November 17, 2008

Mexico and China Agree to Resolve Pending Trade Disputes


On October 13, 2008 a decree was published in the Official Journal of the Federation (Diario Oficial de la Federación or DOF) containing Mexico’s
agreement with the Government of the People’s Republic of China in regard to compensatory duties previously imposed by Mexico on Chinese goods.
Based on the published decree, Mexico will be required to implement measures to cancel the reservations contained in Annex 7 of the Accession Protocol
of China to the World Trade Organization (WTO). The purpose of this is for Mexico to eliminate antidumping duties on products previously listed in
publications in the DOF originating from China, which means that Mexico will not be able to invoke its reservation of Annex 7 in the future. The decree
contains two Annexes: Annex 1. – Identification of products on which compensatory duties will be eliminated progressively through a transitional
means; and Annex 2. – Identification of products on which compensatory duties will be eliminated immediately. While the decree contemplates the
possibility of the progressive elimination established in Annex 1, such decree also states that no compensatory antidumping duties will be able to be
imposed on products originating from China starting December 11, 2001. The forgoing results from China’s entry in the WTO and the end of the term of
the original reservation made by Mexico, which means that Mexico’s market will eventually be totally open to products originating in China.