Due to major driving factors such as low operating costs and ease of access to markets
in the United States and Canada, Mexico has become a popular choice for investors
looking to start doing business in Latin America. This article discusses how to start a
business in Mexico and the required Apostilles for doing business in Mexico.
The Mexican Market
Mexico has the second-largest economy in Latin America based on its gross domestic
product (GDP), behind the country of Brazil. While Mexico’s GDP has fluctuated, it has
continued in a generally upward direction, growing almost six-fold in the three decades
after 1989 to hit 1.27 trillion USD in 2019, following three years of vigorous growth
according to the World Bank’s official website.
Mexico’s increase in GDP has been met by an associated rise in prosperity, with gross
national income hitting $9,430 USD per capita in 2019. This figure placed Mexico as an
upper-middle-income nation based on classifications established by the World Bank.
Mexico is considered a major trade hub in the Americas, with high-volume ports serving
both the Pacific Ocean and the Gulf of Mexico. In 2020 the country was recognized as
the 16th-largest exporter in the world according to cia.gov. More than $1.7 billion of
goods transit Mexico’s 3,145 km (1,954 miles) border with the United States every day
according to data provided on statista.com.
Doing Business In Mexico
Many entrepreneurs looking to do business in a foreign country might ask the question,
“Is Mexico a good country to conduct business in?”. The answer is yes. Due to its
favorable business climate, Mexico is a highly desirable country for conducting business
abroad. The country has a well-established presence in the agricultural industry and has
been trying over the years to attract other business industries, especially manufacturing.
Foreigners are able to own 100% of a Mexican corporation and open their business in
Mexico. The Mexican legal system and tax laws for businesses do not discriminate
between foreign businesses or Mexican National owned businesses. This means that
any non-national of Mexico will have access to the same business resources as
Mexican nationals.
Starting A Business In Mexico
Starting a business in Mexico requires a small investment and a certain number of
corporate shareholders. The minimum investment required to start a Mexican Corporation is about $3,782 United States Dollars. In terms of corporate shareholders,
the company must have at least two people as shareholders. This shareholder
requirement differs from the United States where a single shareholder can own all of a
company's stock.
Mexico is considered the easiest country in Latin America to start a business due to its
faster and much less complicated process of doing so. In some cases, it can only take a
day and zero financial investment to begin running your own company in Mexico. Of
course, this greatly depends on the business industry you’re looking to enter.
When it comes to overall ease of doing business, Mexico ranks 60 out of 190
economies according to doingbusiness.org. The country has an even lower rank for
ease of starting a new business, ranking at 107. The tasks associated with establishing
a new Mexican business, such as the registration processes, are quite complicated and
time-consuming. For example, the business registration process usually takes about
nine days to complete in Mexico City.
Steps To Forming A Mexican LLC
There are five key steps to forming an LLC in Mexico. It’s always a good idea to obtain
professional legal assistance during this process to ensure everything is done correctly.
Here are the five key steps to forming and Mexican LLC:
1. Draft the company’s bylaws and have them authenticated.
2. Register the authenticated bylaws at the Public Registry of Mexico.
3. Obtain a Tax Identification Number (Tax ID).
4. Obtain a commercial business license and register the LLC with the municipality.
5. Complete the LLC formation in Mexico opening a business bank account.
Mexican Business Apostilles
When doing business in a foreign country you will need an Apostille if the following
applies:
The official document is considered to be a public document based on the laws of the
country where it was issued. And, the document requires an Apostille in order to be
recognized as a foreign public document by the country in which it’s going to be used.
Because Mexico is a member of the Hague Apostille Convention of 1961, any official
document destined for this country requires an Apostille from the Secretary of State.
The purpose of the Hague Apostille Convention is to provide a simplified way of
“authenticating” documents for universal recognition.
Official documents that often require Apostilles for doing business in Mexico include but
are not limited to Affidavits, Authorization Letters, and Powers of Attorney. Feel free
to contact American Apostille & Notary Services to learn more about the required
Apostilles for doing business in Mexico.