Published: 2008-08-15

Now in day, Mexico, like many other countries from Latin America, has try to strengthen its economy thought the celebration of international treaties that promote the exchange of services and goods and a bilateral preferential, progressive freedom and reciprocity from the commerce of determine products or sectors of services, under the provisions of the pertinent rulings of the World Trade Organization, of which is part of.

In this sense, starting July 1, 2000, The Free Trade Convention of Mexico and the Europe Union (UE) went in to force, trough which is sought to eliminate trade barriers; promote conditions for fair competition; increase the investment opportunities; provide adequate protection to the rights of intellectual property; establish effective proceedings for the application of the Treaty and the controversy solutions, as well as to promote the regional and multilateral cooperation.

Based on the prior, presently the trade relations with the UE has being enormously increasing, and with that the number of conflicts that arise because of the duty treatment that should be given to the importing of the products and services protected by the cited international treaty.

One of the conflicts that have monopolize the attention of the contributors, in view of the frequency with which they occur, is the founding of the administrative proceeding in custom matter (PAMA), at the moment of introducing to the country merchandise of European origin that is imported under the preferential treatments of the Free Trade Treaty with the UE, and that from the revision on behalf of the customs authority of the certificate of origin EUR 1, with which identifies the community origin of such merchandise, has conducted to the determination of valuable fiscal credits that are generated at the moment of calculating the contributions that should have being paid in case of not enjoying of the preferential treaty; the prior generally, derived of the lack of requirements or irregularities of the cited certificate of origin.

For the effect of cleared the reference supposed, let us think in the case that at the moment of importing merchandise of European origin, for example canvas, and selecting the mechanism of atomized selection, is revised by Customs and is detected that the duty classification of such merchandise is not established in a correct form on the certificate of origin, just as it could be notice in the following determination of the fiscal authority:

“CUSTOM TARIFF REASONING.- Results proceedable the custom tariff fraction… as apply classification for the present matter, that for that effect points at this custom authority for the imported merchandise to the protection of the request number 03 43 3210 3005114, in view that, the analysis of the laboratory that at its moment practice the Central Administration of the Scientific Laboratory Services of the General Customs Administration….”

“As a result, it is not applicable the duty fraction declared on the importing petition because is about the: printed fabric, constituted by threads 50 % of fibers of cotton and 50 % of discontinuous synthetic fibers of polyester…”

“Reason why in accordance with the rule 2.2.1. of the resolution in custom matter of the Decision 2/2000 from the board group of the temporary agreement about trade and questions related with the trade between the Mexican United States and the European Community, published on the Official Paper for the Federation on December 31, 2002, in force starting January 1, 2003, no preferential treatment is applicable for the merchandise in question, since is not found required the certificate of circulation of merchandise EUR1. No A 2169908 AM, since it does not points out the duty tariff of 4 digits, as it provides on the instruction of completion contained in the attached 1 of the cited resolution as well as the description of the merchandise determined by the Central Administration of the laboratory and scientific services officially…”

In consequence, from the changing of the duty tariff fraction… from the technical report of the customs general administration… it is subject to regulations and restrictions non-duty tariff…

“In consequence it is point out an omission of constriction for this particular case….

as it could be noticed in the present case, the costumes authority once the imported merchandise is analyzed in the laboratory (fabric), determines that in reality its compassion in accordance to the fibers, tissue and printing. Does not correspond to the description and duty classification established in the imported request (and for that matter in the certificate of origin EUR 1), and for that reason considers that such merchandise is not protected by that valid

certificate of origin of the UE and that it shouldn’t be given non of the preferential duty tariff, given the omission of contributions of foreign exchange.

What value do those performances have? Since in our concept, the determination of any fiscal credit that has as record such acts of verification, violates article 31, of Attachment III, of the Decision N° 2/2000 form the Conjugate Council established in accordance to the Temporary Agreement about Trade and Questions related with the Trade with the Mexican United States and the European community, in regards with article 1, last paragraph of the Customs Law referring to the hierarchy order of the International Treaties on which Mexico is part of and 38 fraction IV of the Fiscal Code of the Federation, 14,16 and 133 of the constitution.

The prior is like this, since the privation of the duty commercial privilege of the merchandise, derived of the commercial international agreements sustained between Mexico and the European Community prior referred, adducing for such effects a revision to the certificate of the merchandise circulation EUR. 1 that in terms of article 15 of the proper Attachment III of the Decision Nº 2/2000, it’s a “proof of origin” of the merchandise, upholding including its determination, in technical reports from which it concludes that the information of such certificates of merchandise circulation, in relation to the duty fraction, the description of the merchandise or any other data or omission, does not satisfy the legal requirements, resulting by itself insufficient to deprive it of legal value and effectiveness to the certificate of circulation EUR1, therefore, suspend the preferential treatment of such merchandise.

