Jurisprudence Issued by Mexico’s Supreme Court of Justice – Depositary Designated by the Tax Authority

August 17, 2008
Jurisprudence Issued by Mexico’s Supreme Court of Justice – Depositary Designated by the Tax Authority

The First Court of Mexico’s Supreme Court of Justice issued in June of this year jurisprudence Ia./J.22/2008, entitled,Depositaries designated by the Tax Authority. The mere change of location of personal property from the location in whichthe deposit was created does not amount to an act of ownership, therefore, the provision in the first paragraph of article112 of the Federal Tax Code does not apply. Pursuant to Article 112 of the Federal Tax Code in effect, a depositary orbailee designated by the tax authorities which, to the detriment of the federal tax authorities, disposes of the personalproperty under deposit or of any of the byproducts or security that amounts to a taxable event, shall be subject toimprisonment for the period of time provided by such provision of the Tax Code. In such jurisprudence, the courtdetermined that the simple change of location of the personal property under deposit does not amount to an act ofownership by the depositary. Given the foregoing, the First Court of Mexico’s highest court determined that the authorityin each jurisdiction will have to find, on a case-by-case basis, whether there were any acts of ownership involved in order toapply the penalties provided in Article 112 of the Federal Tax Code.

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