Border Link, Beyond boundaries Podcast in English

The objective of this paper is to highlight the importance of inflation within the technical analysis of Transfer Pricing studies. Currently, there is stability in terms of how prices behave in the Mexican economy; however, this situation does not imply that Transfer Pricing analysis stop taking into consideration inflation as part of the relevant adjustments it would need to consider.

It is clearly true that the changing global regulatory environment for all entities and for our profession has led to the increased scrutiny of financial information, as a result of accounting irregularities perpetrated in various public entities before and after the Enron case

On November 30, 2012, there were published in the Federal Official Gazette (DOF), the Amendments to the Federal Labor Law (LFT), and became effective on December 1st., 2012

In 2003 the Tax Administrative Service ("SAT") through the General Customs Administration created the Certified Company Registry by including in the Customs Law article 100-A that states that companies can request their registry as long as they are legally incorporated, are up to date with their tax obligations, and have audited their financial statements for the last 5 years and that they fulfill the compliance levels established in the Rules

Taking into account the current economic and business sector rediscovering that employees are the company's most important asset, it becomes necessary to optimize the salary structures in order to make the most of payroll expenditures and the employee's take home, making the payment of contributions a more efficient cost.

On January 14, 2011; by presidential decree the Mexican Foreign Trade One Stop Website was enacted. It´s main purpose is to simplify, automate and improve the processes made in the Foreign Trade area, reducing time and costs on international trade commercial operations.

On January 23, 2012 the Ministry of Economy published in the Daily Gazette the "Decree for the competitiveness and duty reduction in the economic border region" where the President of Mexico looks to promote investment and maintain productivity and employment in the country by lowering production costs thus reducing the impact of external markets contraction on the demand of products manufactured in Mexico, as well as to contribute to operations improvement of commerce and service companies in the border region against the competition from neighboring countries, all this by reducing import duties nationwide and in the border region.

In this edition we will comment about: Bimonthly Auditor's Opinion for INFONAVIT (Bi-monthly –Bi-monthly audited), Rectification of the Labor Risk Insurance's Classification and the Implementation of SUDINET (IMSS).

This last October 12, 2011, the "Decree by mean of which sundry tax benefits published in November 5, 2007 and May 26, 2010 are modified" was published. This Decree will be in force for the whole tax year of 2012 and 2013 and gives continuity to the Flat tax benefit currently used by maquiladoras provided that certain requirements are met. It worth mentioning the requirement for the adequate and timely compliance with the filing of various tax reports and the compliance with the obligations derived from the granting of the maquila program as stated in the IMMEX Decree, essentially those regarding the adequate control of the import and exports.

Business valuation from a multinational perspective is becoming more important, and earning particular attention for fiscal authorities, in the context of transactions between related parties where an appropriate definition would be that related to fair value market.

In Mexico, the Science and Technology Law regulates the allocation of federal grants to promote, improve, develop and consolidate scientific research, technological innovation and a specialized human capital. Pursuant to the aforementioned legal framework, and in order to fulfill the objective to promote scientific and technological research, the National Science and Technology Council (CONACYT, for its acronym in Spanish) is the special organism that evaluates and allocates incentive grants according to certain eligibility regulatory requirements and provisions.

The Federal Law on Protection of Personal Data Held by Private Parties and Individuals (Ley Federal de Protección de Datos Personales en Posesión de Particulares, or LFPDPPP), was published on July 5, 2010 in the Mexico's Federal Official Gazette. So starting from July 6, 2011, individuals and entities must comply with the applicable provisions derived from the new legislation.

With the purpose of contributing to the countries development though an efficient and secure immigration management, the National Immigration Institute (Also called "INAMI") published in the Official Federal Gazette on March 3rd. 2010 an official Memo in which the authority announces the new basic format and immigration ID cards for foreigners; Non-immigrants, Immigrants and Foreign Residents. Said ID cards have substituted the original "FM3" and "FM2" booklets which were filled out manually.

If your company is not registered as a Certified Company before the General Customs Administration, it is probable that it might be losing important customs benefits.

In this edition, please review a summary of some incentives and remissions applicable to the payment of salaries because in some cases this could represent important benefits to the employers.

In this year, new tax provisions regarding the law of vehicle use and ownership have gone into effect in the State of Baja California, this will result in less collections from this tax. In lieu, the State has made additional state tax changes in order to cover this balance.

The Business Flat Tax Rate (IETU because of its acronym in Spanish), which entered in force as from January 1, 2008 has adverse effects to the maquila industry because in determining the taxable base, not all expenditures of the maquiladora are considered fully deductible.

On December 31st, the Federal Official Gazette published a Decree regarding additions to different income tax provisions, and specifically related to the First Job Tax Incentive.

Tax opinions have been a tool the authorities have used to maximize auditing mechanisms for over 50 years. Registered Certified Public Accountants (RCPA) have played a very important role in this process as the independent professional that issues an opinion on the information contained in the Tax Audit Report Filing System (SIPRED, acronym in Spanish) format, in compliance with the audit standards and procedures that govern his professional activity.

This podcast will address the latest amendments made to the transfer pricing guidelines by the organization for economic co-operation and development (OECD), organization Mexico belongs to. In this podcast we will discuss the changes made to four specific chapters. We will review Chapter 1, which addresses the Arm's Length Principle; Chapter 2 that contemplates the net transactional margin method; Chapter 3, which addresses the comparability analysis, plus new Chapter 9 that addresses the subject of restructuring operations. How does this affect maquiladoras, particularly those that sell their products into the Mexican Market?