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Ease of Doing Business in

Mexico

Mexico Download Profile (2060.2KB, pdf)
Region Latin America & Caribbean
Income Category Upper middle income
Population 127,017,224
GNI Per Capita (US$) 9,710
City covered Mexico City, Monterrey

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 47 45 down
2
72.29 71.95 down
0.34
Starting a Business 93 72 down
21
85.74 86.92 down
1.18
Dealing with Construction Permits 83 87 up
4
69.79 68.91 up
0.88
Getting Electricity 98 84 down
14
68.32 70.11 down
1.79
Registering Property 101 111 up
10
61.05 56.89 up
4.16
Getting Credit 5 5
-
90.00 90.00
-
Protecting Minority Investors 53 51 down
2
60.00 60.00
-
Paying Taxes 114 112 down
2
65.81 65.85 down
0.04
Trading across Borders 61 60 down
1
82.09 82.09
-
Enforcing Contracts 40 42 up
2
67.01 65.69 up
1.32
Resolving Insolvency 30 29 down
1
73.11 73.03 up
0.08

Positive= Doing Business reform making it easier to do business.Negative= Change making it more difficult to do business.

Viewing the data for

DB 2017 DTF (% points):

68.87

DB 2016 DTF (% points):

67.85

Change in DTF (% points):

up1.02

STANDARDIZED WAREHOUSE
Estimated value of warehouse MXN 7,083,838
City Mexico City
Indicator Mexico City Latin America & Caribbean OECD high income
Procedures (number) info_outline 13 14.4 12.1
Time (days) info_outline 81 181.3 152.1
Cost (% of warehouse value) info_outline 11.3 2.5 1.6
Building quality control index (0-15) info_outline 12 8.4 11.3
  • Measure of efficiency
    No. Procedure Time to Complete Associated Costs
    1

    Request and obtain the alignment certificate (alineamiento) and official number (número official)

    Agency: Delegational One-Stop Shop (Ventanilla Única Delegacional), Urban Development and Housing Ministry (Secretaría de Desarrollo Urbano y Vivienda), and Federal District Department (Gobierno del Distrito Federal)

    The relevant agencies for this procedure are the Delegational One-Stop Shop (Ventanilla Única Delegacional), the Urban Development and Housing Ministry (Secretaría de Desarrollo Urbano y Vivienda), and the Federal District Department (Gobierno del Distrito Federal). Either a simple original copy or a certified one is acceptable.

    For the official number, the Federal District Department will assign a single official number for each property, at the request of the interested party, that has a front facing the public pathway. For the official alignment, the plot across the land indicates the restrictions or expropriation lines to be respected in the interaction between the property and the public pathway. Obtaining the single zoning certificate stating specific land use and feasibility is required.

    The following documents must be submitted:
    • Proof of payment of applicable real estate taxes (copy)
    • Public deed certifying property or title ownership (original and copy)
    • Payment of all fees
    • Application form (original)
    • Identification of the person completing the procedure and document certifying the respective identity (original and copy)

    Payment is made the same day when the certificate is requested. At the same time, a date is set for the taxpayer to return to receive the certificate, generally within 3 or 4 working days. The certificate is valid for 2 years.

    The official time limit is 8 days, but in practice, the process can take 1 -- 2 weeks. As the first procedure, it is not a simultaneous one.

    11 days MXN 1,104
    2

    Request and obtain single zoning certificate stating specific land use and feasibility

    Agency: Subdirección de Ventanilla Única of the Secretaría de Desarrollo Urbano y Vivienda attached to the Dirección del Registro de los Planes y Programas de Desarrollo Urbano of the Dirección General de Desarrollo Urbano

    At this stage, BuildCo obtains the document that certifies whether a specific use of a given building is authorized.

    There has been a fee change, increase in minimum wage, effective as of January 1, 2016, which has impacted the price of this procedure.

    12 days MXN 1,296
    3

    Request a water feasibility study

    Agency: Sistema de Aguas de la Ciudad de México

    Upon reception of the zoning certificate, BuildCo must request a water feasibility study in order to continue the request of building permit. This procedure precedes the application for drinking water supply.

    1 day no charge
    4

    Receive inspection for a water feasibility study

    Agency: Water Services Agency

    After requesting for a water feasibility study, there is an inspection to assess the feasibility of the water connection, sewage and rainwater drainage services will be installed in the construction.

