Mexican Foreign Trade Act: Regulations and Practices

Posted on Dec 16, 2024 in Law & Jurisprudence

Title I: General Provisions

Chapter One

Article 1. This Act is to regulate and promote foreign trade, increase the competitiveness of the national economy, promote the efficient use of productive resources of the country, properly integrate the Mexican economy into the international economy, defend the production plant from unfair international trade practices, and contribute to raising the welfare of the population.

Article 2. The provisions of this Act are mandatory and applicable throughout the Republic, without prejudice to the treaties or international agreements to which Mexico is party.

Article 3. For purposes of this Act, the following definitions shall apply:

• I. Secretariat: the Ministry of Economy;
• II. Commission: the Foreign Trade Commission;
• III. Antidumping duties;
• IV. Rules: the general character issued by the Secretariat;
• V. Rules: the Rules of this Act.

Title II: Powers of the Executive Branch, the Ministry of Economy, and Auxiliary Committees

Chapter I: Powers of the Federal Executive

Article 4. The Federal Executive shall have the following powers:

• I. To create, increase, decrease, or eliminate tariffs;
• II. To regulate, restrict, or prohibit the export, import, or transit of goods;
• III. To establish measures to regulate or restrict the exportation or importation of goods through agreements issued by the Secretariat;
• IV. To establish measures to regulate or restrict the movement or transit of foreign goods from the country;
• V. To conduct business negotiations;
• VI. To coordinate, through the Secretariat, the involvement of agencies of the Federal Civil Service;
• VII. To coordinate, through the Secretariat, the agencies of the Federal Civil Service.

Chapter II: Powers of the Ministry of Economy

Article 5. The powers of the Secretariat are:

• I. To study, plan, and propose tariff changes to the Federal Executive;
• II. To process and settle investigations into safeguard measures;
• III. To explore, plan, establish, and amend regulatory measures and restrictions on the export, import, movement, and transit of goods;
• IV. To establish the rules of origin;
• V. To grant prior authorization and allocate export and import quotas;
• VI. To establish the requirements for marking of country of origin;
• VII. To process and resolve the investigations relating to unfair trade practices;
• VIII. To advise Mexican exporters involved in investigations abroad regarding unfair trade practices and safeguard measures or other proceedings which may be a restriction on the importation into other countries;
• IX. To coordinate international trade negotiations with the competent authorities;
• X. To issue the administrative provisions in compliance with international treaties or agreements on trade of which Mexico is a party;
• XI. To establish programs and mechanisms for promotion and export development;
• XII. To issue rules to establish general provisions on the scope of its competence;
• XIII. Any other duties expressly assigned by the laws and regulations.

Chapter III: Auxiliary Commissions

Article 6. The Trade Commission will be a mandatory advisory body for agencies of the Federal Civil Service in relation to the matters referred to in sections I to V of Article 4 of this Act. The Commission shall be responsible for issuing opinions in matters of foreign trade in accordance with the provisions of this Act.

Article 7. The Joint Commission for the Promotion of Exports will assist the Federal Executive in relation to the authority referred to in Section VI of Article 4 of this Act.

Article 8. The chairman and technical secretariat of both commissions will be appointed by the Secretariat. The Federal Executive shall determine the entities and organizations that will comprise each committee and regulate its operation.

Title III: Origin of Goods

Chapter One

Article 9. The origin of the goods may be determined for purposes of tariff preferences, country of origin marking, application of countervailing duties, quotas, and other measures established for that purpose. The origin of the goods may be national if we consider a single country, or regional, if we consider more than one country.

Article 10. The rules of origin must be lodged with the opinion of the Commission and published in the Official Journal of the Federation. These rules shall be made under any of the following criteria:

• I. Change in tariff classification;
• II. National or regional content;
• III. Production, manufacture, or processing.

Article 11. In the importation of goods subject to compliance with rules of origin, the importer must prove their origin in the time and form prescribed by the applicable ordinances.

