Mexico WT/TPR/S/195/Rev.1 
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II. TRADE AND INVESTMENT REGIME 
(1) OVERVIEW  
1. There have been no fundamental changes in the domestic legal framework since Mexico's 
previous Review in 2002, although statutes affectin g trade and investment have been revised and 
published.  Trade policy has also remained broadl y stable.  In the context of this Review, the 
authorities indicated that the emph asis continues to be placed on expa nding and diversifying external 
markets, persevering with the negotiation of prefer ential agreements and deepening their benefits, and 
strengthening the legal framework to  attract foreign investment.  At the same time, they recognize that 
open trading arrangements need to be supported by other policies that promote competitiveness, such 
as certain unilateral tariff reductions. 
2. Mexico is an original member of the WTO, a nd is an active participant in both the multilateral 
trading system and the Doha Development Round negotiations, in which it has submitted several 
proposals either individually or in conjunction with other countries.  Mexico recognizes that there are 
a number of issues on the trade agenda that can only be resolved on a multilateral basis, such as 
agricultural subsidies and trade remedies;  and it demonstrated its support for the multilateral trading 
system by hosting the WTO's Fifth Ministerial Conference in Cancún in September 2003. 
3. During the review period Mexico has submitted  a large number of notifications, but in 
October 2007 some of them had been delayed.  It has also participated actively in the WTO dispute 
settlement mechanism, being invo lved as a complainant in six cases since 2002, as defendant in 
seven, and as a third party in 27.  Four of the seven cases in which Mexico has participated as 
defendant concern anti-dumpi ng and countervailing measures. 
4.  Since 2002, Mexico has signed new preferential agreements with Japan and Uruguay.  As of 
October 2007, it had 12 agreements in force with 44 countries with which most of its trade takes 
place.  These agreements have substantially liberali zed Mexico's trade regime.  Nonetheless, given the 
selective nature of the liberalization in question, as happens with other Member countries that have 
adopted similar strategies, the proliferation of preferential regimes has altered economic incentives 
and resource allocation. 
5. Foreign investment can hold up to 100 per cent of the equity of Mexican enterprises in all 
activities that are not reserved or subject to specific regulation.  Some sectors remain the preserve of 
the State (e.g. hydrocarbons and electricity, with some exceptions);  others are reserved for Mexican 
ownership (e.g. domestic land transport), or re quire majority Mexican ownership (e.g. certain 
telecommunications services, air transport, port administration), or else prior approval to own more 
than 49 per cent of the total capital (e.g. airports  and cellular telephony).  In sectors where foreign 
investment participation is restricted, a larger sh are of the ownership is allowed through the neutral 
investment mechanism. 
(2) GENERAL LEGAL FRAMEWORK  
6. Mexico is a Federal Republic governed by three powers of State: the Executive, the 
Legislature and the Judiciary.1  The Republic consists of 31 states and a Federal District.  The 
President of the United Mexican States serves as both Head of Government and Head of State, and is 
elected by universal suffrage every six years for a single non-renewable term.  The most recent presidential election took place in July 2006.  The Pr esident's powers include directing foreign policy;  
                                                     
