Sole Registry for Real Property Guaranties

February 4, 2011
Sole Registry for Real Property Guaranties

On August 27, 2009 amendments to Mexico’s Commercial Code (Código de Comercio) were published in the Official Journal of the Federation (Diario Oficial de laFederación or DOF) through which an additional section named “SoleRegistry for Real Property Guaranties (RUG)” was added to such law. In addition, onSeptember 23, 2010, additional amendments to the Commercial Code were published regarding the rules of operation of the RUG, including a section of the PublicRegistry of Commerce (Registro Público de Comercio or RPC), which is exclusively under the control of Mexico’s Department of the Economy (Secretaría deEconomía or SE). The RUG will feature registration of documents through digital means and a national database for commercial legal documents through whichparties may create, modify, transfer or cancel real property guaranties, including pledges, liens, special privileges or rights of retention regarding real property.. It ishoped that through the RUG a unified registry will offer increased certainty regarding the granting of real property guaranties, while reducing the risk present infinancing transactions in Mexico. Naturally, one of the fundamental elements for the RUG to be successful is the means that will enable parties to easily identify, at alow cost, which debtors have granted guaranties over their real property to third parties.

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