforfiveyears. Procedure 2*. The notary prepares and signs the public deed, e. Receiptsshowingthepaymentofthewaterratesforfiveyears. retains and pays the property or real state transfer taxes. f. Theconstructionlicense. g. Thenoticeoftermofconstruction. Time:1day h. Theoutlineplanandtheofficialnumberoftheproperty. Cost:Nocost i. Thepropertyplan. Comments:Herethepartiesobtainthepropertyplan(plano catastral)togiveto j. Generalinformationontheseller'srepresentativesandacopyoftheirofficial thenotary. identification. Thebuyermustdelivertothenotarypublicthefollowingdocuments: Procedure 3*. Obtain property valuation of the real estate a. Publicrecord(s)containingthememorandumandstatutesofthebuyingcom- Time:4days pany,togetherwithacopyofanyofficialdocument(s)containingamendments Cost:MXN5,000 tothecompanydeedsofthebuyingcompany. b. Officialdocument(s)containingthepowerofattorneygrantedinfavorofthe Procedure 4. The notary prepares and signs the public deed, buyer'srepresentatives. retains and pays the property or real state transfer taxes. c. Generalinformationonthebuyer'srepresentatives. Time:6days Procedure 7*. Report the transfer of title to the Municipal Cost:MXN113,697(MXN45,039notary'sfee+MXN68,658tax) Cadastre Comments:Herethenotaryreceiveshisfeesandcollectsthetransferofproperty Time:4days tax,1.65%ofthevalueoftheproperty.Itisacommonpracticethatthenotary Cost:MXN120 keepsthemoneyforthetaxinhisaccountforupto30days.Thereisalimitof30 dayswithinwhichthetaxmustbepaidatthebank. Comments:ThelandregistryisintheTreasurydepartmentofallthemunicipalities intheState,butonlythebiggestmunicipalitieshaveanofficeofthestateproperty Thenotary'sfeesgivenhereareanaverage.TheLawofNotarialPracticeoftheState registry. ofAguascalientesgivesatableoffees,butthishasnotbeenupdatedsince1987and inpracticenotariesagreethefeestobechargedwiththeclient. * This procedure is simultaneous with the previous procedure. Procedure 5. Give the second notice to the Public Property Registry Time:1day Cost:Nocost Comments:ThenotarygivesthesecondnoticetothePublicRegistrywithintwo daysofsigningthepublicdeed. casEstudiEs·rEgistEringpropErtY 63 regiStering property Over400to1,600minimumwages 27.5perthousand Baja California Over1,600to4,000minimumwages 20.0perthousand Property value: $385,152 = MXN 4,255,930 Over4,000to8,000minimumwages 15.0perthousand Over8,000to40,000minimumwages 9.5perthousand City: Tijuana Over40,000to80,000minimumwages 5.5perthousand Data as of: July 2006 Over80,000minimumwages 3.5perthousand Procedure 1. Obtain non-encumbrance certificate from the Public Thetaxrepresents2%ofthepropertyvalue. Property Registry Procedure 8. Register the public deed in the Public Property Time:3days Registry Cost:MXN227 Time:3days Cost:MXN21,918 Procedure 2*. Obtain property valuation of the real estate Comments:Thecostrepresents5perthousandofthepropertyvalue,plus3%ofthe Time:5days resultforeducation.ThereisamaximumlimitofMXN22,000. Cost:MXN10,840 * This procedure is simultaneous with the previous procedure. Comments:Thefeesofthevaluationexpertarefixedas25perthousandofthe propertyvalue(MXN10,640).ThecostofcertificationisMXN200;thevaluation regiStering property expertisresponsibleforpayingthecertificationfeetotheMunicipalTreasury. Baja California Sur Procedure 3*. Obtain property certificate and plan Property value: $368,158 = MXN 4,267,051 City: La Paz Time:13days(10-15) Data as of: July 2006 Cost:MXN2,244 Comments:ThisproceduretakesplaceintheMunicipalcadastre(CatastroMunici- Procedure 1. Obtain non-encumbrance certificate from the Public pal). Property Registry Procedure 4*. The notary prepares and signs the public deed, Time:5days(3-7) retains and pays the property or real state transfer taxes. Cost:MXN316 Time:1day Procedure 2*. Give the first preliminary notice Cost:MXN179 Time:1day Comments:Procedures4,5and6arelinkedandthesamedocumentisusedtodo themall.FirstgototheMunicipality'sLandTaxDepartment,showingthereceipt Cost:Nocost fromthelastlandtaxpaymenttoshowthatthishasbeenpaid;thisdepartment Comments:GivethefirstpreliminarynoticetothePublicPropertyRegistryto sendsadocumentcertifyingthatthelandtaxisnotowing.Next,takethedocument ensurethatthepropertyisnottaxed.Thisnoticeisvalidfor30calendardaysfrom totheTijuanaStatePublicServicesCommission,showingthelatestreceiptforthe presentation. waterservicetoshowthatthishasbeenpaid,andtheCommissioncertifiesinthe documentthatthewaterconsumptionorwaterconnectionandpublicdrainage Procedure 3*. The notary prepares and signs the public deed, havebeenpaidfor.Finally,takethedocumenttotheStateUrbanizationCommittee, retains and pays the property or real state transfer taxes. whichnotesinthedocumentthatthepropertydoesnothaveanydebtsforurban developmentwork. Time:3days(2-4) Cost:MXN64 Procedure 5*. Obtain a certificate or proof from the Tijuana State Public Services Commission to show that all water rates have Procedure 4*. Obtain property valuation of the real estate been paid Time:15days Time:1day Cost:MXN2,560 Cost:MXN120 Comments:ObtainablefromtheMunicipalCadastreOffice. Procedure 6*. Obtain authorization from the State Urbanization Procedure 5. The notary prepares and signs the public deed, Committee retains and pays the property or real estate transfer taxes Time:1day Time:14days Cost:MXN65 Cost:MXN117,341(MXN32,000notary'sfee+MXN85,341tax) Comments:Thetimeismadeupof4daystopreparethedeedand10daystoobtain Procedure 7. The notary prepares and signs the public deed, thedeclarationofpaymentofthetax.Onaveragethenotarialcostsincreaseupto retains and pays the property or real estate transfer taxes. MXN32,000.Thetaxrepresents2%ofthepropertyvalue. Time:7days Procedure 6. Give the second preliminary notice Cost:MXN109,842(MXN24,723notary'sfee+MXN85,119tax) Time:1day Comments:Thenotarypublicwillchargehisfeesforthepublicdeedbasedonthe article7oftheNotaries'Tariff(Arancel de Notarios)ofBajaCaliforniaState. Cost:Nocost a. Forthebasic,minimumfixedfee,theratesare: Comments:ThesecondpreliminarynoticeisgiventothePublicPropertyRegistry 48hoursafterthedeedissigned.Thisnoticeisvalidfor90calendardaysfollowing *Uptoapropertyvalueequaltotheamountof200timestheminimumwage, theequivalentof9minimumwages. itspresentation,toallowthirdpartiestoconsideritseffectsonthem. *Forvaluesover200timestheminimumwage,theequivalentof18minimum wages. Procedure 7. Register the public deed in the Public Property b. InadditiontothefixedfeeestablishedintheaboveFraction,whenthevalueof Registry thepurchaseisgreaterthantheamountof400minimumwages,thenotarywill Time:90days haverighttochargeontheexcess,thefeesarecalculatedastheprogressivesum oftheapplicablebandsfromthefollowingtable: Cost:MXN13,868 Comments:Thecostcorrespondsto2.5perthousandonthevalueoftheoperation, plus30%ofthisfortheregistryrights. * This procedure is simultaneous with the previous procedure. 64 doingBusinEssinmEXico2007 regiStering property Theseller: Campeche a. Thetitleofproperty; Property value: $510,178 = MXN 5,637,465 b. Officialconstitutiondocumentsofthesellingcompany,andanymodifications; City: Campeche c. Officialdocument(s)showingthepowerofattorneygrantedtotherepresenta- tiveofthesellingcompany; Data as of: July 2006 d. Receiptthatverifiesthepaymentofthelastrealestatetax; Procedure 1. Obtain non-encumbrance certificate from the Public e. Licenseofconstructionandthenoticeoftermofconstruction; Property Registry f. Non-encumbrancecertificateandpropertyvaluation; g. GeneralInformationontheseller'srepresentativeandtheirofficialidentification. Time:3days(2-4) Thebuyer: Cost:MXN69 a. Officialconstitutiondocumentsofthebuyingcompany,andanymodifications; b. Officialdocumentshowingthepowerofattorneygrantedtotherepresentative Procedure 2*. Obtain property certificate for the real state ofthebuyingcompany; Time:1day c. GeneralInformationofthebuyer'srepresentativeandtheirofficialidentification. Cost:MXN45 Procedure 5. Register the public deed in the Public Property Comments:ThisprocedureisdoneintheMunicipalCadastre. Registry Procedure 3. The notary prepares and signs the public deed, Time:23days retains and pays the property or real estate transfer taxes Cost:MXN8,130 Time:5days Comments:TheIncomeLawofChiapasStateforthefiscalyear2006statesthatthe Cost:MXN122,749(MXN10,000notary'sfee+MXN112,749tax) feetoregisterthepublicdeedwiththePublicPropertyRegistrywillbechargedat therateof6perthousandonthevalueoftherealestate. Comments:Thecostrepresents2%ofthepropertyvalue. * This procedure is simultaneous with the previous procedure. Procedure 4. Register the public deed in the Public Property Registry regiStering property Chihuahua Time:14days Cost:MXN16,395 Property value: $404,469 = MXN 4,469,379 City: Ciudad Juárez * This procedure is simultaneous with the previous procedure. Data as of: July 2006 regiStering property Procedure 1. Obtain non-encumbrance certificate from the Public Chiapas Property Registry Property value: $122,621 = MXN 1,354,958 Time:2days City: Tuxtla Gutiérrez Cost:MXN150 Data as of: July 2006 Procedure 2*. The notary prepares and signs the public deed, Procedure 1. Obtain non-encumbrance certificate from the State retains and pays the property or real state transfer taxes. Internal Revenue Collection department Time:1day Time:7days(3-10) Cost:Nocost Cost:MXN366 Comments:TheIncomeLawofChiapasStateforthefiscalyear2006statesthatthe Procedure 3*. Obtain property valuation of the real estate companywillhavetopay8timesthecurrentminimumdailywageinthezone(MXN 45.81)forthenon-encumbrancecertificate. Time:4days Cost:MXN18,600 Procedure 2*. Obtain property valuation of the real estate Procedure 4. The notary prepares and signs the public deed, Time:7days(3-10) retains and pays the property or real estate transfer taxes Cost:MXN2,749 Comments:Forthis,gototheStateInternalRevenueCollectiondepartment.The Time:6days IncomeLawofChiapasStateforthefiscalyear2006statesthat,forrealestatewith Cost:MXN122,209(MXN29,246notary'sfee+MXN92,963tax) avalueofuptofivemillionpesos,60timesthecurrentminimumdailywageinthe Comments:Thenotarypublicformalizesthepurchaseagreementinapublicdeed. zone(MXN45.81)shouldbepaidforthepropertyvaluation. Todraftthedeedthenotaryneedsthefollowingdocuments: