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1. The legal base that created the programs. (IMMEX)

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1. The legal base that created the programs. (IMMEX)

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IMMEX

Legal Framework

1. Decree for the Promotion of the Manufacturing, Maquila and Export Service Industry, published in the Official Gazette of the Federation on November 1st, 2006.

2. Customs Law and its Regulations

3. General Rules on Foreign Trade Matters.

4. Federal Law on Administrative Procedure.

5. Foreign Trade Law and its Regulations.

6. Internal Regulations of the Secretariat of Economy.

7. Agreement through which the Secretariat of Economy issues General Rules and Criteria on Foreign Trade, and their amendments.

8. Agreement which establishes the procedures entered in the Federal Register of Business Procedures which apply to the Secretariat of Economy and its coordinated sector.

9. Agreement amending the miscellaneous provisions which approve the forms to be used for procedures with the Secretariat of Economy, the National Metrology Center, the Mineral Resource Council, the Mining Development Trust and the Federal Consumer Protection Agency and their reforms.

10. Agreement which establishes the procedures entered in the Federal Register of Procedures and Services which apply to the Secretariat of Economy and the decentralized agencies and regional offices of the sector.

11. North American Free Trade Agreement.

12. Ruling which establishes the general rules related to the application of customs-related provisions of the North American Free Trade Agreement and their reforms.

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1. The legal base that created the programs. (DRAW BACK)

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1. The legal base that created the programs. (DRAW BACK)

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DRAW BACK

Legal Framework

The legal framework of this program includes the following legal and fiscal regulations and provisions:

1. Decree that Establishes the Refund of Import Taxes to Exporters, published in the Official Gazette of the Federation on May 11, 1995 and its reform and addition published on December 29, 2000.

2. Customs Law and its Regulations.

3. Foreign Trade Law and its Regulations

4. Federal Law of Administrative Procedure.

5. North American Free Trade Agreement (NAFTA).

6. Miscellaneous Foreign Trade Resolution.

7. Resolution that establishes the NAFTA rules.

8. Tax Code of the Federation and its reforms.

9. Free Trade Agreement with the European Union (FTAEU).

10. Free Trade Agreement with the European Free Trade Association (CAFTA)

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2. What is the purpose of both programs? (IMMEX)

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2. What is the purpose of both programs? (IMMEX)

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IMMEX

The objective of the IMMEX program is to increase and promote exports and access to international markets by Mexican companies, in addition to stimulating the modernization of the country's productive infrastructure. In addition to strengthening the competitiveness of the Mexican export sector and providing certainty, transparency and continuity to companies' operations by specifying and simplifying compliance factors; allowing them to adopt new ways of operating and doing business; reducing their logistical and administrative costs; modernizing, streamlining and reducing paperwork, in order to increase the capacity for auditing in an environment that encourages the attraction and retention of investments in the country. It grants facilities for:

- Industrial processes.

- Services to export goods and

- Provision of export services

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2. What is the purpose of both programs? (DRAW BACK)

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2. What is the purpose of both programs? (DRAW BACK)

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DRAW BACK

Duty drawback or drawback, is a fundamental principle of international trade law and policy under which duties, taxes and fees paid on imported merchandise are refunded upon the exportation of qualified articles.

Essentially, duty drawback is an export promotion program intended to eliminate or recover the costs of duties, taxes and fees on merchandise sold on international markets; in fact, it is one of the few export incentive programs acceptable under World Trade Organization rules.

The duty drawback program is designed for Mexican companies that import products from the U.S. – typically raw materials or component parts. It allows Mexican importers to claim refunds of duties paid on those imports, which typically are processed and assembled into a finished product, that are exported out of Mexico. The program benefits also apply to products and/or equipment that need to be repaired or modified after they have been imported under the definitive import regime. In almost all the cases, the Mexican buyer is responsible for obtaining permits, making payments to Mexican authorities, and contracting a Mexican custom broker agent. It is also true that it is very useful for U.S. exporters to understand the basics of the Mexican import process.

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3. What type of benefits do they confer? (IMMEX) 

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3. What type of benefits do they confer? (IMMEX) 

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IMMEX

The IMMEX Program offers its holders the possibility of temporarily importing, free of import taxes and VAT, the goods necessary to be used in an industrial or service process for the manufacturing, transformation or repair of goods of foreign origin temporarily imported for export or for the rendering of export services.

These goods are grouped under the following categories:

1. Raw materials, parts and components that are to be totally destined to integrate export merchandise; fuels, lubricants and other materials to be consumed during the productive process of the export merchandise; containers and packaging; labels and leaflets.

2. Containers and trailer boxes.

3. Machinery, equipment, tools, instruments, molds and spare parts for the production process; equipment and apparatus for pollution control; for research or training, industrial safety, telecommunication and computing, laboratory, measurement, product testing and quality control; as well as those involved in the handling of materials directly related to the export goods and others related to the production process; equipment for administrative development.

