FOREWORD During colonial times, Mexico was called the "Mine and Mint of Spain." Had it not been for mining, the capital cities of Mexico, the cathedrals, universities, roads, and wealth could not have been built. Under Spanish law dating back to regulations issued by King Alfonse the Wise (Ley de las Siete Partidas) in 1265, all mines in the land belonged to the king and his subjects could only "hold or use them" by royal grant. This regalian doctrine was car-ried forward without interruption in most subsequent Spanish and Mexican legislation and is the basis of Mexico's present mining laws. The traditional concept of mining concessions has not changed that is, conces-sions do not provide title of ownership over the mineral deposit but only authorize the concessionaire to exploit the deposit and dispose of the minerals in accordance with the terms of the law. Concessions are granted or transferred only to Mexican citizens or to corporations that have a majority of Mexican stockholders. Traditionally, individuals and groups have been permitted to profit from the exploitation of mineral resources only to the extent of one-fifth of the output. This share was called the "Quinto Real," or Royal Fifth. The Mexican government, since colonial times, has taxed mining concessions based on the theory that as owners of the minerals, the state is entitled to par-ticipation in the profits like any mine owner that leases a property. In 1884, for the first time in the history of Mexican legislation, the government par-tially abandoned the regalian doctrine by adopting a system of accession under which the owner of surface land was also recognized as the owner of the minerals in the subsoil. This change was brought about by the depressed price of silver following the U.S. Civil War (the silver crisis) when silver dropped to 90 cents an ounce. Thus, the new mining code of 1884 and the subsequent liberalization during the term of General Porfirio Diaz set the stage for an era of important U.S., French, and British investment in Mexican mining operations. The mining law of June 4, 1892, pointed the way by "... granting the mines facility to acquire, liberty to exploit, and security to retain." This law the most liberal mining law ever promulgated in Mexico preserved the traditional system of mining properties. But more important, it gave miners the freedom to claim (denounce) as much land as they could pay taxes on, to work a mine in any manner they saw fit, and to open or shut down operations as economic circumstances dictated without the obligation of performing assessment work. iii