a. Originalorcertifiedcopyofthepublicdeedinwhichtheselleracquiredthe Procedure 3*. Obtain property certificate and plan property. Time:3days b. Non-encumbrancecertificate. Cost:MXN137 c. Receiptshowingthepaymentoftherealestatetax(obtainedinprocedure2). d. Receiptshowingthepaymentofthewaterrates. Procedure 4. The notary prepares and signs the public deed, e. Propertyplan(plano castral) retains and pays the property or real estate transfer taxes f. Valuationoftheproperty. g. Certifiedcopyofthepowerofattorneygrantedtothepersonwhorepresentsthe Time:5days seller. Cost:MXN30,072(MXN13,000notary'sfee+MXN17,072tax) h. Certifiedcopyofthepowerofattorneygrantedtothepersonwhorepresentsthe Comments:Thenotary'sfeevariesbetweenMXN6,000andMXN20,000.Thetax buyer. represents1.26%ofthepropertyvalue. i. CopyoftherecordofthesellerintheForeignInvestorsRegister(Registro de Normallythenotarypublicmakesthepaymentoftherelevanttaxes. Inversores Extranjeros)(ifitapplies). j. CopyoftherecordofthebuyerintheForeignInvestorsRegister(Registro de Thesellerandthebuyermustdeliverthefollowingpaperstothenotarypublicso Inversores Extranjeros)(ifitapplies). thatthepublicdeedcanbeexecuted. k. Lasttaxreturnofthebuyer(incasethebuyerdoesnotwanttopayimmediately thevalueaddedtax(VAT)ontheconstructionandtheincometaxonthecapital profit,andwantstoaccumulatetheseforhisannualtaxdeclaration). casEstudiEs·rEgistEringpropErtY 65 Thenotary'sfeesarebasedonanofficialprogressivetablethatdependsonthe Procedure 5. The notary prepares and signs the public deed, property'svalue.Thetableoffees,establishedbythestateCongress,isasfollows: retains and pays the property or real estate transfer taxes Upto15,690 1,569 From15,691to83,680 1,569.00+3%overthelowerlimit Time:11days From83,681to167,360 3,608.70+2.5%overthelowerlimit Cost:MXN116,892(MXN46,756notary'sfee+MXN70,135tax) From167,361to334,720 5,700.70+1.5%overthelowerlimit Comments:Thepreliminarynoticepresentedtothepublicregistryisvalidfor2 months.Ifthisexpiresbeforethenotaryrecordsofchangeofpropertytitle(for From334,721to815,880 8,211.10+0.75%overthelowerlimit example,ifthepartieshavenotyetpaidthenotaryorbecauseauthorizationfrom From815,881to2,719,600 11,819.80+0.50%overthelowerlimit anotherbodyisnotyetready)thenthenotarycansendthesecond'preliminary Morethan2,719,600 21,338.40+0.30%overthelowerlimit notice'totheregisterabouttheongoingregistration. Thefeeiscalculatedusingthehighestvaluefromthevalueofthedeal,thevalua- Herethenotaryreceiveshisfeesandcollectsthepropertytransfertax(1.5%ofthe tion,andthepropertyvalue.15%VATisaddedtothefees. propertyvalue).Thetaxispaidthroughthebankandthetaxservices. Thenotarychargesadditionalamountsforcopiesandotheritems. Thenotary'sfeesaregenerallycalculatedinaccordancewiththefeeschedule(aran- Thenotarycollectsfromthebuyerthepropertytransfertax,whichisequivalent cel de honorarios)oftheStateofCoahuila,articles161.2and172. to2%ofthepropertyvaluecalculatedonthehighestvaluebetweenthepurchase value,thevaluationandthepropertyvalue.Aspecial4%taxisaddedonthewhole Procedure 6. Give second preliminary notice to the Public forfundinglocaluniversities.Forexampleinthiscasethetransfertaxiscalculated Property Registry thus: Time:2days Propertyvalue4,469,379*x2%*x1.04=92,963. Cost:Nocost Procedure 5. Register the public deed in the Public Property Procedure 7. Register the public deed in the Public Property Registry Registry Time:15days Time:21days Cost:MXN12,264 Cost:MXN35,113 Procedure 6. Report the transfer of title to the Municipal Procedure 8. Report the transfer of title to the Municipal Cadastre Cadastre Time:9days Time:8days Cost:MXN240 Cost:MXN65 Comments:TheMunicipalCadastreisintheTreasurydepartmentofallthemunici- * This procedure is simultaneous with the previous procedure. palitiesintheState,butonlythebiggestmunicipalitieshaveanofficeofthestate propertyregistry. regiStering property Coahuila * This procedure is simultaneous with the previous procedure. Property value: $423,139 = MXN 4,675,687 regiStering property City: Torreón Colima Data as of: July 2006 Property value: $287,939 = MXN 3,181,731 Procedure 1. Obtain non-encumbrance certificate from the Public City: Colima Property Registry Data as of: July 2006 Time:8days(2-14) Procedure 1. Obtain non-encumbrance certificate from the Public Cost: MXN170 Property Registry Time:3days Procedure 2*. Obtain certificate or proof of payment of water Cost:MXN141 rates Time:1day Procedure 2. The notary prepares and signs the public deed, Cost:MXN200 retains and pays the property or real estate transfer taxes Comments:Thisisanoptionalprocedurebutitisacommonpracticetoobtainthis Time:9days documentbeforethenotaryexecutesthepublicdeed. Cost:MXN67,161(MXN14,662notary'sfee+MXN52,499tax) Procedure 3*. The notary prepares and signs the public deed, Comments:Thetimetakenallows4daysfordraftingofthepurchasecontractdeed and5daysforpayingthetax.Thetaxcorrespondsto1.65%ofthepropertyvalue. retains and pays the property or real state transfer taxes. Time:3days Procedure 3*. Report the transfer of title to the Municipal Cost:MXN100 Cadastre Comments:Thenotaryisresponsibleforverifyingthatallrealestatetaxeshave Time:5days beenpaid. Cost:Nocost Procedure 4*. Obtain property valuation of the real estate Comments:Oncethenotarypaysthetransfertax,thetimestartsfromthe9thday afterthenoticecanbesubmitted. Time:3days Cost:MXN46,756(1%ofthepropertyvalue). Procedure 4. Register the public deed in the Public Property Registry Time:46days Cost:MXN9,545 * This procedure is simultaneous with the previous procedure. 66 doingBusinEssinmEXico2007 regiStering property regiStering property Durango Estado de México Property value: $ 269,880 = MXN 2,982,172 Property value: $206,696 = MXN 2,283,995 City: Durango City: Tlalnepantla de Baz Data as of: July 2006 Data as of: July 2006 Procedure 1. Obtain non-encumbrance certificate from the Public Procedure 1. Obtain a non-encumbrance certificate, which serves Property Registry as the first notification to the Public Register of the transfer of Time:3days the property Cost:MXN185 Time:10days(5-15) Comments:Theregistrationfeetopreparethetaxcertificaterepresents3daysof Cost:MXN800 thecurrentminimumwageofthezone(MXN45.81),inadditionto35%ofthetotal whichistheTaxforthePromotionofthePublicEducation(article52,sectionXLIIof Procedure 2*. Obtain certificate or proof of payment of water theState'sInternalRevenueLaw). rates Procedure 2*. Obtain property certificate and plan Time:10days Time:10days Cost:MXN300 Cost:MXN1,200 Comments:Thisprocedureisoptionalbutitisacommonpracticetoalsosendthis certificatetothePropertyRegister. Procedure 3*. Obtain property valuation of the real estate Procedure 3*. The notary prepares and signs the public deed, Time:4days retains and pays the property or real state transfer taxes. Cost:MXN8,947 Time:10days Comments:ThisprocedureisdoneintheMunicipalCadastreoffice.Thecostis0.3% Cost:MXN300 ofthepropertyvalue. Procedure 4. The notary prepares and signs the public deed, Procedure 4*. Obtain property valuation of the real estate retains and pays the property or real estate transfer taxes and Time:10days certifies the plan Cost:MXN9,000 Time:12days Procedure 5. The notary prepares and signs the public deed, Cost:MXN87,846(MXN28,203notary'sfee+MXN59,643tax) retains and pays the property or real estate transfer taxes Comments:Thecostrepresents2%ofthepropertyvalue. Time:11days Thenotarypublic'sfeesarecalculated,inaccordancewitharticles2,sectionI,and3 oftheDurangostateLawofTariffsforNotaryPublics,as: Cost:MXN88,520(MXN20,000fee+MXN68,520tax) I.-ForpurchasevaluesthatdonothaveaspecialchargedefinedinthisLaw,the Comments:Thenotaryreceiveshisfeesandcollectsthetransferofpropertytax, notarywillcharge: whichisto3%ofthepropertyvalue.Thenotarypaysthisintothebankwithina a. Ifthepurchasevalueisbetween80and400minimumwages,theirfeeis6%of establishedperiod.ThetaxcanbeuptoamaximumofMXN68,520. thepurchasevalue; b. Ifthevalueisbetween400and4,170minimumwages,theyarepaid6%ofthe Procedure 6. Register the public deed in the Public Property 400forthefirstamount,plus2.5%oftheamountover400; Registry c. Ifthevalueisbetween4,170and8,300minimumwages,theyarepaidinaccor- Time:24days(4-45) dancewiththeprevioussectionsforthefirstamount,plus2%oftheamountover 4,170; Cost:MXN8,000 d. Ifthevalueexceeds8,300minimumwages,theyarepaidinaccordancewiththe TheminimumregistrationfeeisMXN1,061andthemaximumisMXN10,642. previoussectionsforthefirstamount,plus0.75%oftheamountover8,300;and e. Ifthedeedreferstotheacquisitionofpublicrealestate,uptoavalueof5,000 Procedure 7*. Report the transfer of title to the Municipal timestheminimumwage,theyarepaid1.5%ofitsvalue. Cadastre Procedure 5. Obtain property cadastre authorization Time:2days Cost:Nocost Time:1day Comments:InEstadodeMéxico,alltheofficesthatthenotarymustvisittocom- Cost:Nocost pletethetransactionareinthesamerealestate. Procedure 6. Register the public deed in the Public Property * This procedure is simultaneous with the previous procedure. Registry Time:7days(4-10) Cost:MXN54,350 Comments:Thecostis1.35%ofthepropertyvalue,plus35%ofthetotalastaxfor education. Procedure 7*. Report the transfer of title to the Municipal Cadastre Time:2days(1-3) Cost:Nocost Comments:ThesecondpreliminarynoticeisgiventothePublicPropertyRegistry 48hoursafterthedeedissigned.Thisnoticeisvalidfor90calendardaysfollowing itspresentation,toallowthirdpartiestoconsideritseffectsonthem. * This procedure is simultaneous with the previous procedure. casEstudiEs·rEgistEringpropErtY 67 regiStering property Providedbythebuyer: Guanajuato a. Publicrecord(s)thatcontainstheconstitutionandthedeedsofthecompany togetherwithacopyofanyofficialdocumentthatcontainsmodificationstothe Property value: $225,355= MXN 2,490,171 companydeedsofthebuyer; City: Celaya b. Officialdocument(s)thatdemonstratethegrantingofthepowerofattorneyto Data as of: July 2006 thebuyer'srepresentativeorrepresentatives(foractsofadministrationbyvirtue ofthesecondparagraphofarticle2064oftheCivilCodeofGuanajuatoState,and Procedure 1. Obtain a non-encumbrance