By Baker & McKenzie

On December 2, 2004, the Ministry of the Economy (SE) published in the Federal Official Gazette amendments to the Decree that Establishes Several Sectoral Promotion Programs ("PROSEC Decree").

Among the reasons for these amendments are promoting the development of
products with greater value added and strengthen the competitiveness of certain productive chains, to benefit the consumer with lower prices, strengthen domestic markets and increase exports.

The amendments include the reduction of duty rates for certain imported goods, as well as additions and eliminations of finished products and imported goods.

In this regard,
the following
sectors were
modified:

Regarding the reduction of duty rates for certain imported goods, most of them were applied

to goods listed under the "footwear" and "textile and apparel" sectors. Most of the materials that were eliminated from the Decree affected goods listed under the "toys" and "footwear" sectors.

Please be advised that the eliminations of imported goods will become effective 180 (one hundred and eighty) calendar days (6 months approximately) following the date of the publication of these amendments. All other provisions established under this publication, became effective on the day following publication.

Should the PROSEC Decree and its amendments not allow your company to benefit from the preferential duty rates established therein, you should be aware that there are certain procedures that may be followed to request the inclusion of goods in the Decree, or, to import goods with preferential duty rates through Rule 8 import permits in accordance with the Mexican General Import and Export Duty Law.