 
1 Article 49 of the Political Constitution of the United Mexican States (1917), current text with the 
latest reforms published in the Official Journal of the Federation (D.O.F.), on 12 February 2007. WT/TPR/S/195/Rev.1 Trade Policy Review 
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signing, denouncing, suspending and amending international treaties;  lifting reservations and issuing 
interpretative statements thereon, and submitting these for Senate approval.2 
7. The Legislature consists of a two-chamber Congress.  The Chamber of Deputies contains 
500 members elected every three years, of whom 30 0 are elected by relative majority voting and the 
remainder by proportional representation.  The Senate  consists of 128 members:  three senators are 
elected for each of the states and the Federal Dist rict (96 in all), while the remaining 32 seats are 
allocated via proportional representation.  The entire Senate is renewed every six years.  The most 
recent congressional elections took place in July 2006. 
8. The Judiciary consists of the National Supreme C ourt of Justice, the Electoral Tribunal of the 
Federal Judiciary, collegiate and unitary  circuit courts, and district courts.3  The National Supreme 
Court of Justice consists of 11 judges who are elected  by a two-thirds majority of the Senate, from a 
shortlist submitted by the President of the Republic. 
9. There have been no fundamental changes in Mexico 's basic legal regime since its last Review.  
Pursuant to the Political Constitution of the Unite d Mexican States (hereinafter referred to as the 
Constitution), international treaties signed by the Preside nt and ratified by the Senate form part of the 
country's domestic laws and, therefore, do not requi re any additional legislative measure for them to 
be enforced or invoked before the country's courts.4  The authorities stated that they have invoked 
WTO Agreements in the national courts, partic ularly against anti-dumping resolutions.  The 
Constitution is the highest ranking instrument in the legal hierarchy; followed by international treaties 
which, as ruled by the National Supreme Court of Justice, are ranked above Federal and local laws.5 
10. The Senate has the constitutional power to a pprove international treaties signed by the 
Government, as well as any decision to denounce or amend them.6  Nonetheless, the Senate does not 
have power to amend an international treaty signed by the Government that is awaiting ratification. 
The Law on the Approval of Intern ational Economic Treaties of 20047 grants the Senate powers to 
request information from agencies of the Federa l public administration on the negotiation and 
conclusion of international treaties relating to trad e and other economic issues.  Under this Law, to 
obtain approval of a treaty, government agencies mu st furnish the Senate with information on the 
administrative and legislative actions needed to enfo rce it.  They must also explain how the treaty is 
consistent with Mexico's interests and the objectiv es set out in that Law, such as promoting access for 
Mexican products to international markets and helping to diversify markets, among others. 
11. Since 2002, Mexico has persevered with and c onsolidated its regulatory reform programme, 
with the aim of enhancing competitiveness and reducing business transaction costs.8  Pursuant to the 
Federal Law on Administrative Procedures (LFPA), the Comisión Federal de Mejora Regulatoria  – 
COFEMER (Federal Regulatory Improvement Commission) reviews and certifies regulations drafted by Federal agencies and decentralized bodies, as well as regulatory impact assessments (MIRs), in 
which public administration entities have to justify the regulations proposed and demonstrate how the 
                                                     
 
2 Article 89 of the Political Constitution of the United Mexican States. 
3 Idem , Article 94. 
4 Idem , Article 133. 
5 Judicial Seminar of the Federation, National Supreme Court of Justice, Ninth Period, Thesis 
P.IX/2007, April 2007. 
6 Article 76 of the Political Constitution of the United Mexican States. 
7 Published in the D.O.F. on 2 September 2004. 
8 Section 6.2.3, subparagraph g) of the National Development Plan 2001-2006, published in the D.O.F. 
on 30 May 2001. See also the Regulatory Improvement Programme 2001-2006, published in the D.O.F. on 17 January 2003. Mexico WT/TPR/S/195/Rev.1 
 Page 17 
 
 
expected benefits outweigh their cost s.  In addition, COFEMER keeps the Registro Federal de 
Trámites y Servicios – RFTS (Federal Register of Formalities an d Services), which is an inventory of 
all formalities applied by the offices and agen cies of the Federal public administration.9  In late 
May 2007, the RFTS containe d 3,327 formalities and services, compar ed to 1,172 at the end of 2001.  
The authorities have recognized that it is impor tant to expand the coverage of the RFTS as it 
encompasses all Federal Government formalities in a self-contained way. 
12. With the aim of guaranteeing access to public information and promoting the accountability 
of Federal Government bodies, in June 2002 th e Federal Law on Transparency and Access to 
Government Public Information was issued.10  This legislation requires the Executive, the Legislature 
and the Judiciary, along with Federal Governme nt agencies, to make available to the public 
information concerning their activities, including th eir draft laws and administrative provisions. 
(3) TRADE POLICY FORMULATION AND OBJECTIVES  
13. The Foreign Trade and Investment  Promotion Programme (PCEPI)11 established the 
following fundamental objectives for trade and invest ment policy in the period 2001-2006:  to expand 
and diversify foreign markets;  to deepen the bene fits of free-trade agreements; and to strengthen the 
legal framework for attracting foreign investme nt.  The Government that took office in 
December 2006 has pursued similar foreign trade objectives:  the National Development Plan (2006-
2012) published on 31 May 2007 , reaffirms the need to persever e with the process of liberalizing 
trade and attracting investment.  The strategy to be pursued in terms of international trade relations is 
to continue with the negotiation of bilateral, regional and multilateral agr eements, and to manage, 
exploit and deepen currently existing trade agreemen ts.  At the same time, it is acknowledged that 
open trade practices need to be supported by ot her policies that promote competitiveness, such as 
unilateral tariff reductions (Chapter III(2)(iv)).12 
14.  No fundamental changes have been made to the formulation of Mexico's trade policy since 
its last Review. Pursuant to Article 131 of the C onstitution and Article 4 of the Foreign Trade Law13, 
the Federal Government is authorized to contro l flows of imports and exports, and to conduct 
international trade negotiations.  Trade policy re mains the responsibility of the Ministry of the 
Economy, which is empowered, among other things , under the Foreign Trade Law to coordinate 
international trade negotiations and issu e rules for enforcing trade agreements. 
15. The Comisión de Comercio Exterior  – COCEX (Foreign Trade Commission) serves as a 
mandatory consultative agency for all entities of Fe deral public administrati on on matters relating to 
measures applicable to imports and exports.14  The COCEX has powers to issue non-binding opinions 
on such issues, both with respect to current measur es and in relation to draft provisions prepared by 
Federal entities and agencies.  In fulfilling its f unctions, the COCEX holds public hearings with 
                                                      