    1 day no charge
    5

    Obtain a water feasibiilty study

    Agency: Water Services Agency

    Once the inspection has been conducted, a water feasibility study report is given to BuildCo, which will be used to continue processing the building permits.

    10 days no charge
    * 6

    Obtain a certificate of debts for Water services

    Agency: Water Services Agency

    Once the water feasibility process is on its way, Buildco. can also request a certificate of debts. This is another mandatory requirement to register a construction statement type B. The warehouse in the case study is considered a construction Type B, therefore this is applicable.

    0.5 days MXN 145
    7

    Register Construction Statement Type B

    Agency: Ventanilla Única Delegacional

    Construction Statement Type B applies to nonresidential or mixed uses of up to 5,000 square meters or up to 10,000 square meters for residential use or for single-family dwelling units within a risk zone.

    The following documents must be submitted:
    • Valid alignment certificate and official number (simple original copy or certified one)
    • Single zoning certificate for specific land use and feasibility (simple original copy or certified copy for collation)
    • Four copies of the architectural project for the construction work on duly outlined scale maps and containing all specifications regarding materials, finishes, and equipment to be used, signed by the owner, the director responsible for the construction work, and the co-responsible party for urban and architectural design and installations, as the case may be
    • Project descriptive report
    • Calculation report
    • Registration and identification card of the director responsible for the construction work and the co-responsible party for structural safety, urban and architectural design, and installations as appropriate (simple original copy or certified copy for collation)
    • Two copies of the structural design signed by the director responsible for the construction work and the co-responsible party for structural safety
    • Proof of payment of improvement taxes for potable water and sewerage works provided by the Federal District Department and license issuance fees if the application is required (simple original copy or certified copy for collation). Because the building considered here requires installation or modification of the water main and hook-up to the sewage system, the application and proof of payment of the corresponding fees are attached.

    After registration of the construction statement, the one-stop shop (Ventanilla Única Delegacional) reviews the submitted data and documents and verifies the progress of the construction work under the terms stated in the Administrative Verification Rules (Reglamento de Verificación Administrativa) for the Federal District.

    The director responsible for the construction work undertakes to post a signboard showing the registration number in the construction work statement and the general construction work data, including the location and statement validity. The signboard must be posted in a visible place and legible from the public pathway.

    The validity of the statement (for construction work completion) is as follows:
    • Up to 300 square meters: 1 year
    • 300 -- 1,000 square meters: 2 years
    • More than 1,000 square meters: 3 years

    The cost breakdown for obtaining the building permit is the following:

    • Register: MXN 562.20 (DF Tax Code 2016 Article 185, Sec. B, fr. I, p.a)
    • Analysis: MXN 81.95 x 1,300.6 m2 = MXN 106,584.71 (DF Tax Code 2016 Article 185, Sec. B, fr. I, p.b)
    • Compensations for the Environment: MXN 43.38 x 1300.6 m2 = 56,420.028 MXN (DF Tax Code 2016 Article 300)
    • Compensations for road impact: MXN 125.20 x 1300.6 m2 = 161,835.9 MXN (DF Tax Code 2016 Article 301)
    • Rights for new water and sewage connection: MXN 306.68 x 1300.6 m2= 398,868 MXN (DF Tax Code 2016 Article 302)

    TOTAL= 725,269.53 MXN

    The cost breakdown for water and sewage:
    .
    A) Services of Hydraulic Construction and Operation (Art. 181)
    • Water Connection: MXN 14,347.50 (DF Tax Code Article 181, Section A, fr. I, p. c)
    • Water measurer device: MXN 7,198.73 (DF Tax Code Article 181, Section A, fr. III, p. c)
    • "Armado de Cuadro": MXN 1,505.93 (DF Tax Code Article 181, Section A, fr. IV, p. c)
    • Sewage Connection: MXN 9,714.84 (DF Tax Code, Article 181, Section B, fr. I, p. a) (Escogemos terreno tipo I y II)
    B) Authorization to use the Water and Sewage Network (Art. 182)
    • Technical assessment: MXN 41,121.80 (DF Tax Code, Article 182, fr. I, p. 2)
    • Water pipes usage fee: MXN 1,248.69 (DF Tax Code, Article 182, fr. III)

    TOTAL = 75,137.49

    Thus, the total cost to Register Construction Statement Type B based on "Codigo Fiscal del Distrito Federal" amended in December 2014 is the following: MXN 725,269.53 + MXN 75,137.49 = MXN 800,407.016

    The cost for the water connection includes the installation of the main pipeline, board, and meter. The cost to connect to water and sewage services are included in this procedure since the proof of payment of such fees are needed to request connection to these utility services (procedure 10). The cost is established by the Financial Code of the Federal District. This procedure cannot be done without the results of the previous one, so it cannot be simultaneous.

