Mexico’s business community has its sights firmly set on who will succeed Andrés Manuel López Obrador as president in 2024. Over the past five years of AMLO’s administration, foreign and private investment has dried up, leaving key areas of the economy underfunded.
Despite his time in office soon coming to an end, AMLO is not resting on his laurels. Indeed, he is making sweeping changes and reforms. In spring 2023, Mexico’s senate approved a reform of the country’s electoral institute (INE), with opponents remarking that the changes would undercut democracy, while the president remained convinced that the plans would save money and reduce political privileges. The Supreme Court halted parts of the reform shortly after the senate gave the green light.
The mining industry was also hit with reform in April 2023. The bill includes a requirement for companies to pay 5% of profits to local communities and reduces the maximum length of concessions from 50 to 30 years.
AMLO is known for his aversion to foreign investment. Therefore, foreign players – especially in the local energy market – have been a rarity in recent years, 2023 saw a landmark deal in the sector. State-owned fund Mexico Infrastructure Partners (MIP) bought 13 power plants from Spanish energy group Iberdrola, a US$6 billion deal. Crucially, the transaction handed state-owned energy company Comisión Federal de Electricidad (CFE) majority control of the energy sector.
Mexico’s economy has been benefitting from the nearshoring trend in recent years, as more and more companies relocate their manufacturing operations closer to home. Big-name companies like Tesla, BMW and Ford have moved their operations from Asia to Mexico in recent years as the need for shorter supply chains increases, a priority exacerbated by the covid-19 pandemic and political tensions between the US and China. The United States–Mexico–Canada Agreement (USMCA) accord has helped trade bounce back and has addressed more trade-related disputes than its predecessor, the North American Free Trade Agreement (NAFTA). This has kept law firms in Mexico busy, often advising across a host of practice areas.
Mexico’s mighty neighbour has undoubtedly shaped the country’s legal market. A hefty list of US clients and financial institutions regularly call on local firms, whilst Mexican lawyers have benefitted from close relations with US law firms, with many working as foreign associates and studying in top US schools.
Various US firms have entered the Mexican legal market too, to capitalise on work south of the border. US outfits have arrived in a variety of ways – absorbing well-established local names, poaching teams and making lateral hires. The merger between Holland & Knight LLP and Thompson & Knight LLP created a sizeable team with a presence in two Mexican cities. The combined firm has gone from strength to strength and scored a coup in 2023 by taking 17 lawyers from Sánchez Devanny.
Leading Spanish names now consider Mexico a key element of their regional strategies, which have largely centred around the Pacific Alliance countries so far. Garrigues and Cuatrecasas both have offices in Mexico City, and continue to invest in these ventures. Garrigues scored a big win when it hired a well-known partner from White & Case’s local outfit, while Cuatrecasas absorbed local firm Rico, Robles, Libenson, SC.
Workflow has remained at a steady level in recent times. Investors and banks looking for opportunities in Mexico can count on a large pool of talented lawyers to assist on complex M&A, private equity and financings.
Mexico’s legal market is home to a variety of different business models, including several full-service behemoths and a handful of leading transactional firms. Among the market-leading full-service firms, many now boast broad service offerings far beyond their transactional core.
Whilst Mexico City remains the heart of the local legal community, some outfits have outposts in industrial hubs such as Querétaro, alongside the more traditional bases of Mexico City and Monterrey. A smaller number of firms also have a presence in Guadalajara, Juárez, Tijuana and Guanajuato. Baker McKenzie (Mexico) has the widest national presence with five offices.
Beyond Mexico, Madrid has become an important hub for a string of Mexican firms looking to capitalise on upcoming investment opportunities from Europe. Creel, García-Cuéllar, Aiza y Enríquez SC inaugurated an office in Madrid in 2022, and is joined in the Spanish capital by Chevez, Ruiz, Zamarripa y Cía SC. Other firms – such as Nader, Hayaux & Goebel – have also looked beyond Mexico for opportunities and is unique in having a name partner based in London, a means to reach the City’s law firms and financial institutions. In addition, Goodrich, Riquelme y Asociados has an office in Paris.
show less
