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US Car Export Laws and CBP Interpretation

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Mexconnect has a report from the US Customs and Border Patrol that Homeland Security/CBP now interprets their laws to say that any US titled vehicle that is taken outside the USA for more than 12 consecutive months, must first be formally exported from the USA using the 72 hr CBP export process:

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US Car Export Laws and CBP Interpretation Quote | Reply | Private Reply

If you don’t like what you are about to read, don’t shoot me I am just the messenger. Below is contact information for you to direct your questions.
With all the discussions on web boards about car importing, brokers, facilitators, bad paperwork, and outright rip-offs, I tried to get to the real “legal” bottom of this mess. I think I have had some success in getting information. Six months ago I started discussions with executives at the Dept of Commerce, Homeland Security, CBP and Mexico Desk Officer, International Trade Administration.
This is about USA laws and regulations, not Mexico’s. I focused on the “export” issue. The following are email discussions getting to the point.
This was my initial official request for an “Advisory Opinion”.
.

Issue

Do all vehicles imported into Mexico have to be formally exported from the USA? Are there exceptions to the law posted at the CBP web page; http://www.cbp.gov/trade/basic-import-export/export-docs/motor-vehicle

Background

There are approximately one million Americans living in Mexico. These expats residents of Mexico have to learn to abide by a completely new set of laws, regulations and customs in their new home. As Americans, we still are subject to USA laws too.

Mexico requires foreigners to obtain permits to drive their foreign plated vehicles in the country. These permits are usually issued for a period up to six months. Because of a loophole in the Mexican customs laws, certain residency visas available in the past to Americans allowed them to keep their US plated car in Mexico beyond the expiration date on the permit. Many expats were able to drive their cars with expired USA plates for years.

In 2013, Mexico implemented a massive overhaul of their Immigration laws. Because of these changes, many American residents of Mexico lost the loophole allowing them to drive their cars. They were to remove the vehicles from Mexico or if eligible to import/nationalize the vehicles. Many of expat residents were caught off guard by these changes. People were not sure what to do.
Facilitators, seeing an opportunity, have appeared out of the woodwork offering all kinds of solutions. "100's of US-plated cars - previously taken into Mexico on a supposedly temporary basis, are being converted into a Permanently Imported Mexican vehicles via a “paper-only” process without ever going back to the USA border for formal export. Other solutions have lead to many expats being ripped off for substantial amounts of money.




Question

When does one have to comply with CFR 192? What are the consequences of not complying? If someone has imported their car into Mexico and has not exported the car from the USA, can they come forward and retroactively comply?


This is the response from executives at CBP in DC.


In many cases, it sounds like these individuals should have formally exported the vehicles from the U.S. (i.e., they did not submit Electronic Export Information (EEI) via the Automated Export System (AES) (unless exempt i.e. valued under $2500) and did not present the title/ownership documentation to CBP prior to export). Some of these vehicles have been in Mexico for years, but a loophole in Mexican law allowed the expats to drive the vehicles without being registered there. Due to recent changes in Mexican law, the vehicles must now be registered in Mexico. An individual residing in Mexico temporarily, such as on a work or student visa should contact the Mexican Embassy or the appropriate Mexican authorities to obtain their import and/or vehicle registration requirements.

After further discussing this with our attorneys, we have the following responses to the questions---

1) When is a vehicle exported?
Pursuant to CBP regulations 19 CFR 192.2, the vehicle and required documentation must be presented whenever a person “attempt to export a used self-propelled vehicle.” “Export” is defined in 19 CFR 192.1 for Part 192 purposes as “the transportation of merchandise out of the U.S. for the purpose of being entered into the commerce of a foreign country.” We generally do not consider Part 192 to apply when someone drives their vehicle foreign for a short period of time and returns to the U.S. It appears that some of the vehicles in question were “previously taken into Mexico on a temporary basis.” However, it also appears that many expats were able to drive their cars with expired U.S. plates for years. If a vehicle is driven in Mexico for years, then we would not consider that to be temporary (unless subject to a work or student visa) in nature and, therefore, we would consider that to be an export under Part 192. Regarding the Foreign Trade Regulations (FTR) (requires the EEI filing via the AES), goods are considered exported when they are sent or transported out of a country. See 15 CFR 30.1. However, temporary exports are generally exempted from filing EEI if they are exported from and returned to the United States in less than one year (12 months) from the date of export. See 15 CFR 30.37(q).

2) Can U.S. expats who legally imported vehicles into Mexico in the past come forward now to fulfill the export requirements (submit EEI and present the title or other ownership documentation)? Individuals may choose to contact the closest port of export to inquire about explaining their situation and processing the vehicle for export. However, penalties may apply depending on the circumstances. The violations occurred when the exporter failed to comply with Part 192 and/or failed to submit the EEI if it was NOT deemed a temporary export. The regulations in Part 192 provide for a $500 penalty against an exporter who has exported a vehicle without complying with the regulations. Under the mitigation guidelines, this penalty may be mitigated to between $50 and $250 for personal exportations. For FTR violations, things are a bit trickier. Under the FTR, a $10,000 penalty can be assessed for failure to file EEI. Under the mitigation guidelines, these penalties can be mitigated to between $750 and $2,500.

When the individuals contact the port to inquire about processing the vehicle for export, they may use my name or Tammy Golden as a reference if there are any questions raised about penalties and so forth. Every situation may vary so we can’t use one answer to fit all situations. We can review the circumstances of the case and assist the field with facilitating the decision if there are problems.

Let me know if this helps or if you have further questions.

