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FIDEICOMISO: REAL ESTATE TRUST ON THE MEXICAN RESTRICTED AREA. Fideicomiso? (Form Latin: Fedei Commisum. Fedei= Fait=Trust). Fideicomiso is one of the alternatives on which a foreigner in México can acquire and hold rights to a property on the restricted Area, according to the article 277 of the Constitution and what is provided by the Mexican Foreign Investment Law. The strip of land of 100 kms from the border with another country or 50 kms from the seashore is what we call restricted area. Foreigners Individuals only can acquire properties that are in the restricted Area through a bank trust with an authorized Financial Institution for a period of 50 years same that can be renewed. A bank Trust will allow a foreigner to establish a will in favor of his/her loved ones in regard to the property at no extra cost.

A Fideicomiso (or Trust) Requires: The authorization from the Secretary of Foreign Affairs that is provided by article 11 of the Mexican Foreign Investment Law. A trustee bank. A deed attested and certified by a Mexican Notary, who is obligated to assure the authenticity and lawfulness of the transaction. The parties in a Trust are: Trustor / Grantor: Individual or legal entity which transfers one or more Real-Estate Properties through the trust ownership. Beneficiary: Individual or legal entity with the appropriate capacity to receive the benefit granted by the trust deed, being able to appoint several beneficiaries to receive the benefits simultaneously or successively. Trustee / Institution: Financial Institution, with appropriate capacity to act in México, who receives the property of the trust fund for the benefit of the Beneficiary and who must carry out specific duties with regard to the property. SUBJECT-MATTER OF THE TRUST: The subject-Matter of the trust is constituted by Real-Estate property transferred by the trustor to the trustee (institution), as well as the constructions, buildings and improvements, if appropriate, made by and on account of the beneficiary.

According to article 14 of the Foreign Investment Law, the Ministry of Foreign Affairs shall determine on the permits for setting up a Bank Trust on a piece of land over 2000 square meters according to the economic and social benefit of that trust to the Nation. In other words, they require a commitment letter from the beneficiary of the trust to invest certain amount of money on the property in order to grant the permit for the Fideicomiso. (Again, this is for pieces of Land over 2000 sq meters.)