{"id":18913,"date":"2018-05-10T12:00:50","date_gmt":"2018-05-10T16:00:50","guid":{"rendered":"http:\/\/www.escapeartist.com\/?p=18913"},"modified":"2020-04-20T12:00:10","modified_gmt":"2020-04-20T16:00:10","slug":"different-types-companies-mexico","status":"publish","type":"post","link":"https:\/\/www.escapeartist.com\/blog\/different-types-companies-mexico\/","title":{"rendered":"Different Types of Companies in Mexico"},"content":{"rendered":"<h2><strong>Different Types of Companies in Mexico<\/strong><\/h2>\n<p><span style=\"font-weight: 400;\">Now more than ever, investors from all around the world are starting to look at Mexico as a prime market for expansion. The country\u2019s population is about 127.5 million in an area that compromises 1.964 million km\u00b2 of land and sea. Its geographical location and proximity to the United States make Mexico one of the most viable options when looking to start a company overseas. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Many businesses from the United States have expanded to Mexico: HP, Google, Coca Cola, Walmart, etc. American businesses have chosen Mexico for its reliable workers, affordable labor, and its position as a gateway into the spanish speaking Latin American market. One of the first things you should consider when starting a business in Mexico is choosing what is the best corporate structure for you. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">There are several options from which to choose when starting a new business in Mexico. The required structure will depend on your line of work, the commercial activity you will be performing in Mexico, and the the amount of gross sales you expec. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">I\u2019ll review these options, the advantages and disadvantages of each, and what requirements you need to create them. Here\u2019s what you need to know to setup a corporation in Mexico and start a new business in Mexico. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Let&#8217;s begin by explaining what is a \u201cSociedad\u201d in Mexico. A Sociedad is a distinct entity with an established commercial activity and involves the participation of partners. We can say that a Sociedad is the union of two or more people through which they contribute something in common for a specific purpose. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">The elements and the type of capital are taken into account when classifying different types of companies or Sociedades. There are three elements: <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">The members: formed by partners that contribute and gather their efforts such as assets and capital.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The patrimonial: constituted by goods that together form the social capital.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The legal part: composed of rules that govern the contract, thus justifying the origin of a society as a legal entity.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">There are also two types of capital that make a company:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Fixed capital: the one that cannot be modified, except for a change of status.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Variable capital (C.V.): one that is flexible according to the progress of the mercantile society.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Some structures are similar to US limited liability partnerships and others a traditional corporation. Unlike the US, some corporate structures require at least 2 shareholders. Here are the types of companies that you can create in Mexico:<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b style=\"color: #2d2d2d; font-size: 25px; text-transform: inherit;\">1. Limited Liability Company (S. de R.L.)<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">This business model allows the partners&#8217; liability to be limited exclusively to the amount of their contributions, regardless of whether they were assets or capital. This means that in case of any problem or bankruptcy that may occur in the company, the partners will not be affected and their personal assets or capital will be safeguarded. <\/span><\/p>\n<ol>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The contributions can only be of goods or money<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The partners must not pay the difference if the assets are depreciated<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">If debts are contracted, the partners respond only for their contribution<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">It takes a minimum of two partners to create and a maximum of fifty are allowed<\/span><\/li>\n<\/ol>\n<h3><\/h3>\n<h2><b>2. Society in Collective Name (Sociedad en Nombre Colectivo)<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The Society in Collective Name model emphasizes the responsibility of the partners for the obligations contracted by the company. The essential characteristics of this partnership is that the responsibility of each partner will be limited, solidary and subsidiary of all partners. The company must have at least two partners and there is no maximum number of partners. The corporate name is made up of the names of all the partners or of some of them, followed only by the words &#8220;and company&#8221;.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>3. Society in Comandita Simple (S. en C. S.)<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">In the Society in Comandita Simple there are two types of partners: the lead partners and the secondary partners. Lead partners have a joint, subsidiary and unlimited liability; while the liability of the secondary partners is determined by their contributions, unless they have taken part in any operation or manage the business of the company. That is to say, a secondary partner can become a lead partner for liability purposes if the exert control over the entity.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>4.