Mexico strengthens supervision over quotation of imported products such as Chinese shoes

December 11, 2011 is the date for ending import quotas for Chinese products (such as footwear, clothing, textiles, bicycles, toys, steel, and other 10 kinds of tools). The Mexican government has strengthened the supervision of illegal importers through the Tax Administration (SAT) and the General Prosecutor's Office (PGR) and issued arrest warrants to illegal importers. There are 400 sea tax categories in the monitoring list of the new import control system. The import control system is specifically formulated for these illegal imports and will come into effect on December 15.

SAT and PGR raise the highest alert Once the Chinese series of imported products get rid of compensation quotas and tariff systems, supported by the National Chamber of Commerce (CONCAMIN), commercial organizations engaged in footwear products, clothing and textiles, bicycles and toys will intensify their efforts to try this way. Or that way to protect employment and production. Because this means that according to the World Trade Organization (WTO), Mexico can only impose an import tax of 35%.

In fact, there are only two basic ways for Chinese goods to enter the Mexican market illegally. One is to flagrantly send products across the United States across borders to avoid customs supervision. This applies only to the import of small quantities of products. The second is to reduce the declared price of goods to the price of raw materials needed for production.

In this regard, the business giants have a wealth of information to prove that reducing the price of quotations or illegal imports will cause damage to local production, which will be even more serious after December 11.

Armando Martín Dueñas of CICEG, Guanajuato’s Industrial Footwear Chamber of Commerce, said: “In the past four years (2008-2011), 215,460,000 pairs of shoes were imported from all over the world due to the previous tariff mechanism that controlled this strategy. Cancellation is estimated to be about 45% of the declared price of imported shoes."

CANAINTEX** Rodolfo García-Muriel Martínez stressed: “Today, about 70% of the declared prices of imported lines and fabrics are not sufficient to cover the cost of international raw materials. Therefore, it is very urgent to reverse this situation to avoid this. The harm caused by unfair competition in our industry."

What measures will the Mexican government take to control the illegal activities of Chinese imports that are too low?

The newly developed strategy is a technology platform that will automatically detect imported products that have a declared price lower than the price of raw materials needed for production. This information is provided by the above-mentioned commercial organization. The results of the information are evaluated in real time to determine whether to lift import restrictions or issue warnings and conduct public investigations with the cooperation of SAT and PGR.

The agreements signed by government agencies and commercial organizations include the following measures:

1) When the importer declares the customs duty paid price through forged documents, it conducts a review.

2) The new system will send an alert to the customs officers to inform them of attempting to enter product information in Mexico that is lower than the price of raw materials needed for production.

3) PGR will initiate criminal proceedings against those importers who perform the above-mentioned illegal operations and hand them over to the relevant parties.