Part IV: Fees and Measures of Non-Tariff Regulation and Restriction of Foreign Trade

Chapter I: Tariffs

Article 12. For purposes of this Act, the fees are fees imposed by tariffs of general export and import, which may be:

• I. Ad valorem, when expressed as a percentage of the customs value of goods;
• II. Specific, when expressed in monetary terms per unit of measurement;
• III. Mixed, in the case of the combination of the two.

Article 13. The tariffs referred to in the preceding article may take the following forms:

• I. Tariff quota, when establishing a tariff level for a certain amount or value of goods exported or imported, and a different rate of exports or imports of such goods that exceed that amount;
• II. Tariff season, when setting different tariff levels for different periods of the year;
• III. The others designated by the Federal Executive.

Article 14. Different tariffs may be established under the general tax rates overall export and import where provided for by international treaties or trade agreements to which Mexico is party.

Chapter II: Control Measures and Restrictions

Section One: General Provisions

Article 15. The measures of regulation and restrictions on the export of goods referred to in section III of Article 4 of this Act may be established in the following cases:

• I. To ensure the supply of basic consumer goods for the population and raw material supplies to domestic producers;
• II. Under the provisions of treaties or international agreements to which Mexico is party;
• III. In the case of products which are subject, by constitutional provision, to specific restrictions;
• IV. When trying to preserve the fauna and flora at risk or endangered or to ensure the conservation or exploitation of species;
• V. When required to keep the assets of historic, artistic, or archaeological value;
• VI. In the case of situations not covered by the official Mexican standards with regard to national security.

Article 16. The measures of regulation and restrictions on the importation, movement, or transit of goods are as follows:

• I. When temporarily required to correct imbalances in the balance of payments, according to treaties or international agreements to which Mexico is party;
• II. To regulate the entry of used goods, waste, or goods that have no substantial market in their country of origin or provenance;
• III. Under the provisions of treaties or international agreements to which Mexico is party;
• IV. In response to restrictions on Mexican exports applied unilaterally by other countries;
• V. When it is necessary to prevent the entry into the domestic market of goods in conditions involving unfair trade practices under the provisions of this Act;
• VI. In the case of situations not covered by the official Mexican standards with regard to national security, public health, sanitation, phytosanitary or ecology, according to the relevant legislation.

Article 17. The establishment of regulatory measures and restrictions on the export, import, or transit movement of goods, referred to in sections III and IV of Article 4, shall previously submit to the Commission’s view and be published in the Official Journal of the Federation. Federal executive agencies competent to issue or enforce these measures shall be published in the Official Journal of the Federation for dispatch procedures or compliance, and report to the Commission on the administration of those measures and procedures.

Article 18. In the cases provided in sections I and II of Article 15 and I-V of Article 16, the assessment by the Commission should be based on an economic analysis prepared by the relevant unit of the costs and benefits arising from the implementation of the measure. This analysis may take into account, inter alia, the impact on the following factors: prices, employment, competitiveness of productive chains, government revenues, profits in the industry, as costs for consumers, variety and quality of supply available, and level of market competition.

Article 19. Notwithstanding the provisions of Article 17, the competent departments of the Federal Executive may establish regulatory measures or non-tariff restrictions on exports, import, or transit of goods movement in the cases provided in sections III to VI of Article 15 and Article 16 without being subject to the opinion of the Commission.

Article 20. In any case, goods subject to tariff restrictions or regulations must not be identified in terms of tariff and nomenclature that are appropriate under the respective fee.

Section Two: Previous Permits, Quotas, and Country of Origin Marking

Article 21. It is for the Secretariat to hold the export and import of goods before issuing permits, as follows:

• I. The subject to prior review shall be submitted to the Commission;
• II. The format of the applications and information requirements and processing procedures should be published in the Official Journal of the Federation;
• III. The issue will be resolved within 15 days;
• IV. Permits shall state the terms, conditions, and duration to be subject, as well as the value and quantity or volume of goods exported or imported and the other information or requirements needed;
• V. The other procedures set out in the Regulations.

