Deloitte Mexico Chinese Services Group · 2020-03-23 · • Our advantage is the team’s...
Transcript of Deloitte Mexico Chinese Services Group · 2020-03-23 · • Our advantage is the team’s...
Deloitte Mexico
2014
Chinese Services
Group
Our firm in Mexico 3
About Deloitte 5
Doing business in Mexico 12
Main clients 25
Contacts 30
Contents
©2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 2
Our firm in Mexico
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 3
The member firm in Mexico is part of the international
organization of Deloitte Touch Tohmatsu Limited. It
has the largest number of professionals among the
private firms operating in Mexico, and its wide client
portfolio comprises leading companies in their
industries.
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 4
Our firm in Mexico
Deloitte Mexico:
• Is the largest professional services firm in the country.
• Has more than 5,400 professionals.
• Has over 250 partners.
• Has a wide geographical coverage: 23 cities in the country.
• Is a multidisciplinary service provider.
• Deloitte Mexico has been consistently recognized as a “Socially Responsible
Enterprise” by the Mexican Center of Philanthropy (CEMEFI), and as one of the
great places to work in the country by the Great Place to Work Institute Mexico.
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 5
About Deloitte
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 6
About Deloitte
Presence by service
7
60%
Audit
Universe: Top 100 Companies
Deloitte clients database and Expansión 500, 2013.
* Financial Estate Audit and other audit services included
36%
Financial
advisory
services
Tax & legal
services
68%
Enterprise
Risk Services
45%
Consulting
25%
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C.
About Deloitte
Presence by industry
38% 62%
29%
71%
32%
68%
25%
75%
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 8
Universe: Top 100 Companies
Deloitte clients database and Expansión 500, 2013.
74%
Consumer
Business
83%
Energy &
Natural
Resources
Manufacturing
87%
TMT
100%
About Deloitte
Presence by industry
38% 62%
29%
71%
32%
68%
25%
75%
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 9
Universe: Top 100 Companies
Deloitte clients database and Expansión 500, 2013.
75%
Financial
sector
82%
Services
Public sector
100%
Real estate
100%
Deloitte Chinese Services Group in Mexico was
founded in 2006, by CSG Director David Chen
Chung. During 8 years CSG closely cooperates with
Deloitte colleagues and partners from all over the
world specially with USA, China, Singapore and
Taiwan.
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• Our advantage is the team’s background, we understand both Asian and Latin
culture and speak fluently Chinese, English and Spanish.
• Currently, there are 1661 foreign contacts in our CSG-Mexico database.
• We advise 77 of the 100 most important
companies in Mexico which is equal to 70%
of the market in Mexico.
About Deloitte
Chinese Services Group
11 © 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C.
77%
About Deloitte
Largest firm in the country
Celaya
México, D.F.
Puebla
Torreón
Ciudad Juárez
Hermosillo
Chihuahua
Monclova
Culiacán Reynosa
Monterrey
San Luis Potosí
León
Querétaro
Cancún
Tijuana Mexicali
Mazatlán
Aguascalientes
Guadalajara
Mérida
BPS has presence in Guadalajara,
Mexico City and Monterrey
24 offices in the most
important cities
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 12
Doing business
in Mexico
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 13
Mexico’s free-trade agreements have been key to
the development of the local automotive industry:
Doing business in Mexico
Structure
• The greatest proportion of the economic activity
is concentrated in Mexico City, Guadalajara and
Monterrey. Also the six northern border states
are home to much of the country’s
manufacturing, particularly maquiladoras (in –
bond assembly for re – export factories)
producing goods that are then sold mainly in the
U.S. and other countries.
• Mexico is a member of the World Trade
Organization (WTO) and has signed tax treaty
agreements with more than 40 countries to
avoid double taxation.
• Mexico has also signed 12 Free Trade
Agreements (FTAs) with more than 49 nations,
and has more than 32 commercial and
investment agreements among the world.
FTA
EL SALVADOR,
GUATEMALA
& HONDURA
NAFTA
FTA BOLIVIA
FTA CHILE
FTA COLOMBIA &
VENEZUELA
FTA COSTA
RICA
FTA
EU
FTA
ISRAEL
FTA NICARAGUA
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26
39
65 58
53
67
29
38
75
53 48
61
0
10
20
30
40
50
60
70
80
China Thailand Vietnam Mexico Brazil Peru
2011-2012 2012-2013
Doing business in Mexico
What is Mexico
importing from
China?
What is Mexico
selling to China?
Around 50% of the
total bilateral trade
goes to electronic and
electrical industry
(semi finished
products –
machinery):
• TV-sets
• Mobiles
• DVD-CD players
• Circuits
• Printers
• Lasers
Exports from Mexico
to China mainly goes
to 3 specific industries:
• 60% to mining and
metallurgical
industry (Copper,
plumb, aluminum,
zinc, etc.)
