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  • Writer's pictureSámano Abogados

New registry rules in relation to real estate and new Regulation of the Registry Law for the DF

(Mexico City). [11/02/2016]

The purpose of this Informative Note is to provide you with relevant information regarding the new registry rules in relation to real estate and the Regulation of the Registry Law for the Federal District.

On July 22, 2008, the “Registry Criteria in Relation to Property” was published in the Official Gazette of the Federal District, which we will focus on, and on November 24, 2008, the “Registry Criteria in Commercial Matters” in order to make registry matters more efficient.

The “Registry Law for the Federal District”, was published in the Official Gazette of the Federal District on January 21, 2011, entered into force on January 22nd of that year and its last amendment was on November 28, 2014.

On September 13, 2011 the “Regulation of the Registry Law and of the Public Registry of Property and Commerce of the Federal District” was published in the Official Gazette of the Federal District and it entered into force on September 14, 2011.

The main objective of both rules is to combat the backlog existing in registry matters and to reflect the registry criteria issued.

While the Public Registry of Property (hereinafter “RPP”) has declarative effects, (which means it recognizes in rem rights) but does not create rights, it is the Institution by which certainty is given to Property Law (in rem right by definition).

In registry matters, since recordal in the RPP has declarative effects, when an in rem right is not binding on third parties, the theory of “inefficacy” is followed and not the theory of “nullity” or “nonexistence”. The legal act (purchase and sale) took place and an in rem right exists in favor of the owner, but if it is not recorded, the act is “ineffective” because it is not binding on third parties. It is for this reason that it is said in practice that “first in registry, first in right”. In a dispute, the one having a Public Instrument recorded in the Public Registry of Property has better title over real estate property than the one that does not.

These criteria in matters of property registry are grounded in existing laws and regulations such as the Notary Law for the Federal District, the Civil Code, the Registry Law and its Regulation, they are of strict application for the personnel of the RPP and they resolve practical problems mentioned in the following table:

PROBLEM:Lack of Attachments at the time of making a recordal in RPPCriterion 1CERTIFICATE OF EXISTENCE OR NON-EXISTENCE OF LIENS

Under the responsibility of the Notary, an instrument may be presented in the RPP without being certified and the registrar will suspend the procedure, keeping the notarial transcript 30 (thirty) calendar days, and will record it when the certificate is exhibited. Otherwise the notarial transcript will leave without registration. In the case of condominiums, consolidations, subdivisions, partitions, repartitions, the certificate of the original property can be used in three cases:


  1. When the condominium has not been recorded and the preventive notices are in force.

  2. If the preventive notices have expired a new certificate should be requested of the original property with the indication of the removed unit or resulting property of the new operation in order to make its respective preventive note.

  3. If the condominium is registered, the certificate of the removed unit or resulting property of the new operation should be requested with the annotation of its respective preventive note


Criterion 2LACK OF CERTIFICATE OF ZONING. DELAY OF THE ISSUING AUTHORITY

It must be in force at the time of the issuance of the instrument and be attached for its registration; if it has not been received due to a delay by the authority, the notarial transcript may be presented for its recordal attaching a copy of the request and the payment of the corresponding fees. The notarial transcript is kept in the operative area until a copy of the certificate is exhibited.

Criterion 3RECEIPT FOR PAYMENT OF TAX ON ACQUISITION OF REAL ESTATE (ISAI for its initial in Spanish)

The payment can be evidenced with any of the following options:


  1. Declaration presented of the payment of the ISAI before the Treasury of Mexico City.

  2. Indicate in the instrument the complementary note that the payment was made, including any capture line.

  3. Transcribe in the instrument the declaration of the payment of the tax, including any capture line.


In case of reduction, forgiveness, exemption or decrease of the tax liability, attach the declaration or the notice of the authority.

Criterion 4CONDOMINIUM, CONSOLIDATION, SUBDIVISION, PARTITION OR REPARTITION.

