Happy new year 2018! We are excited (and a bit worried) about what is coming up this year so we wanted to share it with you. Expect more updates from us on relevant topics throughout this year!
Mexican Congress deadline for creating new Labor Courts in Mexico: February 28, 2018.
In an effort to modernize the 1970’s era Labor Boards and substitute them with a modern Labor Court System that can issue more consistent rulings on labor matters, the Federal Constitution was amended last year and mandated a one year term for all State Congresses and The Federal Congress to organize the new Labor Court System. This System will be akin to the Federal District Court System (copied from the US), so that both workers (plaintiffs) and employers (defendants) can, in good faith, arrive at an early Settlement in the soon to be created, well-staffed and funded Centro de Conciliación (Settlement Center), and only resort to the formal Labor Court System if settlement fails. Other advantages of the laws are geared towards the clarification or specification of Labor Claims, which in practice were difficult to ascertain. Now the Centros de Conciliación will have the obligation of correctly identifying the issues at stake so as to be adjudicated more efficiently and quickly (a major flaw of the current Labor Law). These legal changes will let both plaintiffs and defendants to focus on getting to a resolution based on uncontroverted facts and merits, instead of hunches of their respective lawyers.
US “TPA” trade promotion authority ends July 1st, 2018.
Also, the Mexican Presidential election is to be held July 1st, 2018.
Why are these two things so important? If by such date US Congress fails to extend the TPA, and/or Mexico’s election sentiment helps a winning candidate for President to withdraw from NAFTA, then NAFTA will start a slow or very slow death.
For more detailed discussion of the different scenarios if such remote case arises, please check this excellent report by Mc Larty Associates. Also, another excellent Bloomberg report explains the difficulties the Trump Administration should encounter if it wants to terminate NAFTA.
US Mid-term Elections: November 6, 2018.
Still months away and to be conditioned by electoral events in the US and Mexico, the final part of 2018 will guarantee very interesting developments in the trade front between our countries.
OTHER IMPORTANT FACTORS ARE:
The SAT Cloud.
All tax sensitive transactions in Mexico are to be governed at cloud level from 2018. That also ensures that the Government can instantly verify the income and deductibility of expenses in Mexico for all taxpayers including Maquiladoras.
European regulations on data privacy, collection and dissemination. However, because the cloud is omnipresent globally, no company is exempt from knowledge of these rules if a EU citizen or company shares sensitive data on the cloud. Almost inevitable now or in the near future. Mexican Law has prepared for this by having a very open and flexible law that allows for companies to trade in data from other jurisdictions while safeguarding Mexican-generated data with privacy and re-dress obligations that will assure users of a minimum set of rights comparable to current European and US standards. We will surely inform you about any upcoming changes to Mexican data privacy laws that should improve on the existing ample and flexible regulations.
NAFTA E-Commerce “De Minimis” rules.
NAFTA countries have lesser privacy laws concerns among themselves compared against the EU and the upcoming GDPR. However, the main concern between the NAFTA countries are the very uneven De Minimis rules among the three nations: US de minimis is quite generous: $800 USD, Mexico is only $50 USD, and CANADA a measly C$20 (loonies). This has given E-Commerce giant Amazon an incredible home base advantage, and now it wants to have a freer rein in the NAFTA region.
Environmental Strict Liability Law amendments.
Since 2017, this important Law increased greatly the penalties and fines to environmental violations and also extended the liability to Managers, Shareholders and Employees that were or should have been responsible to sidestep or abate the environmental damage caused by a company. This year it will start to be applied in the context of very heated NAFTA negotiations.
If you have any question regarding these topics feel free to send us a message here!