• 14% to automotive
industry (axes,
vehicles)
• 7% to electronic and
electrical industry
Global Competitiveness Report 2012–2013
Rank/142
Source: World Economic Forum. The Global Competitiveness Report 2012–2013
Note: Ranks out of 144 economies and scores measured on a 1-to-7 scaleis.
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• Foreign investment has been
simplified by amending the relevant
regulations, reducing legal and
administrative bureaucracy, reducing
local content requirements, modifying
ceilings on foreign equity, eliminating
some import license requirements
and overhauling intellectual property
legislation.
• Foreign investment is permitted in all
areas except those explicitly limited to
the Mexican Government.
Doing business in Mexico
Regulations
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• There are no restrictions on domestic
or foreign currency held locally by
non-residents, and non-official
guarantees against inconvertibility.
• Mexico’s labor legislation regulates
labor contracts, minimum wages,
hours of work, legal holidays and paid
vacations, among other working
conditions, as well as trade unions,
strikes and dismissal compensation.
Doing business in Mexico
Regulations
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Doing business in Mexico
Principal forms of doing business
Mexico has several forms of business organization, including the stock company
(SA) and the limited liability company (SRL), both of which can be forms of variable
capital and branches of a foreign corporation.
• A.1 Limited Liability Stock Corporation – Commonly well known a Sociedad
Anónima (S. A.)
• A.1.1 Fixed Capital (S. A.)
• A.1.2 Variable Capital (S. A. de C. V.)
• A.2 Limited Liability Company. Commonly well known “Sociedad de
Responsabilidad Limitada” or “S. de R.L.”
The permit for establishing a company requires inclusion of the “Calvo clause” in
the by laws and on share certificates. This clause waives the right to invoke foreign
diplomatic intervention and relinquishes any claim to treatment different from the
accorded to Mexican nationals. (Is this clause still relevant?)
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Doing business in Mexico
Principal forms of doing business
Organizing a local corporation can take
four weeks or longer, depending on the
complexity of the project. A permit
must be secured from the Ministry of
Foreign Affairs. A minimum of two
shareholders must appear before a
notary to sign the deed of
incorporation. At least 20% of the
capital shares must be paid
immediately, and the remainder within
one year. Other requirements also
apply.
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Doing business in Mexico
Business corporate taxation
Companies doing business in Mexico
typically are subject to corporate
income tax, flat tax, value added tax,
tax on real property, social security
contributions on behalf of their
employees and to distribute and pay
10% of their taxable income to
employees. Some taxes are levied at
the state and municipal levels.
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 20
Doing business in Mexico
Income tax
• A company is a resident in Mexico, if its place of effective management is in
Mexico. Residents are taxed on their worldwide income. Companies not
domiciled in Mexico are taxed only on their Mexican – sourced income.
• Corporate tax is imposed on a company’s profits. Normal business expenses
may be deducted in computing taxable income. The tax rate will be 30% until
2014. (Should there be a time limit?)
• Dividends received by a Mexican resident company from another Mexican
resident company are exempt from corporate tax. Dividends received from a
foreign company are subject to corporate tax.
• Mexican entities are not subject to special tax treatment on capital gains and the
use of capital losses is restricted in some cases.
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Doing business in Mexico
Maquiladora concept
(now known as IMMEX)
• The company may apply for a
Maquiladora (IMMEX) program.
• It is an authorization which allows
Mexican Companies to import, under
a temporary basis, the necessary
goods (raw materials and fixed
assets) to be utilized in an industrial
process to manufacture finished
goods or for rendering export
services, which mainly represents a
benefit related to duty deferral and
exemption of VAT payment on
imports, as well as coverage against
permanent establishment issues for
the foreign parties.
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Doing business in Mexico
Maquiladora concept
(now known as IMMEX)
• A maquiladora may either: (1) adopt
the Safe Harbour rules; or (2) elect to
obtain an advance pricing agreement
(APA) via a private letter ruling. Under
the Safe Harbour, a maquiladora
must report taxable income
corresponding to the higher of the
following:
• 6.9% of the value of its assets.
• 6.5% of its costs and expenses.
• Types of maquiladora entities.
• Typical maquiladora.
• Non-typical maquiladora.
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• The Mexican government has curtailed the use of direct tax incentives for
investment. The most significant tax incentive still available is the accelerated
depreciation allowance for investments in production facilities, which allows
same-year deductions for up to 92% of a new investment´s value. (Has it been
eliminated?)