certificate, which serves powertograntandtosignnegotiableinstrumentsbyvirtueofthearticle9ofthe as the first notification of the property transfer to the Public GeneralLawofNegotiableInstrumentsiftherepresentativepayswithchequeor Property Registry withanyothernegotiableinstrument): c. Generalinformationonthebuyer'srepresentativeorrepresentatives; Time:1days d. Officialidentificationofthebuyer'srepresentativeorrepresentatives. Cost:MXN113 * This procedure is simultaneous with the previous procedure. Comments:Thecertificatecanbeobtainedon-lineifthenotaryhasaccesstothe PublicPropertyRegistry'ssystematwww.rppc.guanajuato.gob.mx. regiStering property Procedure 2*. Obtain certificate or proof of payment of water Guerrero rates Property value: $163,263 = MXN 1,804,054 City: Acapulco Time:1day Data as of: July 2006 Cost:MXN100 Comments:ThelocalwaterdepartmentistheMunicipalDrinkableWaterandSewer Procedure 1. Obtain non-encumbrance certificate from, and give Council,JUMAPA(Junta Municipal de Agua Potable y Alcantarillado). preliminary notice to, the Public Property Registry Procedure 3*. The notary prepares and signs the public deed, Time:4days retains and pays the property or real state transfer taxes. Cost:MXN234 Comments:ThepaymentofrightsisdoneintheFinanceandAdministrationSecre- Time:1day tariatandtheCertificateisobtainedfromthePublicPropertyRegistryDelegation. Cost:MXN93 Procedure 2*. Obtain property certificate from the Acapulco Procedure 4*. Obtain property valuation of the real estate Municipality. Time:5days Time:4days Cost:MXN7,000(entreMXN4,000yMXN10,000) Cost:MXN2,530 Comments:TheofficialcostisMXN1,946.80,plus30%ofextras.Thepaymentis Procedure 5. The notary prepares and signs the public deed, madeintheMunicipalCadastreandPropertyTaxDepartment. retains and pays the property or real estate transfer taxes Time:6days Procedure 3*. Obtain a certificate or proof of land taxes payment Cost:MXN43,578(MXN24,902fee(1%ofthepropertyvalue)+MXN18,676oftax) to the Acapulco Municipality Comments:Thenotaryreceiveshisfeesandcollectsthetransferofpropertytax, Time:4days(2-5) whichcorrespondsto0.75%ofthepropertyvalueinaccordancewiththeCelaya Cost:MXN49 fiscallegislationof2005(thelowesttransferofpropertytaxinthecountry).The Comments:ThepaymentismadeintheMunicipalCadastreandPropertyTaxDept. notarypaysthisintothebankwithinaestablishedperiod.Thenotary'sfeeisfixed forthewholestate,butinthepracticethefeesreceivedforeverynotaryvaryfrom clienttoclient. Procedure 4*. Obtain property certificate and plan from the Acapulco Municipality Procedure 6. Report the transfer of title to the Municipal Time:8days Cadastre Cost:MXN523 Time:8days Comments:TheofficialcostisMXN402,plus30%ofextras.Thepaymentismadein Cost:MXN90 theMunicipalCadastreandPropertyTaxDepartment. Procedure 7. Register the public deed in the Public Property Procedure 5*. Obtain property valuation of the real estate Registry Time:4days Time:4days Cost:MXN5,760 Cost:MXN734(registrationfee) Comments:TheofficialcostforthevaluationisMXN4,320.Thevaluationispre- Comments:Thedocumentsneededtobeprovidedtothenotarypublicinclude: paredbyanexpertauthorizedbytheState'sSecretariatofFinanceandAdministra- tionandtheSecretariatispaidafeeofMXN1,440. Providedbytheseller: a. Titleofproperty; Procedure 6*. Obtain form 3DCC b. Publicrecord(s)thatcontaintheconstitutionandthecompanydeedsofthe sellingcompany,togetherwithacopyofanyofficialdocumentthatcontains Time:1day modificationstothecompanydeedsofthesellingcompany: Cost:MXN40 c. Officialdocument(s)thatcontainthepowerofattorneygrantedtotheseller's Comments:BuytheformintheMunicipalCadastreandPropertyTaxDepartmentof representatives(fortheactsofdomainandactsofadministrationbyvirtueof theMunicipalityandtakeittothenotary,whofillsitinwiththepropertyinformation. thesecondandthirdparagraphsofarticle2064oftheCivilCodeofGuanajuato State); Procedure 7. The notary prepares and signs the public deed, d. Receiptsshowingthelatestpaymentoftherealestatetax; retains and pays the property or real estate transfer taxes e. Receiptsshowingpaymentofthewaterrates; f. Thelicenseofconstruction; Time:5days g. Thenoticeoftermofconstruction; Cost:MXN54,081(MXN18,000notary'sfee+MXN36,081tax) h. Generalinformationontheseller'srepresentativesandacopyoftheirofficial Comments:Thetaxis2%ofthevaluecalculatedonthehighestvaluebetweenthe identification. fiscalvaluationandthepurchasevalue,andispaidtotheMunicipalCadastreOffice andPropertyTaxDepartmentoftheAcapulcoMunicipality. 68 doingBusinEssinmEXico2007 Procedure 8. Register the public deed in the Public Property regiStering property Registry Jalisco Time:11days Property value: $294,093 = MXN 3,249,727 Cost:MXN11,546 City: Guadalajara Comments:Theregistrationfee,paidtotheSecretaryofFinanceandAdministra- Data as of: July 2006 tion,isequivalentto0.64%ofthehighestvaluebetweenthevalueassignedbythe Procedure 1. Obtain non-encumbrance certificate from the Public propertydemarcation,thefiscalvaluationandthetotalofthecontract. Property Registry Procedure 9. Report the transfer of title to the Municipal Time:10days Cadastre Cost:MXN145 Time:2days Procedure 2*. The notary prepares and signs the public deed, Cost:Nocost retains and pays the property or real state transfer taxes. * This procedure is simultaneous with the previous procedure. Time: 1day regiStering property Cost:MXN40(MXN28.50percertificateandMXN11.50perrequest) Hidalgo Procedure 3*. Obtain certificate or proof of payment of water Property value: $173,244 = MXN 1,914,342 rates City: Pachuca de Soto Time:1day Data as of: July 2006 Cost:MXN76.07 Procedure 1. Obtain non-encumbrance certificate from the Public Comments:ManagementofthewatersystemisinthehandsoftheIntermunicipal DrinkableWaterandSewageService. Property Registry Time:5days Procedure 4*. Obtain property valuation of the real estate Cost:MXN134 Time:15days Cost:MXN9,749 Procedure 2*. Obtain property valuation of the real estate Comments:ThisisgivenbyavaluationexpertfromtheMunicipalcadastre(Catastro Time:15days Municipal).Thecostis3perthousandofthepropertyvalue. Cost:MXN16,000 Comments:TheAssessmentDepartmentoftheMunicipalTreasuryhasdifferent Procedure 5. The notary prepares and signs the public deed, chargesdependingonthezone.InPachuca,thelandgovernedbytheMunicipality retains and pays the property or real estate transfer taxes isdividedinzonesandtheseintheirturnintoblocks,eachoneofwhichisassigned Time:4days adifferentamount.ThechargepersquaremeterinasuburbanzoneisMXN1,055. Thevalueofconstructioniscalculatedpersquaremeter.Theareaisworkedoutby Cost:MXN83,215(MXN17,365notary'sfee+MXN65,850tax) multiplyingthecostbytheStatefactor.TheStatefactoristhesumoftheeconomic Comments:Thenotarypublicwillberesponsibleforthepreliminaryandfinalprop- lifeofthepropertyandthenumberofyearssinceitwasconstructed,asdetermined ertyregistrationfeesattheRegistryandthepaymentofthebypropertytransfer byexpertsaccordingtotheAssessmentDepartment'stables.Theareaismultiplied andcapitalgainstaxes.Thetotalamountpaidtothenotaryincludes: bythechargepersquaremeterfortheproperty. Notary'sfee:17,365.Thenotary'sfeecomesfromDecree14240andtheLawof NotariesoftheStateofJalisco,Secondsection,ChapterIXofthetariff. Procedure 3. The notary prepares and signs the public deed, PropertyTransferTax:MXN65,850(asindicatedinthetableshowninthenext retains and pays the property or real estate transfer taxes paragraph).ThepropertyvalueinthiscaseisclosetoMXN3,000,000. Time:6days Registrycharge:MXN30+15,000 Cost:MXN46,587(MXN8,300notary'sfee+MXN38,287tax) Inaccordancewitharticle30oftheLawofIncomeofthemunicipalityofGua- Comments:Thetaxis2%ofthepropertyvalue. dalajara,Jalisco,forthefiscalyear2005,thePropertyTransferTaxwillbepaid,in accordancewiththecorrespondingchapteroftheLawofMunicipalRevenuesofthe Procedure 4. Register the public deed in the Public Property StateofJalisco,usingthefollowingtable: Registry Marginalrateon amountsover Time:14days(7-21) Lowerlimit Upperlimit Fixedquota thelowerlimit Cost:MXN23,945 MXN0.01 300,000.00 MXN0.00 2.00% Comments:Forthefirst100minimumwages(MXN47.16)ofthevalueoftheprop- 300,000.01 500,000.00 6,000.00 2.05% ertytheregistrationfeeisMXN22,945.Foreachmillionthatitexceeds100minimum 500,000.01 1,000,000.00 10,100.00 2.10% wagesanadditionalMXN1,000willhavetobepaid,inaccordancewiththeLawof 1,000,000.01 1,500,000.00 20,600.00 2.15% PropertyfortheStateofHidalgo. 1,500,000.01 2,000,000.00 31,350.00 2.20% * This procedure is simultaneous with the previous procedure. 2,000,000.01 2,500,000.00 42,350.00 2.30% 2,500,000.01 3,000,000.00 53,850.00 2.40% 3,000,000.01andover 65,850.00 2.50% Inaccordancewitharticle116oftheMunicipalRevenuesLawoftheStateofJalisco, paymentofthePropertyTransferTaxshouldbemadetotherelevantmunicipal treasurydepartmentand,foritspart,tothetaxcollectingofficesoftheMinistryof FinanceoftheStategovernment.Bothshouldbepaidwithintwomonthsofthe dateofthedocumentthatsealsthedeedorcontract,orthelegaltransactiondocu- mentwhichestablishesthepre-agreedactionortheassumption. casEstudiEs·rEgistEringpropErtY 69 Procedure 6. Register the public deed in the Public Property Procedure 5. Register the public deed in the Public Property Registry Registry Time:90days Time:13days(10-15) Cost:MXN40+16,249registryfee Cost:MXN366 Comments:Theregistryfeeis0.5%ofthevalueoftheproperty,forthepreventive Comments:Itispossibletoaskfortheprocesstobespeededupifthepurchase anddefinitiveregisteringofthepropertytitle,accordingtoarticle15,sectionsI, needstobecompletedinadayforacostofMXN1,022.However,thisisnotcom- subsectiona),andIX,respectively,oftheLawofRevenueoftheStateofJaliscofor moninMoreliawhichiswhytheordinarytimeandcostofregistrationareshownin thefiscalyear2005.Accordingtoarticle104ofthePublicPropertyRegistryLawof thisexample. theStateofJalisco,thepreventivetaxmustbepaidwithintwoworkingdaysfrom whenthedeedwassigned,inwritingoranyotherincontrovertibleform.Similarly, * This procedure is simultaneous with the previous procedure. thedefinitiveregistrationwillbepaidoncethepublicdeedhasbeensignedandthe correspondingtaxeshavebeenpaid. regiStering property Morelos Procedure 7*. Report the transfer of