The following contains an excerpt an article about the Ejido Properties in Mexico that was written by David Connell and his team at David Connell and Associates, a law firm located in Puerto Vallarta, as well as Ixtapa and Mexico City. Their website is an excellent source for articles dealing with legal and fiscal issues regarding real estate in Mexico. For the full article and others, visit his website at www.mexlaw.com.mx.
A very large part of Mexican real estate is classified as ejido land. Ejido land is not private property and cannot be bought and sold as if it were. However, since the constitutional reforms of 1992 ejido land now can be converted into private property and sold to third parties, including foreigners. The present article will briefly describe what an ejido is and how ejido land is classified as well as talk about the ways in which ejido land can be converted into private property.
In general terms, an ejido is a collective group of people that live and work on a determined piece of property as a community. While the concept of the ejido in Mexico is pre-hispanic, most of the fundamental ideas and concepts that created what an ejido is today stem from the theories of democratic communism. Understanding this is very important when dealing with ejidos. Most people reading this article have grown up in a society based on democratic capitalism in which the individual and not the community determines what he or she is going to do. In a communistic society the community determines what it is going to do, including agreeing upon how the land they hold is to be used.
Taking into consideration the above, it is not hard to imagine the confusions that could exist when discussing ownership of ejido land. Most foreigners associate the word “ownership” with words such as “fee simple”, “private property” “Adam Smith”, while the ejidatarios idea would be more on the lines of “community rights”, “right to use and enjoy”, “governmental concession”.
Until ejido land is converted to private property, foreigners cannot acquire “ownership” of ejido land in accordance with their understanding of the word “ownership”.
1.- Ejido land cannot be sold to non-ejido members until it is converted into private property. There are exceptions where non-ejido members can acquire “posessionary” rights to ejido land, however the rules governing posessionary rights are not very secure, especially for foreigners.
2.- Foreigners cannot legally become ejidatarios.
3.- What an ejidatario understands as ownership is often times different than your understanding of ownership.