Faced with the end of the extension, amparo proceedings against the Registry of Specialized Companies are foreseen

Note published on August 29 in El Sol de México, Finanzas [Finance] Section by Bertha Becerra.
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3 days prior to the end of the extension for registering in the Registry of Specialized Services or Specialized Works (REPSE), on September 1, the filing of amparo proceedings will start. To this date, over 2.000 amparo suits have been filed.

“The extension was a mockery. Thirty days were not very useful at all”, stated Ricardo Martínez Rojas, partner of the De la Vega & Martínez Rojas Firm. “This is very worrying because there is no recourse other than amparo proceedings.

He also spoke about how complicated it has been to comply with the Executive Order that will enter into force as of Wednesday, September 1. There are different regulations for the IMSS [Mexican Social Security Institute] as well as for the Infonavit [National Worker’s Housing Fund Institute]. “We have all shapes, colors and sizes.”

Additionally, the burden of the REPSE carries fines as of September 1. “Each day is more and more complicated for entrepreneurs”, he said.

Jimena Sánchez Arguytia, a partner at the same Firm joined in the statements, saying that registration before the REPSE has to be renewed every six years. She pointed out that 8 thousand companies have already requested it and there are 19 thousand in process out of 100 companies that must obtain registration.

Earlier, lawyer Óscar de la Vega stated that the reform on subcontracting establishes provisions “that 40 lawyers in the Firm cannot decipher. This will cause litigation. Compliance before the Department of Labor and Social Welfare (STPS) is confusing.”

In the webinar on “The true magnitude of the Reform on Subcontracting”, experts spoke of the changes brought by the reform on subcontracting in tax, security and legal matters. Key points for creating a strategy of prevention and handling of labor crises.

Ricardo Martínez Rojas, PhD, pointed out that, in regard to amparo proceedings, that the government resorted to a shrewd strategy to make the process slow “instead of our justice being expedited.”

Thus, all amparo proceedings were sent to the Eighth Court in Labor Matters in the Mexico City circuit. “It is an extremely malicious action”, he said. “It is the last key toll of the bell for seeking amparo actions”, he underlined. “If you visit the court, you will find that there are boxes even on top of the judge’s head. And, of course, with that huge amount of work, when will they be able to reach agreements”, he emphasized.

Additionally, he said that according to the Mexican Social Security Institute (IMSS), they have subcontracting companies with 5 million workers registered therein. 2.5 million have already been transferred; “but many will fall along the way.”

He noted that the IMSS calculates that the base salary used for the payment of social security dues for companies  increased by 12%. “The reform on subcontracting is loaded with obligations. Not even 20% of workers have been registered yet”, he pointed out.

He argued that the most painful thing is that this reform has not benefited the workers. “Many specialized companies will have to close their doors on September 1. And others take advantage of “the leap” and say: “…if we are moving people into the operating company, eliminate as many as you can and become more efficient… and this is not good for the workers”, he explained.

Ricardo Martínez Rojas, PhD, questioned: I don’t know why I need a REPSE? I don’t know why I need to provide information to the IMSS?, as, afterward, the Federal Tax Code forces the contracting party to receive from the contractor information on the payment of Income Tax (ISR) for the workers involved in the contract every month. Additionally, they must include the payments of Value Added Tax (VAT) in a clear manner.

“And all of this leads to: if I do not have information on the ISR for the agreements that I have entered into and there is no information on the VAT and their statements, the deduction will not apply”, he explained.