title to the Municipal Cadastre Property value: $256,109 = MXN 2,830,000 Time:2days City: Cuernavaca Cost:Nocost Data as of: July 2006 * This procedure is simultaneous with the previous procedure. Procedure 1. Obtain non-encumbrance certificate from, and give preliminary notice to, the Public Property Registry regiStering property Michoacán Time:4days Cost:MXN515 Property value: $165,339 = MXN 1,826,995 Comments:ThisprocedureisdoneintheTownHall. City: Morelia Data as of: July 2006 Procedure 2*. Obtain certificate or proof of payment of water Procedure 1. Obtain non-encumbrance certificate from the Public rates in the Cuernavaca Drinkable Water and Sewage Service Property Registry (SAPAC) Time:2days Time:1day Cost:MXN180 Cost:MXN106 Comments:AwrittenrequestshouldbesenttotheHeadofSAPAC,statingthe Procedure 2*. Obtain property valuation of the real estate numberofcontractand/orthenumberofoutlet,withthelatestproofofpayment fortheservice. Time:4days Cost:MXN18,270 Procedure 3*. Obtain property valuation of the real estate Comments:Thecostrepresents1%ofthepropertyvalueandispaidattheState Time:4days(3-5) Cadastre. Cost:MXN9,764 Procedure 3*. Obtain Cadastre certificate Comments:Thecostrepresents3perthousandofthepropertyvalue(VATincluded). Time:4days Procedure 4*. Obtain the property plan (plano catastral) Cost:MXN92 Time:1day Comments:FromStateCadastre. Cost:MXN115 Procedure 4. The notary prepares and signs the public deed, retains and pays the property or real estate transfer taxes Procedure 5*. Obtain a certificate or proof to show that all land taxes have been paid in Cadastre and Property Tax department Time:6days (Dirección de Catastro e Impuesto Predial) of Cuernavaca Cost:MXN56,540(MXN20,000notary'sfee+MXN36,540tax) Municipality Comments:Thetimeisonedayforsigningand5forthepaymentofthetax.The notaryfeeissetonthefollowingscale: Time:1day Propertyvalue(inMXN) Cost:MXN115 a. Upto94,653 3,441.94+V.A.T. Procedure 6. The notary prepares and signs the public deed, b. From94,653to189,306 3,441.94+V.A.T. retains and pays the property or real estate transfer taxes c. From189,306to378,612 4,506.79+V.A.T. Time:5days d. From378,612to757,224 6,352.52+V.A.T. Cost:MXN115,050(MXN44,300notary'sfee+MXN70,750tax) e. From757,224to1,514,448 9,476.07+V.A.T. Comments:Thetimeismadeupof3daystopreparethepublicdeedand2days f. From1,514,448to3,028,896 14,587.33+V.A.T. (1-3)forpayingthetaxes.Thecostrepresents2%ofthepropertyvalue,plusanaddi- g. From3,028,896to6,057,792 22,538.18+V.A.T. tional25%ofthat15%foreducation,5%fortheuniversityand5%forindustry. h. From6,057,792to12,115,584 33,896.54+V.A.T. i. Above12,115,584 47,526.57+V.A.T. Procedure 7. Give the second preliminary notice However,thisfeeisobsoleteanditisnotused;theestimatedcostaboveisbasedon Time:1day theaveragefeechargedforthevalueofthepropertyinthisexample.Thetaxis2% Cost:Nocost ofthepropertyvalue. Procedure 8. Register the public deed in the Public Property Registry Time:5days Cost:MXN42,450 Comments:Thecostis12perthousand,plusanadditional25%ofthisdividedinto 15%foreducation,5%fortheuniversityand5%forindustry. 70 doingBusinEssinmEXico2007 Procedure 9*. Report the transfer of title to the Municipal regiStering property Cadastre Nuevo León Time:1day Property value: $560,419= MXN 6,192,635 Cost:Nocost City: Monterrey Data as of: July 2006 Comments:Itispossibletogivenoticeafterpayingforthepropertytransfer. * This procedure is simultaneous with the previous procedure. Procedure 1. Obtain non-encumbrance certificate from, and give preliminary notice to, the Public Property Registry regiStering property Time:4days Nayarit Cost:MXN229 Property value: $171,221 = MXN 1,891,992 Comments:Itisrecommended,althoughnotrequiredbylaw,toapplyforthenon- City: Tepic encumbrancecertificatewiththepre-salepreliminarynotice,givingthenamesofthe Data as of: July 2006 partiesinvolved,sothatthepurchaseisthefirstintheorderofpriorityoftransactions relatingtothepropertyduringthe30daysafterthenotice.Inthecasethatthe Procedure 1. Obtain non-encumbrance certificate from, and give relevantinformationfortheregistrationisnotavailable,theentrepreneurshould preliminary notice to, the Public Property Registry requestasimultaneoussearchforthepropertyinthePropertyRegister.Normally, thisinformationshouldbeavailableinthepreviouspublicdeedfortheproperty. Time:4days(3-5) Cost:MXN137 Procedure 2*. Obtain property valuation of the real estate Comments:ThisisprocedureisdoneintheTownHall. Time:2days Procedure 2*. Obtain property valuation of the real estate Cost:MXN118 Comments:TheexpertiscommissionedbytheCadastre.Thecalculationofthe Time:5days(3-7) propertytransfertaxisbasedontheresultofthisvaluation. Cost:MXN4,730 Comments:Thecostis2.5perthousandofthepropertyvalue. Procedure 3. The notary prepares and signs the public deed, retains and pays the property or real estate transfer taxes Procedure 3*. Obtain land registry certificate Time:12days(7daysontheaveragetoexecutethedeedand5forthepaymentof Time:5days tax) Cost:MXN275 Cost:MXN178,853(MXN55,000fee+MXN123,853tax) Comments:ThisisobtainedfromtheMunicipalCadastre.Thepropertycertificate Comments:Besidesthedocumentsrelatingtothesteps1and2,thenotaryrequires includesthepropertyoutlineplan. thefollowing: a. Thesellershouldbringevidencethatallpropertytaxesforthepropertyhave Procedure 4. Give notice of real estate purchase and updating of beenpaid,anofficialreceiptoftaxpaymentshouldsuffice(althoughnot the property register (Catastro Municipal) requiredbythelaw,itisrecommendedthattheentrepreneurpresentproofof paymentforthelastfiveyears,aswellaspaymentreceiptsforlight,water,etc.); Time:5days b. Publicrecordsoftheconstitutionandstatutesofthecompany,includingmodifi- Cost:MXN275 cations,andpowersofattorneygrantedbythebuyerandtheseller; Comments:ThisisdoneintheMunicipalCadastre. c. Officialidentificationsandpersonalinformationoftheindividualsthatrepresent theparties.Althoughitisnotrequiredlegallyforthepropertytransferregister,it Procedure 5. The notary prepares and signs the public deed, isrecommendedthatthesellerbringslanduseandconstructionpermits. retains and pays the property or real estate transfer taxes Atpresent,thereisnoofficialscaleoffeesfornotaries,theinformationaboveis basedonthefeesthatthenotarieshabituallychargeinthecityofMonterrey. Time:6days Thenotarycollectsfromthebuyertheamountofthetax,whichequals2%ofthe Cost:MXN109,554(MXN71,645notary'sfee+MXN37,840tax+MXN69). propertyvaluecalculatedonthehighestamongthepurchasepriceandtheproperty Comments:Thenotaryfeesaredeterminedusingthetariffcurrentlyinforce,based valuation.Thetaxshouldbepaidwithin30daysoftheexecutionofthepublicdeed. onthetotalvalueoftherealestate;4%forthefirstmillionpesos,plus2.5%forthe PaymentofthetaxbythenotaryintheMunicipalCadastrealsoservesasnoticeof surplusamount.Tothisshouldbeadd15%VAT,plusMXN68.71perpurchaseand thechangeofthetitleoftheproperty. completedpropertytransferformand/ordeclaration(includestheformfordeclar- ingthepropertypurchasetax).Thetaxrepresents2%ofthepropertyvalue. Procedure 4. The notary gives preliminary notice of completion of the sale to the Public Property Registry Procedure 6. Notice of signing the deed Time:1day(canbethesamedayasthesigningofthepublicdeed) Time:15days Cost:MXN141 Cost:Nocost Comments:Theentrepreneurhastopresent,throughthenotarypublic,aprelimi- Comments:Thisprocedureisalsocalled"solvency".Itincludesthestatement narynoticeofcompletionofthesaledescribingthetransaction,sothatherpurchase andcalculationofthepropertytransfertaxanditsauthorizationbytheMunicipal isthefirstinorderofpriorityoftransactionsrelatingtothepropertyduringthe30 Cadastre. daysfollowingthenotice.Whilenotrequiredbylawthisprocedureisrecommend- able,canbeomittedifthepre-salepreliminarynoticeisstillinforce,andgivestime Procedure 7. Register the public deed in the Public Property forthenotarytopaythepropertytransfertaxandtelltheCadastreofthesaleand Registry theinformationofthenewowner. Time:5days Procedure 5. Register the public deed in the Public Property Cost:MXN17,028 Registry Comments:Thecostrepresents9perthousandofthepropertyvalue. Time:11days(3-18) * This procedure is simultaneous with the previous procedure. Cost:MXN10,375(registrationfee) Comments:Thecostiscalculatedasfollows:2perthousandforthefirstMXN50,000 oftheproperty'svalueandthen2.5perthousandabovethatamount,withamini- mumof3andamaximumof220quotas.Aquotaisequaltotheminimumwagein forceinthemetropolitanareaofthecityofMonterrey,currentlyMXN47.16. * This procedure is simultaneous with the previous procedure. casEstudiEs·rEgistEringpropErtY 71 regiStering property regiStering property Oaxaca Puebla Property value: $129,878 = MXN 1,435,151 Property value: $204,334 = MXN 2,257,889 City: Salina Cruz City: Puebla Data as of: July 2006 Data as of: July 2006 Procedure 1. Obtain non-encumbrance certificate from the Public Procedure 1. Obtain non-encumbrance certificate from, and give Property Registry preliminary notice to, the Public Property Registry Time:10days Time:5days Cost:MXN286 Cost:MXN200 Comments:Ifurgent,thecertificatecanbeproducedin1to3daysforacostof MXN510. Procedure 2*. Obtain certificate or proof of payment of water rates Procedure 2. Preparation and signing of the public deed and Time:3days payment of the property transfer tax Cost:MXN100 Time:1day Cost:MXN50,230(MXN21,527notary'sfee+MXN28,703tax) Procedure 3*. The notary prepares and signs the public deed, Comments:Thenotary'sfeevariesbetweenthe1%and2%ofthepropertyvalue. retains and pays the property or real state transfer taxes. Thepropertytransfertaxisthe2%ofthepropertyvalue. Time:3days Procedure 3. Obtain property valuation of the real estate Cost:MXN100 Time:15days Procedure 4*. Obtain property valuation of the real estate Cost:Nocost Time:5days Comments:ThisprocedureisdoneintheMunicipalCadastreOffice. Cost:ThishaschangedfromMXN5,000toMXN182.50 Procedure 4. Cancel the old property account, open a new Comments:ThechangeincostisbecausetheentrepreneurcanasktheMunicipal Cadastretodothevaluationandcurrently80-90%ofnotariesdoitthiswayto account, pay for the valuation and pay for the physical inspection