KEY FACTS OF BANKRUPTCY, INSOLVENCY AND REHABILITATION PROCEEDINGS IN MEXICAN LAW –
On May 12, 2000, the Commercial Insolvency Act (the “CIL”) was published in the Federal Official Gazette and came into full force the following day. This law replaced the 1943 law governing suspension of payments and bankruptcy, and all other legal provisions which conflicted with the provisions of the new CIL.
According to its preface, the main objective of the CIL is to create a modern regulatory framework that allows the preservation of companies undergoing a financial and economic crisis. To this end, the figure of “conciliation” was created to ensure that the merchant and his creditors come to an agreement for the payment of the merchant’s debts within a reasonable time. If the conclusion of a reorganization agreement is not possible, the CIL establishes a procedure for the orderly liquidation of the goods and rights of the merchant while trying to maximize the proceeds of the sale, applying the funds obtained from it to the payment of the liabilities of the trader, following a fair order and preference regarding the differences between the creditors involved.
Please see the full chapter below for more information.