Carla D’Onofrio, U.S. Customs and Border Protection Program Manager, 202-344-1196

Tammy Golden, U.S. Customs and Border Protection Program Manager, 202-344-3804



To quote from Tammy “CBP regulations are CBP regulations and need to be followed. The 12 month period Carla mentioned is under Census regulations and it is CBP’s responsibility to enforce Census regulations among others too”. The CBP agency expects all (including personal cars for personal use) used vehicles that are out of the USA for a period of more than 12 months to be presented to a “port of export” (Border) for processing a formal export.

This is the official USA CBP position. If you have any questions contact the people above.

This does not have anything to do with Mexico importing laws and regulations.

Attached are a Dept of Census Export Flyer and an official CBP export FAQ that has been posted before."

http://www.mexconnect.com/cgi-bin/forums/gforum.cgi?do=post_attachment;postatt_id=1410;


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Mexconnect discussions on the details include some good questions and good insights:

"

cheenagringo wrote

============================================================
Well, please excuse me?

It just so happens that we broke the current rules & regs when we had an Oregon plated vehicle at our Mexico house for 7 years. How would people's stories of being bit or the fact that they were not compliant change the fact that these are the regs currently in effect? Does the fact that people may have been doing things wrong and getting away with it become an excuse for being ignorant of the law?

============================================================

Good questions that likely have no clear answers.

Remembering the context: These US vehicle export rules have been on the books for roughly 20 years. Homeland Security/CBP/Census Bureau updated them in 2013 to remove the $2,500 valuation exemption, and have the rules apply to all US-plated vehicles.

As of April, 2014, Homeland Security/Customs & Border Patrol had no idea that Americans were taking their cars into Mexico, without using a licensed customs broker, and leaving them outside the USA for years.

Homeland Security/CBP imagined that because they were doing some exports of US-titled cars (the cars being handled by customs brokers), they imagined that all US-titled cars were being appropriately exported. When CBP supervisors and managers heard about the big gap in their enforcement nets in April, 2014, they started a chain of actions and events that led to the joint efforts and joint Oct. 2014 requirements with the Mexican Govt. to start requiring that all US-titled vehicles being imported into Mexico, be first required to go through Homeland Security's/CBP's export and have the US title stamped as cancelled.

Under these historical twists and turns, CBP was not previously enforcing the law - as Neil found with his US vehicle left in Mexico for 7 years.

Now that the Mexican Gob. has fully-functioning computer databases at INM & Aduana - that track our movements/dates and track our Mexican addresses etc, and now that the Mex. Gob. is electronically sharing that information with Homeland Security/CBP for the first time ... Can any of us predict how these things will play out, especially concerning US vehicles that have been outside the USA for more 12 months?

We'll have to wait & see what stories are reported from Americans bringing their old US-titled vehicles back into the USA.
So far, we've seen no reports of either govt. enforcing these US vehicle export rules on US cars returning to the USA.

Happy Trails,
steve "

http://www.mexconnect.com/cgi-bin/forums/gforum.cgi?post=204574;#204574

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We had our US plated vehicle in Mexico for 13 years, then returned to the USA without incident. There was no mention of the car when we were inspected at the US border, dog papers and all.

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Stevie, here you go "AGAIN". Give this topic a REST. Nothing new here you haven't said before, and many people here are tired of hearing it, ok?

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Stevie, here you go "AGAIN". Give this topic a REST. Nothing new here you haven't said before, and many people here are tired of hearing it, ok?

Hud,

Please read the first line of the post to know the significant change in US CBP's policies:

"Homeland Security/CBP now interprets their laws to say that any US titled vehicle that is taken outside the USA for more than 12 consecutive months, must first be formally exported from the USA using the 72 hr CBP export process:"

This is a significant change that can affect any American who takes their US car into Mexico in the future, using a Temporary Import Permit, if the car is outside the USA for more than 12 months.

People who don't like this new Homeland Security/CBP policy should use the contact information to discuss their concerns with the US government, or contact their US Congressman's constituent services representative about this rather substantial change in CBP policies.

**Additional substantial changes: US Homeland Security/CBP and the Mexican Govt. both now have the computerized records and are now exchanging records, to track us taking our vehicles out of the USA and into Mexico. That can be important, because what worked for Americans in Mexico in the past, may stop working and trigger stiff $$ penalties.

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Just another confirmation that if one is going to live here permanently or over a period of years, it only makes sense to ditch the U.S. car and bit the bullet and buy a Mexican plated car. Unlike a lot of other retirement destinations modern cars are available here at prices moderately higher than the best U.S. prices.

Plus there's the added benefit of not being targeted by mordida seeking cops because of your U.S. plates. This has abated somewhat locally but is still going on in other parts of the state and country.

In the mean time, Mexicans will continue to find ways to bring U.S. cars in without all this government BS and drive them. We, however, had better follow the rules to the letter.

Just look upon it as a cost of living here. There are a lot of other things that are a great deal less costly, this one on its own isn't a deal killer. Some places are a lot tougher, I understand for example Costa Rica charges 40 percent duty on imported cars.

Now that this is settled, we await the final verdict on the overall importation process as it will be going forward. Are cars being imported now at the border under the new rules?

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re: Remembering the context: These US vehicle export rules have been on the books for roughly 20 years. Homeland Security/CBP/Census Bureau updated them in 2013 to remove the $2,500 valuation exemption, and have the rules apply to all US-plated vehicles.

If you drove your 10 year old beat up US plated car down in 2010-- and it was worth less than $2500 USD, it sounds as if that was legal .

What happens if you still have this now 15 year old beat up US plated car with a cracked window and a few extra dents, a little rust and maybe worth $1000 USD on a good day?

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Agree. My suspicion is that the focus will be on enforcing the export requirement going forward, not chasing down a handful of old clunkers that are already here.

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