reducecosts. Time:5days Cost:MXN6,041 Procedure 5. The notary prepares and signs the public deed, Comments:Thecostis0.3%ofthevalueoftheassessedproperty,plusMXN252for retains and pays the property or real estate transfer taxes thephysicalverification,plusMXN252tocanceltheoldaccount,plusMXN154to Time:10days openthenewaccount,plus0.12%oftheresultantchargetoaidliteracyteaching. Cost:MXN75,158(MXN30,000fee+MXN45,158tax) Procedure 5. Preparation of the property title document Comments:Thepropertytransfertax(2.0%ofthepropertyvalue,insteadofthe 2.5%itwaslastyear)iscollectedandpaidinthenameoftheparties. (inserting the property's data) Time:1day Procedure 6. Register the public deed in the Public Property Cost:Nocost Registry Time:45days Procedure 6. File the document in the Public Property Registry to Cost:MXN4,515 record the property transfer (Dictaminación) Comments:2perthousandofthepropertyvalue. Time:3days Cost:Nocost Procedure 7*. Report the change of title to the Municipal Cadastre Procedure 7. Approval of the document requires a banker's draft Time:1day to record the document in the Public Property Registry Cost:Nocost Time:2days * This procedure is simultaneous with the previous procedure. Cost:MXN8,611 Comments:ThisisdoneintheFinanceMinistryoftheStateGovernment.Thecost regiStering property shownhereistheregistrationfeeis0.5%ofthepropertyvalue,plus20%ofthis Querétaro chargeforcancellingtheregistration. Property value: $344,255= MXN 3,804,018 Procedure 8. Register the public deed in the Public Property City: Querétaro Registry Data as of: July 2006 Time:15days Procedure 1. Obtain non-encumbrance certificate from, and give Cost:Nocost preliminary notice to, the Public Property Registry Time:3days Cost:MXN310(MXN220+MXN90) Comments:Thenon-encumbrancecertificatecostsMXN220andthepreliminary noticecostsMXN90. Procedure 2*. Obtain property valuation of the real estate Time:5days Cost:MXN8,116.50(anaverageofMXN7,000andMXN9,233) Comments:Thenotarycommissionsanexperttocarryoutthevaluation,which servessubsequentlytocalculatetheamountoftax. 72 doingBusinEssinmEXico2007 Procedure 3. The notary prepares and signs the public deed, Procedure 5*. Obtain a property certificate (cédula catastral) from retains and pays the property or real estate transfer taxes the council's Municipal Cadastre Office Time:3days Time:5days Cost:MXN126,080(MXN50,000fee+MXN76,080tax) Cost:MXN188 Comments:Thenotarycollectsthevalueofthepropertytransfertax,whichissub- sequentlypaidtotheMunicipalTreasury.Thetaxcorrespondsto2%oftheproperty Procedure 6*. Obtain certificate or proof of payment of water value(1.8%ofpropertytransfertaxand0.2%ofstatetaxforeducation). rates from the Drinkable Water and Sewer System Commission Procedure 4. Give the second notice to the Public Property Time:4days Registry Cost:MXN58 Time:1day Procedure 7*. Obtain property valuation of the real estate Cost:MXN56 Time:7days Comments:Alsoknownasthefinalnoticeofthetransferoftheproperty. Cost:MXN13,560 Procedure 5. Register the public deed in the Public Property Comments:Thecostrepresents0.25%ofthepropertyvalue. Registry Procedure 8. Pay for the preparation of the deed Time:35days(30-40) Time:1day Cost:MXN22,881 Cost:MXN369 Comments:Thecostistheregistrationfee,equalto0.6%ofthevalueofthetransac- tion,plus25%ofthischarge.Thedocumentsrequiredforthisregistrationare: Comments:ThisispaidattheRevenueCollectiondepartmentoftheStateGovern- ment. a. TitleofProperty(preliminarynotice),correctlyrecordedinthePublicProperty Registry,fromwhichshouldberemovedthenameoftheseller. Procedure 9. The notary prepares and signs the public deed, b. Municipallandtaxreceipt(Clave catastral),correctlypaidforthebimesterin whichthepublicdeedwassigned. retains and pays the property or real estate transfer taxes. c. Proofoftheproperty'sboundaries(alineamento)andofficialnumber,ifappli- Time:3days cable. Cost:MXN162,720(MXN54,240notary'sfee+MXN108,480tax) d. Valuationbyanauthorizedexpertorinstitution. Comments:Thenotary'sfeesrepresent1%ofthepropertyvalue.Thetaxis2%of e. Documentsthataccreditthelegalexistenceandcapacityoftheauthorized thepropertyvalue. representatives,ifapplicable. f. Documentsthatprovethesupplyorfeasibilityofservices,suchaswaterand Procedure 10. Register the public deed in the Public Property electricity. Registry Procedure 6*. Report the transfer of title to the Municipal Time:135days Cadastre Cost:MXN54,240 Time:13days(10-15) Comments:Thetimeistheaverageofthetimesreportedwhichindicatesaperiod Cost:MXN150.00 offrom3to6monthstocarryoutthisprocess.Thecostrepresents1%ofthe propertyvalue. Comments:TheCadastreformspartoftheMunicipalTreasury.Thisprocedurecon- sistsofcomparingthepropertyvaluethatisregisteredagainsttheexpert'svaluation * This procedure is simultaneous with the previous procedure. (knownasfiscalvalue).Ifthereisadifferencethevalueshouldberevised. regiStering property * This procedure is simultaneous with the previous procedure. San Luis Potosí regiStering property Property value: $238,214= MXN 2,632,268 Quintana Roo City: San Luis Potosí Property value: $490,858 = MXN 5,423,983 Data as of: July 2006 City: Cancún (Benito Juárez) Procedure 1. Obtain non-encumbrance certificate from, and give Data as of: July 2006 preliminary notice to, the Public Property Registry Procedure 1. Obtain State non-encumbrance certificate Time:5days Time:4days Cost:MXN220 Cost:MXN185 Procedure 2*. The notary prepares and signs the public deed, Comments:ObtainedfromtheStateFinanceMinistry. retains and pays the property or real state transfer taxes. Procedure 2*. Obtain Municipal non-encumbrance certificate Time:2days Time:5days Cost:MXN11.45 Cost:MXN115 Comments:Approximately10%ofnotarieshaveaccesstoasystemthatenables Comments:ThisisobtainedfromtheMunicipality'sEnvironmentandHuman themtoobtainthiscertificateon-line,aswellasthatmentionedintheprevious Developmentdepartment. procedure,inoneday. Procedure 3*. Obtain non-encumbrance certificate from the Procedure 3*. Obtain property valuation of the real estate Public Property Registry Time:5days Time:13days(10-15) Cost: MXN194(initialpaymenttorequestthevaluation) Cost:MXN280 Comments:AnemployeeoftheMunicipalCadastrecanmakeaninspectionofthe propertytocheckitscondition.Avaluationbyanexpertwouldberequiredonly Procedure 4*. The notary prepares and signs the public deed, ifthepropertyvalueexceedsMXN5,000,000.Whileotherstatesrequiretheentre- preneurtoannouncethechangeoftitleattheMunicipalCadastre,thisvaluationis retains and pays the property or real state transfer taxes. awaytowarnoftheimminentchangeoftitleoftheproperty,andsoitformsthe Time:2days registration. Cost:MXN115 casEstudiEs·rEgistEringpropErtY 73 Procedure 4. Payment of the valuation property of the real estate Procedure 2*. Obtain a certificate or proof of land taxes payment Time:1day to the Municipal Cadastre Cost:MXN5,265(0.2%ofthecadastralvaluation) Time:1day Comments:ThepaymentismadeintheMunicipalCadastre. Cost:MXN143 Procedure 5. The notary prepares and signs the public deed, Procedure 3*. Obtain property valuation of the real estate retains and pays the property or real estate transfer taxes Time:2days Time:13days(8daystopreparethedeedand5daystopaythetax) Cost:MXN6,930 Cost:MXN83,696(MXN40,000fee+MXN43,696tax) Comments:Thevaluationiscarriedoutbyanexpert.Thecostwascalculatedbased Comments:Thenotarywillchargehisfeesaccordingtotherateapprovedbythe onanaverageof2.5and3perthousandofthepropertyvalue. StateCongressin1993,whichestablishesprogressivefixedbandsdependingon thepropertyvalue.TherateinSanLuisPotosíhasamaximumlimitof80timesthe Procedure 4. The notary prepares and signs the public deed, minimumdailywage(MXN45.87),plus0.35%oftheactualpropertyvalue.Thetax retains and pays the property or real estate transfer taxes represents1.66%ofthepropertyvalue. Time:2days Thenotarycollectstheamountofthepropertytransfertax,andthenpaysitintothe bank.Thetaxisapercentageofthepropertyvaluecalculatedintheprocedure3. Cost:MXN92,940(MXN37,500notary'sfee+MXN55,440tax) Notarialfees.-ThesearecalculatedaccordingtotheTariffofNotaries: Comments:ThenotarialcostswerecalculatedbasedonanaverageofMXN30,000 andMXN45,000.Thetaxequals2.2%ofthepropertyvalue. Article3:Forthepreparing,executingorauthorizingofdeedsandaffidavitsof specificvalue,thatdonothavespecialratesetbythisLaw,notarieswillcharge: Procedure 5. Register the public deed in the Public Property a. IfthevaluedoesnotexceedofMXN1,000.00 MXN25.00 Registry b. IfthevaluedoesnotexceedofMXN2,500.00 MXN35.00 c. IfthevaluedoesnotexceedofMXN5,000.00 MXN45.00 Time:20days d. IfthevaluedoesnotexceedofMXN7,500.00 MXN70.00 Cost:MXN20,790 e. IfthevaluedoesnotexceedofMXN10,000.00 MXN90.00 Comments:Theregistrationfeeis0.75%ofthepropertyvalue,plus10%ofthe f. IfthevaluedoesnotexceedofMXN20,000.00 MXN140.00 valueofthatcharge. g. FromMXN20,000.00toMXN50,000.00theywillchargeanadditional6per thousandontheexcess. * This procedure is simultaneous with the previous procedure. h. FromMXN50,001.00toMXN100,000.00theywillchargeanadditional5per regiStering property thousandontheexcess. i. FromMXN100,001.00toMXN500,000.00theywillchargeanadditionalper Sonora thousandontheexcess Property value: $344,827 = MXN 3,810,342 j. OverMXN500,001.00theywillcharge1.50perthousandontopoftheamounts City: Hermosillo indicateintheprevioussections. Data as of: July 2006 k. Fortheratificationandsigningoffofthecontentsofprivatedocuments,theywill charge: Procedure 1. Cadastral investigation in the Municipal Cadastre IfthevaluedoesnotexceedofMXN500.00 MXN10.00 IfitdoesnotexceedofMXN1,000.00 MXN25.00 Time:4days OverMXN1,000.00theywillcharge1perthousanduntilthemaximumchargeof Cost:MXN310 MXN75.00isreached. Comments:Thisconsistsofobtainingthefollowingdocuments:Certificateofprop- l. Fortheprivatepurchasedocumentsthatthenotariesedit,theywillcharge: ertybackground(MXN100);Certificateofpropertyvalue(MXN60);andtheproperty IfthevaluedoesnotexceedMXN500.00 MXN30.00 planandmap(MXN150). IfitreachesMXN1,000.00,themaximumchargeis MXN45.00. Procedure 2*. Obtain non-encumbrance certificate from the Procedure 6. Give the second notice to the Public Property Public Property Registry Registry Time:1day Time:1day Cost:MXN800 Cost:Nocost Procedure 3*. Obtain property valuation of the real estate Procedure 7. Register the public deed in the Public Property Time:2days Registry Cost:MXN7,500 Time:15days Comments:ThisprocedureiscarriedoutintheMunicipalCadastre. Cost:MXN6,102(10,000X0.002+303+10%forsocialaid). Procedure 4. The notary prepares and signs the public deed, * This procedure is simultaneous with the previous procedure. retains and pays the property or real estate transfer taxes regiStering property Time:10days Sinaloa Cost:MXN100,327(MXN24,120notary'sfee+MXN76,207tax) Property value: $228,054 = MXN 2,519,994 Comments:Thetimeismadeupof7daysforpreparingthedeedand3daystopay City: Culiacán thetax.ThenotarialcostsareMXN15,080,plus2perthousandofthepropertyvalue, plus30timestheminimumwageinforceofthezone(MXN47.16).Theproperty Data as of: July 2006 transfertaxis2%ofthepropertyvalue. Procedure 1. Obtain non-encumbrance certificate from the Public Procedure 5. Register the public deed in the Public Property Property Registry Registry Time:10days Time:7days Cost:MXN202 Cost:MXN19,052 Comments:Thecostrepresents5perthousandofthepropertyvalue. * This procedure is simultaneous with the previous procedure. 