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The Federal Collegiate Circuit Court of Mexico has determined that, when dealing with confidential or managerial employees, and when an employer loses confidence in such an employee for a good reason, it is not necessary to present a written notice informing the employee of the date and cause of termination of the labor relationship as mentioned in Article 47 of the Federal Labor Law. Notwithstanding this legal decision, it is convenient for employers deciding to terminate a labor relationship to present the written notice to the employee according to the final paragraphs of Article 47 of the Federal Labor Law. This is because an employee’s status as confidential or not confidential is a factual determination, and the employer could be considered as having unjustifiably terminated the employee if the employee is deemed not to be a confidential worker. In this case, the Labor Board of Conciliation and Arbitration has the discretion to determine whether a labor relationship is of a confidential nature, so the practical necessity of providing the written notice continues to exist.
Obligation to declare cash, checks or money orders upon entry or departure to or from Mexico. It is common for corporationswith subsidiaries in Mexico to handle checks, money orders or other negotiable instruments for collection in offices outside ofMexico. In this regard, one must keep in mind that in accordance with Articles 9 and 184 of the Customs Law of Mexico, oneis obligated to declare to the international transportation company, courier or messenger service any amounts that enter orleave Mexico that are greater than the equivalent of $10,000 USD. The same obligation applies to individuals entering orleaving Mexico and carrying negotiable instruments over such amount. The fine for not presenting a declaration beforecorresponding customs officials, or for the corporation transferring documents, could be as high as twenty percent (20%) toforty percent (40%) of the amount in excess of $10,000 USD, whether entering or leaving the country.
New Rules for Maquiladora and PITEX Companies. On November 1, 2006, the Mexican Department of the Economypublished in the Official Journal of the Federation a new Decree for the Development of the Manufacturing, Maquiladora andExports Services Industry (IMMEX Decree). The IMMEX Decree, which will enter into force on November 13, 2006, isdesigned to strengthen the competitiveness of the Mexican export sector. The IMMEX Decree is comprised of the rulesgoverning the Program for the Development and Operation of the Maquiladora Exportation Industry (Maquila Decree) andthat establishing the Temporary Importation Program for the Production of Exported Goods (PITEX Decree). According tothe Department of the Economy, the IMMEX Decree will help position Mexico as a leader in the world services market, notonly in the production of goods, but also in the development of design, re-engineering, remanufacturing, softwaredevelopment and information technology service industries, as well as “outsourcing” activities for administration, accounting,subcontracting, data processing and client services, among others. The new IMMEX Decree will attempt to simplify thetransmittals, requirements and forms related to the authorization, expansion and annual reporting of exporting companies In addition, the tax provisions that all companies falling under the Decree will receive a zero percent (0%) value added tax(IVA) rate for the invoicing of services, reduced times for obtaining refunds of value added tax without the necessity ofregistering as a high exportation company (ALTEX), and receiving the same Mexican income tax (ISR) treatment, thusguaranteeing tax neutrality for all companies participating in export programs.