It is like this, in accordance to article 31 of the Attachment III, of the Decision N° 2/2000 from the Conjugate Council established in accordance to the Temporary Agreement about Trade and Questions Related with the Trade with the Mexican United States and the European Community, if well the customs authorities of the country are authorized to verify such certificates EUR1 that protect the duty preferential treatment of the European merchandise when it has reasonable doubts of its authenticity or the origin character of the products in question and the observance of the requirements from the attachment III of the decision, on such cases, the authority from our country is obligated to return the certificate of circulation EUR1 and the invoice to the customs authority of Spain, together with the reports and documents on which that doubt is sustained, for the purpose that the European authorities, proceed to its verification and indicate if in fact, such certificate lacks of the requirements of Attachment III, prior to deprive it of the preferential treatment to the merchandise determining compensatory fees and other taxes, situation that on this matter never happens.

Certainly, the article 31 of the Attachment III, of the Decision N° 2/2000 from the Conjugate Council established in accordance to the Temporary Agreement about Trade and Questions Related with the Trade with the Mexican United States and the European Community that are cited, point out:

ARTICLE 31.
1.- The verification of the evidence of origin it will be randomly carry out or when the customs authorities from the country of importation have reasonable doubts of the authenticity of such documents, of origin character of the products in question or the observance of the another requirements of the present attachment.
2. - For effects of the application of the dispositions of paragraph 1, the customs authorities of the country of importation will return the certificate of circulation EUR.1 and the invoice, if it has being presented, the statement of invoice, or a copy of this documents, to the customs authority or competent governmental authority of the exporting country, indicating, on that case, the motives that justify an investigation. All the documents and the obtained information that suggest that the data recovered on the origin test are incorrect they will accompany the petition of verification.
3. – The customs authorities or competent governmental authority of the exporting country will be the one in charge of conducting the verification. For that effect, they will be empowered to demand any type of evidence and inspect the accounting of the exporter or conduct any other verification that may considerer necessary.
4. – If the customs authorities decided to suspend the preferential treatment to the products that correspond waiting for the results of the verification, it would be offered to the importer the liberation of the merchandise under condition to any measure of precaution considered necessary.
5.- It will be inform as soon as possible of the results of the verification to the customs authorities that had petition it. These results should clearly indicate if the documents are authentic and if the products in question could be considered as origin from México or of the Community and fulfill the other requirements of the present Attachment.
6.- If, in case of reasonable doubts, no answer is received with in a 10 month period starting on the date of the request of verification or if the answer does not have sufficient information to determine the authenticity of the document in question or the real origin of the products, the requesting customs authorities could deny, except in exceptional circumstances, all benefit from the preferential regime.

Meaning, that when the authority determine the existence of reasonable doubt of the authenticity of the documents of origin character of the products or the observance of the other requirements, the proceeding should be follow in specific of article 31, from the respective Attachment III, on which expressly is determine that the customs authority of our country, prior to suspend the preferential treatment, it should return the certificate of circulation EUR1 and the invoice and other documents, to the customs or governmental authority of the importing country, as well as all the documents and motives that justify its investigation or are evidence the incorrect information from the certificate of circulation and other evidences of origin, and it would be the customs authority of the country of exportation, who will perform the verification of such certificate, previous inspection of the accounting and other documents from the exporter; in these cases, the customs authority of the European Union will inform as soon as possible the results of the verification, indicating if in fact, the documents are authentic and if is certain, that the products could or not be considered as origin of the European community and if the requirements of the Attachment are comply with or not, for than, deny the benefit of the preferential regime.
In spite of the prior, such proceeding is not followed by the customs authority, but on the contrary, in an unilateral and illegal manner, proceeds to deny the preferential treatment trough the collection of taxes, accessories, compensatory fees and other inappropriate customs rights, at the protection of the cited international treaty, basing for that, with a simple report or analysis of the merchandise on its laboratories, situation that we insist, in a clear form that violates article 31 of the Attachment III, of the Decision N° 2/2000 from the Conjugate Council established in accordance to the Temporary Agreement about Trade and Questions Related with the Trade with the Mexican United States and the European Community and with that, the customs law on its article 1, as well as article 133 of the Constitution, that in the species indicates the hierarchy application of the international treaties, about the jurisdiction of verification and determination of fiscal credits of the secondary laws such as the Customs Law or the Federal Fiscal Code.
In that order of ideas, before the determination of fiscal credits for contributions to the foreign trade derived of the unilateral ignorance on behalf of our countries customs, the certificate of circulation EUR 1 with which the imported merchandise is protected of any country of the EC, the contributor would have expeditious its means of defense, by means of the revocation appeal or the administrative contentious trial, on which should obtain the plain and flat nullity of such credits by arguing the truth transgression to the international treaties on which generally the federal fiscal authorities incurs with such acts.

these arguments should not only should be of use as base for the defense of the affected contributors, but also, but also should motivate our customs authorities to stick to their verification proceedings to the international regulation, with the intent that day to day, apply to a better state of legal security and legality on the collection of the contributions that support the public expenses, generating confidence among the governed, and with that the imminent reduction of the great fiscal defrauding that so much afflicts our country.


By: Grupo Farías, Tax Attorneys