Mexico Proposes National Security Review Regime for Foreign Investment

Mexico President Claudia Sheinbaum on August 28, 2026, submitted an initiative to amend Mexico's Foreign Investment Law and establish a new national security review process for certain foreign investments in Mexican companies.

If enacted, the proposal would add a new regulatory approval requirement for transactions involving sensitive sectors, including telecommunications, digital infrastructure, energy, transportation, data, critical technologies and cybersecurity.

Under the proposed regime, prior approval from the National Foreign Investment Commission (CNIE) would generally be required if a foreign investor acquires, directly or indirectly, more than 49 percent of the capital of a Mexican company, the target operates in a covered sector and its assets exceed a threshold to be established by the CNIE.

A voluntary filing would be available where the asset threshold is not met or the foreign participation does not exceed that percentage.

Covered Sectors

The proposal's scope is broad and covers a wide range of sectors, including:

• strategic physical or virtual infrastructure, including energy, transportation, communications, data processing and storage, digital systems, aerospace and defense
• critical technologies and dual-use products, including artificial intelligence, semiconductors and cybersecurity
• fundamental inputs, including energy and raw materials
• access to sensitive information, expressly including personal data
• other analogous activities or sectors designated by the CNIE

This could bring a significant number of transactions in telecommunications, technology, data centers and other data-intensive businesses within the review process.

Review Process

Under the proposal, the CNIE could approve a transaction, impose measures to mitigate national security concerns or prohibit an acquisition altogether. Mitigation measures may include continuing obligations and reporting requirements.

The proposed review period is 60 business days. The clock may be suspended once for an information request, and the CNIE may extend the review once for up to 30 additional business days. If no decision is issued within the applicable period, the application would be deemed denied.

Implications for Mergers and Acquisitions

If enacted substantially as drafted, the new regime will need to be considered at an early stage in transactions involving foreign acquisitions of Mexican companies in potentially sensitive sectors.

For affected mergers and acquisitions and other corporate transactions, the review could become a closing condition and may affect transaction timing, outside dates, regulatory covenants, and risk allocation associated with mitigation measures or a potential prohibition.

The proposal also introduces specific penalties for completing transactions without required approval and for failing to comply with mitigation measures imposed by the CNIE.

The amendments would take effect the day after publication. The CNIE would then have 180 calendar days to establish the asset threshold that will determine when qualifying transactions are subject to mandatory review.

Holland & Knight is monitoring developments related to this proposal and its potential implications across sectors. For further information or questions about a specific matter, contact the author.

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