16 February 2023

Energy And Infrastructure Investment Trusts (FIBRA-Es)

Mayer Brown


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Energy and Infrastructure Investment Trusts ("FIBRA-E") are a financing mechanism for companies considered tax residents in Mexico that focus their business in the oil and gas, power or infrastructure industries.
Mexico Energy and Natural Resources
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Energy and Infrastructure Investment Trusts ("FIBRA-E") are a financing mechanism for companies considered tax residents in Mexico that focus their business in the oil and gas, power or infrastructure industries. A FIBRA-E's financing is via a public offering of energy and infrastructure investment trust certificates ("CBFEs"), which represent the investors' equity in the corresponding FIBRA-E.1 Introduced into Mexican regulation in 2014, within the framework of the Financial Reform, and in 2015, as part of the amendments to energy regulations, the CBFE offered the ideal vehicle to create new financing solutions in the energy industry and to allow investors to benefit from the opening of the industry to the private markets.

The purpose of the FIBRA-E is to source funds from institutional and qualified investors, as well as from retail investors, and invest the funds in the energy and infrastructure industries by means of equity investments in companies resident in Mexico for tax purposes. It should be noted that the returns associated with the CBFEs issued by a FIBRA-E are not derived from the payment of interest or any other similar consideration but from cash flows related to the performance of the underlying assets (i.e., a government-licensed public service in the energy or infrastructure industry that complies with the applicable provisions).2 The above means that the value of a CBFE may change over time depending on the performance and expectations for the companies in which the FIBRA-E is invested.

As a result of the FIBRA-E's specialized nature, in order for a company to be eligible for financing through a FIBRA-E (an "Eligible Company"), that company must perform licensed and eligible public services related to (i) oil and gas, (ii) power, (iii) infrastructure, or (iv) the administration of the FIBRA-E per se.

Typical FIBRA-E Structure


The main advantages that distinguish FIBRA-E as an attractive instrument, both for investors and companies with funding needs, are as follows:

  • Manager-friendly corporate governance (e.g., the Technical Committee has supervisory rather than decision-making powers).
  • Possibility of issuing several series of CBFEs with differentiated rights, including voting restrictions.
  • The Manager of FIBRA-E having a broader scope of authority compared to managers of other public financing vehicles.
  • Tax benefits such as (i) CBFE holders not being required to account for the tax effects of distributions until the calculation of the taxable income (including the taxable income of the Eligible Companies) once deductions have been applied; (ii) the Eligible Companies not being required to carry out provisional income tax ("ISR") payments; (iii) foreign-domiciled holders being exempt from paying ISR on the sale of CBFE placed and sold through a recognized stock exchange; and (iv) institutional investors (e.g., Afores, pension funds, insurance and retirement institutions, etc.) being exempt from paying ISR on the sale of the assets and rights comprising the FIBRA-E's estate.

In order to qualify for the aforementioned tax incentives, a FIBRA-E shall, among other requirements, (i) have at least 70% of the trust estate invested in equity of Eligible Companies and the remaining part in domestic sovereign debt securities and (ii) allocate to the holders of the CBFEs at least 95% of its taxable income on a yearly basis.


The FIBRA-E is an attractive financing option that, under a complex structure, allows Eligible Companies to participate in capital markets and gives investors access to industries that were previously restricted, while providing attractive tax incentives to investors.

Disclaimer: This material should not be construed as legal advice and is provided for informational purposes only.


1 FIBRA-Es are similar to US master limited partnerships (sociedades comanditarias de Estados Unidos).

2 Requirements include that (i) the trust shall be incorporated in Mexico; (ii) the main activities carried out shall be the treatment, processing, storage, transportation and commercialization of hydrocarbons; the generation, transfer or distribution of electricity (provided that such activities shall not be carried out under an agreement or assignment); or infrastructure investment projects, provided that they are carried out under an agreement executed between the public sector and private parties and their purpose is to provide services to the public sector or the retail user, which are in the operating stage and whose remaining term at the time of the share acquisition is equal to or greater than seven years; and (iii) under no circumstances, more than 25% of the average annual book value of the FIBRA-E's non-cash assets is invested in new assets.

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This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

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