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Mexico Warehousing: Public Bonded Warehouse Operations

Discussion of any issues related to importing to Mexico.

Mexico Warehousing: Public Bonded Warehouse Operations

Postby bridgat » Mon Nov 17, 2008 12:43 pm

Public bonded warehouses offer the opportunity to U.S. exporters to send all types of materials, products or machinery to Mexico as an extension of their inventory warehouse, so that it can be sold and distributed in Mexico, while holding title to the goods.

In Meixco, public bonded warehouses (almacenadoras) are credit organizations operating under concession granted by the Ministry of Finance and Public Credit (Secretaria de Hacienda y Credito Publico). Their functions are regulated
by the General Organizations and Auxiliary Credit Activities Law. The almacenadoras are the only corporations authorized by law to issue warehouse certificates and warrants in respect of merchandise and goods stores.

Warehouse certificates and warrants are negotiable credit instruments. The difference between certificates and warrants lies in that a warehouse certificate evidences title to the merchandise which has been stored in the warehouse, while a warrant evidences the constitution of a pledge credit on the merchandise or assets indicated in the corresponding warehouse certificate. Mexican and foreign banks may issue credits on the security of warehouse certificates and warrants.

Foreign manufacturers and exporters may be interested in assisting their traditional Mexican customers to maintain sufficient stocks of raw materials, spare parts, all types of products, as well as capital goods, that will enable them to satisfy any short term/emergency demand.

BASIC CONCEPTS:

Mexican Customs and Excise Law (Legislacion Aduanera) contemplates the in bond storage of foreign goods under the chapter called "Regimen de Deposito Fiscal" (Fiscal Deposit Law).

Merchandise may remain in storage in bond, for up to two years. Partial or total withdrawals may be made after payment of corresponding import duties, value-added tax, and warehousing fees and costs.

Duties paid upon withdrawals are exactly the same as if had been paid on the date of storage, as no further changes on import duties or restrictions would take place once the merchandise is duly stored.

Merchandise stored in bond can be shipped to another country tax free, provided that such shipment occurs within the authorized term.

Foreign manufacturers or exporters may safely stock merchandise in Mexico by shipping it under the custody of a duly authorized "almacenadora" or in bond warehouse.

ADVANTAGES FOR THE MEXICAN IMPORTER:

1. Immediate availability of basic imported goods.
2. Minimum investment (Freight, handling, and customs agents charges only)
3. Ability to control costs:
Fixed expenses: import duties freight, insurance, and customs duties eventually paid in Mexican currency based on previously settled amount.
Variable expenses: Monthly warehouse fees and insurance.
4. Qualifies for additional credit in local banks.
5. Savings in use of storage space in their own facilities.
6. The advantage of being able to maintain sufficient inventories to satisfy market demands.

ADVANTAGES FOR THE U.S. EXPORTER:

1. Company retains ownership of goods until the importer withdraws from the warehouse and pays the corresponding cost, duties, handling, and storage fees.
2. US company can make arrangements with in bond warehouse to obtain payment of goods upon initiation of warehouse period or when withdrawn.
3. All in bond warehouses must insure against theft, fire, disasters, etc. by law.
4. They have inventory access at any time.
5. Can coordinate delivery logistics with the warehousing company.
6. Merchandise stored in an in bond warehouse can be returned to its owner without having to pay import duties.
7. Organizations that operate in bond warehouses generally have facilities in several cities in Mexico, and exporter can store in various cities under the same regime.
bridgat
 
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