The new provisions of the Mexican Income Tax Law ("Ley del Impuesto Sobre la Renta" or "LISR") establish that the SOFOMES complying with the following will be deemed as members of the financial system:

" When the documents and accounts receivable derived from the activities that constitute their main corporate purpose, in accordance with the LGOAAC, represent at least 70% of their total assets; or

" When the income derived from such activities and from selling or administrating the credits granted by them, represent 70% of their total income.

The LISR provides that the Tax Administration Service may grant private rulings to SOFOMES of recent incorporation, establishing that the first three years such SOFOMES, may have a percentage lower than 70% in order to be deemed as members of the financial system for the purposes of the LISR.

Likewise, in accordance with the new text of the Value Added Tax Law, the services bearing interest that the SOFOMES shall receive or pay will be exempt from paying the VAT.

D. Industrial Mortgage
The Amendments consider the possibility of SOFOMES being beneficiaries of industrial mortgages; that is, mortgages constituted over the total unit of the industrial, agricultural, or livestock industries engaged in elementary, industrial, commercial or service activities. Before, only the credit institutions, financial leasing companies, financial factoring companies and, in some states, private interests, could act as beneficiaries in this type of guarantees.

E. Regulations to SOFOMES
The Amendments set forth that the granting of credit, financial leasing and financial factoring services by the SOFOMES will be subject to the Law for the Protection and Defense of Financial Services Users ("Ley de Protección y Defensa de los Usuarios de Servicios Financieros" or "LPDUSEF"). In addition, the CONDUSEF will be in charge of the protection and defense of the rights and interest of the users of services provided by the SOFOMES, in accordance with the provisions of the LPDUSEF.

As we mentioned before, the Regulated SOFOMES will be subject to the supervision and inspection of the CNBV. Furthermore, the Unregulated SOFOMES will be subject to the inspection and supervision of the CONDUSEF, being such agency invested for such purposes with the authority that the Law of Transparency and Promotion of Competition in Guaranteed Credit grants to the CNBV with respect to the financial entities granting guaranteed credit.

Likewise, the SOFOMES will be subject to rules to prevent the use of resources of illegal origin (anti-money laundering) and will be supervised by the Tax Administration Services pursuant to the provisions of Article 95 Bis of the LGOAAC.

III. Effectiveness of the Amendments
The Transitory Articles of the Decree set forth, among others, that the Amendments will enter into effect as follows:

" A day after the publication of the Decree in the Federal Official Gazette, the financial leasing and factoring operations will not be considered as exclusive for leasing and financial factoring companies. Consequently, such operations may be carried out by any other individual or entity in its capacity as lessor or factor, respectively. These individuals or entities will be subject to the provisions of the LGTOC in the performance of such operations and will not be subject to the regime set forth by the LGOAAC.

" Seven years after the publication of the Decree in the Federal Official Gazette, the authorizations granted by the SHCP to operate leasing companies and financial factoring companies will no longer have effect by rule of law. This does not mean that such companies shall be dissolved; however, to continue operations, these companies must amend their bylaws eliminating any statement indicating that they are auxiliary credit organizations and are authorized by the SHCP. Failure to comply with the foregoing will cause the dissolution and liquidation of the company by rule of law.

" Seven years after the publication of the Decree in the Federal Official Gazette, the authorizations granted by the SHCP to the SOFOLES will no longer have effect by rule of law, without such companies having the obligation to be dissolved for such reason. To continue their operations after such seven year-term, the SOFOLES will have to amend their bylaws eliminating any statement indicating that they are limited financial purpose companies and that are authorized by the SHCP. Failure to comply with the foregoing will cause the dissolution and liquidation of the company by rule or law.