Annual Corporate Obligations
As the end of the first quarter of 2018 nears, Mexican companies are required to comply with certain annual obligations. We take this opportunity to send you a friendly reminder of the most common annual obligations that your Mexican subsidiary may have to comply this year.
Annual Shareholders’ Meeting.
Shareholders of all Mexican companies shall meet at least once a year –within the first 4 months of every calendar year in the case of Sociedades Anonimas – to approve, among other things, the preceding year’s financial results. Please consider that some limited liability companies by-laws (Sociedad de Responsabilidad Limitada) contain the obligation to hold an annual partners’ meeting; therefore, it is advisable to corroborate if your Mexican subsidiary has the obligation to hold such meeting.
Foreign Investment Registry.
Every Mexican company with foreign participation in its capital must be registered with the National Foreign Investment Registry (Registro Nacional de Inversiones Extranjeras) and comply with the applicable reporting obligations regarding its operations and corporate capital structure. An annual report may apply to your Mexican subsidiary if its accounting shows changes or movements above the threshold set forth in the applicable law. Failure to file the annual report results in fines that range from approximately US$150.00 to USD$400.00.
Anti-money Laundering.
Pursuant to anti-money laundering legislation, companies carrying out the so-called “vulnerable activities” (which include financial services, lending activities, construction or development services) are obliged to comply with certain KYC and periodic reporting obligations.
Collective Bargaining Agreement.
Employers who have entered into one or more collective bargaining agreements must perform annual reviews regarding unionized employee’s salaries and/or wages and once every two years regarding other contractual terms.
Profit Sharing.
Every year, employers must comply their employee profit sharing obligations (commonly known as PTU), including notifying the relevant union, creating a joint committee for the calculation of the profits to be shared, and duly document any PTU payment made to the employees.
Social Security.
Employers are obliged to review their casualty rate on a yearly basis, file their annual premium risk assessment with the Mexican Social Security Institute and comply with a number of other monthly and quarterly reporting obligations.
Intellectual Property.
We recommend conducting annual revisions of your intellectual property portfolio (either, owned or licensed), and confirm that such intellectual property rights are being used properly.
Data Privacy.
Annual reviews of a company’s internal privacy policies and privacy notices are highly recommended in order to confirm the company’s compliance with applicable legislation and the most current criteria of the relevant authorities.
Industry Oriented Regulations.
All industries are subject to specific regulations and thus we recommend monitoring relevant legal developments (including laws, court precedents regulations, Mexican official standards, etc.) in order to avoid the risk of administrative penalties.
Shareholder Tax Registry.
Mexican Companies shall file with tax authorities a list with the names of its foreign shareholders/partners during the month of March.
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If you require further information on any of the annual obligations or specific information on those that may apply to your Mexican subsidiary, please contact us.
Mexico City, March 2018.