Nearshoring

The advent of the United States-Mexico-Canada Agreement (USMCA), along with recent disruptions to global supply chains, once again have generated new opportunities to relocate business and manufacturing operations closer to the United States.

Among the advantages of nearshoring in Mexico are cost efficiency, proximity and time zone alignment, cultural affinity and business orientation. Mexico offers competitive labor costs compared with other nearshoring destinations, making the country an attractive option for businesses looking to reduce costs while maintaining high-quality outputs.

Holland & Knight's Nearshoring Team includes multicultural and multilingual lawyers and senior professionals across various practice disciplines with decades of experience helping clients with all facets of the nearshoring process. We offer a customizable, full-service package tailored to our clients' needs, empowering them with the flexibility to select only those services essential to their objectives and enhancing cost-efficiency and precision. From inception to implementation, our dedicated team is committed to guide you through complexities, help you adeptly navigate and mitigate risks, and unlock the full potential of nearshoring for your organization.

Our team is made up of a former U.S. Under Secretary of Commerce for Trade and a diverse group of attorneys in Mexico and the United States who have been recognized in leading industry publications, such as Chambers Latin America, Chambers Global, Latin Lawyer 250 and The Legal 500 Latin America, as well as IFLR1000, IJGlobal, Who's Who Legal, Best Lawyers in Mexico and by BTI Consulting.

A Full Range of Services

Our team of attorneys has extensive experience across all stages of the nearshoring process, including:

Government Affairs

We assist clients to identify important regulatory considerations, develop strategies to address regulatory issues and implement systems to help achieve clients' business goals, including the negotiation of incentives agreements.

Real Estate, Environmental, Site Selection and Feasibility Studies

Our team of attorneys counsel foreign and local companies focused on site selection, leasing, developing and/or acquiring industrial properties that provide nearshoring services or those requesting nearshoring services related to their business, such as e-commerce and maquila-type operations. Such transactions require proper due diligence, the review and negotiation of complex agreements related to real estate, guaranties, finances, transportation and commercial trade matters, among other services. In addition, our Nearshoring Team assists clients in the determination and permitting of applicable urban development and environmental permits.

Banking and Finance

We offer a broad range of banking and finance services, from corporate and working capital facilities to cash management transactions as well as hedging operations designed to mitigate our clients' supply, trade or financing risks. Holland & Knight lawyers also have experience with transportation and fleet financings, as well as specialty finance, including inventories and other asset-based and asset-backed financings. In addition, our financial services regulatory attorneys also assist clients in the development of compliance policies and processes that are tailored to their specific industry, geographic presence and international operations.

Corporate Structuring and Management

Our Nearshoring Team offers advice to companies on the most efficient business structuring, assisting clients with the creation of a Mexican subsidiary. We also help with regulatory compliance, employee relations, customs and tax considerations, supplier agreements and corporate governance matters, among others.

International Tax

Our team provides domestic and international tax services to maximize tax benefits and minimize liability related to corporate reorganizations, investment vehicles, startup design, financing structures and various client transactions, including Maquiladora, Manufacturing and Export Services Industry (IMMEX)-type operations.

Regulatory Advice

Holland & Knight attorneys provide counsel to foreign clients with regard to environmental, safety, consumer products and other regulatory regimes, including the determination of applicable permits and licenses for the operation and the corresponding permitting.

Labor and Employment

Our lawyers advise companies across a broad range of labor-related matters, including employee handbook drafting, preparation and negotiation of employment and confidentiality agreements, design and implementation of human capital structure, negotiations before the Employee's Defense Office, litigation before the federal and local labor boards, and representation in amparo appeals and compliance investigations, and union relations advice. In addition, our team advises clients with union registration processes of collective bargain agreements and related negotiations.

International Trade

Our Nearshoring Team has experience in all aspects of international trade, from the technical aspects of U.S. Customs and Border Protection (CBP) classification and valuation, to export control requirements, regulatory compliance, trade negotiation and lobbying. We have performed complex analyses to determine the rule of origin, classify Harmonized Tariff Schedule (HTS) codes, obtained general importers and sectorial licenses, Program of Sectoral Promotion (PROSEC), IMMEX Programs and Value-added tax (VAT) certification, among others.

FCPA Counseling

The Foreign Corrupt Practices Act (FCPA) can be challenging to navigate, and unintentional or otherwise, missteps can be common. Our Anti-Corruption and FCPA Team has vast knowledge and experience helping U.S. companies, foreign entities and individuals navigate through FCPA matters and all related issues. Our team helps businesses prevent FCPA violations by creating compliance programs, conducts internal investigations of potential FCPA violations, and advises businesses and individuals before the U.S. Department of Justice (DOJ), U.S. Securities and Exchange Commission (SEC) and other federal agencies once an inquiry or investigation has opened, including responding to grand jury subpoenas. The team includes attorneys that are fluent in English, French, Portuguese and Spanish, and has represented companies and individuals throughout the U.S., Latin America and rest of the world.

