Mexican Legal Framework of Business Insolvency - White & Case
Mexican Legal Framework of Business Insolvency - White & Case Mexican Legal Framework of Business Insolvency - White & Case
15. Reorganization Once the visitor has submitted his report (cfr. 14), the judge must render judgment of the declaration of concurso which, if declaring the debtor en concurso, shall contain, among other things [LCM 43]: 38 ■■ The declaration of concurso. ■■ An order to Ifecom to appoint the conciliator. ■■ The opening of the conciliatory stage (or the liquidation stage ( cfr. 16) if the debtor specifically requested his concurso to be opened in the liquidation stage). ■■ An order to the debtor to deliver books and records to the conciliator. ■■ An order to the debtor to suspend the payment of its indebtedness ( cfr. 15.g). ■■ An order to suspend all enforcement proceedings ( cfr. 15.h). ■■ A notice to all creditors, so that they may appear in the proceeding ( cfr. 15.a). ■■ An order to the conciliator to record the judgment with the Public Registry of Commerce of the domicile of the debtor and of each place where the debtor has branches, agencies or assets subject to recordation. ■■ The retroactivity date ( cfr. 15.j). ■■ The order to the conciliator to begin the claim recognition process ( cfr. 16.a). a. Notices Under the Insolvency Law, notices must be given to both foreign and domestic creditors equally [LCM 44]. Further, the court shall order that appropriate steps be taken to notify any creditor whose address is not yet known [LCM 291]. Notice to non- Mexican creditors must be given individually, unless the court considers that, under the circumstances, some other form of notification would be more appropriate [LCM 291]. When a notification of commencement of a case is to be given to foreign creditors, such notice shall, among other things, provide a 45-day period for filing proofs of claim (as opposed to a 20-business-day period for Mexican creditors), specify the place for
filing such proofs of claim and indicate whether secured creditors are required to file proofs of claim [LCM 291]. b. Appeal The judgment that declares the debtor en concurso (or denies such declaration) can be appealed by the debtor, the visitor, the demanding creditors or the Office of the Attorney General [LCM 49]. c. Conciliatory Stage The stated purpose of the conciliatory stage is to conserve or save the business enterprise through a restructuring plan [LCM 3]. The conciliatory stage is designed to be completed in 185 days, although one 90-day extension may be granted if the conciliator or creditors representing two-thirds of the recognized claims so request. An additional 90-day extension may be granted if the debtor, together with creditors representing 90 percent of the recognized claims, so requests. The Insolvency Law clearly provides that in no event may the conciliatory stage be extended beyond 365 days, whereupon, if no restructuring plan is agreed to, the liquidation stage will immediately begin [LCM 145 and 167-II]. d. The Estate From a doctrinal point of view, the estate is the portion of the assets of the debtor devoted to satisfy creditors’ claims, over which the debtor has limited governance (during conciliation) or no governance (during liquidation). The Insolvency Law defines estate as the sum of all the assets of the debtor, other than excluded assets, on which creditors can make their claims effective [LCM 4-V]. The estate includes all assets of the debtor (whether tangible or intangible, present or after-acquired, encumbered or unencumbered), but excludes nontransferable assets, those that cannot be attached and those that are not subject to adverse possession [LCM 179]. White & Case 39
- Page 1 and 2: Mexican Legal Framework of Business
- Page 3 and 4: Mexican Legal Framework of Business
- Page 5: Maria Teresa Fernández Labardini*
- Page 8 and 9: PART IIISpecial Insolvencies ......
