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NAFTA - ANNEX VII Schedule of Mexico
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Holding Companies
INDUSTRY CLASSIFICATION: Not applicable
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley para Regular las Agrupaciones Financieras (Law Regulating
Financial Groups), Art. 18
DESCRIPTION: Aggregate foreign investments in
financial holding companies are limited to 30% of common stock capital
(capital ordinario). These limits do not apply to financial holding
companies established pursuant to Parts B and C of the Schedule of
Mexico.
DURATION: Indeterminate
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ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Commercial Banks (Instituciones de Cr‚dito)
INDUSTRY CLASSIFICATION: 811030
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley de Instituciones de Cr‚dito (Law of the Credit
Institutions), Arts. 11 y 15
DESCRIPTION: Aggregate foreign investments in
commercial banks are limited to 30% of common stock capital (capital
ordinario). These limits do not apply to Foreign Financial Affiliates
established pursuant to Part B of the Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Securities Firms (Casas de Bolsa)
INDUSTRY CLASSIFICATION: 812001
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitations on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley del Mercado de Valores (Law of the Stock Market),
Art. 17-II
DESCRIPTION: Aggregate foreign investments in
securities firms are limited to 30% of capital (capital social) and
individual foreign investments are limited to 10% of capital, while
individual investments by Mexicans may, with approval from the Ministry
of Finance and Public Credit, rise to 15% of capital. These limits do not
apply to Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Securities Specialists (Especialistas Burs tiles)
INDUSTRY CLASSIFICATION: 812001
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitations on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley del Mercado de Valores (Law of the Stock Market),
Art. 17-II
DESCRIPTION: Aggregate foreign investments in
securities specialists are limited to 30% of capital (capital social) and
individual foreign investments are limited to 10% of capital, while
individual investments by Mexicans may, with approval from the Ministry
of Finance and Public Credit, rise to 15% of capital. These limits do not
apply to Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: General Deposit Warehouses (Almacenes Generales de Dep¢sito)
INDUSTRY CLASSIFICATION: 811042
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 8-III-1
DESCRIPTION: Foreign participation must be less
than 50% of paid-in capital (capital pagado). These limits do not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Leasing Companies (Arrendadoras Financieras)
INDUSTRY CLASSIFICATION: 811043
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 8-III-1
DESCRIPTION: Foreign participation must be less
than 50% of paid-in capital (capital pagado). These limits do not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Factoring Companies (Empresas de Factoraje Financiero)
INDUSTRY CLASSIFICATION: Not applicable
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 8-III-1
DESCRIPTION: Foreign participation must be less
than 50% of paid-in capital (capital pagado). These limits do not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Credit Unions (Uniones de Cr‚dito)
INDUSTRY CLASSIFICATION: 811041
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 8-III-1
DESCRIPTION: Foreign capital investment in these
entities is prohibited. This limitation does not apply to Foreign
Financial Affiliates established pursuant to Part B of the Schedule of
Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Foreign Exchange Firms (Casas de Cambio)
INDUSTRY CLASSIFICATION: 811044
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 82-III
DESCRIPTION: Foreign investors may not participate
in the capital of these entities. This limitation does not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Agents (Comisionistas Financieros)
INDUSTRY CLASSIFICATION: 811045
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley de Instituciones de Cr‚dito (Law of Credit Institutions),
Art. 92 Reglas de SHCP (Regulations of the Ministry of Finance
and Public Credit)
DESCRIPTION: Foreign investors may not participate
in the capital of these entities. This limitation does not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Bonding Companies (Instituciones de Fianzas)
INDUSTRY CLASSIFICATION: 813001
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley Federal de Instituciones de Fianzas (Federal Law of
Bonding Companies), Art. 15-XIII
DESCRIPTION: Foreign participation must be less
than 50% of paid-in capital (capital pagado). These limits do not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Insurance Companies (Instituciones de Seguros)
INDUSTRY CLASSIFICATION: 813002
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Aggregate limits on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Instituciones y Sociedades Mutualistas de
Seguros (General Law on Insurance Institutions and Mutual
Societies), Art. 29-I
DESCRIPTION: Foreign participation must be less
than 50% of paid-in capital (capital pagado). These limits do not apply to
Foreign Financial Affiliates established pursuant to Part B of the
Schedule of Mexico.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Holding Companies
INDUSTRY CLASSIFICATION: Not applicable
TYPE OF RESERVATION: Limitation on foreign ownership
MEASURE: Articles 1404, 1407 (Establishment, National Treatment)
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley para Regular las Agrupaciones Financieras (Law Regulating
Financial Groups), Art. 18