74 doingBusinEssinmEXico2007 regiStering property Procedure 3. The notary prepares and signs the public deed, Tabasco retains and pays the property or real estate transfer taxes Property value: $191,894 = MXN 2,120,424 Time:2days City: Villahermosa (Centro) Cost:MXN104,821(MXN30,000notary'sfee+MXN74,821tax) Data as of: July 2006 Comments:Thecostrepresents2%ofthepropertyvalue. Procedure 1. Obtain non-encumbrance certificate from the Public Property Registry Procedure 4. Notify the change of cadastral situation in the Municipal Cadastre Time:4days(2-5) Cost:MXN234 Time:5days Comments:ThepaymentismadetothecashieroftheMinistryofFinanceof Cost:MXN48.67 Tabasco.Thecostrepresents5timestheminimumwageinforceofthezone(MXN Comments:Thecostis1dayoftheminimumwageinforceinthezone. 46.80). Procedure 5. Register the public deed in the Public Property Procedure 2*. Obtain land occupancy, purpose and reserve Registry permit Time:43days Time:24days Cost:MXN29,928 Cost:Nocost Comments:Thecostis8perthousandofthepropertyvalue. Comments:ThiscameintoeffectinJanuary2006,incompliancewitharticles5 * This procedure is simultaneous with the previous procedure. and77oftheLawofSustainableUrbanDevelopmentoftheStateofTabasco.Itis obtainedfromthePublicPropertyRegistryanditsrespondtimevariesbetween8 regiStering property and40days,dependingonthelocationoftheland. Tlaxcala Procedure 3*. Obtain property valuation of the real estate Property value: $169,951 = MXN 1,877,964 Time:5days City: Tlaxcala Cost:MXN5,301 Data as of: July 2006 Comments:ThisisdoneatthePublicPropertyRegistry.Thecostis2perthousandof Procedure 1. Obtain property valuation of the real estate thepropertyvalue. Time:3days Procedure 4. The notary prepares and signs the public deed, Cost:MXN962 collects and pays the real estate or estate transfer tax, and the Comments:ThisisdoneattheTownHall. acts and contracts tax Procedure 2*. Obtain non-encumbrance certificate from the Time:3days Public Property Registry Cost:MXN83,613(MXN20,000notary'sfee+MXN42,408propertytransfertax+ MXN21,204actsandcontractstax) Time:5days Comments:Thetotalcostisthesumofthenotary'sfeethatgoesuptoMXN20,000, Cost:MXN94 plusthepropertytransfertaxthatis2.0%ofthepropertyvalueandthetaxonacts andcontractswhichis1.0%ofthepropertyvalue. Procedure 3. The notary prepares and signs the public deed, retains and pays the property or real estate transfer taxes Procedure 5. Register the public deed in the Public Property Time:17days Registry Cost:MXN47,688(MXN7,500notary'sfee+MXN40,188tax) Time:15days Comments:15daysarerequiredtopreparethedeedand2daystopaythetax.The Cost:MXN21,204 notarialfeesareMXN7,500onaverageandthepropertytransfertaxis2.14%ofthe Comments:Theregistrationfeeis1%ofthepropertyvalue. propertyvalue. * This procedure is simultaneous with the previous procedure. Procedure 4. Obtain cadastral opinion regiStering property Time:1day Tamaulipas Cost:MXN138 Property value: $338,554 = MXN 3,741,026 Comments:ThisisobtainedfromtheMunicipalCadastre. City: Reynosa Procedure 5. Register the public deed in the Public Property Data as of: July 2006 Registry Procedure 1. Obtain non-encumbrance certificate from the Public Time:10days(5-15) Property Registry Cost:MXN18,780 Time:11days Comments:Thecostrepresents1%ofthepropertyvalue. Cost:MXN146 * This procedure is simultaneous with the previous procedure. Comments:Thecostrepresents3timestheminimumdailywageinforceinthe zone(MXN48.67). Procedure 2*. Obtain property valuation of the real estate Time:4days Cost:MXN7,482 Comments:Thecostis2perthousandofthepropertyvalueandispaidinthe MunicipalCadastre. casEstudiEs·rEgistEringpropErtY 75 regiStering property regiStering property Veracruz Yucatán Property value: $180,634 = MXN 1,996,005 Property value: $249,791 = MXN 2,760,186 City: Coatzacoalcos City: Mérida Data as of: July 2006 Data as of: July 2006 Procedure 1. Obtain non-encumbrance certificate from the Public Procedure 1. Obtain non-encumbrance certificate from, and give Property Registry preliminary notice to, the Public Property Registry Time:15days Time:2days Cost:MXN224 Cost:MXN110 Comments:ThisprocedureisdoneintheStateFinanceOffice. Procedure 2*. Obtain property certificate and plan from the Procedure 2*. Obtain property record from the Municipal Municipal Cadastre Cadastre Time:1day Time:3days(1-5) Cost:MXN250 Cost:MXN550 Procedure 3*. Obtain certificate or proof of payment of water Procedure 3*. The notary prepares and signs the public deed, fees retains and pays the property or real state transfer taxes. Time:1day Time:3days(1-5) Cost:MXN40 Cost:MXN53 Procedure 4*. The notary prepares and signs the public deed, Procedure 4*. Give preliminary notice to the Public Property retains and pays the property or real state transfer taxes. Registry Time:1day Time:1day Cost:MXN20 Cost:Nocost Comments:Inthecapital,Mérida,lessthanthehalfofthenotarieshaveaccessto anonlineservicethatenablesthemtopaytheregistrationfeesandtoobtainthe Procedure 5. The notary prepares and signs the public deed, certificateimmediately. retains and pays the property or real estate transfer taxes Procedure 5*. Obtain property valuation of the real estate Time:3days Cost:MXN40,487(MXN20,000notary'sfee+MXN19,960tax+MXN547) Time:3days Comments:Thepropertytransfertaxis1.0%ofthepropertyvalueplusapayment Cost:MXN8,281 ofMXN547forthecertificateofvalue. Comments:Thecostrepresents3perthousandonthepropertyvalue. Procedure 6. Register the public deed in the Public Property Procedure 6. The notary prepares and signs the public deed, Registry retains and pays the property or real estate transfer taxes Time:10days Time:3days Cost:Nocost Cost:MXN76,954(MXN21,750notary'sfees+MXN55,204oftransfertax) Comments:Theregistrationfeeis8perthousandofthepropertyvalue.However, Comments:Therearenotofficialratesforthenotaries.Thefeesarebasedonthose inordertoencourageinvestmenttheStateGovernment,basedonLaw829for ofotherstatesandintheFederalDistrict. EconomicDevelopmentandthePromotionofInvestmentoftheStateofVeracruzde Documentsrequiredoftheseller: IgnaciodelaLlave,offerstopaythepropertytransferregistrationfee,generatinga a.TitleofProperty. savingofMXN15,968pesos(0.8%ofpropertyvalue). b.Companydeed,reformsofstatutesandpowerofattorneyfortheirrepresentative. * This procedure is simultaneous with the previous procedure. c.CadastreCertificate. d.CadastrePlan. e.Proofofpaymentsofpropertytaxes. f. Generalinformationontheseller'srepresentativesandtheirofficialidentification. g.Althoughnotnecessaryforthetransaction,issuggestedthattheentrepreneurre- questsproofofpaymentsofelectricity,waterandtelephonebills,whereapplicable, sothatthebuyercanverifythattherearenooutstandingdebts. Documentsrequiredofthebuyer: a.Companydeed,reformsofstatutesandpowerofattorneyfortheirrepresentative. b.Generalinformationontheseller'srepresentativesandtheirofficialidentification. Atthispointthenotarycollectsthepropertytransfertax,whichispaidwithin38 daysfromtheofficialregistrationofthechangeofthetitleofproperty.Theproperty transfertaxis2.0%ofthepropertyvalue. Procedure 7. Give the second notice to the Public Property Registry Time:1day Cost:MXN13.00 Comments:Generally,thenotarygivesthesecondpreliminarynoticeofthesale withintwodaysoftheexecutionofthepublicdeedanditisvalidfor90days. 76 doingBusinEssinmEXico2007 Procedure 8. Register the public deed in the Public Property Registry Time:15days Cost:MXN1,924 Procedure 9. Report the transfer of title to the Municipal Cadastre Time:3days Cost:MXN92 * This procedure is simultaneous with the previous procedure. regiStering property Zacatecas Property value: $168,412 = MXN 1,860,955 City: Zacatecas Data as of: July 2006 Procedure 1. Obtain certificate or proof of payment of water rates from the Inter municipal Drinkable Water and Sewer Department of Zacatecas (JIAPAZ) Time:1day Cost:MXN100 Procedure 2*. Obtain plan or outline plan of the real estate Time:2days(3-5) Cost:MXN500 Procedure 3. Obtain property valuation of the real estate Time:4days Cost:MXN12,025 Comments:Thecostinthisexamplecorrespondstothemaximumpropertyvalue band. Procedure 4*. Obtain non-encumbrance certificate from the Public Property Registry Time:3days Cost:MXN144 Procedure 5. Give preliminary notice to the Public Property Registry Time:1day Cost:Nocost Comments:Thisnoticeisgivenafterthesigningofthedeed. Procedure 6*. The notary prepares and signs the public deed, retains and pays the property or real estate transfer taxes, and certifies the plan Time:8days Cost:MXN51,192(MXN13,828notary'sfees+MXN37,219tax+MXN145plan certification) Comments:Thetimecorrespondsto7daysonaverageforpreparingthedeed,plus 1dayforpayingthetax.Thetaxonrealestatepurchaseis2%ofthehigherofthe propertyvaluationandthepurchaseprice,plusMXN145forcertifyingtheplan.The notarialfeescorrespondtotheapplicablefee. Procedure 7. Register the public deed in the Public Property Registry