Article 22. No prior authorization will be used to restrict:

• I. The importation of goods as provided in section V of article 16 of this Act; or
• II. The export, import, or transit of goods movement in order to comply with the provisions on official Mexican standards.

Article 23. The term export quota or import quota refers to the amount of goods that may be exported or imported, either maximum or within a tariff-quota. The administration of quotas can be done through prior authorization.

Article 24. The quota will be allocated through competitive bidding, for which notice shall be issued to any individual to present proposals to acquire part or all of the quota assigned to a particular export or import goods.

Article 25. The Secretariat, after consulting the Commission, will require that goods imported into the country hold a strong country of origin where indicated the name of the country.

Section Three: Other Measures to Regulate Foreign Trade and Mexican Official Standards

Article 26. In any case, the importation, movement, or transit of goods is subject to the official Mexican standards in accordance with the law of matter. There may be no standard rules for the importation, movement, or transit of goods other than the official Mexican standards. The goods subject to Mexican Official Standards will be identified in terms of tariff nomenclature and their corresponding under the respective fee.

Article 27. Any other administrative action of the agencies of the federal government, which has the purpose of regulating or restricting foreign trade and the movement or transit of foreign goods, must submit to the opinion of the Commission prior to dispatch, to ensure better coordination with its tariff and non-tariff measures provided for in this Act.

Title V: Unfair Trade Practices

Chapter I: General Provisions

Article 28. Unfair trade practices are considered to be the import of goods under price discrimination or subsidies in the exporting country, whether of origin or provenance, causing injury to a domestic industry of goods identical or similar in terms of Article 39 of this Law.

Article 29. The determination of the existence of price discrimination or subsidization, injury, causal relationship between them, and the establishment of countervailing duties are carried out through an investigation under the administrative procedure under this Act and its regulations.

Chapter II: Price Discrimination

Article 30. The import conditions of price discrimination is the introduction of goods into the country at a price below its normal value.

Article 31. The normal value of goods exported to Mexico is the comparable price of identical or similar goods, intended for the domestic market in the country of origin in the course of trade.

Article 32. Trade means the trade to reflect market conditions in the country of origin and usually have been made, or within a representative period between independent buyers and sellers.

Article 33. In the case of imports from a country with a centrally planned economy, the normal value of the goods concerned is taken as the price of identical or similar in a third country market economy that can be considered as a substitute for a centrally planned economy country for purposes of research. The determination of normal value shall be in accordance with the provisions set out in previous articles.

Article 34. When goods are exported to Mexico from an intermediate country, and not directly from the country of origin, the normal value is the comparable price of identical or similar goods in the country of origin.

Article 35. When unable to obtain an export price or where in the opinion of the Secretariat, the export price is unreliable because there is a connection or arrangement between the exporter and importer or a third party, that price may be calculated on the basis of the price at which the imported products are first resold to an independent buyer in the country, or if the products are not resold to an independent buyer or not resold in the same condition as imported, on a reasonable basis that the authority determines.

Article 36. For the export price and normal value to be comparable, the Secretariat will make the adjustments resulting from, among others, the terms and conditions of sale, differences in quantities, the physical differences, or differences in tax burdens.

Chapter III: Grants

Article 37. For the purposes of this Act, the term subsidy means:

• I. The financial contribution granted by a foreign government, its agencies or mixed, its entities, or regional agency, public or mixed up by several countries, directly or indirectly, to an enterprise or industry or group of enterprises or industries and that this confers a benefit;
• II. Some form of income support or price and that it confers a benefit.

Article 38. In calculating the amount of subsidy received by the foreign goods exported to Mexico, minus the total of export taxes, duties, or other charges to which it has undergone the export of goods in the country of origin intended to offset the subsidy.

Chapter IV: Injury to Domestic Industry

Article 39. For the purposes of this Act, damage shall mean, except for the concept of serious injury to safeguards:

• I. A material damage caused to a domestic industry;
• II. A threat of injury to a domestic industry; or
• III. A delay in the creation of a domestic industry.

