CCN MEXICO REPORT

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Issue #
50
 – 
February 2008

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Recommendations for Avoiding Suspension of Registration on Mexico’s Importers’ Registry for Deficiencies in their Federal Taxpayer Registrations

February 14, 2008

On December 28, 2007 Rule 2.2.4 of the General Rules Governing Foreign Commerce (Reglas Generales en Materia de Comercio Exterior2007) entered into force, as published by the Department of Finance and Public Credit (Secretaria de Hacienda y Crédito Publico or SHCP)in the Official Journal of the Federation (DOF) on June 27, 2007. Such rule provides changes to the causes for which one’s GeneralImporters or Specific Sectors Importers Registry may be suspended. As a result of these amendments, a cause for suspension includes ataxpayer’s failure to obtain an Advance Electronic Signature authority (Firma Electrónica Avanzada) issued by the TaxpayerAdministration Service (Servicio de Administración Tributaria or SAT). The new rule also defines the situations in which an immediatecancellation of the Importers’ Registry may take place, with no prior notice from the SHCP. Some of the causes of suspension include ataxpayer’s failure to maintain in good standing their Federal Taxpayer Registration (RFC) and Advanced Electronic Signature (FEA). Theamendments provide procedures for the local SAT office to verify a taxpayer’s status and potentially avoid the suspension, which include:1) requesting a printout of the current RFC status; 2) verifying the printout and the database of the Mexican SAT to confirm the taxdomicile and that all tax branches reflect the status of “verified” (localizado); 3) requesting a verification visit for any offices that do notappear as “verified”; 4) verifying that someone from the company is present at the visit in order to confirm that the location of the office hasbeen properly verified; 5) verifying that all changes of name, corporate purpose, etc. have been filed by the taxpayer; 6) verifying if any taxreturns are pending and, as the case may be, filing any such pending returns; 7) verifying that the FEA of the company is current or, makessuch current as quickly as possible (it is important to note that the Digital Certificate of the FEA expires two years after it is issued, so it isimportant to verify that such FEA registration is current; if the FEA certificate has lapsed, the taxpayer should immediately renew such);and 8) verifying if the taxpayer has any pending tax credits, in which case it should file a reimbursement request and make anycorresponding clarifications. Finally, keep in mind that the person appearing at the local SAT office should be a legal representative of thecompany and should bring his or her official identification and an original or certified copy of their notarial power of attorney.Appointments to meet with the local SAT office may be made on the SAT’s webpage ( www.sat.gob.mx ) or by telephone: 1-800-INFOSAT(I-800-463-6728).

New Rules Governing Fees Earned by Trustees

February 14, 2008

Parties contributing to Mexican trusts (trustors or fideicomitentes), trustees and beneficiaries of trusts created under Mexican law shouldverify that such trusts do not have pending trustee fees due and owing based on recent amendments to the General Law of CreditInstruments and Transactions (Ley General de Títulos y Operaciones de Crédito) published at the beginning of this month, which authorizebanking institutions serving as trustees of Mexican trusts to dissolve any trust in which late trustee fees are more than three years past due.

Mexico Issues New Rules Relating to Representation Offices of Foreign Companies

February 14, 2008

In order to facilitate and better organize the process of authorizing a representation office or establishment in Mexico of companies basedabroad, an amendment to the Law of Credit Institutions (Ley de Instituciones de Crédito) was published establishing that the MexicanNational Banking and Securities Commission (Comisión Nacional Bancaria y de Valores or CNBV) is the competent authority to reviewand authorize representation offices in Mexico, instead of the Mexican Department of Finance and Public Credit (Secretaria de Hacienda yCrédito Publico) making the CNBV and the Mexican Central Bank, Banco de México, responsible for regulating such representationoffices. The amendment will enter into force 120 days following its publication.