• A variety of export incentive programs, including special temporary import
programs, are in place to encourage export sales. The legislation promoting in-
bond facilities in Mexico (maquiladoras) makes the country an attractive place to
manufacture goods for export.
• The Federal Government grants to “maquiladora” companies:
− Partial exemption on corporate tax, (because they don’t have to set up a
permanent establishment?)
− Reduction on flat tax (Has it been eliminated?)
− VAT exemption
− Duty payment deferral under certain conditions
Doing business in Mexico
Government actions to support foreign
investment
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 24
Doing business in Mexico
Mexico-China Treaty to avoid double taxation
• Signed in 2005. Effective as of January 1, 2007.
• Benefits similar to other Chinese treaties to avoid double taxation.
• Tax exemptions (i.e. technical assistance) and reduced withholding rates (i.e.
interest and royalties).
• Allows “maquiladora” operations to enjoy Mexican special tax regime that
provides tax administrative conveniences.
• Tax exemption on interest paid to People’s Bank of China, State Development
Bank, Import and Export Bank of China, Agriculture Development Bank of China,
China Export & Credit Insurance Corp.
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Main clients
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Manufacture industry:
• HiTi Digital, Inc.
• Hisense Mexico S. de R.L. de C.V.
• Beijing West Industries Co. (BWI)
• Hynday Motors Mexico
• Nam Liong Group
• Foxconn Mexico Precision Industry Co
S.A. de C.V.
• Flextronics Manufacturing Mex., S.A. de
C.V.
• Huawei Technologies
de Mexico, S.A. de C.V.
• Lenovo Mexico, S. de R.L. de C.V.
• Likom de Mexico, S. A. de C. V.
• Pegatron Mexico, S.A. de C.V.
• Rapid Manufacturing
Consume industry:
• Smithfield Foods, Inc.
• PC BAJA, S.A. de C.V.
Services:
• Truper S.A. DE C.V.
• Technology, media and
telecommunications:
• Wistron Mexico, S.A. de C.V.
Mining Industry:
• Desarrollo Minero de Unificado (DMU)
• Agromag
Our recent main clients are:
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Energy and Natural Resources
Industry:
• Great Wall Drilling Company
• COSL Mexico, S.A. de C.V.
• Sinopec
Technology, media and
telecommunications:
• Wistron Mexico, S.A. DE C.V.
• HUTCHINSON WHAMPOA
• PCE Paragon
Solutions (Mexico), S.A. de C.V.
• Tatung Mexico, S.A. de C.V.
Real Estate:
• Parks Desarrolladora S.A. de C.V.
• Desarrollo Nuevo Altata S.A. de C.V.
• Recursos Tyler, S.A. DE C.V.
(JINCHUAN)
• Chileno Bay Development Partners, LP
• Danske Bank A/S
• Anhui Foreign Economic Contruction
Group Co. Ltd. (AFECC)
• CCIS Real State Joint Appraisers Firm
China Credit Information Service, Ltd.
Infrastructure Industry:
• China Harbour Engineering Company
(CHEC)
Our recent main clients are:
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Other Industry:
• Vehicle Stability Technology, S.A. de C.V.
• Mentor Media Juarez S.A. de C.V.
Our recent main clients are:
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 29
Organizations and government groups CSG
Mexico works with:
• Mexican Business Council for Foreign Trade, investment and Technology
(COMCE)
• China Council for the Promotion of International Trade (CCPIT)
• Embassy of the People´s Republic of China in Mexico
• China Chamber of Commerce and Technology, Mexico
• General Chamber of Chinese Entrepreneurs in Mexico
• Taipei Economics and Culture Office in Mexico
• Korea Trade-Investment Promotion Agency
• Taiwan Trade Center, Mexico City
• World Trade & Investment Group
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Contacts
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Our contacts
Gonzalo Gómez
Tax & Legal Office partner
+52 6646227950
David Chen Chung/陈忠智
Chinese Services Group, Partner
+52 (65) 66886568
Amy Liang/梁怡芳
Chinese Services Group, Manager
+52 (55) 50807659
Xiao Cheng/程霄 China Services Group, Senior Specialist
+52 (55) 50807338
© 2014 Galaz, Yamazaki, Ruiz Urquiza, S.C. 32
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms,
each of which is a legally separate and independent entity. Please see www.deloitte.com/mx/aboutus for a detailed description of the legal structure of Deloitte
Touche Tohmatsu Limited and its member firms.
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of excellence.
As used in this document, "Deloitte" means Galaz, Yamazaki, Ruiz Urquiza, S.C., which has the exclusive legal right to engage in, and limit its business to,
providing auditing, tax consultancy, financial advisory, and other professional services in Mexico, under the name "Deloitte".
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