    1 day MXN 800,407
    8

    Notify the Municipal Authority upon completion of construction work

    Agency: Municipality

    The notification of completion is made in writing once the construction has been completed. Once notified, inspectors may visit the location within a week to verify the construction is in compliance with all applicable regulation.

    1 day no charge
    9

    Receive inspection upon completion of construction work from Directorate of General Works

    Agency: Directorate of General Works (Municipality)

    BuildCo. request the occupancy clearance once all the previous inspections have been passed in a satisfactory way.

    1 day no charge
    10

    Request and obtain occupancy clearance

    Agency: Delegational One-Stop Shop

    Building use clearance is granted by the one-stop shop, once the occupancy clearance is issued to BuildCo.

    6 days no charge
    11

    Request and obtain authorization from civil protection

    Agency: Secretaria de Protección Civil

    An inspection from the civil protection agency (Secretaria de Protección Civil) will be conducted upon request by BuildCo. After the form and the emergency plan are filed, the civil protection agency will issue a certificate within 7 days.

    7 days no charge
    12

    Request and connect to water and sewage services

    Agency: Sistema de Aguas de la Ciudad de México

    Once BuildCo. receives the authorization by the Civil Protection Department, it can request and obtain the water and sewage services.

    30 days no charge
    * 13

    Update the building record at the Tax Ministry

    Agency: Tax Ministry

    Finally, BuildCo. is apt to register the new warehouse.The time and cost of updating the building record are established by the Financial Code of the Federal District, Article 217. The building is not actually registered with the Property Registry. Once built, a cadastral actualization document (manifestacion de actualisacion del valor cadastral) is filed for tax purposes with the Tax Ministry. The information in the new deed is updated only when the property (with the building included) is sold. In Mexico, the owner of the land is automatically the owner of the building unless otherwise specified. Only in cases where the owner of the building and the owner of the property are two different people would the building be registered.

    1 day no charge

    * Takes place simultaneously with previous procedure.

  • Measure of quality
    Answer Score
    Building quality control index (0-15) 12.0
    Quality of building regulations index (0-2) 2.0
    How accessible are building laws and regulations in your economy? (0-1) Available online; Free of charge. 1.0
    Which requirements for obtaining a building permit are clearly specified in the building regulations or on any accessible website, brochure or pamphlet? (0-1) List of required documents; Fees to be paid; Required preapprovals. 1.0
    Quality control before construction index (0-1) 1.0
    Which third-party entities are required by law to verify that the building plans are in compliance with existing building regulations? (0-1) Licensed architect; Licensed engineer. 1.0
    Quality control during construction index (0-3) 2.0
    What types of inspections (if any) are required by law to be carried out during construction? (0-2) Inspections by in-house engineer. 1.0
    Do legally mandated inspections occur in practice during construction? (0-1) Mandatory inspections are always done in practice. 1.0
    Quality control after construction index (0-3) 2.0
    Is there a final inspection required by law to verify that the building was built in accordance with the approved plans and regulations? (0-2) Yes, final inspection is done by government agency; Yes, in-house engineer submits report for final inspection. 2.0
    Do legally mandated final inspections occur in practice? (0-1) Final inspection does not always occur in practice; Final inspection occurs most of the time. 0.0
    Liability and insurance regimes index (0-2) 1.0
    Which parties (if any) are held liable by law for structural flaws or problems in the building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1)  Professional in charge of the supervision; Construction company; Owner or investor. 1.0
    Which parties (if any) are required by law to obtain an insurance policy to cover possible structural flaws or problems in the building once it is in use (Latent Defect Liability Insurance or Decennial Insurance)? (0-1) No party is required by law to obtain insurance . 0.0
    Professional certifications index (0-4) 4.0
    What are the qualification requirements for the professional responsible for verifying that the architectural plans or drawings are in compliance with existing building regulations? (0-2) Minimum number of years of experience; University degree in architecture or engineering; Being a registered architect or engineer; Passing a certification exam. 2.0
    What are the qualification requirements for the professional who supervises the construction on the ground? (0-2) Minimum number of years of experience; University degree in engineering, construction or construction management; Being a registered architect or engineer; Passing a certification exam. 2.0