Time:5days Cost:MXN18,767 Comments:Thecostcorrespondstotheapplicablechargeband. * This procedure is simultaneous with the previous procedure. AgrAdecimientos 77 Acknowledgments Contact details of local partners are available on the Doing Business website at www.doingbusiness.org Doing Business in Mexico 2007 was prepared by a team The Project was funded by the FIAS Trust Fund and led by Mierta Capaul. The team comprised Fernanda the Small and Medium Enterprise Support Fund (Fondo Almeida, Diego Borrero Magaña, Claudia Contreras, PYME) of the Ministry of Economy (SE) in coordination Zenaida Hernández Uriz, Luis Aldo Sánchez Ortega with AMSDE, which acted as an intermediary to direct and Sylvia Solf with the assistance of Caralee McLiesh, resources and the contributions from the governments of Penélope Fidas, Adriana Vicentini, Benjamin Horne and the States and Municipalities. The CGPPP of the Ministry Sabine Hertveldt. Simeon Djankov, Igor Artemiev and of Foreign Affairs (SRE), through the Technical Assis- Vincent Palmade reviewed the text. The team would like tance Project maintained with the UNDP, co-financed to thank Anna Wellenstein, Keta Ruiz, Paolo Martelli, the project for the nine states of the South-Southeast Re- Eduardo Wallentin and Luke Haggarty, all from the gion of Mexico that are part of the Plan Puebla Panama. World Bank Group, for their support during the pro- Almost 80 lawyers and notaries, coordinated by Ricardo ject. Gerry Quinn designed the report and Nick Service Lan, Carlos Morán and Edgar Martínez of the law firm translated sections into English. Goodrich, Riquelme and Associates, contributed to the The project was made possible thanks to the support Doing Business in Mexico 2007 indicators. The team of the Mexican Association of Economic Development wants to express special gratitude to the public officials Secretaries (AMSDE), especially Eloy Vargas Arreola, and judges in the 31 states and cities that participated in Misael López Vergara and Ernestina Villa Aguiar; the the project and who made valuable observations during Federal Regulatory Improvement Commission (COFE- the consultation period. Their names are listed on the MER), especially David Quezada Bonilla, Jesús Gua- next page. dalupe Hurtado Rodríguez, Julia Vázquez Gutiérrez, Mariem Andrade Trejo and Gloria Silberman Medina; and the officials of the Plan Puebla Panama General Co- ordination (CGPPP), in particular Minister Alejandra García Brahim and Ana Valero Jiménez, and on behalf of the United Nations Development Program (UNDP), Eugenia Huizar Robles. 78 doingBusinessinmeXico2007 PUBLIC OFFICIALS ACAPULCO, GRO.! CD. JUÁREZ, CHIH.! CUERNAVACA, MOR.! Lic. Salvador Chávez Ferruzca C. Alberto Guerrero Lic. Ángel Beltrán Lucero C. Elda Flores León Director de Mejora Regulatoria, Gobierno Municipal$ Director de Planeación, Director General de Promoción Juez Civil En Materia Familiar y Secretaría de Desarrollo Financiera y Económica, Gobierno de Sucesión, Supremo Tribunal de Mag. Guillermo Guerrero Franco Económico, Gobierno del Estado $ Municipal$ Justicia del Estado$ Integrante de la Octava Sala del C. Edmundo Román Pinzón Lic. Nora Morales C. Fausto Estrada Ocampo Tribunal Superior de Justicia del Estado$ Magistrado, Tribunal Superior de Jefe del Departamento de Director de Mejora Regulatoria, Justicia del Estado$ Desarrollo Empresarial, Secretaría de Desarrollo HERMOSILLO, SON.! Lic. René Hernández de la Rosa Secretaría de Desarrollo Económico, Gobierno del Estado$ Director de Registro de la Económico, Gobierno del Estado $ Lic. Abraham Eduardo García Rabadan Lic. Geovani Ciscomani Dávila Propiedad, Gobierno Municipal$ Lic. Rebeca González Almeida Subdirector de Mejora Director de Planeación, Administración y Evaluación, C. Augurio Rodríguez Clavel Jefe de la Unidad de Información, Regulatoria$ Secretaría de Desarrollo Director de Información y Tribunal Supremo de Justicia del Lic. Eric Alexis Pedraza Nava Económico, Gobierno del Estado $ Estadística, Secretaría de Estado$ Registro Público de la Propiedad, Desarrollo Económico, Gobierno Gobierno del Estado$ Lic. Amos Benjamín Moreno Ruiz del Estado $ CELAYA, GTO.! Icreson$ Lic. Gabriela Beltrán Hernández Lic. José Antonio Ruiz Araujo AGUASCALIENTES, AGS.! C. Rebeca Lomelín Velasco Directora General de Desarrollo Fondo Para El Financiamiento de Las Empresas de Solidaridad del Secretario Ejecutivo de la Lic. Noemí Carrillo Villalobos Económico, Gobierno Municipal$ Estado$ Presidencia, Tribunal Superior de Justicia del Estado$ Directora General de Mejora Lic. José Rivera Carranza Regulatoria, Secretaría de Presidente Municipal de Celaya$ CULIACÁN, SIN.! Desarrollo Económico, Gobierno LA PAZ, B.C.S.! del Estado$ Lic. Ernesto Saucedo Pérez C. Matilde Elizabeth Morales Zamora Jefe del Departamento de Gobierno Municipal$ C. Camilo Torres Mejía Ing. Ariel Muñoz Maya Procedimientos Disciplinarios, Director de Planeación y Director del Instituto Municipal Tribunal Superior de Justicia del Ing. Leticia López de Tamayo Financiamiento, Secretaría de de Planeación, Gobierno Municipal Estado$ Directora General de la Comisión Desarrollo Económico, Gobierno $ Estatal de Mejora Regulatoria, del Estado $ Lic. Luis Felipe Delgado Aboytes Secretaría de Desarrollo C. Juan Manuel Ponce Sánchez Director de Mejora Regulatoria, Económico, Gobierno del Estado $ Lic. Roberto Ascencio Ibarra Magistrado Numerario de la Secretaría de Desarrollo Juez de Primera Instancia, Tribunal Segunda Sala Mixta del Supremo Económico, Gobierno del Estado$ C. Javier Rolando Corral Escoboza Superior de Justicia del Estado$ Tribunal de Justicia del Estado $ Director, Firmeza Juridica,s.c.$ C. Porfirio Hernández Oropeza M. en C. Jorge Alberto Vale Sánchez C. Tania Lorena Valdez Parga Director General de Registros C. Mónica Iliana Cárdenas Delgado Secretario de Promoción y Registro Público de la Propiedad Públicos y Notarías$ Coordinadora de Gestión Desarrollo Económico $ y del Comercio, Gobierno del Empresarial, Secretaría de Estado$ COATZACOALCOS, VER.! Desarrollo Económico, Gobierno MÉRIDA, YUC.! del Estado$ CAMPECHE, CAMP.! Dr. Miguel Aguilar Hernández Lic. Ángel Francisco Prieto Méndez Secretaría de Desarrollo C. José Martín Lizarraga Rocha Presidente del Tribunal Superior C.P. Jorge Antonio Ortegón Ruiz Económico, Gobierno del Estado $ Coordinador de Reforma de Justicia del Estado$ Oficial Mayor del Tribunal Regulatoria, Secretaría de C. Cesar Rosado Berlín Superior de Justicia del Estado$ Ing. César González Velasco Desarrollo Económico, Gobierno Secretario de Desarrollo del Estado$ Jefe Departamento de Promoción y Lic. Miguel Góngora Rodríguez Económico, Gobierno Municipal$ Desarrollo Económico, Secretaría Secretaría de Fomento Industrial DURANGO, DGO.! de Desarrollo Económico, y Comercial del Gobierno del Mtra. Ofelia Peñaflor Toniz Gobierno del Estado $ Estado$ Tribunal Superior de Justicia del Ing. Carolina Uriarte Rodríguez Estado$ Directora de Promoción C.P. Mario Arturo López Cámara Lic. Ramiro Cuevas Alcalá Industrial, Comercial y Turística, Director de Desarrollo Director de Desarrollo COLIMA, COL.! Gobierno Municipal$ Económico, Gobierno Municipal$ Económico, Gobierno Municipal $ Lic. Regina Garza Roche Ing. José Luis Covarrubias Venegas Lic. Juan Guillermo Toro Lerma BENITO JUÁREZ Directora General del Instituto Director General de Desarrollo Director del Instituto de Para la Innovación, Calidad y (CANCÚN), Q.R.! Económico, Gobierno Municipal$ Especialización Judicial del Tribunal Superior de Justicia del Competitividad$ Lic. Manuel Chejín Pulido Lic. Carlos Alberto Gallegos Estado$ C. María Elizabeth López Valencia Director General de la Cemer, Responsable de la Unidad de Lic. Phillip H. Brubeck Gamboa Directora del Registro Público Secretaría de Desarrollo Transparencia del Supremo de la Propiedad, Gobierno del Económico, Gobierno del Estado $ Tribunal de Justicia del Estado$ Director Jurídico y Mejora Regulatoria, Secretaría de Estado$ Lic. Marco Antonio Sánchez Vales Lic. Cuauhtémoc Gómez Cabezud Desarrollo Económico, Gobierno MONTERREY, N.L.! Notaria Pública No. 3$ Director General del Registro del Estado $ Público de la Propiedad y del Lic. Sandra Luz Morales de Vado Comercio, Gobierno Estatal$ GUADALAJARA, JAL.! Lic. Cristina Montemayor González Juez Primero Civil de Primera Coordinadora de Mejora Instancia$ Lic. Perla Magaly Prado Pérez Regulatoria, Secretaría de Directora de Asuntos Jurídicos, Lic. Luz Maria Cárdenas Vazquez del Mercado Desarrollo Económico, Gobierno C. Rogelio Márquez Valdivia Secretaría de Desarrollo del Estado $ Regidor Propietario del Municipio Económico, Gobierno del Estado$ Directora de Análisis y de Benito Juárez (Cancún); Propuestas, Secretaría de C. Francisco González Treviño Gobierno Municipal$ C. Agustín Santa Cruz Ramírez Desarrollo Económico, Gobierno Coordinador de Modernización Secretario Primero de Acuerdos$ del Estado$ del Registro Público de la C. Javier Olvera Iglesias C. Ana Patricia Godínez Luna Propiedad y del Comercio$ Director de Información y Estadística, Secretaría de Directora del Área de Propiedad Lic. Gabriel Cavazos Villanueva Desarrollo Económico, Gobierno En El Registro Público de la Director Jurídico de la Secretaría del Estado $ Propiedad, Gobierno del Estado$ de Desarrollo Económico, Lic. Armando García Estrada Gobierno del Estado $ C. Víctor Armando Pérez Sandoval Consejero Ciudadano, Tribunal Juez Especializado, Tribunal Superior de Justicia del Estado$ Superior de Justicia del Estado$ AcKnoWLedgments 79 Lic. Gustavo Adolfo Guerrero QUERÉTARO, QRO.! TIJUANA, B.C.! TUXTLA GUTIÉRREZ, Gutiérrez CHIS.! Magistrado de la Primera Sala Ing. Juan Manuel Navarrete Reséndiz Lic. Brunelda Burrola Aragón Unitaria del Tribunal Superior de Jefe de Gestión E Infraestructura Directora del Centro de Atención C. Ana Lidia Solís Gómez Justicia del Estado$ Industrial, Secretaría de Empresarial, Gobierno Municipal $ Jefe del Departamento de Gestión Lic. Humberto Dingler Delgado Desarrollo Económico, Gobierno Lic. Ignacio Salazar Badillo Empresarial, Secretaría de Coordinador