South of the Border

From the archives….Good info from  a US Commercial Service webinar “How to Settle Disputes with Mexico Customs.” Exporters to Mexico often experience frustrating customs delays. More serious issues involve denial of entry, seizure of goods, or NAFTA violations. The webinar was very detailed so let me summarize my takeaways:

Mexican Importer of Record (IOR)

  • very rare for foreign company to be MX IOR
  • MX IOR is always liable for duties/taxes and compliance with non tariff barriers
  • MX brokers have significant liability, explaining their caution and due diligence which can become red tape and delays for the US exporter
  • MX IOR must have tax registration number and be listed on importer registry

Classification and Valuation

  • HTS code up to 6 digits same as other countries but subject to customs verification
  • MX uses 8 digit codes so last 2 digits are unique to MX
  • MX broker verifies or determines correct code and non tariff barriers
  • Valuation determines duty/tax according to MX law based on WTO rules (TV- Transaction Value, etc)
  • Non tariff barriers are regs not related to taxation such as trade agreements, anti dumping, etc
  • Binding rulings can be requested for classification, valuation or NAFTA rules of origin

When Are Goods Seized?

  • unauthorized port of entry used…mostly contraband
  • failure to comply with non tariff barriers
  • goods not declared on entry docs including errors
  • false name/address of IOR or false invoice
  • undervalued goods

Frequent Issues for MX Customs

  • Origin verification for US and CA companies claiming NAFTA preference
  • Failure of exporters  to respond to questionnaires from MX customs
  • Exporters address different from address on NAFTA cert
  • Exporters lack of knowledge about NAFTA rules of origin
  • Lack of original records

MX Customs Recommendations

  • Know your MX buyer and their customs broker
  • It is OK to contact MX customs for info…they will reply in English
  • Make sure NAFTA certificates of origin are accurate….many exporters simply guess
  • Keep original copies of documents….MX customs will only verify using original docs
  • Make sure to respond to questionnaires or requests from MX customs within 30 days
  • Communicate before goods are seized or litigation begins…best to use a MX attorney
  • Remember, prior notification to avoid liabilities does not exist in MX as it does in US


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