9 The RFTS can be accessed from the COFEME R web site:  http://www.cofemer.gob.mx. 
10 Published in the D.O.F. on 11 June 2002. 
11 D.O.F. of 14 April 2004. 
12 Ministry of the Economy (2007). 
13 Foreign Trade Law, published in the D.O.F. on 27 July 1993; most recent re form published in the 
D.O.F. on 21 December 2006. 
14 The COCEX comprises representatives of the Bank of Mexico, the Federal Competition Commission 
and the following Ministries:  Foreign Affairs;  Finance and Public Credit;  Social Development;  the Economy;  
Agriculture, Rural Development, Fisheries and Food;  the Environment and Natural Resources;  and Health.  
Other Federal or state agencies may be invited to par ticipate in its meetings when the COCEX is considering 
specific issues within their areas of responsibility. WT/TPR/S/195/Rev.1 Trade Policy Review 
Page 18 
 
 
business chambers, industrial, commercial and agricultu ral associations and other stakeholders, giving 
them a 30-day period to comment on the proposed measures. 
16. The Government holds regular consultations with civil society on issues relating to 
international trade negotiations, basically using two mechanisms for this purpose.  One is the Consejo 
Asesor para las Negociaciones Comerciales  Internacionales  (Advisory Council for International 
Trade Negotiations), which represents the production , labour and academic sectors, together with 
recognized experts on foreign trade, and formulates  and evaluates international trade negotiations 
policy.  The other is the country's Comisión de Organismos Empresariales de Comercio Exterior  
COECE (Commission of Foreign Trade Business Associ ations), which consists of a technical expert 
team specializing in foreign trade issues, repr esenting all business associations involved in the 
external sector of the Mexican economy.  The COECE accompanies and assists the negotiating team in trade negotiation rounds. 
(4) F
OREIGN INVESTMENT REGIME  
(i) Formulation and regulatory framework 
17. Mexico considers foreign investment promoti on as a key force for economic development and 
more active participation by the country in th e international economy, as well as a necessary 
complement to trade liberalization.  As noted above, one of the objectives of the PCEPI is to 
strengthen the legal framework to help attract larger foreign investment flows, particularly by 
administering free-trade agreements and expanding the network of Acuerdos para la Promoción y la 
Protección Reciproca de las Inversiones  – APPRIs (Agreements on Reciprocal Promotion and 
Protection of Investments). 
18. The main instruments in the domestic legal fra mework for foreign investment are Article 73 
of the Constitution, and the Fo reign Investment Law (LIE)15 together with its Implementing 
Regulations.16 
19. Under the LIE, foreign investment may hold up to 100 per cent of the equity of Mexican 
companies, open and operate establishments in all economic activities that are not expressly reserved 
or regulated specifically in the Law itself (exceptions are described in subsection (ii)  below). 
20. Although investment does not require prior author ization, all foreign investors and Mexican 
firms with foreign participation in th eir ownership must register with the Registro Nacional de 
Inversión Extranjera –  RNIE (National Register of Foreign Investment) kept by the Ministry of the 
Economy.  Failure to do so on time results in a fine or sanction. 
21. The Comisión Nacional de Inversiones Extranjeras  – CNIE (National Foreign Investment 
Commission), consisting of ten Ministers and chaired by the Minister of the Economy17, has powers 
that include issuing foreign investment polic y guidelines and designing mechanisms to promote 
investment in Mexico.  Another of its responsib ilities is to approve the te rms and conditions under 
                                                      
