Regulation and M&A in Mexico | Capital En Orden

In an M&A transaction in Mexico two regulatory pillars can affect closing: COFECE (antitrust and concentrations) and the Foreign Investment Law (LIE) with the National Commission on Foreign Investment (CNIE). This guide summarizes when antitrust notification applies, when foreign investment requires authorization or falls in restricted sectors, and when to get advice so the deal is not delayed.

When do you need to notify COFECE and what are the timelines?

COFECE reviews concentrations (mergers and acquisitions) that exceed the asset or sales thresholds set by the Federal Economic Competition Law. Those amounts are published and updated. If the transaction exceeds them, the parties must notify before closing; the Commission has a period to decide and may authorize, condition, or prohibit. Failing to notify when required can lead to fines and orders to divest. In practice: check with the parties’ financials whether combined national assets or sales exceed the threshold; if so, include notification and the waiting period in the closing timeline. A competition lawyer can confirm the calculation and the relevant market.

How do the LIE and CNIE apply to foreign investment?

The Foreign Investment Law (LIE) defines which activities are reserved to the State or to Mexicans, which have a cap on foreign participation, and which require a favorable ruling from the CNIE. If the buyer is foreign and the target operates in a restricted sector or under a cap, the transaction may be subject to prior authorization or not permitted in the planned structure. Due diligence identifies whether the target falls into any of these cases; the LOI and contract often make CNIE approval a closing condition when it applies, and time is left in the timeline for the filing. Not factoring it in can delay closing or force a change in deal structure.

When should you get advice?

Antitrust (COFECE). As soon as it is clear the transaction could exceed the asset or sales thresholds — usually after a first pass at the parties’ figures — confirm with a competition lawyer whether notification is required and what timelines COFECE uses. That way notification is built into the schedule and you avoid closing without having notified.

Foreign investment (LIE / CNIE). If the buyer is a foreign individual or entity, from the due diligence phase (or earlier if the target’s sector is obviously sensitive) verify whether the business’s activities are on the restricted or capped list and whether a CNIE ruling is needed. The legal or tax advisor on the transaction can do that check; if there is doubt, a foreign-investment specialist can confirm and help with the filing.

Structure. The choice of asset vs share purchase and the buyer’s country of incorporation can interact with COFECE and the LIE. Addressing these in the LOI phase reduces the risk of having to restructure mid-process.

In this guide:

Due diligence in Mexico: a guide for sellers and buyers — what it covers and how to prepare.

Frictions in Mexico–US cross-border transactions — regulation and tax in Mexico–US deals.

How to buy a company in Mexico — sourcing, valuation, and closing.

How to sell your company in Mexico — sale process and closing.

How to prepare a data room in Mexico — documents the buyer reviews.

Sources

M&A regulation determines whether the deal can close and on what timeline; reviewing COFECE and LIE/CNIE from the LOI avoids surprises and delays. For definitions and the cross-border framework, see the glossary (COFECE, LIE, CNIE) and the frictions in Mexico–US cross-border transactions guide.