History of foreign trade in Mexico
The following section will provide an account of foreign trade, from the revolutionary period to the present day. This is intended to give a concise overview of the evolution of customs and the history of foreign trade in Mexico.
Revolutionary Stage
In the period from 1910 to 1917, this type of activity had a negative impact due to the reality of the country thanks to the First World War. The period of the Mexican Revolution from 1917 to 1922, was distinguished by the decrease in obtaining the country's customs.
This led the government to attempt to overcome this foreign trade situation through tax collection and loan applications.
In 1916, the new tariff schedule was published, with opium being the only prohibited product. Taxes were reduced on basic necessities, while those on luxury items were increased.
The then government, led by Carranza, continued the tradition of collecting some of its income in cash, generally those related to foreign trade.
While international contributions were paid in paper money. These import tariffs, the government reduced them with respect to those rights of those products that were considered indispensable for the consumption of the population.
As long as these were not manufactured within the country or when national production was not capable of producing them sufficiently. Thus minimizing the protection of national industries and favoring rational protection for viable industries.
However, an attempt was made to facilitate trade between Mexico and the United States of America; but, the commercial relations between both countries due to the situation of internal instability that existed at that time, was suspended.
Effects of the First World War in the history of foreign trade in Mexico
In the same way, the restrictions imposed by the countries that participated directly in the first world war, which were activated on international trade, cornered the government.
This one had to place different tariffs on the trade. This with the objective of giving an advantage to those governments that did not place restrictions on their foreign trade with Mexico.
Legal system
Remembering, on February 5, 1917, the Political Constitution of the United Mexican States was published by President Venustiano Carranza, this as a result of the revolutionary movements of the year 1910.
This text, which is still in force and contains guidelines for economic, growth, and foreign trade policies, among other important considerations, has undergone approximately 200 reforms over time.
decrees
Along these same lines, on February 15, 1918, Venustiano Carranza issued a decree using his full powers. It was published in the Official Gazette of the Federation on February 20 of the same year.
It establishes the creation of the figure of the customs agent and delimits the specific guidelines for the performance of those who acted in full representation in customs activities. To implement this movement, it was necessary to have the approval of the then secretary of the Treasury.
This legal system was regulated by a relative instrument dated May 7, 1918. Despite this, both legal devices were repealed by decree on May 20 of that same year.
Instead, the ordinance of 1891 was urged. Later, there was the Customs Agents Act of August 27, 1927, which governed the actions of the customs agent.
Likewise, we can speak of three related regulations dated April 18, 1928, December 29, 1928 and August 19, 1935. In them, the principles framed in the Customs Agents Law of 1927 were enshrined.
In 1919, an initiative was promoted regarding petroleum and mineral fuels, with the aim of regulating their exploitation.
With the presidency in the hands of Álvaro Obregón in 1922, a fiscal balance was achieved without resorting to drastic measures. This creates the bases for the exploitation of oil, which were part of the constitutional principles.
Post-revolutionary stage in the history of foreign trade in Mexico
In 1929, the Customs Law, in force, sought to modernize and simplify procedures for clearing goods through customs. It also attempted to standardize a single tariff for the various taxes.
This law was repealed by the new Customs Law of 1935, in which a new legal system was introduced to regulate the operations of customs agents.
In November 1931, the Internal Regulations of the General Directorate of Customs and the Internal Regulations of the Treasury Secretariat were established in the country. One of their rulings defines the Customs Directorate as part of the physical establishments of General Services.
This in order to perform the function of managing, coordinating and supervising taxes, duties and customs benefits.
Custom code
The customs code of the United Mexican States of December 30, 1951, which was in force until 1982. Basically in the period of import substitution.
This indicated the locations for the introduction or extraction of goods, the cases in which exceptions applied to trade with countries, and the special requirements.
Also prohibitions, documentation for operations and products subject to customs contributions.
Title XVIII was the legal framework used to regulate the operations of customs brokers. It was later replaced by the Customs Act of December 28, 1984.
This was in force until the Customs Law was revealed on December 15, 1995, which came into force on April 1, 1996.
Current Customs Law
This Customs Law is the one currently in force, despite this, it has been modified more than 12 times.
According to the needs of control, facilitation and use of information technology. This has been recently modified and its publication dates from December 2013.
The evolution of the legal framework is key to adapt to political, social and technological changes
With the entry into force of the Organic Law of the Federal Public Administration, on December 29, 1976, new regulations of the Ministry of Finance and Public Credit were created, this just one year later.
The Undersecretariat of Finance and Public Credit, the Undersecretariat of Revenue, the Undersecretariat of Tax Inspection, to which the General Directorate of Customs was attached, the General Office, the Federal Tax Attorney's Office, and the Federal Treasury are integrated into the Undersecretariat.
The Customs Law, enacted on December 30, 1981, provided the concepts used worldwide and facilitated the structure of administrative resources, highlighting those provided for in the Federal Tax Code.
This was guided by a new principle of trust in the taxpayer, through the principle of self-determination of taxes on foreign trade.
Merchandise valuation standards were compiled, the maquiladora industry and PITE export companies were encouraged, and the customs regimes known today were established.
From nationalism to trade openness
It is always prudent to remember and place ourselves in the context of the global crisis of 1929, which extended into 1939 and 1945. This crisis was caused by an oversupply of goods in the most industrialized countries.
