News & Trends – EU-Mexico FTA

EU-Mexico free trade agreement modernised

09.09.2021

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The EU and Mexico announced the modernisation of the already existing bilateral trade agreement in April 2020. Ratification of the agreement is expected before the end of 2021. This will open up new market opportunities, especially in the procurement, agricultural and services markets. This article explains what will change and how EU companies can benefit.

The EU and Mexico announced the modernisation of the already existing bilateral trade agreement in April 2020. Ratification of the agreement is expected before the end of 2021. This will open up new market opportunities, especially in the procurement, agricultural and services markets. This article explains what will change and how EU companies can benefit.

Mexico is an important market for European and especially German companies. In 2020, the German-Mexican trade volume amounted to 19.1 billion euros, according to the Federal Ministry of Economics and Technology (BMWi). Mexico thus remains the most important recipient country of German exports in Latin America.

What was negotiated – details on the modernised agreement

First things first: With the modernisation of the existing trade agreement from the year 2000, the EU and Mexico have agreed to reduce further tariffs. For example, Mexico’s existing high tariffs on agricultural products are to be phased out. This means that under the modernised EU-Mexico Agreement, almost all trade in goods between the EU and Mexico will be duty-free in the future. This will create new export opportunities for high-value food and beverages, as well as EU exports from other sectors.

The EU and Mexico have upgraded their existing bilateral trade agreement.
The free trade agreement between Mexico and the European Union offers many export opportunities for EU companies.
Photo: © European Union, 2019

The new agreement will also introduce new rules regarding customs clearance to simplify and speed up “paperwork” and goods checks at Mexican customs.

The EUR.1 movement certificate used up to now will be abolished. In future, only the declaration of origin on the invoice or other commercial document will count as proof of preference. For consignments of preferential goods with a value of more than 6,000 euros, these may only be made in the EU by Registered Exporters (REX). Existing REX registrations (for example for Canada or Japan) can be used for Mexico. The authorisation as an approved exporter no longer applies to Mexico.

© European Union, 2021

In Mexico, only exporters authorised by the local authorities may issue declarations of origin for consignments of preferential goods worth more than 6,000 euros.

Gerlach Zolldienste is happy to support companies in the process of obtaining “Registered Exporter (REX)” status. “We advise our customers and all companies in general not to miss out on these export opportunities arising from the modernisation of the EU-Mexico Agreement. With our extensive customs experience and expertise, we are here to help them not only with the REX procedure, but with all customs-related issues. Please feel free to contact us at any time,” says Thomas Weins, VP Customs & CEO Gerlach Germany.

In addition to trade in goods, the new agreement also offers new opportunities for the export of services in areas such as financial services, transport, e-commerce and telecommunications. It is also the first agreement between the EU and a Latin American country that also protects investments, and in which anti-corruption provisions and measures against bribery and money laundering have been agreed. In addition, 340 geographical indications (GIs) of European regional food and drink products will be protected in the Mexican market.

More details on the EU-Mexico agreement on the modernisation of the trade part of the Global Agreement can be found on the homepage of the European Commission “In focus EU-Mexico Trade Agreement“.

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