VTZ

Download our newsletter in PDF: Trading Room -24012020

WTO Members Express concerns on Mexico’s Food Labeling Project

According to media outlets such as Inside U.S. Trade and Grupo Reforma, the US issued comments regarding Mexico’s project of overhauling the labeling scheme for food and nonalcoholic beverages in the WTO. VTZ has prepared Trade Alerts regarding this topic.

In essence, we highlight that the US, as well as other WTO members (including the European Union), questions Mexico’s draft labeling project in a handful of matters, which suggests whether this labeling draft-project may not comply with article 2.2 of the Technical Barriers to Trade (TBT) Agreement as well as the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement, an issue that was raised by our members, other Mexican trade law experts as well as foreign companies in Mexico. Moreover, this topic was discussed in a panel during the V Biennial Conference of the Latin American Network of International Economic Law, which was held in ITAM last year.

It must be noted that the period to submit comments to the project concluded in early December. According to government officials, 4, 775 comments were submitted which will have to be studied by the Ministry of Economy. If the labeling project is subject to modifications, such modifications must be done within a 45 natural day term pursuant Mexican Law, though this may be unlikely given the international attention and the number of comments. The responses to the comments and the modifications to the draft-labeling project, if any, will have to be published in Mexico’s official gazette.

Ayer concluyó el periodo de Consulta Pública de la Modificación a la NOM 051 de #etiquetado para alimentos y bebidas no alcohólicas. En un hecho sin precedentes se recibieron 4,775 comentarios. Gran participación de los sectores aportando elementos para la recta final del proceso

— Alfonso Guati Rojo (@A_GuatiRojo) December 12, 2019

In its face, Mexico’s draft labeling project does not violate the national treatment principle since it will apply to both domestic and foreign products. However, we wonder whether this project, if adopted as such or with minor amendments, will trigger a WTO dispute because it creates unnecessary obstacles to international trade? Do you need more information? Do not hesitate to contact us.

México Signs BIT with Hong Kong

Yesterday, the Bilateral Investment Treaty (BIT) between Mexico and the Hong Kong Special Administrative Region was signed in Davos, Switzerland. This Agreement will grant legal protection to investments from investors from both economies in the host economy, and, as a consequence, this will increase investor confidence.

#WEF2020 La subsecretaria Luz Maria de la Mora @luzmadelamora firmó hoy con su contraparte de Hong Kong, Edward Yau, el Acuerdo de Promoción y Protección de Inversiones (APPRI), que fortalece la certidumbre y alienta las inversiones en ambas economias.#Diversificación pic.twitter.com/dzaKVaFiHC

— Graciela Márquez Colín (@GMarquezColin) January 23, 2020

Among the commitments agreed in the document, the two governments undertake to provide investors with fair and equitable treatment in accordance with the international customary law minimum standard of treatment of aliens, non-discriminatory treatment, compensation in case of expropriation of investments, and the right of free transfers abroad of capital. The Agreement also provides a dispute settlement mechanism under internationally accepted rules.

Being China Mainland the main investor in Hong Kong, this BIT will allow Mexico not only to increase trust among investors in this Special Administrative Region but also to expand investment flows and strengthen trade with the Asian country.

Mexico offers important opportunities for Hong Kong and Chinese companies in the logistics, manufacturing, tourism and services sectors. As of June 2019, the Ministry of Economy reported in Mexico 1,203.8 million dollars of investment from mainland China and 991.2 million dollars of Hong Kong investment since 1999.

Internal processes are still pending to approve the APRI in both countries, but this Investment Agreement will be 22nd for Hong Kong, while for Mexico it adds to the 29 previously signed.