For its part, Mexico resorted to protectionist measures reaching its maximum limit in the government of Lázaro Cárdenas. This through an economic policy called economic nationalism.
This kept the national interest above any foreign or private benefit. Promoting a true and feasible state intervention in the national economy.
From this stage until the six-year term of José López Portillo, from 1976 to 1982, commercial activity was negatively affected by the import substitution system.
The foregoing is in order to preserve natural resources and promote its own industry to transform the national economy into a self-sufficient economy.
Thus, Mexico's contemporary economic policy is based on a system of open trade, which was strengthened in the mid-80s when the import substitution model was repealed.
Integration to international associations
The most significant move toward a new economic model materialized when Mexico joined the Latin American Integration Association (ALADI) in 1981.
It then joined the General Agreement on Tariffs and Trade (GATT) in 1986. Later, in May 1988, it joined the Customs Cooperation Council (CCC).
This is intended to harmonize and facilitate international trade. Thus, during Miguel de la Madrid Hurtado's six-year term, from 1982 to 1988, Mexico gradually opened up to the outside world.
In this way, it takes its first steps towards neoliberalism, due to constant pressure from international organizations. Protectionist barriers are reduced, simplifying the bureaucratic system and privatizing industries.
Mexico's entry into the GATT marked the beginning of the new Mexican economic model, which was undoubtedly realized in 1944 with the entry into force of NAFTA. It then became a member of the World Trade Organization (WTO) in 1995.
Constitutional Article 27
New treaties were signed and commercial agreements signed with other nations of the world. Ratifying with it and with the reform of article 27 of the constitution, which allowed peasants to be owners of the land where they worked.
This same Article 27 of the Constitution confirmed the neoliberal policy proposed by the federal government from 1988 to 1994, which drew certain criticism.
The truth is that FTAs and ECAs, among other systems, have been beneficial to the country's economic development, allowing it to earn significant foreign currency and foreign investment.
With the benefit of creating new businesses and therefore more jobs, but with the negative side effect of political corruption that continues to this day.
Commercial opening model in the history of foreign trade in Mexico
Through the trade liberalization model in 1989, the General Directorate of Customs was integrated into the Undersecretariat of Revenue, through the reform of the Internal Regulations of the Secretariat of Finance and Public Credit.
Nowadays, trade with other countries has its advantages and disadvantages.
However, in the search for a new position to face the new changes imposed by globalization, through the decree by which they are reformed.
They add to and repeal the legal system established in the Internal Regulations of the Ministry of Finance and Public Credit, published in the Official Gazette of January 4, 1990.
Where a large part of the functions of the General Directorate of Customs were delegated to administrative units attached to the Undersecretariat of Revenue, with exclusively fiscal functions.
In January 1993, the modification to the Internal Regulations of the Ministry of Finance and Public Credit was published, where the name was changed to the General Directorate of Customs AGA and the authority of the 45 customs offices in the country was revealed.
In 1994, they distanced themselves from the regulations that established general fiscal rules. A new Customs Law was published on December 15, 1995, and entered into force on April 1, 1996.
The Tax Administration Service (SAT), related to the General Customs Administration, was established in mid-1997. In 1988, the Customs Law was reformed again to prevent late payment of taxes.
In 2002, this law was modified again with the intention of promoting, among other things, the use of technology and investment, as well as increasing legal certainty.
Customs at the beginning of the millennium 2000
In the late 80s, customs clearance of goods was still carried out manually, theoretically taking one to three hours; however, the actual customs clearance process could take days.
At the end of 1999, the manual process began to be replaced by current and rapid systems, CADEPA, SAAI, SAAI M3.
In the 90s, the implementation of the updating of the customs method began, using new technologies and automated processes.
At the beginning of the year 2000 relevant modifications were made for the electronic control. Initially in warehouse management and custody of foreign trade merchandise.
Administrative procedures and customs violations were also improved, such as the establishment of companies certified as AEO authorized economic operators.
Later, in the mid-2010s, the 49 customs offices in Mexico began a process of improving the system and reinforced their essential activity in the commercial regulations of the region as an instrument to support foreign trade.
It also serves as support for foreign trade promotion programs, specifically to boost exports from IMMEX maquiladora companies. It also promotes and develops the aeronautical and automotive sectors.
Electronic customs in the history of foreign trade in Mexico
Thus, in the decade following 2010, the Tax Administration Service (SAT) established stricter controls on importing and exporting companies.
Specifically, to IMMEX maquiladora companies and the country's most vulnerable sectors. Thus, the Electronic Customs System (SAE) was born.
The customs legal representative for companies was also born, which was a prior matter in national laws for its modernization. These were included in the reform of the Customs Law.
This reform was published on December 9, 2013, which strengthens the promotion of the online customs application. A digital window for foreign trade, as well as the use of electronic files.
Consolidating the customs space as a series of steps and specifications that encourage the issuance of online and digital assets. These assets must be generated, transmitted, and presented through technological means and the use of the internet.
In this way, customs clearance becomes electronic, defining the requirement as:
"The declaration in an electronic document, generated and transmitted, regarding compliance with the regulations that tax and regulate the entry and exit of goods from the national territory."
However, with this, customs agencies also began in 2016 with online reviews in international business activities and the use of online tax messaging.
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