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a financial holding company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Commercial Banks (Instituciones de Cr‚dito)
INDUSTRY CLASSIFICATION: 811030
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley de Instituciones de Cr‚dito (Law of Credit Institutions),
Art. 15
DESCRIPTION: Foreign entities that exercise
governmental functions may not invest, directly or indirectly, in a
commercial bank.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Securities Firms (Casas de Bolsa)
INDUSTRY CLASSIFICATION: 812001
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley del Mercado de Valores (Law of the Stock Market),
Art. 17-II-b
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a securities firm.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Securities Specialists (Especialistas Burs tiles)
INDUSTRY CLASSIFICATION: Not applicable
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley del Mercado de Valores (Law of the Stock Market),
Art. 17-II
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a securities specialist.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: General Deposit Warehouses (Almacenes Generales de Dep¢sito)
INDUSTRY CLASSIFICATION: 811042
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 8-III-1
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a general deposit warehouse.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Leasing Companies (Arrendadoras Financieras)
INDUSTRY CLASSIFICATION: 811043
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y
Actividades Auxiliares del Cr‚dito (General Law of Auxiliary
Credit organizations and Activities), Art. 8-III-1
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a financial leasing company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Financial Factoring Companies (Empresas de Factoraje Financiero)
INDUSTRY CLASSIFICATION: Not applicable
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y
Actividades Auxiliares del Cr‚dito (General Law of Auxiliary Credit
Organizations and Activities), Art. 8-III-1
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a financial factoring company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Savings and Loan Companies (Sociedades de Ahorro y Pr‚stamo)
INDUSTRY CLASSIFICATION: 811046
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Organizaciones y Actividades Auxiliares del
Cr‚dito (General Law of Auxiliary Credit Organizations and
Activities), Art. 38-G
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may
not invest, directly or indirectly, in
a savings and loan company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Managing Companies of Investment Companies (Sociedades Operadoras
de Sociedades de Inversi¢n)
INDUSTRY CLASSIFICATION: 812003
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley de Sociedades de Inversi¢n (Law of Investment Companies),
Art. 29-VI
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
an operator of an investment company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Investment Companies (Sociedades de Inversi¢n)
INDUSTRY CLASSIFICATION: 812002
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley de Sociedades de Inversi¢n (Law of Investment Companies),
Art. 9-III
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
an investment company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Bonding Companies (Instituciones de Fianzas)
INDUSTRY CLASSIFICATION: 813001
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley Federal de Instituciones de Fianzas (Federal Law of
Bonding Companies), Art. 15 bis-IV-a
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
a bonding company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Insurance Companies (Instituciones de Seguros)
INDUSTRY CLASSIFICATION: 813002
TYPE OF RESERVATION: Articles 1404, 1407 (Establishment, National Treatment)
MEASURE: Limitation on foreign ownership
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Instituciones y Sociedades de Mutualistas de
Seguros (General Law on Insurance Institutions and Mutual
Societies), Art. 29-I
DESCRIPTION: Foreign governments and foreign state
enterprises or their investments may not invest, directly or indirectly, in
an insurance company.
DURATION: Indeterminate
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Insurance
INDUSTRY CLASSIFICATION: 813002
TYPE OF RESERVATION: Article 1405 (Cross-Border Trade)
MEASURE: Restrictions on cross-border insurance
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley General de Instituciones y Sociedades Mutualistas de
Seguros (General Law on Insurance Institutions and Mutual
Societies), Art. 3§
DESCRIPTION: Mexico reserves its existing
prohibitions and restrictions on
cross-border trade in insurance
services, which do not now include
restrictions on the right of
individuals to purchase, by physical
mobility, life and health insurance.
Mexico is not reserving its present
restrictions with respect to the
ability of residents of Mexico to
purchase from non-resident insurance
companies of another Party, the
following types of insurance:
(a) tourist insurance (including
travel accident and motor
vehicle insurance for non-
resident tourists, but not
insurance of risks of
liability to third parties)
for individuals, purchased
without solicitation via
physical mobility of such
individuals;
(b) cargo insurance to and from
each Party purchased without
solicitation for goods in
international transit from
point of origin to final
destination and for the
vehicle during the period of
its use in transportation of
such goods, provided such
vehicle is licensed and
registered outside Mexico
(including vehicles in
maritime shipping,
commercial aviation, space
launching and freight
(including satellites)); and
(c) intermediary services
incidental to (a) and (b)
without solicitation.
