Properties in Mexico
Everything you need to know about the Fideicomiso

what is the trust?

Before defining what a bank trust is , let me explain why you need one . You may be familiar with a strip of land called the Restricted Zone, an area 50 km (30 miles) from any coastline or 100 km (60 miles) from any international border, i.e., with the United States, Belize or Guatemala; the entire Baja California Peninsula is part of the restricted zone.

According to Mexican law, only Mexican citizens can own and purchase property in the restricted zone, but there is also a legal way for foreigners to own property in these areas. When a foreigner wishes to purchase property within the restricted zone, he has the option of acquiring the property using a Mexican bank trust or by establishing a Mexican corporation, which then acquires the asset.

The Mexican Constitution of 1917 clearly describes that non-Mexican citizens cannot own real estate along the coast of Mexico or near any international border (within the distances mentioned above).
When the Mexican government realized that foreign investment in these areas was advantageous and attractive, special arrangements were made that allowed investment without changing the constitution.
Mexico's Foreign Investment Law mandates the process for owning property in this restricted zone. This was first introduced in 1971, adjusted in 1993 and updated once again in 1998.
If we take a closer look at these regulations, we can find these interesting points.
- If it is for residential purposes, foreigners can own property within the restricted zone using a Mexican bank trust for real estate (BankTrust).
- For commercial purposes, foreigners may own property within the restricted zone using a Mexican corporation.
- Foreigners may incorporate, invest and own 100% of a Mexican Corporation.

READ THE FULL GUIDE HERE