|
Business Complexity: Mexico Now Second-Worst Worldwide
Brazil and Argentina also worsen as Costa Rica, Dominican Republic improve.
BY LATINVEX STAFF
Mexico and Brazil are now among the world’s three worst countries in business complexity, according to the 2026 Global Business Complexity Index from the TMF Group.
Mexico now ranks second, only behind Greece, while Brazil ranks third. Last year, Mexico ranked third and Brazil ranked sixth.
The Global Business Complexity Index is based on 200 indicators relating to business complexity and provides in-depth analysis of global and local challenges impacting on the ease of doing business around the world. These data points are used to compile a global ranking of the 81 jurisdictions, based on the complexity of their business environments and covering legislation, compliance, accounting procedures, tax regimes, human resources (HR) rules and payroll processes.
Other Latin American countries that worsened include Argentina, Bolivia, Ecuador, El Salvador, Peru and Uruguay.
Countries that improved include Colombia, Costa Rica, the Dominican Republic, Guatemala, Honduras, Nicaragua and Venezuela.
Meanwhile, Chile, Panama and Paraguay remained the same compared to last year.
MEXICO
Mexico moves into 2nd place in the GBCI rankings, up from 3rd in 2025, reinforcing its reputation as one of the world’s most challenging jurisdictions for foreign businesses.
“Foreign companies face ongoing challenges marked by frequent regulatory changes and unpredictable administrative requirements,” TMF says.
Adrian Owen, head of Mexico and Mid-Americas at TMF Group, says changes to the regulatory framework affect both companies and investors, as well as those who provide advisory services, such as lawyers, tax specialists, accountants, and others who must attend courses and workshops to stay up-to-date.
“If there’s no consistency, it’s like investing in the unknown,” he tells El Economista.
The tax authority’s discretionary actions, constant changes to requirements, and unclear expectations around international reporting standards drive complexity and as a result, tasks like opening bank accounts and working with said tax authorities can mean both doubt and delay, making it difficult for businesses to plan with confidence, TMF points out.
“Mexican authorities are moving business incorporation and corporate tasks toward digitalization, but they still require physical presence or wet ink signatures for many procedures, meaning overall progress can be inconsistent,” according to the report.
Meanwhile, over the years, lawmakers have repeatedly revised HRP outsourcing regulations, creating ongoing confusion regarding compliance and penalty avoidance.
| Most Complex Countries | ||||
| Ranked by worst to best. | ||||
| LRK=Latin America rank. GRK=Global rank. | ||||
| LRK | GRK | Ch | Country | |
| 1 | 2 | 1 | Mexico | |
| 2 | 3 | 3 | Brazil | |
| 3 | 6 | -1 | Colombia | |
| 4 | 7 | 1 | Bolivia | |
| 5 | 9 | 2 | Argentina | |
| 6 | 10 | 3 | Peru | |
| 7 | 12 | Paraguay | ||
| 8 | 20 | Chile | ||
| 9 | 24 | 3 | Uruguay | |
| 10 | 26 | 4 | Ecuador | |
| 11 | 27 | -5 | Venezuela | |
| 12 | 42 | Panama | ||
| 13 | 43 | 3 | El Salvador | |
| 14 | 46 | -1 | Guatemala | |
| 15 | 52 | -2 | Nicaragua | |
| 16 | 55 | -2 | Dom Rep | |
| 17 | 63 | -5 | Costa Rica | |
| 18 | 65 | -1 | Honduras | |
| Sources: Global Business Complexity Index 2026, TMF; Latinvex (LatAm rank) | ||||
BRAZIL
Brazil moves from 6th-worst to 3rd-worst in this year’s GBCI rankings.
“A multi-layered tax system and frequent regulatory changes across all service lines drive complexity in the jurisdiction, further compounded by heavy compliance demands and inconsistent rules at federal, state, and municipal levels,” TMF says. “Businesses must rely on local expertise, particularly as regulatory hurdles often delay business setup, enrolments, and licensing.”
Over the past year, lawmakers introduced tax reforms that have specifically impacted foreign businesses and are likely to implement further changes within accounting and tax, capital markets and funds across the next 12 months. Regulators have adjusted rules in tax and foreign exchange, which whilst simplifying processes, often also add new layers of complexity.
ARGENTINA
Despite the business-friendly government of President Javier Milei, Argentina ranks 9th overall in this year’s rankings, rising from 11th position in 2025.
“This move into the top 10 highlights the persistent challenges that foreign companies encounter within the jurisdiction,” TMF says. “The business environment remains demanding. Regulators continue to introduce unpredictable changes and are likely to increase regulatory compliance next year. Frequent legal updates force companies to review local processes constantly, raising operational risk and emphasizing the need for local specialist expertise.”
Following the elections, policymakers may ease regulatory requirements. Combined with a drop in inflation since 2025, these changes could attract new investment. If realized, both the reduction in inflation and any decrease in regulatory pressure would positively impact international businesses, according to the report.
“However, several core complexities persist,” TMF says. “Foreign exchange restrictions complicate business operations. And even as the possibility of regulatory easing increases, regulatory instability continues to challenge companies doing business in Argentina. Unpredictable changes in local regulations and persistent currency controls remain significant obstacles for firms navigating the market.
COLOMBIA
Colombia ranks 6th in GBCI 2026, a slight improvement from 5th place in 2025.
“Remaining firmly in the top ten, this position underscores the persistent and significant challenges faced by foreign companies when operating in the country,” TMF says. “The landscape is a complicated one. Colombian regulators frequently update tax legislation, including VAT rules and policies targeting high net worth individuals, meaning foreign firms must adapt quickly. In addition to these changes, authorities require annual filings and detailed shareholder disclosures, increasing the ongoing demands of governance and entity management. Businesses also face complex labor laws, compulsory social security contributions and substantial severance payments.”
And even with ongoing reforms aimed at lowering complexity and attracting foreign investors, businesses must still meet demanding compliance and reporting standards, particularly for tax and wealth management. An increase in minimum wage is set to affect HR and payroll in the coming year.
BOLIVIA
Bolivia now ranks 7th in market complexity, moving up from 8th, underlining continued complexity within the jurisdiction.
Business-friendly Rodrigo Paz assumed Bolivia’s presidency in November 2025.
“A new government brings hope for gradual improvements across the jurisdiction, but businesses continue to face bureaucratic hurdles and experience slow responses from local authorities,” TMF says. “The ongoing shortage of US dollars is a key complication for businesses navigating accounting and tax matters, impacting financial operations and planning…Although the new government is introducing corrective measures to address the dollar shortage, businesses have yet to see tangible improvements.”
The pace of change will likely remain gradual as the new administration settles in, and businesses should expect all service lines to feel the effects, according to the report.
“Overall, persistent complexity makes the Bolivian market less attractive, so businesses must continue to prepare for operational delays and limited flexibility,” TMF warns.
© Copyright Latinvex