\u00a0 The Limited Partnership for Shares (S. en C. por A.)<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">It is also formed by lead and secondary partners, its capital is formed by shares, which credit the partner as a &#8220;partner&#8221;. The partners may have a company name or social name, and like the previous company, the partner will be the lead partner, in the case of operating under a company name. The reserves also formed of 5% annual profits, its constitution must be done before a notary public, and all necessary records must be made.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>5.\u00a0 The Sociedad An\u00f3nima (S.A.)<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">It is a mercantile society whose owners are by virtue of a collaboration in the social capital through titles or shares, the owners or shareholders do not resolve the affairs of the company with their personal assets, but with the total amount of the capital that they have contributed.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><b>6.\u00a0 Co-operative Society (S.C.)<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The Cooperative Society offers income for work or consumption, and all partners belong to the working class. The responsibility may be limited to the amount of its contribution or supplemented by which the partners respond up to the amount determined in the constitutive act.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A minimum of capital is not established; however, this must always be variable. The reserve fund is constituted with 10 to 20 percent of the income of each fiscal year, which may be defined in the constitutive bases, but can not be less than 25% of the share capital in the SC. There is a minimum of five partners, but there is no limit.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Forming a corporation can be a difficult process and much more difficult if you are not familiar with the laws of the country. It is highly advisable to search for a good legal representative to help guide you through this process.<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><strong>I hope you\u2019ve found this article on different types of corporations in Mexico to be helpful. For more information, or for assistance in investing in Mexico or opening an offshore company, please contact us <a href=\"https:\/\/www.escapeartist.com\/offshore-incorporation-setup\" target=\"_blank\" rel=\"noopener noreferrer\">HERE<\/a><\/strong><\/p>\n<p><strong>For all things Offshore, please make sure to read <a href=\"https:\/\/www.escapeartist.com\/blog\/ultimate-guide-to-going-offshore\/\" target=\"_blank\" rel=\"noopener noreferrer\">The Ultimate Guide to Going Offshore<\/a>. You will love it!<\/strong><\/p>\n<p><strong>Enjoy these articles by Escape Artist.<\/strong><\/p>\n<p><strong><a href=\"https:\/\/www.escapeartist.com\/blog\/top-6-reasons-to-choose-mexico-as-your-new-home\" target=\"_blank\" rel=\"noopener noreferrer\">The Top 6 Reasons to Choose Mexico As Your Home<\/a><\/strong><\/p>\n<p><a href=\"https:\/\/www.escapeartist.com\/blog\/everything-need-know-perfect-trip-mexico-city\" target=\"_blank\" rel=\"noopener noreferrer\"><strong>Everything You Need To Know For a Perfect Trip to Mexico City<\/strong><\/a><\/p>\n<p><a href=\"https:\/\/www.escapeartist.com\/blog\/e-commerce-mexico\/\" target=\"_blank\" rel=\"noopener noreferrer\"><b>E-Commerce in Mexico<\/b><\/a><\/p>\n<p><strong>If you want to learn Spanish, you should get in touch with some of my associates at <a href=\"https:\/\/expatmoneyshow.com\/languages\/\" target=\"_blank\" rel=\"noopener noreferrer\">IWillTeachYouALanguage<\/a>. Visit their website today to sign up for expert <a href=\"https:\/\/learn.iwillteachyoualanguage.com\/spanish-beginnersfz5inudw?affiliate_id=1764132\" target=\"_blank\" rel=\"noopener noreferrer\">Spanish language lessons<\/a>.\u00a0<\/strong><\/p>\n<p><strong>Here is an amazing interview with my friend Olly Richards: <a href=\"https:\/\/expatmoneyshow.com\/olly-richards-secrets-to-learning-a-foreign-language-quickly\/\" target=\"_blank\" rel=\"noopener noreferrer\">Secrets to Learning A Foreign Language Quickly<\/a><\/strong><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Different Types of Companies in Mexico Now more than ever, investors from all around the world are starting to look at Mexico as a prime market for expansion. The country\u2019s population is about 127.5 million in an area that compromises 1.964 million km\u00b2 of land and sea. Its geographical location and proximity to the United [&hellip;]<\/p>\n","protected":false},"author":686,"featured_media":28295,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","om_disable_all_campaigns":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2],"tags":[29,71,258,406],"yst_prominent_words":[9308,9127,5227,9312,2370,9315,5220,9314,2406,9305,9302,9304,9306,9313,9311,9309,9303,9310,9307,1804],"acf":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/www.escapeartist.com\/wp-content\/uploads\/2018\/05\/mexico-city-2719368_1280.jpg","_links":{"self":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/18913"}],"collection":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/users\/686"}],"replies":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/comments?post=18913"}],"version-history":[{"count":13,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/18913\/revisions"}],"predecessor-version":[{"id":34860,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/posts\/18913\/revisions\/34860"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/media\/28295"}],"wp:attachment":[{"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/media?parent=18913"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/categories?post=18913"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/tags?post=18913"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.escapeartist.com\/wp-json\/wp\/v2\/yst_prominent_words?post=18913"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}