The Recinto Fiscal in Mexico
A Recinto Fiscal in Mexico is comparable to a Free Trade Zone (FTZ) in the United States in concept. It is a specifically demarcated area that has a surface area of no less than twenty hectares (or approximately 50 acres) that has been set aside by Mexican Customs that is utilized to warehouse, keep, load or unload, and, in general terms, supervise merchandise related to foreign trade.
Since the recinto fiscal in Mexico is administered according to Mexican Customs Law and by Mexican Customs, the latter has facilities on site to fulfill its legally defined duties and obligations. Recintos Fiscales are typically located at commercial land crossings between the United States and Mexico, at commercial port facilities and adjacent to rail lines which transport goods. According to Mexican Customs Law, goods that are imported into Mexico and transported to a recinto fiscal in Mexico may be kept within the zone for a maximum time period of two years. There are, however, a number of exceptions to this limitation on time. Among the items that can be kept in a recinto fiscal in Mexico for a period of more than twenty-four months are:
- machinery
- laboratory equipment
- replacement parts
- molds
- industrial security equipment
- testing equipment
- some items related to telecommunications
Within a recinto fiscal in Mexico, there are often “recintos fiscalizados estrategicos” (RFEs). If a recinto fiscal in Mexico can be thought of, in general terms, as being akin to a foreign trade zone in the United States, an RFE can be considered to be similar in function and purpose to a bonded warehouse. Recintos fiscalizados estrategicos (RFEs) were established under Mexican Customs Law in December of 2002 for the purpose of creating an incentive to increase international trade flows and to enhance Mexico’s global economic competitiveness by decreasing logistics cost related to the movement of goods internationally. RFEs can be established using private capital through concessions granted by the Mexican government. Concessions for RFEs are for a twenty year time
period, and can be extended for another twenty years, should the application to renew the concession be made within the last three years of the agreement’s expiration date. If a concession ends without renewal, any facility improvements or equipment that is on site becomes the property of the Mexican Federal Government.
Individuals or organizations seeking a concession from the Mexican government to establish an RFE inside or outside a recinto fiscal in Mexico must establish that they:
- are a legal entity;
- are in good legal, moral and economic standing;
- have the capacity, in both technical and experiential terms, to administer and RFE;
- have access to sufficient finances to establish and run the recinto fiscal estrategico;
In addition to being found within a Mexican Customs administered recinto fiscal in Mexico, an RFE, with proper authorization and with Mexican Customs officials and technology on site, can be located in other, independent facilities. The same is true with warehouses that have been bonded in the United States. Items that enter an RFE do so on a tax and duty free basis, and are not subject to non-tariff barriers to trade or Mexican Normas Oficiales (NOMS). This is with the exception of items that are subject to rules and regulations related to trade in animal and plant products, as well as goods that impact public health and safety, and national security. Goods entering RFE’s can be manipulated, transformed, distributed, sold or repaired. They may be removed from a recinto fiscal estrategico in order to:
- import them definitively into Mexican commerce, if they originate outside of the country;
- export the items in a definitive manner should they be product made in Mexico;
- return them to their original country so that they may be reincorporated into the commerce of that nation;
- import them on a temporary basis so that they can be used as inputs to products made by IMMEX certified manufacturers.