Thursday, May 13, 2010

Setting Up: What is an S.A. de C.V.?

When you first open a business in Mexico, you will be faced with a variety of options...S.A. de C.V., S.R. de L., S.A., S.C., etc

It is important to note that in Mexico, sole proprietorships do not exist.  You must have someone else on the papers when you incorporate.  Many people who want to run their own businesses have silent partners who are listed in the paperwork, but in reality do not make any of the business decisions.

S.A. de C.V.'s must have a minimum of two partners (individuals or entities).  There is a misconception that corporations in Mexico can NOT be completely foreigned owned.  This is simply not true.  There are certain protected industries (oil and electricity for example), but the majority of corporations can be opened with foreign partners.

S.A. de C.V. means "Sociedad Anonima de Capital Variable" or.  In a S.A. de C.V. setup, the partners may alter the amount of capital at anytime either by adding new partners or just simply adding more capital, without ammending the original incorporation documents.

The S.A. de C.V. set up is the most common form of incorporating your business in Mexico. 

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