Attach or transcribe in the instrument the license or certificate of zoning, judicial ruling and order, as it may correspond.

Criterion 5LACK OF CADASTRAL CODE (REAL ESTATE TAX ACCOUNT).

The operations related to real estate not transferring ownership may be recorded even when they fail to mention the real estate tax account.

Criterion 6LACK OF TABLE OF VALUES AND UNDIVIDED RIGHTS AND DESCRIPTION OF PRIVATE UNITS.

In the creation of condominiums, to facilitate the recordal the descriptive memories of the private units may be entered electronically.

Criterion 7IT IS NOT NECESSARY TO ATTACH ANNEXES TO THE NOTARIAL TRANSCRIPT THAT CONTAINS THE CERTIFICATION OF THE NOTARY.

If in the notarial transcript the notary certifies having had a document before him.





PROBLEM:Discrepancy between notarial transcripts and registry entriesCriterion 8CORRECTION OF ERRORS OR DISCREPANCIES ATTRIBUTABLE TO PERSONNEL OF THE RPP

Provided the following are evidenced with the text of the recordals:


  1. If the notary notices the error, he will exhibit a certified copy (of what is relevant) of the instrument of origin where the err where the error appears.

  2. The registrar will notify the notary so that he may present a certified copy (of what is relevant) of the instrument of origin where the error appears.


As a record of the correction of the entry, the request will be made separately or in the same instrument. The registrar respop the responsible for the registration will make the correction or rectification in the folio after reviewing the registration history.

Criterion 9CORRECTION OF ERRORS OR DISCREPANCIES IN THE NOTARIAL INSTRUMENTS ATTRIBUTABLE TO THE NOTARY.

The notary will present prior to the recordal, certification of the complementary note entered in the protocol as a result of the error found, in which that error is clarified, with indication of what it consisted of. The registrar will include the page on which such certification is recorded in the notarial transcript presented and will put the security seal that links the page of the certification with the immediately previous page of the notarial transcript. In the registration seal the existence of the certification will be recorded

Criterion 10FORM OF IDENTITY IN THE SUBJECT AND IN THE OBJECT OF THE ACT.

SUBJECT: In the instrument, mention will be made of the subject’s name as well as the different forms or variations in which the person uses it (including abbreviations).

OBJECT: In the instrument, the changes in the information on its identification will be mentioned, without altering its descript altering its description (whether personal property or real estate), for example: nomenclature of the street, property number, colony.

The mention should be recorded in one of the clauses of the instrument, notwithstanding that it appears in another part thereof.

Criterion 11MECHANISM TO REMEDY THE DISCREPANCY BETWEEN THE REGISTRY HISTORY AND THE CITE IN THE RECORDAL SEAL

The notary will request the recordal through a certification that clarifies the error. The registrar will include the page where the certification is recorded in the notarial transcript presented and will put the security seal that links the page on which the certification is recorded to the page immediately before it of such notarial transcript.

Criterion 12LACK OF SIGNATURE IN THE REGISTRY ENTRY

The validation can be requested in:


  1. The instrument that is to be registered itself.

  2. A separate document that will be entered with a new entry number, but related to the entry number of entry of the principal document.


The first or last notarial transcript must be exhibited or a certified copy in which the marginal or Complementary note appears in which note is taken of the recordal. The registrar will make the validation and will give notice the notary.

Criterion 13LIENS THAT DO NOT APPEAR IN THE PROPERTY TRANSFER PUBLIC INSTRUMENT.

When there are liens on a property although from the drafting of the instrument it is clear the purchasr and the notary did not know aboit, the registrar:


  • Will report by publication in the resgistry bulletin the existence of liens not mentioned in the instrument.

  • The notary within 10 (ten) business days will present a document stanting his awareness of this circumstance, proceeding to the registration of the instrument ando to the annotation that they were registered under a certain date and number and leaving the record of the liens.


In case of preventive annotations such as seizure, bond or claim anotation, if they have expired the notary shall request their cancellation in a separete document, relating the request to the entry number of the notarial instrument.