Article 40. For the determination of injury, the term domestic industry means the total domestic producers of identical or similar goods, or those whose collective output constitutes a major proportion of the total domestic production.

Article 41. In the determination of material injury to domestic industry, the Secretariat will take into account:

• I. The volume of imports of goods subject to price discrimination or subsidies;
• II. The effect on prices of identical or similar goods in the domestic market caused or may cause the import of goods subject to price discrimination or subsidization;
• III. The effect caused or may cause such imports on the domestic industry concerned, considering the economic factors and indices having a bearing on the state of the domestic industry.

Article 42. In the determination of the existence of a threat of injury to the domestic industry, the Secretariat will take into account, inter alia, the following factors:

• I. A significant rate of increase of imports of goods subject to price discrimination and subsidies in the domestic market indicating the likelihood of a substantial rise from them;
• II. A sufficient freely disposable, or an imminent, substantial increase of the exporter indicating the likelihood of substantially increased dumped exports of price discrimination or subsidies to the Mexican market;
• III. If imports are entering at prices that will have the effect to lower or contain the rise in domestic prices significantly, and likely will increase demand for further imports;
• IV. The existence of the subject merchandise;
• V. Where appropriate, the nature of the subsidy in question and the effects likely to be in trade; and
• VI. Other items deemed appropriate by the Secretariat, or your case, provide the domestic industry.

Article 43. For the determination of injury, the Secretary may collect the amount and impact of imports of identical or similar goods from two or more countries under investigation.

Article 44. In determining the existence of injury to a domestic industry, the country may be divided into two or more competitive markets and the producers within each market may be regarded as a separate industry if:

• I. The producers within such market sell all or almost all of its production of the goods in question in that market; and
• II. In that market demand is not substantial degree supplied by producers of the goods in question located elsewhere in the territory.

Title VI: Protection Measures

Chapter One

Article 45. The safeguard measures are those that, in terms of Section II of Article 4, regulate or temporarily restrict imports of identical, similar, or directly competitive domestic production to the extent necessary to prevent or remedy serious injury to the domestic industry concerned and to facilitate adjustment of domestic producers.

Article 46. Serious injury is significant overall impairment of a domestic industry. Threat of serious injury is clearly imminent serious injury to a domestic industry.

Article 47. The determination of serious injury or threat of serious injury, its causal relationship to increased imports, and the establishment of safeguards will be done through an investigation under the administrative procedure under this Act and its provisions regulations.

Article 48. To determine whether increased imports have caused or threaten to cause serious injury to a domestic industry:

• I. The rate and amount of the increase in imports of the product concerned in absolute terms or relative;
• II. The part of the domestic market taken by increased imports;
• III. Changes in the levels of sales, production, productivity, capacity utilization, profits or losses, employment, and prices;
• IV. Repealed;
• V. Other items which the Secretary deems necessary.

Title VII: Procedure in Unfair Trade Practices and Measures to Safeguard

Chapter I: Provisions Common to the Procedures

Article 49. The investigation on unfair trade practices and safeguard measures will be launched officially in special circumstances when the Secretary has sufficient evidence.

Article 50. The request may be made by legally constituted organizations, individuals, or companies producing.

Article 51. An interested party is considered to be the requesting producers, importers, and exporters of subject merchandise, as well as foreign legal persons having a direct interest in the investigation in question and those who enjoy this character in international treaties or trade agreements.

Article 52. After the submission of the request, the Secretariat shall:

• I. Within 25 days, accept the petition and declare the beginning of the investigation by the relevant resolution; or
• II. Within 17 days, require the applicant for further evidence or data;
• III. Within 20 days, discard the request if not complied with the requirements of applicable law, through the respective resolution.

Article 53. From the day following the date of publication of the decision to initiate an investigation in the Official Journal of the Federation, the Secretariat shall inform interested parties known to you to appear to manifest what you deem appropriate.

Article 54. The Ministry may require the parties concerned the evidence, information, and data it deems relevant, for which forms will use the same set.

