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The annual USMCOC-NE Golf Outing has grown more
popular every year. Co-organized by AXA, the outing
held last August 8th, was a great opportunity to
play golf and network with other members of the
U.S.-Mexico business community. Great gifts and
prizes were given away and raffled, among them hotel
stays in Cancun, as well as ProShop Gift cards.
The USMCOC-NE organized a members-only roundtable
discussion with Ambassador Ruben Beltran, Consul
General of Mexico in New York in August. Ambassador
Beltran led an outstanding discussion on the
Mexico-United States bilateral agenda, including the
most relevant topics such as the current Mexico’s
drug war, the pending energy reform, the immigration
agenda, the upcoming U.S. elections, and the
economic projections for these two countries. The
USMCOC-NE plans to hold these types of discussions
on a regular basis in an effort to promote
understanding and communication on bilateral issues
between the two countries.
On September 12th the USMCOC-NE celebrated Mexico’s
Independence Day with its annual gala. The
celebration gathered around 300 people that enjoyed
the cuisine of the best Mexican restaurants in New
York: Amanda Smith Caterers, Café Frida, Crema, Dos
Caminos, La Esquina, Maya, Mercadito, Mi Cocina,
Pámpano, Rosa Mexicano, Toloache, Zarela and Zona
Rosa. The Celebration also featured an open bar
courtesy of Tequila Don Julio and Jose Cuervo,
Corona and LA Cetto's wines, as well as Live
Mariachi band music and dance. The Chamber was
honored to have the Consul General of Mexico in New
York, Amb. Ruben Beltran, conducting the ceremony of
“el Grito”.
Mexico’s Custom and Trade Facilitation Seminar
By: Guillermo Sánchez Chao*
On past days the Northeast Chapter of the United
States – Mexico Chamber of Commerce invited me to
participate on its Mexico’s Custom and Trade
Facilitation seminar held at New York City, same
that resulted in a very gratifying experience for
all the participants.
Being a Mexican lawyer in a
United States forum represented a challenging
experience, as my goal was to transmit the new
measures taken by the Mexican government in order to
improve its custom and trade policies while
addressing a audience that is not fully familiarized
with the Mexican legal system.
As such, my participation at the
event was aimed to answer the questions that are
typically posted in the American exporter’s mind
while trading with a Mexican partner; questions that
we all have to admit are more and more challenging
as the trade between our two countries continues to
increase in volume and value.
In this regard, one of the first
questions that was arisen was involved with the main
risks that an American exporter may face while
trading into Mexico, the latter as there must be a
consciousness that trading, although profitable, may
involve potential contingencies to both trading
partners (the American exporter and the Mexican
importer).
Within the abovementioned
framework it is important to point out, that one
often missed out point on the United States – Mexico
trade relation that may represent a contingency to
the American exporters, is the obligation to comply
with the Reviews of Origin as established at the
North American Free Trade Agreement (NAFTA).
Considering the latter, it will
be important to remember that under NAFTA the
Mexican authorities may exercise their jurisdiction
over an American exporter that has issued a
Certificate of Origin under the scope of the
aforesaid treaty, in order to verify whether or not
the exported goods actually qualified as NAFTA
originating, therefore performing a Review of Origin
upon an American exporter via a questionnaire.
In this concern, the main problem
for the American exporter facing a Review of Origin
carried out by the Mexican government agency, is
that they typically dismiss the questionnaire sent
by such agency by virtue of which the information
concerning the NAFTA origin qualification of a
certain exported merchandize is being requested.
The aforesaid dismissal of the
questionnaires, might be the natural and the most
obvious course of action for the executive of an
American exporting company, as such person will be
facing a questionnaire issued by a foreign
government requiring to answer questions that
directly involve the manufacture of its exported
goods.
However, the fact that an
American exporter ignores and disregards said
questionnaires will enable the Mexican authorities
to issue a resolution declaring that the
merchandizing described at the NAFTA Certificates of
Origin issued by that exporter are false and
henceforward null.
In this regard, to ignore the
questionnaires sent by the Mexican government while
carrying out a Review of Origin may result in
further contingencies for the American exporter that
can be characterized in a double liability.