- Page 10 and 11: 2 Consignment Consignación Coopera
- Page 12 and 13: 4 Priority claim Crédito con privi
- Page 15 and 16: Introduction All of a debtor’s as
- Page 17 and 18: PART I Out-of-Court Restructuring O
- Page 19 and 20: One of the risks that suppliers of
- Page 21 and 22: Under either of the two approaches,
- Page 23 and 24: . Prevention of Systemic Risk Anoth
- Page 25 and 26: verification and admission of claim
- Page 27 and 28: The issue is still divided between
- Page 29 and 30: the debtor to arrive at a consensua
- Page 31 and 32: v. Remuneration Specialists are ent
- Page 33 and 34: after his death, if the creditors
- Page 35 and 36: The above court precedent has two f
- Page 37 and 38: 2. Voluntary Acceptance Small merch
- Page 39 and 40: ii. Passive Estate Since a branch i
- Page 41 and 42: For a debtor to be considered a hol
- Page 43 and 44: ■■ Shutting down the enterprise
- Page 45: ■■ The facts that motivate the
- Page 49 and 50: 29 P. 161. i. Conservative Measures
- Page 51 and 52: i. Disposition of Assets During con
- Page 53 and 54: ■■ ■■ Granting of collatera
- Page 55 and 56: All assets acquired by the concubin
- Page 57 and 58: ■■ ■■ ■■ ■■ ■■
- Page 59 and 60: ■■ ■■ Claims for an uncerta
- Page 61 and 62: chattel 35 ) unless its price is pa
- Page 63 and 64: c. Extensions of Credit An extensio
- Page 65 and 66: the negotiable instruments and the
- Page 67 and 68: epayment or abandonment shall apply
- Page 69 and 70: ■ ■ Swaps: transactions in whic
- Page 71 and 72: If the subject matter of the constr
- Page 73 and 74: Netting of obligations in light of
- Page 75 and 76: they function generally determine f
- Page 77 and 78: . The Reorganization Plan The purpo
- Page 79 and 80: extend to guarantors or co-obligors
- Page 81 and 82: the reorganization plan); (3) all s
- Page 83 and 84: If a debtor does not successfully c
- Page 85 and 86: ii. Timing Removal takes effect leg
- Page 87 and 88: Claims by creditors operate at two
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- Page 91 and 92: predictability in commercial relati
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15. Reorganization<br />
Once the visitor has submitted his report (cfr. 14), the judge must render judgment <strong>of</strong> the<br />
declaration <strong>of</strong> concurso which, if declaring the debtor en concurso, shall contain, among<br />
other things [LCM 43]:<br />
38<br />
■■ The declaration <strong>of</strong> concurso.<br />
■■<br />
An order to Ifecom to appoint the conciliator.<br />
■■ The opening <strong>of</strong> the conciliatory stage (or the liquidation stage ( cfr. 16) if the debtor<br />
specifically requested his concurso to be opened in the liquidation stage).<br />
■■<br />
An order to the debtor to deliver books and records to the conciliator.<br />
■■ An order to the debtor to suspend the payment <strong>of</strong> its indebtedness ( cfr. 15.g).<br />
■■ An order to suspend all enforcement proceedings ( cfr. 15.h).<br />
■■ A notice to all creditors, so that they may appear in the proceeding ( cfr. 15.a).<br />
■■<br />
An order to the conciliator to record the judgment with the Public Registry <strong>of</strong><br />
Commerce <strong>of</strong> the domicile <strong>of</strong> the debtor and <strong>of</strong> each place where the debtor<br />
has branches, agencies or assets subject to recordation.<br />
■■ The retroactivity date ( cfr. 15.j).<br />
■■ The order to the conciliator to begin the claim recognition process ( cfr. 16.a).<br />
a. Notices<br />
Under the <strong>Insolvency</strong> Law, notices must be given to both foreign and domestic<br />
creditors equally [LCM 44]. Further, the court shall order that appropriate steps be<br />
taken to notify any creditor whose address is not yet known [LCM 291]. Notice to non-<br />
<strong>Mexican</strong> creditors must be given individually, unless the court considers that, under the<br />
circumstances, some other form <strong>of</strong> notification would be more appropriate [LCM 291].<br />
When a notification <strong>of</strong> commencement <strong>of</strong> a case is to be given to foreign creditors,<br />
such notice shall, among other things, provide a 45-day period for filing pro<strong>of</strong>s <strong>of</strong> claim<br />
(as opposed to a 20-business-day period for <strong>Mexican</strong> creditors), specify the place for
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