RULE 7.2.4: CAUSES OF CANCELLATION AND SUSPENSION OF THE REGISTRY IN THE BUSINESS CERTIFICATION SCHEME IN THE VAT (IVA) AND IEPS MODALITIES AND CERTIFIED COMMERCIAL PARTNER

The General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) will proceed to initiate the procedure for canceling the Registry in the Business Certification Scheme granted in terms of rules 7.1.2. (RGCE 2020: Regla 7.1.2), 7.1.3. (RGCE 2020: Regla 7.1.3) and 7.1.5. (RGCE 2020: Regla 7.1.5), for any of the following causes:

A. General causes:

I. Failure to discredit the inconsistencies that have generated a requirement.

II. They do not present the notices referred to in rule 7.2.1. (RGCE 2020: Regla 7.2.1)

III. Failure to prove, during the compliance supervision inspection or in the exercise of the faculties of verification, that it has the necessary infrastructure to carry out the activities for which its Registration in the Company Certification Scheme was granted.

IV. Failure to carry the inventory control system in an automated way.

V. Present and / or declare false, altered, or false information or documentation in any procedure or process related to the Registry in the Business Certification Scheme and / or when carrying out foreign trade operations.

VI. When the Service Tax Administration (Servicio de Administración Tributaria) files a criminal complaint or complaint against partners, shareholders, legal representative, or members of the administration of the requesting company or declaration of damage, as appropriate before the competent authorities.

VII. The taxpayer is not located in their fiscal address or that of their establishments are in the assumption of not located or nonexistent.

VIII. When it is detected that it temporarily imported merchandise from fractions of Annex II (DECRETO IMMEX: Anexo II) of the IMMEX Decree without having requested the corresponding authorization or having the corresponding authorization, import merchandise from said Annex (DECRETO IMMEX: Anexo II) that did not correspond to its production process, or, finished products that do not correspond to the type of program to which it corresponds.

IX. When it is determined that its partners or shareholders, legal representative with power to act of ownership and members of the administration, are linked to a company that has been canceled in the Registry in the Business Certification Scheme, Value-Added Tax (Impuesto al Valor Agregado) and Special Tax on Production and Services (Impuesto Especial sobre Producción y Servicios) modality in accordance with sections V, VI and VII of Section A; II and III of Section B of this rule; VI and VII of rule 7.2.5. (RGCE 2020: Regla 7.2.5)

X. When it is determined that the name or address of the supplier or producer, recipient or buyer in national territory or abroad, indicated in the customs declarations (pedimentos), Digital Tax Receipt Online (Comprobante Fiscal Digital por Internet) or equivalent documents, or the information provided, are false, non-existent or not located.

B. Additionally, the General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) will proceed to initiate the procedure for canceling the Registry in the Business Certification Scheme granted in terms of rules 7.1.2. (RGCE 2020: Regla 7.1.2), 7.1.3. (RGCE 2020: Regla 7.1.3) and 7.2.3. (RGCE 2020: Regla 7.2.3), in addition to those indicated in Section A of this rule, for any of the following causes:

I. For the definitive cancellation of the authorization, permit, or customs regime by which the Registry in the Business Certification Scheme was granted, as the case may be.

II. For companies with the IMMEX Program, when derived from the faculties of verification, it is not proven that the merchandise imported temporarily, were returned abroad, transferred, or were destined to another customs regime, within the authorized period.

III. When the customs authorities detect that the merchandise imported temporarily under their program are not found in the authorized addresses.

IV. When the legal stay of foreign trade merchandise is not accredited for more than $100,000.00 (one hundred thousand pesos 00/100 m.n.) and the tax credit determined and notified by the Service Tax Administration (Servicio de Administración Tributaria) is not covered.

V. When, once the procedure for suspending the Register of Importers and / or Register of Importers of Specific Sectors and Register of Sectorial Exporters, has been notified that the definitive suspension in the respective registry proceeds.

VI. When derived from the initial inspections or supervision of compliance or in the exercise of faculties of verification in the addresses or establishments in which they carry out operations, the General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) have knowledge that it does not have the necessary infrastructure for the operation of its IMMEX Program or of the customs regimes of fiscal deposit to undergo the process of assembly and manufacture of vehicles, to companies of the terminal automotive industry; of elaboration, transformation or repair in the Controlled Premises or Strategic Controlled Premises; does not comply with the production process or provision of services according to its regime or does not have the investment in national territory declared before the General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior).

C. For authorized taxpayers in accordance with rule 7.1.5. (RGCE 2020: Regla 7.1.5), the General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) will proceed with the cancellation in the following cases:

I. For the reasons indicated in Section A of this rule.

II. When to the Certified Commercial Partner rubric "Customs Agent":

a) The customs patent has been suspended during the validity period of its Registry in the Business Certification Scheme.

b) The customs patent has been canceled in accordance with article 165 (LA: Art. 165) of the Law.

c) The voluntary suspension is authorized, in accordance with article 160, section V, second paragraph (LA: Art. 160) of the Law.