DURATION: For greater clarity, this reservation does not apply to reinsurance.
=============================================================================
ANNEX VII
PART A
Schedule of Mexico
SECTOR: Financial Services
SUB-SECTOR: Banking
INDUSTRY CLASSIFICATION: 811021 811030
TYPE OF RESERVATION: Articles 1404, 1405, 1407 (Establishment, Cross-Border
Trade, National Treatment)
MEASURE: Activities reserved for development banks
LEVEL OF GOVERNMENT: Federal
LEGAL CITATION: Ley Org nica de Nacional Financiera (Organic Law of Nacional
Financiera), Art. 7; Ley Org nica del Banco Nacional del
Ej‚rcito, la Fuerza A‚rea y la Armada (Organic Law of the
National Bank of the Army, Air Force and Navy)
DESCRIPTION: The following activities are reserved
solely to Mexican development banks:
(1) acting as custodians of
securities and cash funds
deposited by or in the
administrative or judiciary
authorities, and acting as
custodian of goods that have been
confiscated according to Mexican
measures;
(2) managing the savings funds,
retirement plans and any other
funds or property of the
personnel of the Secretar¡a de la
Defensa Nacional, Secretar¡a de
Marina and the Mexican armed
forces, and performing other
financial activities pertaining
to the financial resources of
such personnel.
DURATION: Indeterminate
ANNEX VII
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PART B
Schedule of Mexico
TRANSITIONAL EXCEPTIONS
Reservations to Articles 1404 and 1407
1. The provisions of paragraphs 2 through 10 of this Part B of
the Schedule of Mexico shall apply during the Transition Period,
except as otherwise specifically provided in paragraphs 9 and 10
of this Part B.
2. For the types of financial institutions listed in the chart
in this paragraph 2, the maximum capital to be authorized for a
Foreign Financial Affiliate, measured as a percentage of the
aggregate capital of all financial institutions of the same type
in Mexico, shall not exceed the percentage set forth in the chart
in this paragraph 2:
Type of Financial Institution Maximum Individual Capital to
be Authorized (Percentage of
the Aggregate Capital of all
Institutions of the same type)
Commercial Banks 1.5%
Securities Firms 4.0%
Insurance Companies
Casualty 1.5%
Life and Health 1.5%
In the case of an acquisition by a financial service provider of
another Party of a financial institution established in Mexico,
the sum of the authorized capital of the acquired institution and
the authorized capital of any Foreign Financial Affiliate already
controlled by the acquiror may not, at the time of acquisition or
at any time thereafter during the Transition Period, exceed the
applicable limit set forth in the chart in this paragraph 2.
This paragraph 2 will not apply to new or existing Mexican
insurance companies invested in by insurance providers of another
Party (or their affiliates) pursuant to paragraph 7 of this Part
3 or paragraph 4 of Part C of the Schedule of Mexico.
3. For purposes of the proper administration of the capital
limits in the Schedule of Mexico, the following provisions shall
apply:
i. Each Foreign Financial Affiliate shall have a paid-in
capital not less than that authorized by Mexico at the time of
approval of its establishment. The authorized capital shall be
determined by Mexico. After the time of establishment, Mexico
may permit authorized capital to exceed paid-in capital.
Authorized capital shall not be reduced by any measure of Mexico
(other than prudential measures) below paid-in capital. The
maximum size of the operations of each Foreign Financial
Affiliate shall be determined, on a national treatment basis, as
a function of the lesser of its capital or its authorized
capital.
ii. Mexico reserves the right to impose limitations on
transfers of assets or liabilities by Foreign Financial
Affiliates that have the effect of evading the capital limits set
forth in the Schedule of Mexico. This subparagraph does not
apply to bona fide transfers of funds to make overnight deposits
or bona fide transfers of banking liabilities.
4. A Foreign Financial Affiliate shall not issue subordinated
debentures, except to its parent outside of Mexico.
