I. INTRODUCTION
In Mexico, commercial activities are regulated by federal laws. Thus, all
regulations are applicable throughout Mexico. Commercial activities may
be performed by legal entities or by individuals, although for the purpose of
limitation of liability, only small commercial practices are carried out by
individuals. The organization and basic operations of commercial companies
are regulated by the General Law of Commercial Companies (the GLCC)
and the New Securities Law (the NSL). Other supplementary statutes are the
Commerce Code (CCom) that regulates commercial activities in general and
the Federal Civil Code (FCC), which regulates matters not included in the
GLCC or the CCom, such as authority.
Any individual, legal entity, joint venture, or any other legal structure
that carries out commercial acts in the broadest sense is a merchant. Such
acts include manufacturing, production of goods, and any other activity
deemed to be made for profit under the CCom or any other applicable
legislation. (The CCom lists what it deems commercial activities, but is not
a comprehensive list—there are many others listed in different specific
mercantile laws). Any act carried out by a merchant or by a legal business
entity in operating its business or for profit is a commercial act and thus, is
regulated by mercantile laws, even if such act may be deemed civil in
nature.
Under Mexican law, a commercial legal entity is a legal person created
through the voluntary collective actions of two or more persons (legal
persons or individuals) with a common business goal of obtaining a profit.
Its members or shareholders have the obligation to contribute capital in cash
or in kind and will have the right to profits in proportion to their
contribution to the capital. Essential elements of the existence of a
commercial legal entity are a common patrimony and the right to profits.
The performance of commercial acts may carry a risk to personal
patrimony; the performance of commercial acts through a legal entity limits
liability and protects personal assets of the shareholder or member of a legal
entity. Most commercial entities that do not afford protection of personal
assets are barely used. Such entities temporarily protect and limit the
liability of the shareholders to their contributions.
