Companies with current operations in Mexico, or looking to operate a duty deferral program (Maquiladora) in Mexico can benefit significantly from an automated solution that assists with inventory tracking and manage regulatory compliance – a key component to maintaining that competitive edge.

Integration Point Maquiladora/IMMEX provides companies with a web-based, automated solution that provides savings opportunities to companies by effectively managing manufacturing and distribution processes in Mexico.

Integration Point Maquiladora / IMMEX assists with country of origin requirements based on First in First Out (FIFO) or primeras entradas primeras salidas (PEPS) inventory management, allowing companies to differentiate between domestic and foreign goods, utilize bonded warehousing, sub-maquilas, virtual operations, and equipment processing.

Using Integration Point Maquiladora / IMMEX, companies can easily manage operations in Mexico to optimize inventory, comply with government regulations, and recognize savings opportunities. Integration Point Maquiladora / IMMEX does not use static Bill of Materials (BOMs) for production tracking, but instead it uses dynamic BOMs which allows for more up-to-date tracking as the production process takes place.

Integration Point helps organizations in Mexico and across the world with the automation and management of their Maquiladora / IMMEX operations. Some of the industries in which Integration Point Maquiladora / IMMEX is used are: Apparel, Footwear and Textile, Retail, Automotive, Pharmaceutical and Electronics.

Regardless of industry, Integration Point Maquiladora / IMMEX is the industry standard when it comes to managing operations and optimizing savings.

What is a Maquiladora / IMMEX?

Maquiladoras are facilities located in Mexico - with a large concentration near the US border - which were started in the middle 60s as an economic answer to the increase cost of labor that was taking place in the highly industrialized countries. At Maquiladoras, or Maquilas, industrial or service processes are conducted for modifications, alterations or repair of goods previously imported under a temporary importation order only to be exported once the process has been concluded.

In 2006, the Mexican Government published the IMMEX Decree to Promote the Manufacturing, Maquila and Service Export Industries. This decree took two individual programs - Maquiladora and PITEX - and brought them together under a single export support program to be known as IMMEX. This program now includes companies that represent 85% of the manufacturing exports in Mexico.

The IMMEX program was created with the following objectives:

  • Fortify the competitiveness of the Mexican export sector
  • Simplify the fulfillment factors
  • Diminish logistic and administrative costs
  • Modernize and reduce lead times
  • Create new job opportunities in Mexico
Benefits of IMMEX Participation

While the main benefit of the IMMEX program is to defer taxes on goods temporarily imported into Mexico for manufacturing purposes, there are other benefits that should be noted as well:

  • Reduce or eliminate import duties for goods and materials temporarily imported by accessing the PROSEC program
  • Avoid payment of taxes such as the General Import Tax in Mexico, VAT which is typically 15% of the import value, and compensatory quotas such as anti-dumping
  • Create virtual pedimentos between companies registered in the IMMEX program as well as create consolidated Import pedimentos
  • Lower transit times and costs due to proximity to borders
  • Reduce operational costs due to lower labor and utility rates
  • Qualify for free trade agreements - such as NAFTA or MX-EU - for Mexican manufactured products
  • Access other customs programs and enhanced compliance
  • Perform post-import reconciliation with penalty reduction for goods not declared upon entry
Requirements to Participate

For companies wishing to participate in the IMMEX program through the establishment of a Maquiladora, it must be similar to the following profile and meet government reporting requirements.

  • Export at least $500,000 (USD) in a one year period or export 10% of the company sales into Mexico
  • Import only the approved goods based on HTS classifications
  • Use the goods solely for what they have been approved
  • Respect the terms set forth under Mexico Customs Law (Article 108) and the IMMEX Decree (Article 4)
  • Be a legal entity in Mexico with the obligation to pay ISR (income tax)
  • Maintain the goods in the registered and approved addresses
  • Inform the Economy Secretary is there is a change in the legal name of the company, Tax ID or address, if there are changes in the addresses of companies which provide sub-Maquila services
Cross Border Operations

Most companies looking to implement a Maquiladora fail to evaluate their entire cross border operations. This could potentially leave cost savings on the table as well as open the door for non-compliance to US and Mexico regulations. For a US firm considering becoming part of the IMMEX program and implementing a Maquiladora, there are several areas which should be considered:

  • Inventory Control — how are you going to track the imported goods and materials to ensure export takes place in the appropriate time-frame
  • Classification of Goods — how will you verify the classification of goods and materials to ensure the correct tariff is applied for both the US and Mexico
  • Origin Determination — how will you ensure that goods are accurately qualified and certificates of origin are solicited to ensure FTA benefits
  • Landed Cost Analysis — how will landed costs, both inbound and outbound, be utilized to ensure this will be a cost-saving program
  • Audit Processes — will an audit plan for all transactions be set in place and will it include a periodic reconciliation of operations and inventory balances against government information
  • Customs Broker — will a customs broker be selected to process all imports and/or exports, and if so, has the broker been approved by the Mexican Government

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