de Relaciones del Estado$ Jefe de Informática, Tribunal Desarrollo Económico, Gobierno Internacionales, Gobierno Lic. Mariela Ponce Villa Superior de Justicia del Estado$ del Estado $ Municipal$ Directora Jurídica del Tribunal de Ing. Lorena Huerta Corona Justicia Estatal$ Lic. José Luis González Canales Encargada de la Coordinación de MORELIA, MICH.! Director de Eficiencia Lic. Oscar Vega Pérez Empresarial, Secretaría de Ventanilla Única y del Sistema de Apertura Rápida de Empresas, Lic. Luis Navarro García Director de Desarrollo Desarrollo Económico, Gobierno Gobierno Municipal$ Secretario de Fomento Económico, Económico, Gobierno Municipal$ del Estado $ Gobierno Municipal$ Lic. Aurora Guadalupe Ruiz Niño REYNOSA, TAMPS.! Lic. Sergio Javier Camacho Diez Secretaría Particular del Lic. Guillermo Arteaga Torres Encargado del Despacho del Magistrado, Tribunal Superior de Director del Registro Público de C. Zonia Torres Saeb Fideicomiso Mi Crédito-cae, Justicia del Estado$ la Propiedad y del Comercio$ Directora General de Promoción Gobierno Municipal$ Lic. Luis de Pablo Hernández Lozano Lic. Misael López Vergara de Inversión, Secretaría de TLALNEPANTLA DE BAZ, Subsecretario de Desarrollo Asesor de la Asociación Mexicana Desarrollo Económico, Gobierno EDO. DE MEX.! Empresarial, Secretaría de de Secretarios de Desarrollo del Estado $ Desarrollo Económico, Gobierno Económico$ Ing. Leonel Cantú Robles Ing. Carlos Mayer Herreros del Estado $ Mtro. Emmanuel Roa Ortíz Secretario de Desarrollo Director General de Atención Director del Instituto de Económico, Gobierno Municipal $ Empresarial, Secretaría de CENTRO Especialización Judicial, Tribunal Lic. Elva García Barrientos Desarrollo Económico, Gobierno (VILLAHERMOSA), TAB.! Superior de Justicia del Estado$ Tribunal Superior de Justicia del del Estado$ Estado$ Ing. Luis Omar Muñoz Pifano C. Elisa Alejandra de la Peña Silva PACHUCA, HGO.! Subdirectora de Promoción de Nancy Leticia Chávez Meléndez Director General de Desarrollo Económico, Gobierno Municipal$ Inversiones, Gobierno Municipal$ C. Alberto Islas Lara Ernesto Velarde-danache, Inc$ Lic. Elías Arzubide Dagdug Director del Registro Público Lic. José Luis Vázquez Ramírez Titular de Patrimonio Municipal, de la Propiedad y del Comercio, SALINA CRUZ, OAX.! Integrante del Consejo de la Gobierno Municipal$ Gobierno del Estado$ Judicatura, Tribunal Superior de Lic. Eduardo Pinacho Sánchez Justicia del Estado$ Lic. Félix Schnabel Suárez Lic. Ernesto Gutiérrez Amador Presidente de la Primera Sala Director de Fomento Económico, Secretario Particular, Tribunal Civil del Tribunal Superior de María Guadalupe Morales González Gobierno Municipal$ Superior de Justicia del Estado$ Justicia del Estado$ Registradora de la Propiedad y del Comercio, Distrito de Toluca$ Lic. José Martín Félix García Lic. José Gonzalo Badillo Marino Lic. Silvestre Rivera Hernández Juez Quinto Civil de Primera Director de la Unidad de Mejora Director de Calidad y Mejora TLAXCALA, TLAX.! Instancia del Tribunal Superior de Regulatoria, Secretaría de Regulatoria del Instituto Justicia del Estado$ Desarrollo Económico, Gobierno de Innovación y Calidad C.P. Eygor Moranchel Pérez del Estado$ Gubernamental, Gobierno del Secretario Técnico, Secretaría de Lic. Mario de la Cruz Sarabia Lic. Salvador Elguero Molina Estado$ Desarrollo Económico, Gobierno Subsecretario de Desarrollo Económico, Secretaría de Subsecretario de Competitividad C. Jorge Contreras Kat del Estado$ Desarrollo Económico, Gobierno Empresarial y Laboral, Secretaría Síndico Municipal del Municipio de Lic. Artemio Saldaña Tlachi del Estado $ de Desarrollo Económico, Salina Cruz$ Tribunal Superior de Justicia del Gobierno del Estado$ Estado$ Lic. Yedi Orueta Méndez Mtra. Delia Jessica Blancas Hidalgo SAN LUIS POTOSÍ, S.L.P.! Secretaría Particular del Lic. Ma. Elena Bautista Hernández Presidente del Tribunal Superior Secretaría de Desarrollo Coordinadora de Fomento de Justicia del Estado$ Económico, Gobierno Municipal$ Ing. Enrique Martín del Campo Director de Sistemas, Calidad Económico, Gobierno Municipal$ PUEBLA, PUE.! E Innovación Gubernamental, ZACATECAS, ZAC.! Gobierno Municipal $ TORREÓN, COAH.! Lic. Ileana Ortega C.P. Víctor Gabriel Chedraui Lic. Sonia Najera Hernández Ing. Héctor Dávila Directora de Mejora Regulatoria, Secretario de Fomento Económico, Directora General de Mejora Director General de Secretaría de Desarrollo Turismo y Empleo, Gobierno Regulatoria, Secretaría de Normatividad, Secretaría de Económico, Gobierno del Estado $ Municipal$ Desarrollo Económico, Gobierno Desarrollo Económico, Gobierno Lic. Juan Luis Rivera Ruiz Dra. Margarita Palomino Ovando del Estado $ del Estado $ Secretario de Desarrollo Magistrada de la Tercera Sala Ing. Armando Eduardo Hoyos Reyes Económico, Gobierno Municipal$ Civil, Tribunal Superior de Justicia TEPIC, NAY.! Director del Registro Público del Estado$ C. Jair Omar Gutiérrez Ibarra de la Propiedad, Gobierno del Lic. Raúl Carrillo del Muro Lic. Leobardo Briceño Moreno Administrador del Módulo Sare, Estado$ Director de la Escuela Judicial del Poder Judicial, Tribunal Tribunal Superior de Justicia del Gobierno Municipal$ Lic. Gerardo Montañéz Betancourt Superior de Justicia del Estado$ Estado$ Lic. María Catalina Medina Rosales Director de Modernización, Lic. Silvia Hernández Chassin Secretario de Acuerdos del Gobierno Municipal$ Subdirectora del Registro Público Consejo de la Judicatura del Lic. Gregorio Alberto Pérez Mata de la Propiedad y El Comercio del Tribunal Superior de Justicia del Presidente del Tribunal Superior Estado de Puebla.$ Estado$ de Justicia del Estado$ Lic. Víctor Díaz Ortiz Lic.José Luis Lozano Gárate Lic. Marina Isabel Salinas Romero Director General de la Comisión Director de Promoción Económica, Gobierno Municipal$ Estatal de Mejora Regulatoria, Secretaría de Desarrollo Secretaría de Desarrollo Económico, Gobierno del Estado$ Lic.Edmundo Rodríguez Barrera Económico, Gobierno del Estado $ Oficial Mayor del Poder Judicial del Estado $ 80 doingBusinessinmeXico2007 PRIVATE LEGAL PROFESSIONALS Lic. Antonio Barroeta Zamudio Corredor Público No. 1 de La Creel, Garcia-cuellar y Lexcorp, Inc$ Lic. Carlos De la Madrid Plaza de Tabasco$ Muggenburg$ Lic. Sergio Bustamante Acuña Lic. Gerardo Del Rayo Castrejón Lic. Jaime Antonio Reynés Manzur Lic. Badir Treviño-Mohamed Lic. María Isabel Sánchez Lic. Diana Edith Flores Herrera Corredor Público No. 1 de Puebla$ Cuesta Campos y Asociados, S.C.$ Mata Gálvez Reynoso y Urrutia $ Lic. José Alberto Gutiérrez Arellano Lic. Francisco Javier Lara Mendoza Lic. Azucena Marín Díaz Lic. Rosendo López Mata Lic. Gilberto Armando Manzano Alba Corredor Público No. 1 de Lic. Berenice Soto Notaría No. 3 de Aguascalientes$ Lic. Basilio Ramos Zapata Tlaxcala$ Dorantes Aranda y Asociados$ Lic. Gabriel Villalobos González Lic. Ariel Ríos Lic. Leonardo Daniel Adolfo Molina Lic. Jorge Dorantes Aranda Lic. Eduardo Robles Elías Yano Lic. Oscar Dorantes O'Loughlin Notaría No. 1 de Pachuca$ Lic. Rafael Arriaga Paz Acevedo, Peniche y Asociados, Corredor Público No. 10 de Ezkauriatza, Fregoso, Vázquez y S.C.P.$ Coatzacoalcos$ Abogados $ Notaría No. 28 de Celaya$ Lic. Jorge Ramón Peniche Aznar Lic. José Manuel Ricardez Reyna Lic. Oscar Rafael Ezkauriatza Fregoso Lic. Jorge Negrete Quintana Lic. Josefina Fregoso Asesoría Jurídico Administrativa Corredor Público No. 2 de Notaría No. 3 de Celaya$ Peninsular, S.C.P.$ Oaxaca$ Firma Profesional Flores Quiñones Lic. Enrique Jiménez Lemus Lic. Bertha María Villajuana Lic. Zenón López López y Asociados $ Lic. Norma Flores Martínez Notaría Pública No. 48 de Tuxtla Bufete de La Garza, S.C.$ Corredor Público No. 2 de Culiacán$ Lic. Catarino Flores Quiñones Gutiérrez$ Lic. José Mario De la Garza Lic.Jesús Gabino Aldana Hernández Goodrich, Riquelme y Asociados$ Lic. Aarón Cisneros López Bufete Troncoso$ Corredor Público No. 2 de Lic. Paulina Avendaño Notario Público No. 30 de Lic. Saraí Jiménez Tlaxcala$ Lic. Waldo Bonilla Zacatecas$ Lic. David Enríquez Lic. Jaime Santoyo Castro Bufete Troncoso$ Lic. Nora Mendoza Arrevillaga Lic. Hilda Farah Lic. Francisco Javier Troncoso Corredor Público No. 2 del Estado Lic. Carlos J. Freaner Nieves Notario Público No. 60 de Reynosa$ Colegio de Corredores Públicos de Nayarit$ Lic. Teresa Gómez Neri Lic. Enrique Francisco Sepúlveda del Estado de Durango$ Lic. Gilberto Miramontes Correa Lic. Damián González Lic. Ruth Herrera González Lic. Liliana Del Rayo Corredor Público No. 3 de Lic. Ricardo Lan Notario Público No. 7 de Colegio de Corredores Públicos Oaxaca$ Lic. Edgar F. Martínez Herrasti Zacatecas$ del Estado de Guerrero, A.C.$ Lic. Enrique López Salinas Lic. Carlos Morán Lic. Tarsicio Félix Serrano Lic. Adrian García Fierro Correduría Pública No. 2 de Lic. Tatiana Ortega Robles Lic. Roberto Ortíz de Montellano Notario Público No. 10$ Colegio de Corredores Públicos Chihuahua$ Lic. Roberto Ramírez Lic. Javier Palazuelos Cinta del Estado de Hidalgo, A.C.$ Mtro. Omar Cayám Valenzuela Escalante Lic. Jorge Sánchez Dávila Lic. Eduardo Javier Baños Gómez Lic. Francisco Javier Velázquez Ritch, Heather y Mueller $ Lic. Maribel Trigo Aja Lic. James E. "Ritch, Jr." Colegio de Corredores Públicos Correduría Pública No. 4 de del Estado de Nayarit, A.C.$ Campeche$ Dr. Emilio Del Rio Pacheco J.a. Treviño Abogados, S.A. de C.V.$ Rivadeneyra y Asociados, S.C.P.$ Lic. Otoniel Pérez Orta Lic. Jaime Treviño Lic. Bernardo Rivadeneyra Corporacion Jurídica Piña y Correduría Pública No. 4 de J.w. Pinedo y Asociados $ Romero de La Torre Abogados$ Asociados, S.C.P.$ Tuxtla Gutiérrez$ Lic. Luis Mauricio Ibarrola Serrano Lic. Pablo Ochoa Lic. Juventino Romero de la Torre Lic. Marcio Piña Heredia Lemini y Artasánchez, S.C.P.$ Santamarina y Steta, S.C.$ Corporativo Reyes$ Correduría Pública No. 6 de Torreón$ Lic. Carlos Manuel Lemini Ávila Parra Lic. Jorge Barrero Lic. Jorge Reyes Peralta Lic. Juan Manuel Barrera Martínez Lic. Heriberto de J. Garza THEWORLD BANK International Finance Corporation World Bank Group WWW.DOINGBUSINESS.ORG/MEXICO ECONOMÍA AMSDE RELACIONES EXTERIORES