III. When the authorization as a Controlled Premises is definitively canceled.

IV. Prevent the access of the customs authority personnel to the compliance supervision inspection.

V. When, once the deadlines have been exhausted, the notices that meet the specific requirements derived from the certification or the compliance supervision inspection are not submitted.

VI. When they no longer comply with the provisions of the "Profile of the Land Car Carrier", "Profile of the Customs Agent", "Profile of the Railway Carrier", "Industrial Park Profile", "Profile of Controlled Premises", "Courier and Parcel Profile" and "Profile of the General Warehouse of Deposit" of Annex 1 (RGCE 2020: Anexo 1), as appropriate.

VII. When the authorization to provide the merchandise storage service under the fiscal deposit regime is definitively canceled.

In the cases in which the assumption of section VI of Section B of this rule is updated, the authority will initiate the cancellation procedure through the official letter that notifies the irregularities detected within the inspection in the addresses or establishments in which they carry out operations.

For the purposes of the provisions of this rule, the customs authority will notify in terms of articles 134 (CFF: Art. 134) of the Federal Fiscal Code (Código Fiscal de la Federación) and / or 9-A (LA: Art. 9A) and 9-B (LA: Art. 9B) of the Law, the beginning of the procedure indicating the causes that motivate it, and will order the suspension of the effects of the Registry in the Business Certification Scheme granted and will grant a period of 10 days to offer the evidence and arguments that in its right suits.

The customs authorities must issue the corresponding resolution within a period that will not exceed 4 months from the notification of the start of the procedure.

Taxpayers whose Registry in the Business Certification Scheme has been canceled in the Value-Added Tax (Impuesto al Valor Agregado) and Special Tax on Production and Services (Impuesto Especial sobre Producción y Servicios) modality and Certified Commercial Partner, in any of its rubrics, will not be able to access them again until after 2 years from when the resolution is notified.

In the case of those companies that have enjoyed the benefits or facilities established in the Registry in the Business Certification Scheme in accordance with rule 7.1.3. (RGCE 2020: Regla 7.1.3), to which the registration is canceled, will have a period of 12 months from the notification of the cancellation to update the inventory control referred to in article 59, section I (LA: Art. 59) of the Law.

The General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) will suspend the Registry in the Business Certification Scheme granted in terms of rules 7.1.2. (RGCE 2020: Regla 7.1.2) and 7.1.3. (RGCE 2020: Regla 7.1.3), for any of the following reasons:

I. When the Secretary of Economy (Secretaría de Economía) has suspended the IMMEX Program to companies that have the Registry in the Business Certification Scheme. The suspension will subsist until the Secretary of Economy (Secretaría de Economía) terminates the suspension of the IMMEX Program. In the event that the Secretary of Economy (Secretaría de Economía) determines the cancellation of the IMMEX Program, in the Registry in the Business Certification Scheme, the cancellation procedure will begin in accordance with the first paragraph of this rule.

II. When the Federal Taxpayer Registration (Registro Federal de Contribuyentes) of those taxpayers that have the Registry in the Business Certification Scheme is suspended, until the competent authority resolves said situation.

III. When the company prevents access to the General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) personnel to carry out the supervision of compliance with the Registry in the Business Certification Scheme, until the taxpayer requests the General Administration of Foreign Trade Audit (Administración General de Auditoría de Comercio Exterior) in writing in terms of rule 1.2.2, first paragraph (RGCE 2020: Regla 1.2.2), date and time for said visit to be carried out and is specified by the authority.

Law 9-A (LA: Art. 9A), 9-B (LA: Art. 9B), 59-I (LA: Art. 59), 160-V (LA: Art. 160), 164 (LA: Art. 164), 165 (LA: Art. 165), Federal Fiscal Code (CFF) 134 (CFF: Art. 134), IMMEX Decree Annex II (DECRETO IMMEX: Anexo II), Regulation 225 (RLA: Art. 225), General Rules of Foreign Trade (RGCE) 1.2.1. (RGCE 2020: Regla 1.2.1), 1.2.2. (RGCE 2020: Regla 1.2.2), 7.1.2. (RGCE 2020: Regla 7.1.2), 7.1.3. (RGCE 2020: Regla 7.1.3), 7.1.5. (RGCE 2020: Regla 7.1.5), 7.1.6. (RGCE 2020: Regla 7.1.6), 7.2.1. (RGCE 2020: Regla 7.2.1), 7.2.3. (RGCE 2020: Regla 7.2.3), 7.2.5. (RGCE 2020: Regla 7.2.5), Annex 1 (RGCE 2020: Anexo 1)