Bureaucratic battles: four foreigners and a Mexican open a bar in Mexico City.

It all started with a common interest in music. Umair Khan (a Briton), Jussi Walker (a Scot-Finn), and a third friend who has since emigrated to Australia, had been commiserating over what they felt was a lack of venues in Mexico City to hang out and hear the kind of funk/jazz/hip-hop music they liked.

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So they formulated an idea: Why not find a bar that would allow them to host an event, and then, that way, they could choose the music?

They began asking around and soon found a place willing to give it a try. On May 1, 2002, they sponsored their first event: a birthday party for a friend at a bar in Colonia Cuauhtemoc.

Next thing they knew, the party had become a weekly event.

Chilean-Briton Julian Bunster and local guy Juan Vasquez joined up with the core group to spin records, and another friend, French-Scottish Ben Carter, got involved on the organizational level.

Soon, the host bar, which had seen somewhat slow business beforehand, was becoming frequented and popular again. But the guys started to feel that they weren't getting the respect they were due.

"We started suggesting all these things that we could do to improve the night, to improve the owner's business, but he kept on saying 'no,'" says Ben. "So there was just a sense of frustration, and so we thought, 'We've got a lot of good ideas and we're not getting a response here, so why don't we start a place of our own?'"

And that's exactly what they did.

Today, three years after that first birthday party, Umair, Jussi, Julian, Juan and Ben are co-owners of the Black Horse Pub in Mexico City's fashionable Condesa neighborhood. On a recent Friday night, the guys took time out to gather around a table in the corner of the bar and recount their adventure opening a pub in the largest city in the Americas.

"It was fate, really," recalls Julian, "because we had been talking about (opening our own venue), and then one day when we were all really fed up with the frustration, Jussi said, 'I just saw this place that used to be a vegetarian restaurant that's for rent.'"

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The location looked great. So, armed with an idea and an available space, they took the next step and contracted a lawyer.

Entering The Maze 

Umair had known attorney Arminda Mancebo from Solutions Abroad, where he had worked previously and where she serves as legal counsel.

Not only was Arminda someone whom Umair knew and trusted, she also spoke flawless English--a big plus for an ownership group that was 80 percent Anglophone. For even though the guys all spoke excellent Spanish, as Arminda notes, "sometimes you need to get things explained to you in your own language if you want to make sense of our legal imbroglio."

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Arminda was also able to write up their company by-laws in English--since one of the first steps in the process was to set up a limited liability corporation--and that made everyone feel more comfortable with the document they were signing.

Not only was it immensely helpful to have a fluent English speaker as their legal representation, the entrepreneurs point out that having a Mexican citizen, Juan, as part of the team was a big plus as well.

"Although it's no longer a legal requirement (for foreigners to have a Mexican business partner), it sure does make things smoother if you have a Mexican who can be the one to speak with other Mexicans in key situations," says Julian.

After the group got themselves incorporated, they signed a lease on their space and began renovating as they started to apply for the requisite licenses.

Of course, getting the licenses was no easy thing.

Jumping Through Hoops

First, they had to go to the administrative offices of their delegacion, or precinct, and apply for a licensia de uso de suelo, or zoning permit. To get the zoning permit, they had to apply as a restaurant/bar rather than simply a bar, since neither bars nor nightclubs are allowed on their street.

Even so, the restaurant/bar requirement was not a deterrent for the group. "We didn't see ourselves as a night club," says Ben. "Our vision was to really make it into a pub--something that is open throughout the day. And that made it easier for us anyway since that was the only type of license that this delegacion had been giving out."

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They went to the delegacion office and filed for the permits. That's when the bureaucratic headaches started.

For example, on one application form, they had called their neighborhood Condesa, when its official name is actually Hipodromo Condesa. That meant a setback of two or three weeks as they re-filed the form.

Then the delegacion tried to tell them they needed to get a license as if they were going to be running a strip club.

"They said: 'You have to have a license for table dancers,' even though we kept telling them, 'We don't want table dancers!'" recalls Ben.

As the zoning and restaurant/bar licenses slowly made their way through the bureaucracy, there were issues with the facility as well.

They had hired workers to renovate the bar, and that meant they needed a license from the builders' union saying that the workers were protected.

When they had the bar completely renovated, they had to hire a gestor, an inspector licensed by the delegacion, to come and put his stamp of approval on the site. But the inspector wouldn't come when he said he was going to, and the process dragged on.

Meanwhile, back at the delegacion office, things were not going any better. "We were being told different things constantly," says Jussi. "Like with the liquor license. One day they said, 'Yes, you can sell just beer and wine,' but then when we went back they said, 'No, you cannot have just a beer and wine license, you have to have the full license.'"

"I remember saying, 'If only they would just say, this is exactly what you need,' and then we'd comply with that," says Ben. "But we got three rejections and each time it was something else, something different, and so we were thinking, 'Why didn't they just tell us that in the first place?'"

Still, despite the headaches, Julian says he could see some method in the bureaucratic madness.

"There are a lot of rich kids who think, 'I'm going to set up a bar because my daddy's going to give me money,' and so they kind of try out your patience to see how committed and how serious you are about it."

Satisfaction, At Last

Finally, the guys must have adequately proved their seriousness, for in September 2004, eight months after paying their first rent and four months after beginning the license application process, they opened the Black Horse with all the requisite licenses in hand.

There were still some hoops to jump through, like signing a collective bargaining agreement with their employees and winning over a concerned neighborhood committee, but, as Julian notes, "Touch wood ... it's been fairly straightforward since then."

Looking back on the process, he adds, "I think we were all aware that in Britain, this would have been just about impossible for us to do. We were surprised by the way Mexican business works, but at least we knew that it could be done."

And keeping your eyes on the prize despite the inevitable surprises, says lawyer Arminda Mancebo, is perhaps the best advice for foreigners who want to start a business in Mexico.

"The biggest problem (foreigners) have is when they start making comparisons to their own country," she says. "'But in the United States ...,' they say, or, 'But in Britain ...'"

"You have to remind people to forget about what they've learned and realize that this is Mexico. You will run into trouble, but we can take care of it."

Jonathan Clark ([e-mail]) is a journalist based in Mexico City.