How Do Shelter Companies Help with Trade Compliance and Customs in Mexico? 

Article Overview: Trade compliance is a comprehensive matter, especially for U.S. and other foreign companies manufacturing in Mexico. To alleviate the stress, time, and cost associated with handling this key part of production, many choose to engage the expertise of a trusted shelter company to keep their setup on track.

Trade compliance and customs are complex, no matter what, and operating in a foreign country requires special day-to-day oversight of changes and implementation, in addition to unforeseen challenges.

Not only is information constantly updated, but it can also be difficult for one person to keep track of – and if any details are missed, manufacturers are subject to fines and setbacks that can affect the entirety of their project.

Companies manufacturing in Mexico can avoid many common mistakes and challenges by calling on the guidance and expertise of a local shelter company.

Challenge #1: First-Time IMMEX Program Applicants

When manufacturing in Mexico, U.S. and other foreign companies must apply for IMMEX program approval and value-added tax (VAT) certification. This allows manufacturers to temporarily import raw materials and equipment for production without paying related VAT on the temporary importations.

However, new program applicants face a long approval time and face the risk of being denied if there are inaccuracies with any of the information provided. Therefore, this process needs to be carefully managed, and leaving it up to one person with limited knowledge can present complications.

Working with a Mexico shelter company allows foreign manufacturers to be added to the shelter company’s established permits and certifications, creating a quicker, safer process to get production up and running.

Challenge #2: Compliance Changes Are Constant

Manufacturing in Mexico isn’t a new concept; yet, rules and regulations are constantly changing. Even if a manufacturer has previously operated in Mexico, they may not realize that compliance is completely different, and the landscape of what’s acceptable may no longer apply.

Rules on tariffs, duties, and taxes are constantly changing, and any misstep can lead to project fines, delays, or full cancellations.

A shelter company is equipped with trade compliance and customs experts to guide U.S. and other foreign manufacturers through the process and keep them at the forefront of newly implemented (and pending) regulations, and how they might affect production.

Challenge #3: Inaccurate Materials List and/or Categorization

Manufacturers are required to provide a detailed list of imported materials. Everything is checked, marked, and categorized for applied duties, taxes, and customs approval.

Without proper communication and clarity, whether to their shelter company or as a standalone entity, the lack of planning or full disclosure makes it harder for companies to comply, resulting in setbacks.

When partnering with a Mexico shelter company, manufacturers benefit from economies of scale, as well as access to an established team that is well-versed in all aspects of trade, rather than relying on a single person to handle compliance.

A Trusted Team of Experts

Who a manufacturer chooses to work with makes a difference. A reputable shelter company, such as IVEMSA, works closely with the Ministry of Economy and the National Council INDEX in Mexico to maintain a strong network and continuously build upon the local expertise and experience needed to succeed.

Learn how IVEMSA’s trade compliance and customs experts can help you streamline the import/export process and reach your production goals. Contact our team today.