Prior to buying or selling a business in Mexico, or an M&A deal in that jurisdiction, you should get familiarized with its legal framework carefully to avoid mistakes. If the decision is made, you should apply to the appropriate authority before making such a transaction and subject to the requirements of Mexican law.
Where to apply?
The Federal Antitrust Commission regulates mergers and acquisitions related to Mexican corporations or Mexican assets. However, if the transaction affects the telecommunications sector, the competition authority is the Federal Telecommunications Institute.
Compulsory before buying a business in Mexico
When acquiring shares or merging companies in Mexico, due diligence is mandatory, especially if the transaction involves technological assets and / or IP assets.
Due diligence in Mexico includes verification:
- license agreements on the use of patents, trademarks, etc.;
- documents confirming the ownership of the technology in Mexico;
- technical assistance and know-how agreements entered into by the target company and its subsidiaries either under license or in their favor;
- patents and trade names registered with the Mexican Institute of Industrial Property on behalf of the entity and its subsidiaries;
- copies of contracts used by the target group for licensing.
Transfer of IP rights
If you are going to make a deal to buy a business in Mexico, you will be pleased with the provisions of local labor laws, which give the employer the right to own any industrial property rights to all inventions developed by their employees.
As for copyrights, they belong to the employees. However, not everything is so clear. Economic rights must be equally divided between the employee and the employer. Unless the employee has worried about his rights in advance and has written something else in his employment contract.
Typically, due diligence of software in Mexico is conducted on the same principles as any other due diligence of M&A or asset acquisitions in Mexico. However, it should be borne in mind that some features of the assets may create a need for further study by the buyer. In some cases, an additional non-disclosure agreement or confidentiality agreement must be drawn up and signed.
Drawing up sales contracts for businesses in Mexico requires careful preparation. One of the stages will be the due diligence procedure in Mexico, which includes an analysis of the company's contracts, statutory documents, verification of intellectual property rights. We will help to check documents, information on the object of sale and the contractor, we will help make contracts legally competent. You will be provided with more detailed information when you sign up for a consultation on the regulation of M&A transactions in Mexico. Please contact us directly by filling out the form below.