Dispute Resolution

Disputes are inevitable in the business sector. Our international disputes team has extensive experience representing clients with a broad range of cross-border disputes, as well as domestic disputes across various industries, including manufacturing, fashion, environmental, energy, finance, real estate, tax, labor and employment, and technology. Our bilingual and bicultural lawyers regularly represent clients before international tribunals, U.S. courts (state and federal) and Mexican courts.

General Steps to Establish Manufacturing Operations in Mexico

Corporate Matters

• Tax and operational planning
• Obtain corporate background data for beneficiary controllership regulations
• Incorporation of a Mexican subsidiary
  • Create articles of incorporation and bylaws
  • Grant powers of attorney
  • Notarization with Mexican public notary
  • Registration with the Public Registry of Commerce
• File for tax ID and electronic signature
• File for the National Foreign Investment Registry
• Open bank accounts

Labor and Immigration Matters

• Registration with the Mexican Social Security Institute (IMSS)
• Registration before the state treasury for state payroll tax
• Prepare the internal shop rules
• Individual employment agreements
• Employers registration at the Mexican Immigration Institute
• Job offer visas for foreign employees

Real Estate and Environmental Matters

• Due diligence
• Availability of utilities (energy, gas, water)
• Land or facility acquisition or leasing
• Permits for environmental and urban development
  • Environmental impact assessment
  • Operations license
  • Civil protection authorization
  • Hazardous waste registry
  • Air permit
  • Water discharge permit

Customs Matters

• Classification of Harmonized Tariff Schedule (HTS) codes
• Rule of origin analysis
• General importers registry
• Sectorial importers and exporters registry
• IMMEX program
• Value-added tax (VAT) certification
• PROSEC program
• Trade compliance structures, diagnosis and legal implementation

Government Affairs Matters

• Construction project approvals
• National and local permitting

Select Representative Experience

• Represented the Mexico-based subsidiary of a global leader in technology protection services with obtaining employer registration before the Mexican Social Security Institute (IMSS), as well as obtaining the electronic signatures necessary to register and unsubscribe employees from such institution
• Represented a multinational electronics manufacturer to conduct an import compliance audit and provided advice on the adoption of an import compliance program
• Represented a multinational food and beverage corporation on matters concerning benefits laws, executive benefits, severance compensations, employment relations, non-compete agreements, layoffs and changes of control
• Represented the Mexico-based subsidiary of a chemicals company regarding expatriates working in Mexico and Mexican personnel assigned to render services abroad
• Represented one of the nation's financial institutions and an affiliate with the implementation of two cross-border financing programs; provided legal guidance and implemented revisions to the documents in both programs to reflect the cross-border and applicable tax consequences in Mexico and provided a solution to deliver electronic notices and confirmations as well as register transferred receivables as security interests in Mexico, as required under each program
• Represented a Japanese manufacturer of automotive parts on corporate, commercial and customs matters concerning the operation of plant manufacturing semiconductors, leather seats and original equipment manufacturer (OEM) parts for vehicles
• Represented companies on cross-border trade and compliance issues in connection with a wide range of COVID-19 personal protective equipment (PPE)
• Represented a robotics company with operations in China and Germany
• Represented a Japanese global heavy machinery company in the manufacturing and textile sectors with legal and regulatory advice concerning selling manufacturing equipment to plants in Mexico in the automotive and textile industries
• Represented a U.S. magnesium die-cast company in the automotive industry with legal and regulatory advice with setting up a Mexico plant; included drafting the company's incorporation Mexican documents, preparing the corresponding entries at the company's corporate books, filing the mandatory registrations before Mexican authorities, filing and obtaining of the IMMEX and trade program approvals, and negotiating and drafting real estate and intercompany agreements for manufacturing, financing and use of equipment and raw materials
• Represented Fibra UNO, a Mexican real estate investment trust (REIT),  in a US$841 million deal to acquire 74 industrial properties with approximately 1.2 million square meters in gross leasable area and a land reserve of approximately 1 million square meters in Mexico from real estate developer Finsa
• Served as regular counsel to Mexican REITs in the acquisition of real estate portfolios related to Grupo GICSA, Grupo MRP and Finsa, among other developers
• Conducted an internal investigation of a telecommunications company involving potential corruption in several Central American countries, resulting in a voluntary disclosure to the U.S. Department of Justice (DOJ) and a favorable resolution of the matter
• Conducted an internal investigation involving possible corruption by the Peruvian subsidiary of an American information technology (IT) products distributor as part of a merger and acquisition (M&A) due diligence
• Represented a fashion company involved in a commercial dispute with a Mexican distributor
• Represented a U.S. beverage company in a multimillion-dollar International Chamber of Commerce (ICC) dispute with a Mexican licensee and distributor
• Represented a major auto manufacturer in hundreds of product liability cases pending in U.S. state and federal courts that involved events and parallel proceedings taking place in Mexico, Venezuela, Argentina, Colombia and Panama
• Represented a major auto manufacturer in a commercial dispute with a Mexican distributor
• Represented an English company in a global technology outsourcing dispute centered on claims of fraud in the inducement; matter resolved favorably for client with a settlement valued at more than US$50 million
• Represented a wiring systems manufacturer involved in an ICC dispute against the manufacturer of lightweight metals technology relating to the purchase of various assets in Mexico