On 23 October 2018, the National Regeneration Movement Party, Morena (Movimiento de Regeneración Nacional), submitted an Initiative of a Decree before the Senate which abrogates the current Agrarian Law and issues the Law for Agrarian Development. The purpose of the new Law for Agrarian Development is the modernization of several systems ordained by the current Agrarian Law, same which has been in force since 1992.
Some of the most important provisions of the proposed Initiative for the Law of Agrarian Development are, among others, the following:
- The Ejido and the Community are acknowledged as the most representative social and economic organization in rural society, with respect to land ownership.
- The Fund for Agrarian Development is created, with the purpose of financing productive activities in the common use lands of the Ejidos and Communities.
- The documents to credit the legal identity and estate of Ejidos and Communities are established, in order for Ejidos to be able to receive subsidies and financing, without them needing to incorporate a new form of association.
- Procedures are established for the termination of the ejido regime, the incorporation of a new Ejido from the contribution of lands subject to the private property regime, as well as for the acknowledgement as a Community.
- Possessors are included as subjects with the same rights as those of an ejidatario over its parcel.
- The way to integrate the list of ejidatarios is defined and the responsibility for the integration is granted to the Agrarian Prosecution Office (Procuraduría Agraria) and the National Agrarian Registry (Registro Agrario Nacional).
- The authority for the Assembly of the Ejido to change the destination of lands of common use to parcels and to lands for human settlement is included, provided that the expert opinions of SEMARNAT and SEDATU are available when making such decision. Likewise, the requirement to approve the usage of lands of common use by third parties is modified, from a simple majority to a qualified majority and special formalities.
- The obligation to register the act of Assembly of election of the representation and supervision organs in the National Agrarian Registry (Registro Agrario Nacional), is established.
- The procedure for land expropriation in Ejido and Community properties is regulated, also promoting a fair payment to the owners within a period of 90 days. In addition, the figure of reversion of expropriated properties to Ejidos and Communities is regulated, in case of non-compliance with the cause of public utility or change of destination, in a term of 5 years as from the publication of the expropriation decree.
- The limits of the individual small agricultural, livestock and forest property are reaffirmed, and maximum permitted limits are established for the ownership of parcel rights within the same Ejido as well the maximum limits for commercial companies that own agricultural, livestock or forest properties (25 times the limits of the small property); and it is established that individuals, associations or companies that exceed the established limits will have a period of 1 year to divide or transfer excess land.
- The rural companies that do not imply the contribution of lands are regulated, as well as the companies owners of agricultural, livestock and forest lands that can be incorporated with the contribution of common or ejido lands, but also with lands subject to the private property regime.
- The maximum duration of contracts that imply the use of Ejido lands by third parties remains at 30 years, same which may be extended.
- The limit for foreign investment of 49% of the shares or equity quotas series T remains, which represent the value of land for agricultural, forest or livestock use contributed to any commercial or civil company.
- A chapter on lands of the communities that belong to indigenous groups is included where the following is acknowledged: (i) the right to be acknowledged as an Ejido or Community; and (ii) the right of an indigenous group of people to appear before agrarian courts to request the recognition of their property rights, through their elected representatives, pursuant to their internal regulatory systems.
If the aforementioned is of your interest, the Real Estate and Infrastructure Law Practice Group of our Firm has the necessary experience to advise you as to the way in which the provisions of the Law for Agrarian Development could be applied by you or by your company, in case the same is approved.