First, the American exporter may
face a civil liability concerning the Mexican
importer, the latter as if the Certificates of
Origin are declared null by the Mexican authorities
the Mexican importer will be bound to pay the
general import tax and several fines, as it could be
considered that a NAFTA preference was wrongfully
applied.
Consequently, if the Mexican
exporter is able to establish that the general
import tax and fines it was bound to pay by its
government are directly linked with the dismissal of
the questionnaires by the American exporter, said
exporter may be facing a civil liability before its
trading partner.
Secondly, the American exporter
might be facing a liability before the American
government, as it can be considered that such
exporter issued a false document in order to allow
another person to qualify for a tax preference.
Derived from the latter, during
my participation at the aforementioned seminar, I
tried to address the attention of the audience to
the importance of taking seriously the Review of
Origin questionnaires sent by the Mexican
government, even more considering that in past days
the Mexican Tax Authorities have stated that they
will increase the number of this reviews.
Nevertheless, my participation at
the seminar was not circumscribed to alert the
American exporters on the risk they may face while
trading with Mexico, on the contrary, one good share
of the questions asked concerned the opportunities
that are now being presented considering the new
Custom and Trade Facilitation policy to be enforced
by the Mexican government.
The Mexican government and some
of its agencies envisioned the aforesaid
facilitation policy in order to increase its
competitiveness, making Mexico more attractive to
traders and foreign investors.
As such, this new Custom and
Trade Facilitation policy will involve four main
fronts of action, same that concern tariffs, the
tariff classification system, the non tariff
regulations and paperwork simplification and
elimination.
Regarding tariffs, the
Facilitation policy envisions a framework in which
almost all the imports into Mexico will be import
tax exempted and only the more sensible imports will
be levied.
The latter, under the logic that
at present day almost 80% of the Mexican imports are
carried out applying a Free Trade Agreement
preference, and consequently the general practice
while importing a certain merchandize is not to
apply the general import tax rate that was
established but the aforementioned preference.
Also the aforementioned
Facilitation plans cover a reduction on the Mexican
tariff classification system, same that on present
day is composed on a eight digits code (the
Harmonized System code plus two additional numbers),
considering that at presently most of the
classification controversies comprise not the
classification number under the Harmonized System
but the two additional numbers that have been added
by the Mexican government.
Consequently, the reduction of
the Mexican tariff classification system will make
easier for the foreign exporters to trade with their
Mexican partners as they will have the certainty
that if a certain product is correctly classified in
accordance with the Harmonized System, no
classification controversies will arisen in this
concern with the Mexican authorities.
Even more, said Facilitation
plans also provide the simplification non tariff
regulations concerning the Mexican Official
Standards, drawing a plan to reduce the excessive
number of scattered regulations that have to be
complied amalgamating them in just a few
understandable documents.
Additionally, the Facilitation
plans comprise the simplification and reduction of
paperwork foreseeing the possibility of digital
filing and decision processes at the Ministry of
Economy; same that will help to expedite compliance
and resolution processes.
Moreover, during my participation
I was able to notice great interest from the
participants regarding the opportunities that
American investors might take advantage of,
considering the abovementioned Custom and Trade
Facilitation Plans.
In this regard, I pointed out
that one of the forthcoming opportunities for
investing in Mexico is the logistics sector. The
latter, considering that any changes on Custom and
Trade policies in Mexico will give rise to the
necessity of having specialized logistics
counseling.
Derived from the above, and considering that the
logistics counseling sector in Mexico is
underdeveloped at present time, the opportunity to
embrace it by the American investor is not to be
missed, considering that nowadays the negotiations
concerning the uniformity of custom procedures at
the NAFTA region will gain relevance.
Finally, I would like to thank
everyone at the Northeast Chapter of the United
States – Mexico Chamber of Commerce for the
opportunity to participate at the Custom and Trade
Facilitation in Mexico Seminar, I am convinced that
this kind of exercises, beyond being a great
experience for everyone that participated in it,
will help to improve the dynamic commercial
relationship between both countries and will
increase the understanding of each other.
*Lead Partner of the
International Trade and Customs practice at Chevez,
Ruiz, Zamarripa y Cía., S.C.
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