By Mauricio Monroy, Deloitte
On January 1, 2008, a business flat tax (flat tax), also known as IETU, its Spanish acronym, became in force in Mexico. The tax was enacted through a decree published on October 1, 2007 in the Mexican official gazette.
By Gerardo Hernandez Reyes, Jose Luis Alvarez Palacio, Sergio Barajas Perez, Turenna Ramirez Ortiz and Luis F. Martinez, Basham, Ringe y Correa, S.C.
In recent years, the Tax Authority Auditing Offices have begun to implement a series of revisions in the area of Foreign Trade, which have resulted in exorbitant tax calculations and fines, and created uncertainty within the industry.
These audits have focused directly on reviewing the requests for import permits filed between 2001 and June of 2003 the description of the imported merchandise, and (b) the allocated customs tariffs within the authorizations issued in connection with manufacturing programs. The auditing officers are seeking to verify the merchandise has indeed entered the country legally.
By Margaret Mann
The globalization of the world’s business activities and the nearly universal adoption of capitalism as the world’s economic system have led to two related phenomena. The first is the need for effective national economies to enact an effective bankruptcy law. Capitalism rewards the taking of risk, and the taking of risk leads to inevitable failures. The more efficiently the applicable bankruptcy system frees the assets trapped in a failed capital structure, the more economic growth can be generated from the asset. China, Mongolia, the Czech Republic are among the emerging economies that have realized this phenomenon and recently adopted a new bankruptcy law.
By David Sands and Gabriel Matus
With the uncertainty surrounding the long term effects of the current credit crunch, buyers and sellers in M&A transactions are pondering how to best protect themselves. The traditional guard against the unforeseen is the material adverse change clause – also known as a “MAC.”[1] As highlighted recently by the Accredited Home Lenders acquisition and the abandoned Sallie Mae deal, buyers may seek to use MAC clauses when economic conditions worsen to escape deals or to exert leverage to renegotiate terms. Recent market events pose the question of whether a global credit crunch can trigger a MAC and allow the buyer the option to terminate the transaction. A review of standard MAC clauses and case law suggests that in most cases it would not.
By Polly Towill and Olivier Theard
Introduction
Latin American companies have had relatively open access to the market in the United State and sell billions of dollars of merchandise to U.S. consumers every year. While enjoying the fruits of this trade, Latin American companies should be aware of the potential pitfalls if the goods they sell to U.S. consumers are somehow defective or cause injury. The U.S. provides its consumers with specific legal protections against harmful products. Latin American companies need to know these laws if they want to protect themselves, while continuing their profitable relations with U.S. buyers.
By Luis F. Martinez Serna, Basham, Ringe y Correa, S.C.
Summary
This essay will discuss a North American Free Trade Agreement (“NAFTA”) shortcoming that results in the unfair payment of import duties, fines, interest, and antidumping duties. Many times, funds for payment come from United States or Canadian companies with operations in Mexico. NAFTA´s flaw lies mainly in not contemplating legal-cultural differences between Mexico, the United States and Canada, which results in Mexican customs officials invalidating NAFTA certificates of origin for formalistic reasons. These certificates of origin are often completed by United States or Canadian company officers with practical, good-faith, business-oriented minds who are not accustomed to stringent formalistic interpretations of the law.
By David Chidlaw and Ruben Escalante
In November 2007, the Equal Employment Opportunity Commission ("EEOC") filed a lawsuit against the Salvation Army because the Salvation Army instituted a policy which required its employees to learn English within a year or else face termination. The EEOC's stance against "language-based" discrimination, is founded upon Title VII's prohibition against "national origin" discrimination. The implications of such a stance are widespread, given the labor force continues to grow more ethically diverse and employers try to find the proper balance between employee, customer, and management relations. The purpose of this brief article is to provide an overview of the EEOC's current approach to "language-based" discrimination.
By Mr. London, London Group Realty Advisors
Baja California’s easy access, proximity, great weather and warm culture have always attracted Americans to travel to its Mexican next door neighbor. Now, world class housing and hotels, and great real estate value, add to the allure for Americans considering investing or living in Mexico.
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