Navigating Credit Risks in Mexico: Legal Strategies to Mitigate Risks

About the webinar:

Mexico is the United States’ #1 trading partner, but doing business there carries real legal and operational risk. This session opens with a brief look at the scale of that opportunity, then turns its full attention to what matters most for credit managers: the specific challenges of Mexico’s legal and business environment, and a practical game plan to manage them. Drawing on real case studies, we’ll examine Mexico’s rule-of-law landscape, due diligence tools and investigations, drafting terms of sale and jurisdiction clauses that hold up, and the security devices available under Mexican law that give creditors real leverage when a dispute arises.

Objectives

• Understand why Mexico’s position as the U.S.’ top trading partner creates both opportunity and exposure for credit managers.
• Assess the specific legal and operating risks credit managers face in Mexico, including rule-of-law weaknesses and court reliability.
• Learn how to conduct effective due diligence and investigations on Mexican prospects and customers.
• Develop a practical legal strategy: reviewing and designing terms of sale, jurisdiction and arbitration clauses, and incentives that improve early settlement.
• Gain working knowledge of Mexican security devices — pagaré, pledges, mortgages, personal guarantees, and guaranty trusts — to add real layers of protection.

Practical Insights

• How Mexico’s rule-of-law environment — corruption indexes, judicial reliability, court efficiency — translates into real credit risk
• Conducting due diligence: lawsuit searches, RUG/SIGER/IMPI records, COMPRANET, public information requests
• Building credit applications that spot red flags and assign risk levels by jurisdiction
• Structuring terms of sale: governing law, jurisdiction clauses, and arbitration options that actually hold up
• Creating incentives — late fees, attorneys’ fees, damages — that make non-payment costly for the debtor
• Choosing the right dispute resolution path: litigation in the U.S., arbitration, or litigation in Mexico
• Leveraging the pagaré (promissory note) as a foundational security device, while adding further layers of protection: pledges, mortgages, personal guarantees, title retention, and guaranty trusts

Directed to

Credit managers of international companies selling to the Mexican market, as well as lawyers or debt collectors in North America engaged in debt collection or litigation in Mexico.

About the speaker:

Romelio Hernandez, President, HMH Legal, Credit & Collections

Romelio Hernandez is President at HMH Legal, a Law Firm that focuses on creditor protection in Mexico and Latin America, with services of debt collection, litigation, secured transactions, and due diligence investigations. Based in Tijuana-Baja California, México, he works extensively with foreign firms, exporting companies and collection agencies, assisting them with out-of-court and legal collection efforts throughout the region, including cross-border debt collection efforts. Romelio's 25+ years of litigation experience and exposure to international commercial law have equipped him with insights into the unique challenges and risks that may arise in cross-border debt collection situations, allowing him to navigate them effectively. As a result, he can provide expert guidance to US companies extending loans or exporting to Mexico and other international markets, helping them to mitigate risks and optimize their collections efforts. Romelio graduated from Universidad Autónoma de Baja California Tijuana, and was admitted to practice law in Mexico since 1997. Romelio holds a Masters’ Degree in Comparative Law (LL.M.) from the University of San Diego School of Law (2011).