15 The Foreign Investment Law was published in the D.O.F. on 27 December 1993, and was amended 
in 1995, 1996, 199 8, 1999, 2001 and 200 6.  The most recent reform wa s published in the D.O.F. on 
18 July 2006. 
16 Implementing Regulations for the Foreign Investment Law and the National Foreign Investment 
Register were published in the D.O.F. on 8 September 1998. 
17 The CNIE consists of the Ministers of:  the Interior;  Foreign Affairs, Finance and Public Credit;  
Social Development;  the Environment and Natural Resources;  Energy;  the Economy;  Communications and Transport;  Labour and Social  Welfare;  and Tourism. Mexico WT/TPR/S/195/Rev.1 
 Page 19 
 
 
which foreign investment participates in activities a nd acquisitions that are specifically regulated in 
the LIE, based on the following criteria:  impact on employment and worker training;  technological contribution;  compliance with environmental standa rds;  and contribution in terms of enhancing the 
competitiveness of the national production base.  In d eciding whether to grant a request for approval, 
the CNIE may only impose requirements that do not distort international trade;  it may also block 
acquisitions by foreign investment for reasons of national security.
18  All requests submitted to the 
CNIE but not resolved within 45 working days must be considered approved under the terms presented. 
22. Mexico does not restrict remittances abroad of profits, royalties, dividends, and interest paid 
on loans, or repatriation of foreign investment-rela ted funds.  Nonetheless, the free-trade agreements 
and APPRIs signed by Mexico foresee the possibility of  temporarily restricting transfers in the event 
of balance-of-payments difficulties. 
(ii) Restrictions on foreign investment 
23. Article 5 of the LIE identifies the following activ ities as the preserve of the State;  petroleum 
and other hydrocarbons;  basic petrochemicals;  electri city;  generation of nuclear energy;  radioactive 
minerals;  telegraph;  radio telegraph services;  pos tal services;  issuing of banknotes and minting of 
coins;  control, supervision and surveillance of por ts, airports and heliports;  and any other areas that 
may be expressly reserved by specific legislation.  The authorities have confirmed that there are no other sectors reserved for the Mexican State, apart from those listed in the Constitution and Article 5 
of the LIE.  The Implementing Regulations for the LI E are more precise in defining the scope of some 
of the reserved activities;  for instance, the reserv e on activities in the electricity sector does not apply 
to private generation of electricity under certain conditions.
19 
24. The LIE reserves certain activities for Mexican nationals or firms, with a "foreigners 
exclusion clause".  This clause relates to the expr ess agreement contained in the company's articles of 
association establishing that it will not admit as partners  or shareholders, either directly or indirectly, 
foreign investors or firms that have a foreigners admission clause.20  The reserved activities are:  
domestic land transportation of passengers, touris m and freight (excludi ng messenger and parcel 
services);  retail sale of gasoline and distribution of liquefied petroleum gas;  broadcasting and other 
radio and television services (with the exception of cable television);  credit unions;  development 
banking institutions;  and professional and technical services expressly reserved by sector-specific legislation (see Chapter IV(5)(vi)).  In these activit ies, foreign investors may not participate either 
directly or through trust funds, agreements or  other mechanisms that give them control. 
25. Other economic activities maintain  limits of 10, 25 or 49 per cent on foreign investment 
participation (Table II.1).  Successive reforms to  the LIE between 2001 and 2006 eliminated the 
49 per cent limit for various types of fi nancial activity (see Chapter IV(5)(iii)). 
                                                     