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4. How are the programs affected due to the provisions of FTAs, especially, under Art. 2.5 of the USMCA?

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4. How are the programs affected due to the provisions of FTAs, especially, under Art. 2.5 of the USMCA?

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The USMCA introduced a general prohibition with Article 2.5, that restricts the amount of refund of drawbacks, or the number of duties deferred under the duty deferral programs to the lesser of the duties paid either at the time of admission into the first USMCA country or upon exportation and importation into the second USMCA country.

The IMMEX program allows to differ customs duties provided that the manufactured or assembled goods are exported, among other conditions. Due to Article 2.5 of the USMCA, when exporting to another USMCA party, companies would have to pay the resulting import duties applicable to the non-USMCA materials.

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3. What type of benefits do they confer? (DRAW BACK) 

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3. What type of benefits do they confer? (DRAW BACK) 

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DRAW BACK

The Drawback program is intended for those exporting companies and its main benefit is the facilitation of the refund of taxes caused by the import and subsequent export of products such as:

Raw materials

Parts and components

Packaging and containers

Fuels

Lubricants

Other materials that make up the exported product

Also for the import of goods returned abroad in the same state in which they were imported or for goods imported for repair or alteration.

It also has the following benefits:

It allows recovering the General Import Tax paid for those imported goods, which are returned in the same state or are incorporated to an exported product.

It does not require maximum export amounts.

It helps to reduce tariff charges on imported inputs.

It will help to provide liquidity to exporting companies in their finances.

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CBP. (2020). Drawback and Duty Deferral Program. Retrieved on February 24, 2022 at https://www.cbp.gov/sites/default/files/assets/documents/2020-Aug/Drawback%20and%20Duty%20Deferral%20Program_USMCA%20Informational%20Fact%20Sheet%20%281%29.pdf

Charter (s.f) What is a Duty Drawback. Retrieved on February 24, 2022 at https://charterbrokerage.net/what-is-duty-drawback/#:~:text=Essentially%2C%20duty%20drawback%20is%20an,under%20World%20Trade%20Organization%20rules.

Godina, F. (2021). Drawback - Import Tax Refund to Exporters. Retrieved on February 23, 2022 at https://contadormx.com/2021/03/11/drawback-devolucion-de-impuestos-de-importacion-a-los-exportadores/

Lujan y Asociados. (s.f) Operaciones IMMEX. Retrieved on February 21, 2022 at http://lujanasociados.com.mx/servicio/operaciones-immex/#:~:text=El%20objetivo%20del%20programa%20IMMEX,a%20mercanc%C3%ADas%20de%20exportaci%C3%B3n%20y

Ministry of Economy. (2012). Secretaría de Economía - IMMEX. Retrieved on February 23, 2022 at http://www.2006-2012.economia.gob.mx/comunidad-negocios/industria-y-comercio/instrumentos-de-comercio-exterior/immex

National Archives. (2021). Code of Federal Regulations. Retrieved February 24, 2022 at https://www.ecfr.gov/current/title-19/chapter-I/part-182/subpart-E

N.A. (2020). DUTY DEFERRAL & TRADE PROMOTION INSTRUMENTS. Retrieved on February 24, 2022 at https://doingbusiness-mexico.com/duty-deferral-in-mexico/

Secretaría de Economía. (s. f.). Secretaría de Economía - DRAW BACK. Retrieved on February 21, 2022 at http://www.2006-2012.economia.gob.mx/comunidad-negocios/industria-y-comercio/instrumentos-de-comercio-exterior/draw-back

Secretaría de Economía. (s. f.-b). Secretaría de Economía - IMMEX. Retrieved on February 21, 2022 at http://www.2006-2012.economia.gob.mx/industry/foreign-trade-instruments/immex

Teutli, R. (2021). Know the benefits of the main foreign trade promotion programs. Retrieved February 23, 2022 at https://loftonsc.com/blog/comercio-exterior/conoce-los-beneficios-de-los-principales-programas-de-fomento-al-comercio-exterior/

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4. How are the programs affected due to the provisions of FTAs, especially, under Art. 2.5 of the USMCA?

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4. How are the programs affected due to the provisions of FTAs, especially, under Art. 2.5 of the USMCA?

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Duties not subject to drawback

Antidumping and countervailing duties

A premium offered or collected on a good with respect to quantitative import restrictions, tariff-rate quotas, or tariff preference levels.

Customs duties paid or owed under unused merchandise substitution drawback.

Eligible goods subject to USMCA drawback

Subsequently exported to Canada or Mexico.

Used as a material in the production of another good that is subsequently exported to Canada.

Substituted by a good of the same kind and quality as defined in §182.44(d) and used as a material in the production of another good that is subsequently exported to Canada or Mexico.