More breathing room over new anti-smuggling rules for Mexican shipments – Natural Self Esteem

Mexican Border Photo 220784496 © Christopher Smith

© Christopher Smith

The Mexican authorities have extended the grace period for his complete the charter (CCP) requirement for all shipments within, to and from Mexico.

The new CCP regime came into effect on January 1st, with a grace period for compliance until March 31st. This has been pushed back to the end of September.

CCP is an addendum to digitized tax documents that supplements bills of lading that Mexican owners of shipped goods, shippers, and freight forwarders must comply with. It helps Mexico’s tax authorities certify property, type of goods, origin, destination and means of transport – its main purpose is to fight smuggling and tax evasion.

In the original timeline, after March 31, operators faced fines of up to $5,000, suspension of operating licenses, and confiscation of goods.

Supply chain solutions provider IntelliTrans highlights studies showing Mexican governments lose up to $7 billion annually to smuggling tax evasion.

CCP applies to all shipments and covers all modes of transportation and requires carriers to provide requested shipment information before goods enter Mexico or begin their journey in the country. There are no exceptions, not even for goods that are transported under customs connection.

The information required up front is more comprehensive than before, meaning transportation providers need to gather more details from shippers, said Carlos Duron, president of Mexpress, which operates a cross-border air cargo trucking service.

“It’s not very complicated, but it’s very detail-oriented,” confirmed IntelliTrans President Ken Sherman.

As is so often the case with bureaucracy, there are stumbling blocks. The code used by the tax authority does not match the international HTS code, Mr Duron noted.

“If your details don’t match, the shipment will be rejected,” he said, adding that it causes delays that translate into subsequent payments for truckers. Likewise, if an incorrect digit is included in a code due to a data entry error, the shipment will be rejected.

“Small parcel companies face a bit of a challenge with so many small shipments,” said Mr. Duron.

Canadian Pacific Railway advised its customers, “If a shipment does not contain this newly required information, there is a risk of delays in handling and/or transfers and departures. Customers must be fully compliant to avoid late deliveries, additional fees or even penalties for the Mexican part of the delivery.”

IntelliTrans has advised its customers that carriers who fail to comply face fines, confiscation of goods and suspension of truck permits, warning: “If a carrier is affected, so is the carrier using it.” Forwarder uses, affected.”

According to the US International Trade Administration, non-compliance with the CCP can result not only in fines but also potentially the closure of involved Mexican companies for up to 15 business days.

Fines reportedly range from $800 to $5,000 depending on the severity of the problem, IntelliTrans told its customers. The amount primarily relates to the volume and recurrence of violations, Mr Sherman said.

For shippers, the impact is mainly delays, but also financial implications, IntelliTrans noted.

“The VAT charged by the carrier is not deductible for the owner of the transported goods unless all documentation is compliant,” it says.

Mr Duron said: “However, it is usually the carrier who faces the music, as the carrier is the party that files the CCP with the authorities. At the end of the day, it is the carrier’s responsibility.”

Some carriers have taken a strict approach to their customers; Canadian Pacific advised customers that CCP data must be submitted via EDI or by billing through the railroad’s customer station.

“There are only two ways to send data to the railroad companies – either via EDI or through their website – and not by fax or email,” noted Sherman.

With stiffer competition on the truck side, road hauliers tend to be more accommodating to hauliers, he added.

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