22 Sep RNIE Obligations
Is it applicable to my company?
When certain scenarios are met, all Mexican companies that have foreign investment in their capital stock are subject to file quarterly and annual notifications before the National Registry of Foreign Investment (“RNIE”).
Sanctions and Penalties
When applicable, failure to comply with the corresponding filings may result in substantial fines or even the revocation of benefits and permits granted by the RNIE, the Ministry of Economy or other governmental authorities related to foreign investment procedures.
Some of the sanctions and penalties may be:
- Financial penalties: ranging from 100 to 1,000 minimum wages, increasing each day since default. (Art. 38 fraction IV Foreign Investment Act)
- Risk of operative paralysis: In case the company fails to obtain registration before the RNIE, it won´t be able to carry out several day-to-day corporate operations before notary publics, since they are required by law to confirm such registration. (Art. 34 and 39 Foreign Investment Law)
- Corporate repercussions: The company may not be able file and submit certain corporate procedures before governmental authorities and websites related to the Ministry of Economy, foreign trade authorities, tax authorities, among others.
Filing calendar
Quarterly Update Notification: The periods to file these notifications are within the first ten business days after the end of each year quarter:
- Q1 (January – March): Filing on first 10 business days of April.
- Q2 (April – June): Filing on first 10 business days of July.
- Q3 (July – September): Filing on first 10 business days of October.
- Q4 (October – December): Filing on first 10 business days of January.
Annual Economic Report: The annual economic report must be filed during the months of April or May depending on the initial of the name of the company.
- From “A” to “J” during April; and
- From “K” to “Z” during May.
Registration before the RNIE: The registration before the RNIE must be filed within the first 40 business days after the beginning of operations in Mexican territory, or the start of the participation of the foreign or neutral investment in capital stock; or the incorporation of the trust in which rights are derived in favor of the foreign investor.
It is essential that companies with foreign investment in Mexico are properly advised to ensure corporate compliance and avoid the possible sanctions mentioned herein. Our lawyers in Cuesta Campos will be happy to assist you with the applicable filings and corresponding procedures.
Contacto
Rafael Sánchez
Jorge González