Exporters could lose customs duties rights in Mexico due to lack of compliance with labor rights.

Note published in El Debate in the Economía [Economy] section by Gabriela Castro.
Read the note in its original source

The founding partner of D&M Abogados warned that, given the new regulations imposed in the USMCA, companies that do not comply with labor rights will begin to pay customs taxes.

Mexico – Given the new regulations brought by the implementation of the United States-Mexico-Canada Agreement (USMCA), companies must be extremely careful so as not to face obstacles in regard to the export of their products, warned Ricardo Martínez Rojas, founding partner of D&M Abogados.

He explained that, at this time, and given the new regulations imposed by the USMCA, there is a possibility that companies that do not comply with the labor rights of workers start paying customs taxes as a consequence of the loss of their tariff and customs duties rights.

Regarding this problem, he highlighted the importance of companies to concern themselves with complying with and enforcing the labor rights of those who work for them, particularly in the case of the country’s large exporters, who could be the most affected.

“The United States may request a penalization, and the penalization is very serious, because the company exporting to the United States could lose its tariff and customs duties rights, which means that they would start paying customs taxes”, he reiterated.

On the same topic, he said that in the event that a violation is detected by the verifiers and the damage to workers’ rights in Mexico is not repaired, the second penalization could be that the entire corporate group be banned from using tariff and customs duties rights.

In the event of a third violation, for which the damage is not repaired, the United States may request the company’s customs duties rights to be seized, which means that it could not make exports into that country.

In this regard, he underlined, as a warning, that the neighboring country to the north has created three authorities to verify that Mexico complies with the agreements; additionally, it has a council of experts who are strong in the unions, in order to enforce compliance by the companies with the labor rights of the workers of companies that send products into the United States.