Doing Business México 2020 MEX | Page 42

Doing Business 2020 Mexico Figure – Registering Property in Mexico City and comparator economies – Measure of Quality 20 18 16 14 12 10 8 6 4 2 0 16.0 17.6 16.5 16.3 17.5 14.0 12.0 Mexico City Brazil Chile Colombia United States Monterrey Latin America & Caribbean Details – Registering Property in Mexico City – Procedure, Time and Cost No. 1 Procedures The notary obtains a non-encumbrance certificate Agency : Public Registry of Property of Ciudad de Mexico ("Registro Público de la Propiedad y del Comercio de la Ciudad de México") Pursuant to article 3016 of the Civil Code for the Federal District, the notary before whom the transfer deed is being formalized must request a non-encumbrance certificate to the Public Registry. This request also acts as the mandatory pre-preventive notice (aviso preventivo) to the Public Registry, which suspends any inscription on the corresponding property for 60 days. Time to Complete 7 days Associated Costs MXN 623; (MXN 623.00 (Regular - 7 days) MXN 1,246.00 (Urgent - 1-2 days) (Article 198 I(a) of the Fiscal Code).) The applicant must submit before the Public Registry of Property and Commerce the following documentation: - Application for request in triplicate, including the name and signature of the of the applicant, term of the certificate, location of the property and real estate folio. - Proof of payment of fees established in article 198, section I of the Fiscal Code of Mexico City in duplicate. - The application for request may also be made online, as well as the payment of fees. This procedure can be done online at the following website: http://data.consejeria.cdmx.gob.mx/index.php/dgrppyc/certificado-de-existencia-o-inexistencia-de- gravamenes 2 The notary requests a commercial valuation of the property Agency : Licensed valuer A commercial valuation is required under the Fiscal Code of the Federal District to determine the taxable value of the property subject to transfer. Article 116 of the Fiscal Code of the Federal District establishes that the property tax shall be calculated taking in to account the highest of (i) the purchase price, (ii) the cadastral value, and (iii) the value resulting from the commercial valuation by the fiscal authorities or authorized appraiser. 7 days MXN 18,171.63; (0.2% of the Property Value) The notaries usually have their own appraisers. Nevertheless, the parties may hire the appraiser they choose. When banks are involved in the transaction, they will usually bring in the valuers they usually work with. Sometimes parties have a previous valuation, and the notary can have it reviewed to see if it suffices. However, these previous valuations are usually not fiscal ones and therefore another one has to be done to determine the value of the property for the ISAI tax, but also for the VAT tax to which commercial constructions are subject to when transferred (please note that the land is not taxable under VAT, just the commercial constructions). 3 The notary obtains the Zoning Certificate of the property Agency : Ministry of Housing and Urban Development of Ciudad de Mexico (Secretaría de Desarrollo Urbano y Vivienda de la Ciudad de Mexico or SEDUVI) The Public Registry of Property and Commerce requires a zoning certificate of the property to be attached together with the application to register the property transfer. The notary shall request the zoning certificate at the Ministry of Urban Development and Housing (Secretaría de Desarrollo Urbano y Vivienda). The cost is established in article 235, section III of the Fiscal Code for the Federal District. 6 days MXN 1,542; (MXN 1542.00 (Article 235 III(a) of the Fiscal Code)) The applicant must submit an original and copy, the documents below with the corresponding delegation’s single-counter service. The authority will retain only the copies. - Form TSEDUVICGDAU_CNZD_1. - Proof of payment of property taxes to date. - Proof of payment of fees. - Official identification. - Relotificaton or subdivision license, if applicable. - Street number designation and boundary alignment certificate (certificado de alineamiento y número oficial), if applicable. - Public deeds, if applicable. - Copy of the cadastre appraisal. - If the procedure is not carried out by the owner of the property, it must also submit a proxy letter or a notarized power of attorney. - Companies should submit the incorporation act, power of attorney and official ID of the legal representative or proxy. Page 42