Doing business in Mexico has become increasingly complex in 2025, according to the TMF Group’s Global Business Complexity Index. The country now ranks as the third most complex jurisdiction in the world for corporate operations, just behind Greece and France.

The main drivers of this ranking are recent labor law reforms in Mexico, including new regulations on remote work, ergonomic rights under the “Ley Silla,” and other pro-worker initiatives. While these changes aim to improve employee well-being, they’ve also added layers of compliance that make business operations in Mexico more challenging.

Labor Reforms Add to Business Complexity in Mexico

The TMF report analyzed 79 jurisdictions worldwide, measuring the administrative burden of regulatory and legal requirements. It found that Mexico remains a particularly complex jurisdiction due to evolving labor legislation and an unpredictable legislative agenda.

“The reforms are positive from a labor perspective, but as an employer, you must be prepared,” said Dunia Salomon, Country Head of TMF Group Mexico.

Salomon noted that doing business in Mexico often requires companies to remain highly adaptive. Some reforms—like a proposal to increase annual holiday bonuses—remain stalled, while others are quickly introduced and passed within months, making corporate compliance in Mexico difficult to predict.

Nearshoring Still Relevant Despite Complexity

Despite the increasing regulatory complexity in Mexico, Salomon emphasized that nearshoring in Mexico remains a strategic priority for international businesses.

“Nearshoring continues to be a key strategy, even with shifting U.S. trade policies,” Salomon noted.

With companies relocating supply chains closer to the U.S., Mexico remains an attractive destination thanks to its geographic advantage and skilled workforce—even if business setup in Mexico demands careful planning.

Mexico’s Dual Identity: Opportunity Meets Complexity

The 2025 TMF report paints Mexico as a country of contrasts—offering vast opportunity through nearshoring and labor talent, while also challenging investors with compliance-heavy processes and legislative volatility.

Still, many businesses see this as manageable. Companies with the right advisors and planning frameworks can navigate corporate complexity in Mexico while leveraging its proximity to the U.S. and growing role in global manufacturing.

Conclusion

Mexico’s rise to the third most complex country for doing business in the 2025 TMF Index reflects a regulatory landscape in flux. While labor reforms in Mexico are welcomed for improving employee conditions, they require businesses to stay informed, flexible, and proactive.

In the context of nearshoring in Mexico, this complexity may be a hurdle—but it’s not a deal-breaker.