 
18 Articles 29 and 30 of the LIE. Although the LIE does not define the term "national security", 
Article 3 of the National Security Law identifies this concept with actions intended to maintain the integrity, 
stability and permanency of the Mexican State. 
19 Article 2 of the Implementing Regulations for the LIE. 
20 Article 2 of the LIE. WT/TPR/S/195/Rev.1 Trade Policy Review 
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Table II.1  
Limits on foreign holdings in economic activities  and companies subject to specific regulation, 2007 
Limit/specific regulation Activities and companies 
Foreign investment allowed in up 
to 10 per cent of the enterprise's 
equity  
 Production cooperatives 
 
Foreign investment allowed in up 
to 25 per cent of the enterprise's 
equity  
 Domestic air transport, air taxi services, and specialized air transport. 
 
Foreign investment allowed in up 
to 49 per cent of the enterprise's 
equity  Insurance institutions;  bond institutions;  currenc y exchange houses;  general deposit warehouses;  
companies mentioned in Article 12 bis of the Stock Market Law (s ee Chapter IV(5)(iii) below);  
retirement fund management companies;  the ma nufacture or commercialization of explosives, 
firearms, cartridges, munitions and fireworks (exc luding the acquisition or use of explosives for 
industrial and extractive activities);  printing and publication of news papers for circulation only in 
Mexico;  series-T shares in compan ies that own agricultural, ranching or forestry lands;  fresh water, 
coastal, and exclusive economic zone fishi ng (excluding aquaculture);  integrated port 
administration;  port pilot services for vessels car rying out inland navigation;  under the terms of the 
respective law;  companies involved in the commerci al exploitation of ships engaged in inland and 
coastal navigation (excluding touris t cruises, marine dredging activities, and implements for port 
construction, conservation and opera tion);  supply of fuel and lubricants for ships, aeroplanes, and 
railway equipment;  and concessionaire compan ies under the terms of Articles 11 and 12 of the 
Federal Telecommunications Law (Chapter IV(5)(ii)  below). 
CNIE approval is required to allow 
foreign investment to exceed 
49 per cent of the enterprise's 
equity. Port services for ships engaged in inland navi gation operations, such as towing, mooring and 
lighterage;  shipping companies engaged in the ope ration of ships solely for high-seas traffic;  
concessionaires or permit-holders for aerodromes fo r public service;  private education services, 
from pre-school to high school levels;  legal servi ces;  credit information companies;  securities 
rating institutions;  insurance agen ts;  cellular telephone services;  the construction of pipelines for 
petroleum and refined oil products ;  the drilling of petroleum and gas wells;  the construction, 
operation and exploitation of railroads considered as a means of general communication;  and the 
supply of public railway services. 
Source : WTO Secretariat, based on Articles 7 and 8 of the Fore ign Investment Law (D.O.F. of 27 December 1993;  latest 
revision, 18 July 2006). 
26. In certain activities, CNIE approval is required for foreign investment to exceed 49 per cent 
of the firm's equity (Table II.1).  In the case of  already established companies with activities that are 
not specifically regulated, CNIE approval is nonethel ess required for foreign investment to have more 
than a 49 per cent stake when the total value of the company's asset s exceeds the amounts determined 
annually by the Commission.21  In 2007, this amount was Mex$2.392 billion (about 
US$218 million).22 
27. For sectors reserved to Mexican nationals or t hose that impose limits on foreign investment 
stakes, a larger foreign share may be held through the "neutral investment" mechanism, which is not 
included in the calculation to determine the percentage  of foreign investment in a Mexican company.  
This capitalization mechanism, which is provided for in the LIE, allows Mexican companies to issue 
shares that only give pecuniary rights to their holde rs, with either limited or no corporate rights.  The 
mechanism also allows authorized trust funds to issue neutral instruments.  Undertaking a neutral 
investment operation requires authorization from the Ministry of the Economy and, where applicable, 
the National Banking and Securities Commission.23 
                                                      
