Mexico Moves to Ease Restrictions on Foreigners Buying Coastal Property

The lower house of Mexico’s congress voted Tuesday to loosen longstanding restrictions on foreigners buying property along the coast and the nation’s borders, a proposal that drew stiff criticism from some quarters.

The measure, which passed 356-119 in the Chamber of Deputies, still needs approval from the Senate and a majority of the country’s 32 state legislatures to become law.

For decades, foreigners have had to use real-estate trusts or Mexican front companies to buy beachfront properties, because Article 27 of the constitution prohibits non-Mexicans from directly owning land within 31 miles (50 kilometers) of the coast and 62 miles (100 kilometers) of the nation’s borders.

The trusts and front companies have provided a lucrative income for banks, lawyers and notaries who are required to operate them, and the extensive paperwork has discouraged many foreigners from buying.

The change, sponsored by Congressman Manlio Fabio Beltrones of the governing Institutional Revolutionary Party, would allow foreigners to directly buy ocean-front property for residential use, but not for commercial projects.

Such proposals have been made before, but not by figures as influential as Beltrones, the PRI’s congressional leader.

The Union of Indians and the Farmers’ Force, a farmworkers group, criticized the proposal Tuesday, saying it would “give free rein to foreigners to legally buy up the best land, and encourage robbery and financial and real estate speculation.”

Those are strong sentiments in a country frequently invaded by foreign powers in the 19th and early 20th century. Mexico set up the restrictions to ensure national security and avoid the creation of foreign enclaves like the one that grew up in a former Mexican province known as Texas, where the foreigners eventually rebelled and split from Mexico.

Source: Associated Press