5. The aggregate of the authorized capital of all Foreign
Financial Affiliates of the same type, measured as a percentage
of the aggregate capital of all financial institutions of such
type in Mexico, shall not exceed the percentage set forth in the
chart in this paragraph 5 for that type of institution, except
for the case of insurance which is addressed in paragraph 6 of
this Part B. Beginning one year after the entry into force of
the Agreement, these initial limits shall increase annually in
equal increments so as to reach the final limits specified in the
chart in this paragraph 5 at the beginning of the last year of
the Transition Period.
Type of Financial Institution Percentage of Total Capital
Initial Final
Limit Limit
Commercial banks 8% 15%
Securities firms 10% 20%
Factoring companies 10% 20%
Leasing companies 10% 20%
Any capital in existence as of the date of signature of this
Agreement of a foreign bank branch established in Mexico prior to
such date shall be excluded from each of the aggregate capital
limits referred to in the Schedule of Mexico.
6. In the case of insurance, the aggregate of the authorized
capital of all Foreign Insurance Affiliates, measured as a
percentage of the aggregate capital of all insurance companies in
Mexico, shall not exceed the percentage set forth in the chart in
this paragraph 6 for the respective one-year periods beginning on
each of the following dates:
Date Percentage of Total Capital
January 1, 1994 6%
January 1, 1995 8%
January 1, 1996 9%
January 1, 1997 10%
January 1, 1998 11%
January 1, 1999 12%
If the entry into force of the Agreement occurs on a date prior
to January 1, 1994, that date shall become the initial date for
purposes of this chart, and each succeeding anniversary of the
entry into force of the Agreement shall become the next
succeeding date in this chart, with the percentages listed in
this chart applying to each of the respective periods as so
adjusted. If the entry into force of the Agreement occurs on a
date after January 1, 1994, the dates and corresponding limits in
this chart shall nonetheless not be changed.
The individual and aggregate capital limits described in
paragraphs 2 and 6 of this Part B shall be measured separately
(through separate accounting) for life and non-life insurance
operations; but both types of insurance operations may be
conducted either by a single or separate Foreign Financial
Affiliates.
7. Insurance providers of another Party may elect an
alternative procedure for entering Mexico through phasing-in an
equity interest in a new or existing Mexican insurance company,
and thereby exempt such Mexican company from the capital limits
of paragraphs 2 and 6 of this Part B. In order to qualify, the
percentage of the Mexican insurance company's voting common stock
that is owned by Mexican persons must not be less than the levels
set forth in the chart in this paragraph 7 for the respective
one-year periods beginning on each of the following dates:
Date Mexican Interest
January 1, 1994 70%
January 1, 1995 65%
January 1, 1996 60%
January 1, 1997 55%
January 1, 1998 49%
January 1, 1999 25%
If the entry into force of the Agreement occurs on a date prior
to January 1, 1994, that date shall become the initial date for
purposes of this chart, and each succeeding anniversary of the
entry into force of the Agreement shall become the next
succeeding date in this chart, with the percentages listed in
this chart applying to each of the respective periods as so
adjusted. If the entry into force of the Agreement occurs on a
date after January 1, 1994, the dates and corresponding limits in
this chart shall nonetheless not be changed.
On and after January 1, 2000 (or, if the entry into force of the
Agreement occurs on a date prior to January 1, 1994, on and after
the sixth anniversary of such date), the percentage requirement
of Mexican ownership set forth in this paragraph 7 shall no
longer apply.
This paragraph 7 is further modified by paragraph 4 of Part C of
the Schedule of Mexico to the extent set forth therein.
8. The aggregate assets of Foreign Financial Affiliates that
are limited scope financial institutions within the meaning of
paragraph 2 of Part C of the Schedule of Mexico shall not exceed
3% of the sum of (1) the aggregate assets of all commercial banks
in Mexico plus (2) the aggregate assets of all types of limited
scope financial institutions in Mexico. Lending by affiliates of
automobile manufacturing companies with respect to their vehicles
shall not be subject to or taken into account in determining
compliance with this 3% limit.
9. The capital limits in paragraphs 2, 5, 6 and 8 of this Part
B shall be removed at the end of the Transition Period. If the
sum of the authorized capital of Foreign Financial Affiliates,
measured as a percentage of the aggregate capital of all
financial institutions of such type in Mexico, reaches the
percentage set forth in the chart in this paragraph 9 for such
type of institutions, then Mexico shall have the right, once
during the four years following the end of the Transition Period,
to freeze such aggregate capital percentage at its then-existing
level:
Commercial banks 25%
Securities firms 30%
If applied, such a restriction will have a duration not to exceed
a period of 3 years.
