WHICH INCOTERMS ARE BEST FOR IMPORTING?
The supplier will most likely quote you a price for FOB (Free on Board) and one for CFR (Cost and Freight). We recommend that you always try to maintain control of your shipment, meaning that FOB is the best way to go. By choosing FOB, not only will the price of the goods be included, but also any costs up to when the goods are loaded onto the ship.
Remember that FOB does not include the cost of transportation. You can obtain an estimate from a shipping agent. If you don’t have one, we would be happy to send you a quote!
If, for some reason, your goods come with fees paid, we suggest that you request a quote for DAP (Delivered at Place); however, be careful because this will be more expensive than FOB when added to your transportation costs, and you could lose control of your shipment with this option.
Remember that when calculating how much your final import will cost, you will have to find out what taxes need to be paid on the goods. Your freight forwarder will be able to help you with this.
FINANCING THE IMPORT
In the current market, the possibility of financing will greatly depend on your relationship with the bank. The supplier will not give you credit, especially for your first transaction, and will definitely ask you to pay a portion of the invoice in advance (20-40%) and the remainder following submission of shipping documents. This means that once the goods are shipped, the supplier will not send you the documents until you make a bank transfer for the remainder of the total.
Sometimes, instead of sending the document via courier, due to the associated costs and risks, you can use an “Express Release BOL.” This means that the agent at the destination will not require the “original” bill of lading in order to release the goods.
WHAT DO I NEED IN ORDER TO IMPORT TO MEXICO?
As a general rule, the first thing to keep in mind when you begin the process to import is that you must file your business with Mexico’s Registry of Importers for Specific Industries, which is run by the Mexican tax authority SAT (Servicio de Administración Tributaria). In order to do so, you must be up-to-date on all of your tax obligations, prove to the customs authorities that you are listed on the Federal Registry of Taxpayers, and meet all other requirements established by Customs Law and SAT’s general rules on foreign trade.
Additionally, you must have an automated way of keeping inventory control, and a log of the inventory data must be kept up to date at all times.
You will also need to obtain information and documents to prove the country of origin of your goods for the purposes of preferential tariff levels, marking the country of origin, applying countervailing duties, meeting quotas, and other applicable measures according to the Law of Foreign Trade.
Before importing, you must submit a written manifest to your customs agent detailing the value of your goods for customs purposes. You will need to keep a copy of this manifest and obtain information and documents to prove that the value you declared was determined in accordance with the provisions of Customs Law.
You must electronically register a power of attorney with the General Customs Administration, granting authority to your customs agent, to carry out transactions on your behalf.
Finally, remember that you must pay all foreign trade taxes and anti-subsidy duties and comply with all non-tariff regulations and restrictions.
WHAT DOCUMENTS DO I NEED IN ORDER TO IMPORT TO MEXICO?
In order to import, you must have the following documents:
COMMERCIAL INVOICE
This is an invoice issued by the supplier, which should clearly state their registered business name and address, along with your own, as well as a description of the goods, price, and terms of the sale (for example: FOB Shanghai).
PACKING LIST
This is a clear and accurate list created by the supplier that specifies all contents of the shipment. The packing list must identify the number of pieces, unit weight and total weight, dimensions of each piece, and if possible, references. This is especially recommended for consolidated freight.
BILL OF LADING
This is the document issued by the shipping agent at the origin and submitted to your supplier. Generally, your supplier will send it to you when you have paid them (or earlier, if you have an established credit account). Your shipping agent uses this document to deliver the goods.
You must pay careful attention to the number of original copies mentioned in the BOL, since you need all of them to be able to deliver your goods. If you have an Express BOL, it will not be needed to deliver your goods, but you will need it to receive customs clearance.
CERTIFICATE OF ORIGIN
If your goods are subject to an excise tax, whether due to the type of goods or their origin, the official document must accurately prove said origin. This is generally done by means of a form.
More documents and certificates may be required depending on the type of product you import (food, seafood products, cosmetics and toiletries, agricultural or animal, personal effects, clothing, shoes, etc.)
WEIGHT OR VOLUME CERTIFICATE
This certificate must be issued by the company authorized by the Ministry of Finance and Public Credit to certify this type of document.
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