Hot Topics in International Trade – April 2022 – IMMEX – More What You Need to Know | Braumiller Law Group, PLLC

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IMMEX is an acronym which means in Spanish Industria Manufacturera, Maquiladora y de Servicios de Exportacion (Manufacturing, Maquiladora and Export Services Industry). It is a Mexican federal government program focused on promoting foreign investment, exports, job creation, technology development, etc. Businesses can apply for authorization to operate under this program provided they comply with the requirements. This would allow them to benefit from customs advantages on the rate of import duty and value added tax.

An IMMEX can import in bond anything that is directly needed to support the production process. This includes line machinery and equipment, raw materials and parts, safety and health items, boxes, labels, manuals and necessary administration equipment, tools and spare parts. Assets can remain in Mexico as long as the Maquila program continues.

All IMMEX products must be exported, directly or indirectly, or transferred to another IMMEX or exporter. The type of production can be the simple assembly of temporarily imported parts or the end-to-end production of a product from materials sourced from various countries, including Mexico.

IMMEX authorization can only be granted to companies incorporated and located in Mexico. Nevertheless, foreign individuals and/or entities may participate as shareholders/stockholders of IMMEX companies, unless restricted under the Foreign Investment Law or other regulations. Applicants can choose from one of five types of IMMEX modalities available: Controller, Industrial, Services, Shelter or Third Party. This will depend on the activities planned to be carried out in Mexico. For example, if the applicant wishes to import raw materials and produce a finished product for later export/return, then he can choose the industrial modality, or if he wishes to offer services such as warehousing, testing, repair, software design, or any other of the services listed in the rules, he may then wish to select the modality of the services.

Over the past two years, applying for the IMMEX program has become a complex and time-consuming process for the majority of businesses, as the federal government seems reluctant to grant and authorize IMMEX applications. The regulations stipulated that the authorization should be issued within 15 working days, however, in practice, this period has been extended to a few weeks or even months, as applicants may need to submit the application request several times. , before approval was finally granted. granted.

The complexity does not end there, as once the IMMEX application has been authorized, the company must be prepared to ensure full compliance with the law. From a customs compliance perspective, the administration and control of an IMMEX involves a high degree of knowledge regarding legal obligations and responsibilities. These are not only the Mexican customs law and its regulations, but also the tax code, the income tax law, the IMMEX decree, the general rules of foreign trade, the general criteria and rules foreign trade, etc. In addition, there are hundreds of legal provisions from other laws, codes, standards, decrees, etc., which may also govern IMMEX operations. These complexities mean that the legislation is not available in one place with amendments published by various authorities, at different dates.

There are many requirements and obligations that IMMEX must meet to be in full compliance. For example, they must have a system for controlling inventory of equipment and materials, demonstrate ongoing tax compliance, file tax and customs declarations, prove legal possession or ownership of the facility, maintain goods in the warehouse within the regulatory deadlines and limits. the import of harmonized tariff codes, production operations and processes, etc., to that authorized by the government. They must also have contracts with suppliers and customers in place, compliance with labor laws, an accurate description of goods, maintenance of complete customs documents in a consistent manner, maintaining VAT certification…and the list can be expanded. lengthen over and over again… (and it usually does given my experience of having done about 18 of these over the past few years)

One of the main obligations of an IMMEX is to have an automated inventory control system for materials and products, which must be managed in accordance with Mexican Customs Law, but mainly in accordance with Annex 24. It is This is one of 31 annexes to the General Rules of Foreign Trade, and it sets out the guidelines for controlling and managing the customs operations of an IMMEX.

The automated inventory control system must be able to:

  • Compliance with customs law, its regulations and the general rules of foreign trade relating to the control of stocks of temporarily imported goods.
  • Proof of return of temporarily imported goods and control of goods awaiting return.
  • Create reports that enable compliance with information requirements set forth in customs provisions and authority.

The system consists of catalogs and modules containing detailed information and reports on entries, discharges, materials used, withdrawals, returns, destructions, donations, changes in customs regimes, fixed assets, balances , tariff codes, units of measure, description of materials and goods produced, fixed assets, pedimentos (MX entry summary), production processes, suppliers, customers, customs brokers, customs agencies, legal representatives, etc.

Another important requirement is to demonstrate compliance with schedule 31. This schedule is related to the value added tax of goods managed by IMMEX and goes hand in hand with schedule 24. It can be described as a guideline necessary to manage and control tax credits and amounts related to temporary admission subject to VAT certification. It must include information on the inventory before and after the IMMEX is VAT certified, discharges associated with declarations, changes in customs regimes, virtual transfers, withdrawals, sales, donations, destructions, etc. An IMMEX attesting to its compliance can save the 16% value added tax on the materials it temporarily imports.

An IMMEX in full compliance with the law can be a competitive advantage that enjoys attractive advantages and savings on import duties, value added tax and potential exemptions from complying with international standards (Normas Oficiales Mexicanas ). However, an IMMEX without knowledge of the regulations can be negatively impacted financially and if they break the regulations, subject to high penalties and sanctions. Occasionally, minor errors, such as filings or reports containing typos or unintended statements, may result in a violation of the law with such adverse consequences and effects as to result in the cancellation or revocation of the IMMEX or the importer of record license, which can also be considered criminals with personal liability.

Therefore, persons or entities wishing to obtain an IMMEX should fully understand the implications and obligations involved, ensuring that the application is as complete and detailed as possible. Companies that already have an IMMEX program in place should devote the effort and resources necessary to put in place a robust compliance plan with sufficient staff familiar with the applicable legislation. Additionally, it should implement routine audits to confirm compliance.

The foregoing is not intended to provide legal advice or recommendations. It is presented for general information only.

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