Structuring Considerations for Mexico's Newly Approved Infrastructure Law

The Mexican Congress approved on April 7, 2026, the new Law for the Promotion of Investment in Strategic Infrastructure for Welfare Development (Ley para el Fomento de la Inversión en Infraestructura Estratégica para el Desarrollo con Bienestar). The bill, submitted by the federal government on March 19, 2026, was approved by the Chamber of Deputies and the Senate, adding to the set of investment instruments the government has announced to encourage investment in Mexico.

Key Points

• New Framework. This new law creates a comprehensive regulatory framework seeking to attract public, private and social investment in strategic infrastructure projects, including transportation, energy, water, health, education and technology.
• Special Purpose Vehicles (SPVs). Mechanisms such as trusts, corporations and other legal vehicles are established to channel investments, including the possibility of issuing trust bonds and other securities.
• Mixed Participation Schemes. Government participation may be majority, minority or equal. The law permits long-term contracts (up to 40 years) and mixed investment schemes with risk distribution.
• Strategic Planning Council. An advisory body chaired by the federal executive evaluates, approves and monitors eligible projects.
• Guarantees and Financial Support. Approved projects may access guarantees from the federal government, development banks or multilateral institutions, improving financing conditions.
• Fiscal and Financial Discipline. The law does not create new expenditure sources, nor can it be interpreted as an autonomous legal basis for budget allocation; all commitments must comply with the applicable budgetary and public debt legislation (in most cases, this implies legislative authorizations at the federal or state level).
• Amendments to the Federal Budget and Fiscal Responsibility Law (Ley Federal de Presupuesto y Responsabilidad Hacendaria or LFPRH). Provisions are modified to integrate strategic infrastructure multi-year contracts into the federal budgetary framework.
• Risk Allocation. Rules and regulations will be key to properly assessing risk allocation and bankability.

Investment Models: What Changes for the Private Investor?

SPVs

SPVs are legal instruments for channeling project investment and financing. Their primary function is to isolate the project's assets, cash flows and risks, and to serve as a platform for the joint participation of public and private investors.

Under the law, SPVs may take various legal forms, including public or private trusts, commercial companies (investment promotion corporations and variable capital publicly traded corporations) or other equivalent vehicles. They may also be structured to issue debt instruments, trust bonds and other securities.

The Ministry of Finance and Public Credit (Secretaría de Hacienda y Crédito Público or SHCP) may establish or rely on SPVs to coordinate with the private and social sectors. The creation of an SPV will not, by itself, imply the state's assumption of financial obligations or its automatic budgetary recognition. Any public sector participation must comply with the applicable fiscal discipline framework and obtain the corresponding authorizations.

Existing Public Funds and Trusts

The National Infrastructure Fund (FONADIN) and other public funds created by law or decree may constitute SPVs to improve the investment conditions for eligible projects. The federal government may make contributions in cash or in kind to these vehicles in accordance with applicable legislation.

Mixed Participation Schemes

Mixed participation schemes are mechanisms through which the economic relationship between the public and private sectors is defined within a project, including risk allocation, repayment source and return structure. The law permits the following three main forms of public-private participation:

Long-Term Contracting (Availability or Performance Model)

Under this model, the private investor participates in the financing, development and operation of a project, and recovers its investment through periodic payments by the relevant public entity, generally tied to compliance with performance indicators.

This scheme will require careful structuring of multi-year payment commitments and a thoughtful risk allocation design, including early termination and asset reversion or substitution. Given the complexity of these variables, the choice of dispute resolution mechanisms will also be an essential component.

Mixed Investment (Equity Co-Investment Model)

Private investors may participate directly in the equity or assets of a vehicle alongside the public entity, sharing both the return potential and the project's risks. This model approximates a joint venture structure with the state.

Under this model, investor protection will depend largely on contractual and corporate design, including governance rights, exit mechanisms, economic rights and minority protections, none of which are standardized by the law and must be negotiated on a case-by-case basis.

As with the mixed investment models of the Federal Electricity Commission (Comisión Federal de Electricidad or CFE), the valuation (accounting and financial) of contributions made by public entities will be a key factor in project structuring.

Project Life Cycle

The project development process under the law can be understood in the following three stages within the interaction with the Strategic Planning Council for Infrastructure Investment and other competent authorities:

• Stage 1 (Eligibility). The eligibility determination constitutes an initial filter and does not in itself imply budgetary authorization, resource allocation or approval for project execution.
• Stage 2 (Approval). Once determined eligible, the project may be reviewed for approval, which includes assessment of its potential incorporation into an SPV and the feasibility of its structuring under the mechanisms provided by the law.
• Stage 3 (Award). The law does not replace existing contracting procedures, nor does it establish an autonomous award regime. the selection of contractors and formalization of projects must comply with the applicable legal provisions in each case, including those relating to competition, transparency and fiscal discipline.

The Strategic Planning Council: Composition and Status

As of this date, the council has not been created. Under the transitional provisions of the law, a period of up to 120 calendar days from publication in the Official Gazette of the Federation (Diario Oficial de la Federación or DOF) is available for its installation and adoption of operating rules, as well as an additional period of up to 180 days for the issuance of the law’s regulations and the corresponding guidelines by the SHCP.

Timeline: What's Coming and Why It Matters

The law enters into force with relevant operational elements subject to regulatory development and administrative guidelines. This reflects a design that delegates to secondary legislation the definition of applicable criteria, procedures and methodologies. Accordingly, for projects currently under structuring, the implementation timeline (shown below) is as relevant as the law's text itself.

For more information or any questions, please contact the authors.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.