With the United Kingdom´s (UK) withdrawal from the European Union (EU), a new trade agreement was necessary between Mexico and the UK to maintain preferential tariffs and market access.
For this reason, in December 2020, the Trade Continuity Agreement between Mexico and the UK was signed, as well as the Agreement related to Article 12 of the Trade Continuity Agreement between Mexico and the UK. Both agreements are aimed at maintaining and expanding preferential market access between the two countries.
As mentioned in our Legal Alert of April 30, the Trade Continuity Agreement had to be published in the Official Gazette of the Federation (DOF) to become legally binding in Mexico.
Today, Tuesday, June 1, 2021, the Trade Continuity Agreement was finally published, entering into force on such date. The following decrees were published in the DOF:
In addition, the Mexican Ministry of Treasury also issued the Resolution that establishes the General Rules related to the application of the customs provisions of the Continuity of Trade Agreement between Mexico and the UK.
In this regard, Rules 2.2.2 and 2.2.3. provide the mechanism for the refund or compensation of duties paid by importers of goods that qualified as originating in the UK and were imported into Mexico as of January 1, 2021; as noted, this is the date that the UK’s exit from the European Union became effective, and prior to the entry into force of the Trade Continuity Agreement in Mexico.
In addition to the publication of the aforementioned decrees, the following five instruments necessary to guarantee preferential access for products between Mexico and the UK were published in the DOF:
The purpose of these instruments is to provide the necessary information to economic operators in Mexico regarding the requirements to access the preferential quotas provided in the Continuity Agreement.
The Trade Continuity Agreement establishes that Mexico and the UK will begin negotiations for an ambitious, modern and comprehensive free trade agreement as soon as there is an opportunity and within one year of the entry into force of this Agreement. In other words, before June 1, 2022, both countries commit to start negotiations for a free trade agreement that will seek to strengthen and expand preferential access between both markets.
Finally, both countries commit to make every effort to conclude the negotiations of the free trade agreement within a period of three years from the entry into force of this Agreement, that is, before June 1, 2024.