21 Article 9 of the LIE. 
22 CNIE General Resolution No. 8, published in the D.O.F. on 29 May 2007.  Average exchange rate 
for the first half of 2007. 
23 Articles 18, 19 and 20 of the LIE. Mexico WT/TPR/S/195/Rev.1 
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28. Under the Constitution, foreigners may not acqui re direct ownership of land or water in a 
restricted 100 km. strip or zone along the country's borders and 50 km. wide along beaches.24  
Nonetheless, the LIE authorizes foreign participation in Mexican companies that acquire real estate in 
the restricted zone for the purpose of engaging in no n-residential activities.  In the case of residential 
activities, rights over real estate must be acquire d by a Mexican bank that acts as a trust fund and the 
purchase must be approved by the Ministry of Fore ign Affairs.  Foreigners may also invest in a 
Mexican company that owns immovable property in the restricted zone, for non-residential purposes, 
provided the articles of association of the company in question contain a clause whereby foreigners 
agree to be considered as nationals and not seek protection from their governments with respect to 
such assets, and the Ministry of Foreign Affairs is notified of this. 
(iii) International investment agreements 
29. Mexico has adopted disciplines on investment in the framework of free-trade agreements 
(FTAs) and APPRIs.  In general, the investment ch apters incorporated in FTAs establish disciplines 
on sector liberalization, national treatment, most-f avoured-nation (MFN) treatment, minimum level of 
treatment, performance requirements, capital movements, expropriation and dispute settlement 
mechanisms (including between the investor and th e State).  With the exception of the Mexico-Israel 
agreement, all of Mexico's FTAs contain a chapter on investment, or a commitment to promote investment between the parties.  Such is the case with the agreements concluded with the European 
Union and the European Free Trade Association (EFTA). 
30. Mexico has persevered with its strategy to  expand its network of APPRIs.  The aim, 
according to the Ministry of the Economy, is to conc lude agreements with countries that are potential 
investors in Mexico;  with those that currently ha ve investments in the co untry;  and countries in 
which Mexicans themselves are increasingly investing.   As of the second half of 2007, Mexico had 
23 APPRIs in force, and two others signed.
25  Ten of these agreements have been signed since 2002.26  
The country was also in negotiations with Russia, Ukraine, Belarus, Saudi Arabia and China.  In 
general, the APPRIs cover the following disciplines:  definition of investment;  scope;  promotion and 
admission; treatment of investment;  expropriation;  transfers;  dispute settlement (both investor-State 
and State-State). 
31. In June 2004, the Investment Promotion Agre ement signed between Mexico and the United 
States entered into force.27  Under this Agreement, the Overseas Private Investment Corporation 
(OPIC) may provide investment support in Mexico  in the form of insurance, co-insurance and 
reinsurance, participation in the equity of en terprises and issuance of debt, as well as investment 
guarantees.  Support is granted for projects and ac tivities on Mexican territory permitted by the North 
American Free Trade Agreement (NAFTA) or by current Mexican laws. 
32. Mexico has signed agreements to avoid double taxation with 34 countries, including its main 
trading partners (see Chapter III(4)(i)). 
                                                      