10. No additional license to establish a Foreign Financial
Affiliate shall be granted during the Transition Period (and, in
the case of paragraph 9 of this Part B, during the additional
periods described in that paragraph) if after such issuance the
sum of the authorized capital of all Foreign Financial Affiliates
of the same type would exceed the applicable percentage limit for
that type of institution in paragraph 5, 6, 8 or 9 of this
Part B.
OTHER EXCEPTIONS
11. The provisions of the following paragraphs 12 through 15 of
this Part B shall apply immediately upon the entry into force of
the Agreement and at all times thereafter, except as otherwise
specifically provided in such paragraphs. Any amendment or
modification to a measure adopted or maintained pursuant to
paragraphs 12 through 15 of this Part B shall not decrease the
conformity of the measure, as it existed immediately before such
amendment or modification, with Articles 1404 to 1409 of the
Agreement.
Reservation to Article 1407
12. Mexico may require that a Foreign Financial Affiliate (other
than a Foreign Insurance Affiliate) be wholly-owned by a
financial service provider of another Party (except for
directors' nominal qualifying shares). Mexico may also restrict
any Foreign Financial Affiliate from establishing agencies,
branches, or other direct or indirect subsidiaries in the
territory of any other country.
Reservations to Articles 1404 and 1407
13. Following the Transition Period, acquisition of a commercial
bank established in Mexico, or of the assets or liabilities
thereof, by a financial service provider of another Party will
only be authorized by Mexico, subject to reasonable prudential
considerations on a case by case basis, if the sum of the
authorized capital of the acquired commercial bank and the
authorized capital of any commercial bank in Mexico already
controlled by the acquiror would not exceed 4% of the aggregate
capital of all commercial banks in Mexico.
14. Mexico may adopt measures that (i) limit eligibility to
establish a Foreign Financial Affiliate in Mexico to a financial
service provider of another Party that is, directly or through
any of its affiliates, engaged in the same general type of
financial services in the territory of the other Party; and (ii)
limit such provider (together with its affiliates) to no more
than one institution of the same type in Mexico. In determining
what types of operations a financial service provider of another
Party is engaged in for purposes of the preceding sentence, all
types of insurance shall be considered to be only one type of
financial service; but both life and non-life insurance
operations may be conducted either by a single or separate
Foreign Financial Affiliates.
Reservation to Articles 1404, 1405 and 1407
15. The existing activities and operations of Mexican
governmental insurance programs conducted by Aseguradora
Mexicana, S.A. or Aseguradora Hidalgo, S.A. (including insurance
for government employees, agencies, instrumentalities and public
entities) are excluded from Articles 1404, 1405 and 1407 for so
long as such firm is controlled by the government of Mexico and
for a commercially reasonable time after such governmental
control ceases.
Reservation to Article 1405
16. In order not to impair the conduct of Mexico's monetary and
exchange rate policies, non-resident financial service providers
of another Party shall not be permitted to provide financial
services into the territory of Mexico or to residents of Mexico,
and residents of Mexico may not purchase financial services from
non-resident financial service providers of another Party, if
such transactions are denominated in Mexican pesos.
Reservation to Articles 1404-1409
17. The benefits of this Agreement shall not be extended to a
foreign bank branch existing in Mexico on the date of entry into
force of this Agreement. The existing legal regime will continue
to apply to such a branch for so long as it operates in that
form. Such a branch shall be permitted to convert to a
subsidiary pursuant to the terms of this Schedule, and upon
conversion shall be covered by this Agreement. The existing
capital of such branch on the date of signature of this Agreement
shall not be counted against such Foreign Commercial Bank
Affiliate's individual capital limit, or the aggregate capital
limits for commercial banks in the event of conversion.
