"Ejido, in Mexico, village lands communally held in the traditional Indian system of land tenure that combines communal ownership with individual use. The ejido consists of cultivated land, pastureland, other uncultivated lands, and the fundo legal (townsite). In most cases the cultivated land is divided into separate family holdings, which cannot be sold although they can be handed down to heirs. SOURCE: http://www.britannica.com/topic/ejido
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 prehispanic, 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. SOURCE:http://www.mexicolaw.com.mx/es/articles/can-i-buy-ejido-land
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.
Measures taken during the reform period that began in 1855 abolished the landownership rights of civil and religious corporations. Although the primary purpose of this reform was to dissolve the large ecclesiastical estates, the law also forced the Indians to give up their village lands. The land reform measures in the 1917 constitution restored land that had been taken from ejidos, made land grants to landless villages, and divided large estates into smaller private land holdings. Today ejidos constitute some 55 percent of Mexico’s cultivated land". SOURCE: http://www.britannica.com/topic/ejido
OCA LAW FIRM NOTES ON THE EJIDO:
1.- When dealing with EJIDOs, EXTRA due diligence is always requiered. Don not let the size of the ejido fool you.
2.-YES, lands may be incorporated from Ejido if certain conditions are met, such as:
2.1. Terminations of agrarian regime is approved by members of the Ejido
2.2. Resolution: Clear and transparent resolution of members of the Ejido when pro-indiviso has been allocated
2.3. Transfer of land for "evident utility causes" or business corporations
2.3. Publication and registration is needed to terminate rights of labor of Ejido and family members
2.4. Public notary work is needed to formalize the trasnfer
2.5. Public notary will address tax issues and is also responsible
3.- Lease is possible but some states require Contract registration
3.1. Lessees have the first right of refusal to acquire property
4. The Ejido is entitled to a class action for environmental damages.
Not Doing Due Dilgence on Ejidos is Asking for Disaster
The use and exploitation of common use properties is regulated by the ejido’s internal regulations and cannot be assigned or attached except for the cases provided for in Article 75 of the law. The general regulations of the ejidovare very similar to a corporation’s articles of incorporation and bylaws, in that, they lay out the basic rules under which the ejido operates. The general regulations and the maps indicating the location of the ejido’s properties are filed with the National Agrarian Registry and are available to the public. This is the natural place to start due diligence on any joint venture: nothing should be taken for granted. Too many times foreign investors are willing to rely on information provided by the ejido instead of doing the due diligence necessary to independently verify such information. Not doing the necessary due diligence is asking for disaster. This is because all transactions with ejidos are protected by law in that the ejido is basically not responsible to make sure its property is in order: that job is left to the buyer or joint venture partner. Source: http://www.lawmexico.com/articles/Joint%20ventures%20with%20ejidos%20in%20Mexico.pdf