Article 55. The Secretary may require producers, distributors, or retailers of the goods in question and customs agents, representatives, agents, or consignees in importing, or any other person it deems appropriate, information and data at their disposal.

Article 56. The parties concerned in an investigation should be sent to other interested parties copies of each of the reports, documents, and evidence to submit to the authority in the course of the proceedings, unless the confidential information referred to in Article 81.

Chapter II: Procedure for Unfair Trade Practices

Section One: Resolution Preview

Article 57. Within 90 days, counting from the day following the publication of the decision to initiate the investigation in the Official Journal of the Federation, the Ministry shall issue the preliminary determination, through which you can:

• I. Determine provisional antidumping duty;
• II. Not impose provisional antidumping and continue with the administrative investigation; or
• III. Adjourn administrative investigation when there is insufficient evidence of price discrimination or subsidization, injury, or alleged causal relationship.

Section Two: Final Resolution

Article 58. After the investigation of unfair trade practices, the Secretary shall submit to the Commission’s view the draft final resolution.

Article 59. Within 210 days, counting from the day following publication in the Official Journal of the Federation of the initiation of the investigation, the Ministry shall issue the final decision. Through this resolution, the Secretariat shall:

• I. Impose definitive antidumping;
• II. Revoke the provisional countervailing duty; or
• III. Declare the investigation without the imposition of antidumping duty.

Section Three: Hearing Conciliation

Article 61. In the course of the administrative inquiry, interested parties may request the Secretariat to hold a conciliation meeting. This hearing will propose ways of solution and conclusion of the investigation, which, from the proceeds, shall be punished by the Secretariat itself and incorporated in the relevant resolution shall be considered as final resolution.

Section Four: Dumping Duties

Article 62. It is for the Secretariat to determine the antidumping duties, which shall be equivalent in the case of price discrimination, the difference between normal value and export price and in the case of subsidies, the amount of benefit.

Article 63. The antidumping duties will be considered as exploitation in terms of Article 3 of the Federal Tax Code.

Article 64. The Ministry will calculate individual margins of price discrimination or subsidies to those foreign producers to provide sufficient information for it; these individual banks will be the basis for the determination of specific countervailing duties.

Article 65. The Ministry of Finance shall recover the provisional and definitive countervailing duties. This dependence may accept collateral security provided under the Federal Tax Code, in the case of provisional countervailing duties.

Article 65 A. In the case of price discrimination that causes injury to the domestic industry, for the Secretariat to determine the application of a final antidumping duty on goods under investigation which have been imported during the previous three months the date of application of provisional measures when the product in relation to price discrimination investigation.

Article 66. The importer of an identical or similar to that payable by a provisional or definitive antidumping duty shall not be obliged to pay if they prove that the country of origin or provenance is different than the merchandise subject to antidumping duty.

Article 67. The final countervailing duties will be in effect as long as and to the extent necessary to counteract the damage to the domestic industry.

Article 68. The final countervailing duties may be reviewed annually at the request of a party or at any time by the Secretariat office, whether such fees are subject to an alternative dispute resolution or administrative or judicial proceedings.

Article 69. When the final countervailing duties were imposed to counter the threat of injury caused by imports in terms of price discrimination or subsidy, the review should include, where appropriate, an assessment of the investment without the countervailing duty not would have been feasible.

Article 70. The final countervailing duties will be eliminated within five years from the date of its entry into force, unless before the end of this period, the Secretariat has started:

• I. An annual review process at the request of an interested party or ex officio, which analyzes both price discrimination or amount of subsidies, and injury;
• II. A review of the enforcement of antidumping duties of office, to determine whether removal of the countervailing duty would lead to continuation or recurrence of the unfair practice.

Article 71. They are not subject to the payment of antidumping or safeguard measure, the following goods:

• I. The baggage of passengers on international voyages;
• II. The household goods belonging to immigrants and repatriated or deported nationals, that they have used during their residence abroad;
• III. The imported by residents of the border for personal use;
• IV. Those that are donated to be intended for cultural, educational, research, public health, or social service agencies importing public;
• V. Others authorized by the Secretariat.

