9. What are the requirements for the international assignment of receivables from a debtor in Mexico (either an international assignment or an international account receivable)?

Notification of an assignment or a payment instruction to debtor will be effective every time debtor acknowledges such notice either by express or implied means such as complying with the new terms of payment. However, whenever debtor does not acknowledge such notice, does not agree with new payment terms to the assignee or just defaults payment with no cause, a formal notification will have to be done in strict compliance of Mexico's commercial laws.

Article 390 of Mexico's Commercial Code provides that the assignment of receivables is to be done with proper notification of debtor before two witnesses. However, it is a common practice in Mexico to give notice to debtor with the help of a Notary Public instead of the two required witnesses. This is what we call a "formal notification", and there is much more to it.

In order for the notice to be valid, it has to be done through a legally appointed representative of the creditor or assignor. That means that a power of attorney will have to be furnished to the creditor's representative in Mexico, and such power of attorney will have to strictly comply with Mexican laws on issuance of powers of attorney. This document will also have to be furnished to the debtor at the time of notice.

Furthermore, notice will have to be provided in Spanish language or proper translation of documents will have to be provided at such time. It is also highly recommended that all documents pertaining to the assignment are furnished to debtor, making sure he is well informed of such operation, and that the rights of the assignee are justified. This step should be taken to avoid future problems assignee may have when trying to collect such receivables in court.

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