Brazil and Mexico Take Legislative/Administrative Actions that May Impact Imports
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Brazil and Mexico recently implemented certain policies that may have an impact on imports from Hong Kong, mainland China and other foreign suppliers, including the United States. Mexico's Servicio de Administración Tributaria, the tax and revenue branch of the Mexican government, issued a press release on 16 August announcing its decision not to extend the contracts of all of its customs inspectors (totalling about 700) in an effort to crack down on corruption, the smuggling of illegal drugs and guns and the evasion of customs duties. The SAT has replaced these inspectors with some 1,400 new agents, most of whom are university educated and all of whom have undergone a thorough background check. The agents are also reportedly trained in the legal aspects of foreign trade and have been taught to use new equipment installed at border crossings. Inspectors who have been replaced will be allowed to reapply but must meet stricter requirements to be rehired. This abrupt change in personnel is likely to have an impact on import flows, possibly slowing down trade at first but hopefully speeding up the importation process in Mexico in the medium to long term.
Brazil enacted a new law in early August that reportedly prevents importers in that country from filing a court injunction to obtain the release of imported merchandise being held up by Brazilian Customs. It is not unusual for Brazilian Customs to detain merchandise at ports of entry due to questions over the tariff classification of the merchandise. In some cases importers have filed these injunctions alleging abuse of power or illegal activities by customs authorities. In other cases, the injunctions have been filed without any allegations of illegal activity, in which case the merchandise was typically released after the importer agreed to pay a guarantee equal to the value of the goods. The new law has the potential to prevent the timely release of certain imported merchandise, which would be especially detrimental for shipments of perishable merchandise and goods with a relatively short shelf or commercial life. One way around this dilemma would be for Brazilian importers to request advance tariff classification rulings, thus preventing customs officials from detaining their merchandise on misclassification grounds.
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