Section Five: Commitments by Exporters and Governments

Article 72. When in the course of an investigation the exporter of the goods in conditions of unfair trade practices, to commit voluntarily to change its prices or cease exports or whether the government of the exporting country eliminates or limits the grant of concerned, the Secretary may suspend or terminate the antidumping investigation without applying.

Article 73. If the Secretary accepts the commitment of the exporter or the government concerned, it shall make the appropriate decision, stating suspended or terminated the administrative investigation, which shall notify the parties concerned and published in the Official Journal of the Federation.

Article 74. The implementation of these commitments may be revised periodically ex officio or upon request. If as a result of the review the Secretariat noted the breach, be restored investigation and, where appropriate, impose the appropriate antidumping duty on the basis of the facts that they are known by publication in the Official Journal of the Federation respective resolution.

Chapter III: Procedure for Safeguard Measures

Section One: Determination of Safeguard Measures

Article 75. The determination of the safeguard measures shall take place no later than 210 days, counting from the day after publication in the Official Journal of the Federation of the initiation, and is subject to the provisions treaties and international conventions to which Mexico is party.

Article 76. After the investigation for the application of safeguard measures, the Secretariat will send the draft final resolution to the Commission to issue its opinion before the publication of this resolution.

Article 77. The duration of the safeguard measures may be up to four years and renewable for up to six years if that warrants the need for it, taking into account the implementation of the adjustment program domestic production.

Section Two: Critical Circumstances

Article 78. The Federal Executive may establish provisional safeguard measures within 20 days, counting from the day after publication in the Official Journal of the Federation of initiation of the investigation.

Article 79. The duration of provisional measures shall not exceed six months. This period will mark the provisions of treaties or international agreements to which Mexico is party.

Chapter IV: Other Provisions Common to the Procedures

Article 80. The Ministry will give interested parties timely access to review all the information available in the administrative record for the presentation of its case.

Article 81. In the notification referred to in Article 53, the Secretariat shall notify all interested parties conducting a public hearing which may appear and present arguments in defense of their interests as well as in the case of measures safeguards, to present relevant evidence.

Article 82. Any interested party may offer any kind of evidence except the confession of the authorities, or those that are deemed contrary to public order, morality, or decency.

Article 83. The Secretary may verify the information and evidence in the course of the investigation and held by the administrative record, subject to authorization by the interested parties who are determined to verify. To do so, may give written notice for visits to the domicile, establishment, or place where you find the information.

Article 84. The notifications referred to in this Act shall be made to the party or his representative at his home in person, by certified mail, return receipt requested or any other direct means, such as courier or electronic means or any other technology. Notices will be effective the business day following that on which they were made. The rules establish the manner and terms under which notifications will be made.

Article 85. In the absence of express provision in this Act with regard to administrative procedures relating to unfair trade practices and safeguard measures shall apply additionally the Federal Tax Code, as is consistent with the nature of these procedures. This provision shall not apply with respect to notification and verification visits.

Article 86. If in the course of the procedures referred to in this title, the Secretariat considers that there are grounds to suspect that any of the parties made sanctioned monopolistic practices in terms of the law of matter, will view the competent authority.

Article 87. Countervailing duties and safeguard measures can be defined by specific amount or ad valorem. If there are specific are calculated per unit of measure will be cleared in equivalent local currency. If there are ad valorem shall be calculated as a percentage of the customs value of goods.

Article 88. In imposing a countervailing measure or propose the application of a safeguard measure the Secretariat will provide a timely defense to domestic production.

Article 89. The provisional and definitive countervailing duties and safeguard measures shall apply from the day following its publication in the Official Journal of the Federation.

Chapter V: Special Procedures

Article 89 AF. Determined a final antidumping duty, interested parties may request the Secretariat to resolve whether a product is subject to this antidumping duty, to be that the request will begin a process of product coverage within 20 days the presentation of the same, and issue the final decision within 60 days after onset. These resolutions must be published in the Official Journal of the Federation.