By Alfredo Herrera (alfredoh@tropicasa.com)
On October 17, 2012 the Federal Government of Mexico published the Anti Money-Laundering Law that
came into effect nine months after, that is on July 17, 2013.
The goal of this law is to protect the national economy and the financial system of Mexico with measures
and procedures to prevent and detect acts or transactions that involve illegal resources with interinstitution
coordination.
One of the activities this law considers vulnerable to illegal transactions is the development and the
buying and selling of real estate. However, in this case, this law directly affects real estate agents and
agencies and not so much the potential buyer nor seller. In fact, some of the measures this law requires
is to have real estate agents and agencies collect basic information about clients, this is something that
has customarily been done by agents to set up the real estate trusts.
If you have been involved in a real estate transaction in the last few years you would remember filling out
a form known as KYC (Know Your Client) with a variety of personal information like your name, date and
place of birth, nationality, marital status, and a statement that the funds for that transaction were not from
illegal origin. These forms must be presented in original form (no copies) so if you are not attending the
closing you will have to send them via DHL so they get to the Notary prior to the closing.
You may also remember providing a proof of domicile (a bank statement, or a utility bill with your name
and street address) and, if you attended the closing, you also provided proof of legal stay in the country
(the tourist Visa you get on the plane on your flight to Mexico or any other Visa you may have had at the
time).
This is the same kind of information that this Anti Money-Laundering Law requires the Public Notaries get
from clients. What will change is that sellers will also have to provide their basic information in a new
format (forms) which will be dictated by the Federal Government.
Another requirement of this law is that now service providers are obligated to report to the proper
authorities of any transactions above $40,000 that is paid in cash. Cash means hard currency so paying
with cash is now considered a concern.
As you can see, if you are considering buying a house or a condo in Puerto Vallarta, the changes in the
law will have very little to no effect for you.
If you want to know more about the real estate market in Puerto Vallarta, give me a call at 3221426296 or
via e-mail at alfredoh@tropicasa.com and let’s chat!