Definitions
For purposes of Part B of Mexico's schedule:
capital means the following, as defined in Mexican measures,
applied on a national treatment basis:
Type of Financial Institution Concept of "Capital"
commercial banks capital neto
securities firms capital global
insurance companies
casualty requerimiento bruto
de solvencia (allocation to
casualty insurance)
life and health requerimiento bruto
de solvencia (allocation to
life and health insurance)
factoring companies capital contable
leasing companies capital contable
Foreign Commercial Bank Affiliate means a Foreign Financial
Affiliate that is a commercial bank;
Foreign Financial Affiliate means a financial institution
established in Mexico and owned and controlled by a financial
service provider of another Party;
Foreign Insurance Affiliate means a Foreign Financial Affiliate
that is an insurance company; and
Transition Period means the period beginning with the entry into
force of the Agreement and ending on the earlier of i) January 1,
2000, or ii) six years from the entry into force of the
Agreement.
=============================================================================
ANNEX VII
PART C
Schedule of Mexico
SPECIFIC COMMITMENTS
1. Mexico shall retain discretion to approve, on a case-by-case
basis, any affiliation of a commercial bank or securities firm
with a commercial or industrial corporation that has a commercial
presence in Mexico, if Mexico determines that such affiliation is
harmless and, in the case of banking, either (a) not substantial,
or (b) the financial-related activities of the commercial or
industrial commercial corporation are at least 90 percent of its
annual income worldwide, and the non-financial activities of such
commercial or industrial corporation are of a type that Mexico
determines to be acceptable. Affiliation with a non-resident
commercial or industrial corporation that has no commercial
presence in Mexico will not be a reason for denial of an
application to establish or acquire a commercial bank or
securities firm in Mexico.
2. Non-bank financial service providers of another Party shall
be permitted to establish one or more limited scope financial
institutions in Mexico to provide separately consumer lending,
commercial lending, mortgage lending or credit card services on
terms no less favorable than those applied to like domestic firms
under Mexican measures. Mexico may permit lending services
closely related to the principal authorized business of a limited
scope financial institution to be carried out by that
institution. Such firms shall be provided the opportunity to
raise funds in the securities market for business operations
subject to normal terms and conditions. Mexico may restrict such
limited scope financial institutions from taking deposits.
3. Within two years of the entry into force of the Agreement,
Mexico shall conduct a study of the desirability and, if
desirable, the possible methods of establishing limited scope
securities firms which would have more limited powers than
current securities firms. Such limited scope securities firms
would be subject to differing capital requirements, depending on
the type and extent of business conducted, that would permit
lower minimum capital requirements than those currently
applicable to Mexican securities firms. The basis of the study
would be prudential considerations and opportunities for
investment in the securities sector. As part of the second
annual meeting of the Committee required under Article 1414,
Mexico shall report to the other Parties on the outcome of the
study, including any plans for the establishment of new
categories of securities firms.
4. Notwithstanding Part B (paragraph 7) of the Schedule of
Mexico, an insurance provider of another Party, together with its
affiliates, that as of July 1, 1992 collectively have an active
investment or ownership interest that has been specifically
approved by the Mexico of 10% or more in a Mexican insurance
company may: (1) exercise any contract right or option in
existence as of July 1, 1992 with respect to ownership interests
in such Mexican insurance company; and (2) effective the earlier
of January 1, 1996 or two years following the date of entry into
force of the Agreement, acquire a controlling interest of up to
100% in such Mexican insurance company. Before the effective
date described in clause (2) of the preceding sentence, an
insurance provider of another Party (together with its
affiliates) described in that sentence may exercise any existing
contract right or option described in clause (1) of that
sentence, and choose to maintain its existing interest or expand
its interest in such Mexican insurance company to the extent
consistent with Part B (paragraph 7) of the Schedule of Mexico.
Mexico shall maintain discretion to permit acceleration of the
schedule for equity participation in a Mexican insurance company
by an insurance provider of another Party described in the first
sentence of this paragraph.
5. A bank or securities provider of another Party that is
authorized to and establishes or acquires a commercial bank or
securities firm, respectively, in Mexico may also establish a
financial holding company in Mexico, and thereby establish or
acquire other types of financial institutions in Mexico, under
the terms of Mexican measures.
6. Mexico shall administer its licensing and approval
procedures during the Transition Period (as defined in Part B of
the Schedule of Mexico) in a manner that does not deny the
benefits of the liberalization of existing measures described in
the Schedule of Mexico to enterprises of another Party ultimately
controlled by nationals of that Party.
=============================================================================
ANNEX VII
PART D
Schedule of Mexico
The agency of the government of Mexico responsible for
financial services is the Secretar¡a de Hacienda y Cr‚dito
P£blico.
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