PROBLEM:Chain of titleCriterion 14RECORDAL ENTERED ERRONEOUSLY IN ANOTHER FOLIO.

The notary will request the transfer to the correct folio by correspondence, unless the error is detected before the granting of an act, in which case he/she may request it in the instrument in which the act is recorded.



PROBLEM:Errors detected in reports of conclusion of entriesCriterion 15ERROR IN THE REPORT OF CONCLUSION OF ENTRY.

When the text of such report does not coincide with the information of the recorded instrument, the entry will be corrected and the correction will be delivered.



PROBLEM:Operations transferring ownership between living persons or as a result of deathCriterion 16REGISTRATION OF FORECLOSURE OR MORTGAGE BOND.

The preventive annotation does not close the registration for new recordals, except by judicial order, even though from the drafting of the instrument it is clear that the buyer and the notary did not have knowledge with respect to the existence of such preventive annotations.

Criterion 17COMMUNITY PROPERTY REGIME NOT REGISTERED.

If in the registry entry this does not appear recorded, the recordal will proceed with the granting of the instrument by the registry head. The recordal is also appropriate if in addition the spouse mentioned in the instrument appears.



PROBLEM:Auctions, statutes of limitation and formalizationsCriterion 18DISTRIBUTION BY AUCTION.

The real estate will go to the purchaser free of liens, following payment of the cancellation fees and determination of any liens and annotations.



PROBLEM:TrustsCriterion 19RECORDAL OF THE TRUST IN THE FIRST PART OF THE FOLIO.

It will be recorded independently of its purposes, noting in the recordal the Settlor(s), Trustee, Beneficiary(ies) (and their changes or assignments when requested). The notary may enter electronically the purposes of the Trust, in order to facilitate the recordal.

Criterion 20RECORDALS IN WHICH THE ISAI IS NOT CAUSED.

It will be sufficient for the notary to give the corresponding notice. The same applies in the case of reversion, and therefore the notice shall be reproduced in the notarial instrument or mention made that the notice was given therein.

Criterion 21TERMINATION AND REVERSION OF THE TRUST.

In the trust created before 2003, recorded in the second part of the folio or in the section of trusts, the termination will be recorded. If in the instrument the reversion is recorded, the notary will request the partial recordal of the document only for the termination.



PROBLEM:Differences in payments of feesCriterion 22PAYMENT OF FEES FOR THE CANCELLATION OF GUARANTEES, MORTGAGES OR PLEDGES.

For the registry entry of these, including their extensions, agreements or modifications, a single fee will be paid as fees. The notary will specify the entries to cancel.



PROBLEM:Credits, amendments and guaranteesCriterion 23THE AMOUNT OF THE CREDIT SHOULD BE SET IN NATIONAL CURRENCY FOR PURPOSES OF PAYING FEES.

With respect to the amending agreements, only those referring to the duration, interest rate or amount of the guaranteed obligation require recordal. If its amount is in foreign currency, UDIS, minimum wages or units of account and the amount in national currency does not appear in the instrument, this must be indicated in the request for entry and processing.


Some other practical actions that have combatted the backlog in the RPP are:


  1. Require only one background document for the recordal of an act relative to real estate since it is presumed that the previous background document and the existence of the chain of title have already been verified by the prior registrar.

  2. It has been made transparent and explained to the interested party the reasons that a folio may “be in custody” (constructions with anomalies, frauds, termination of ownership, administrative matters, lack of chain of title, apocryphal recordals, etc.) and how this in rem folio is released, by whoever evidences having a legal interest.

  3. Restructuring of the RPP to eliminate defects

  4. Implementation of the Professional Career Service inside the RPP, which prevents the rotation of personnel each six years (due to a change of government of the City), keeping and promoting the employees that have knowledge of registry matters.


To learn more about this topic, please contact: Lic. Cynthia Osorio Muñoz: cosorio@samanosc.com.mx

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