T-MEC's Pending Issues (Video)

Business

By CAPosts 08 August, 2020 - 01:00am 505 views

(Expansion) – The lack of a transition process between the entry into force of the T-MEC and the end of NAFTA has generated some slopes that could impact the operation of the companies. For example, import tariff refunds still under NAFTA, bound pediments made during the exchange period, and the effects of the elimination of the official format of the certificate of origin. Although companies had to foresee the changes, the reality is that there was not much room for action. It is important to remember that the negotiation of the Uniform Regulations concluded in early June.

On the 30th of the same month, the General Rules of Foreign Trade were published in the Official Journal of the Federation. A day later the T-MEC came into force. Therefore, this accelerated process has led some companies to be unclear on how they will be able to resolve some issues. Even under NAFTA, when the importation of goods was carried out, and the certificate of origin was not held to guarantee the tariff preference at the time of release of the goods, the import was executed by paying a general tariff. However, the importer had up to 12 months to apply for preferential tariff treatment from the date of importation. Once the certificate was referred to, the import order was amended in order to apply the preferential tariff rate and subsequently be able to request the balance to be refunded. Today, with the entry into force of the T-MEC, there is no certainty about these returns for those who made imports so far this year, and who did not have a CERTIFICATE of NAFTA origin at the time of dispatch. In principle, these companies would not be able to make the "correction", because the new treaty is in force and no measures were considered for this transition. OPINION: Will T-MEC live? When mariachis are silent Although the companies had to foresee the closure of several transactions by 30 June, another very common practice is to make consolidated pediments. That is, a customs benefit is obtained when monthly or weekly orders are made related to purchases from the same supplier. This type of pediment should be closed within the first days of the month or week following the one it was generated. For the consolidated operations that took place within the period in which the T-MEC was started, there was also no clarity as to how they should have been concluded.

The removal of the official format of the certificate of origin is one of the most relevant changes in the new treaty. The current certification of origin – is more flexible. Any document can be used to demonstrate certification of origin, provided that the document has certain minimum requirements. However, this does not mean simplifying the procedure. Previously, the format was standardized. Today, everyone could have different formats, and companies will have to agree with their suppliers on the type of documents they will need to use, to prove that the goods qualify as originating in the region. OPINION: Intellectual property and T-MEC Companies still have many challenges ahead. They will need to do an in-depth analysis of their processes so that in case of review they can demonstrate that their products originate under the T-MEC. They should also have increasing best practices and use automated tools to facilitate international transactions in order to achieve success in the implementation of this new trade treaty. Note editor: Yamel Cado is a Leading Partner in Indirect Taxes and Foreign Trade at PwC Mexico. Follow her on Twitter and/or on LinkedIn . The opinions published in this column belong exclusively to the author. See more information about this and other topics in the Review