24 Article 27, fraction I. 
25 As of the second half of 2007, Mexico had agreem ents in force with Argentina, Australia, Austria, 
the Benelux Union, Cuba, the Czech Republic, Denmark, Germany, Finland, France, Greece, Iceland, Italy, the 
Netherlands, Panama, Portugal, the Republic of Korea,  Spain, Sweden, Switzerland , Trinidad and Tobago, the 
United Kingdom and Uruguay.  It also had agreements signed but not yet in force with India and Slovakia. 
26 With Australia, the Czech Republic, Cuba, Iceland, India, Panama, the Republic of Korea, Slovakia, 
the United Kingdom and Trinidad and Tobago. 
27 Decree Promulgating the Investment Promotion Agreement between the Government of the United 
Mexican States and the Government of the United States of America, D.O.F. 14 June 2004. WT/TPR/S/195/Rev.1 Trade Policy Review 
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33. On 22 October 2007, Mexico signed the Conven tion Establishing the Multilateral Investment 
Guarantee Agency (MIGA), which provides a multilateral system of guarantees against non-
commercial risks; the Mexican Senate still has to ratify this agreement. 
34. As a member of the Organisation for Econom ic Co-operation and Development (OECD), 
Mexico has signed the Codes of Liberalization of Capital Movements and of Current Invisible 
Operations, and the National Treatment Instrument. 
35. According to an OECD study28, Mexico is among the five OECD member countries with the 
highest FDI restrictiveness index.  Most of th ese consist of limits on foreign equity holdings in 
enterprises, the most affected sectors being el ectricity, the financial sector, transport and 
telecommunications.  These are also the most restricted sectors among OECD countries generally.  
The same study indicates that Mexico is among th e five OECD member countries whose indices 
decreased somewhat in 2000-2006. 
(5) INTERNATIONAL TRADE RELATIONS  
(i) WTO 
36. Mexico is an original member of the World Trade Organization, in which it is represented by 
the Ministry of the Economy.  It took part in the negotiations on telecomm unications and financial 
services after the Uruguay Round, and accepted the Fourth and Fifth Protocols of the General 
Agreement on Trade in Services (GATS), respectively.29  Mexico is not a party to the Information 
Technology Agreement (ITA).  It grants MFN treatmen t or better to all countries, whether or not they 
are WTO Members. 
37. Mexico takes an active part in the WTO's wo rk and supports the successful conclusion of the 
Doha Agenda, endeavouring to ensure that its resu lts are favourable to developing countries.  In 
Mexico's opinion, a successful multilateral round woul d open up the world's markets to developing 
countries' exports and would give a stronger boost to  economic growth.  Mexico recognizes that there 
are several issues that can only be addressed in a multilateral framework , such as agricultural 
subsidies and trade standards; and that the WTO' s importance also stems from its dispute settlement 
mechanism and its contribution to tran sparency in Members' trade policies.30  Mexico demonstrated 
its support for the multilateral trading system by hosting the Fifth WTO Ministerial Conference in Cancún in September 2003. 
38. In the context of this Review, the authorities stated that the multilateral trading system and 
preferential agreements form complementary ag endas for moving towards liberalization of the 
economy, so they need to be kept mutually consiste nt.  In systemic terms, the authorities believe the 
multilateral trading system remains the key instrument for liberalizing world trade and that completion of the Doha Round would bring economic gains for Mexico, e.g. through the streamlining 
of customs procedures, which would result in lower trading costs. 
39. In the framework of the Doha Agenda, Mexico has submitted a number of proposals 
individually or jointly with other WTO Members in various areas of the negotiation, including 
                                                     
 
28 OECD (2006b). 
29 WTO documents WT/LET/213 of 30 January 1998 and WT/LET/288 of 18 February 1999. 
30 WTO document TN/C/W/39 of 24 April 2006.  See also Ministry of the Economy (2007). Mexico WT/TPR/S/195/Rev.1 
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agriculture (as a member of the G-20)31, market access for non-agricultura l products, trade facilitation, 
trade rules, services and intellectual property (geographical indications). 
40. Mexico has submitted many notifications to  the WTO, particularly on sanitary and 
phytosanitary measures, technical barriers to trad e and anti-dumping measures.  Nonetheless, as of 
October 2007, several notifications were pending, e. g. on non-agricultural subsidies and tariff quotas, 
and on domestic support and agricultura l export subsidies (Table AII.1). 
41. Mexico has participated actively in the WTO dispute settlement mechanism.  Since 2002, it 
has been involved as a co mplainant in seven cases (five of whic h resulted in the establishment of a 
panel); as a defendant in seven cases (in four of wh ich a panel was established); and as a third party in 
27 other cases32 (Table AII.2).  Of the seven cases in which Mexico participated as defendant, four of 
them related to anti-dumping and countervailing me asures;  the remaining cases concerned sanitary 
and phytosanitary measures, customs valuation, and domestic taxes. 
(ii) Free-trade agreements (FTAs) 
42. With the aim of diversifying and expanding its markets, Mexico has persevered with its 
strategy focusing on FTAs and other preferential agre ements.  Since the last Review, it has signed 
agreements with Uruguay (in force since 15 July 2004)  and with Japan (1 April 2005).  It also has 
bilateral and regional FTAs currently in force w ith: Bolivia, Canada and the United States, Costa 
Rica, Colombia, Chile, El Salvador, Guatemala, H onduras, Nicaragua, Israel, the European Union and 
the European Free Trade Associati on, making a total of 12 FTAs with 44 countries (Table II.2).  In 
addition, in the framework of the Latin Ameri can Integration Association (LAIA), Mexico has 
Economic Complementarity Agreements (ECAs) in fo rce with Argentina, Brazil, Cuba and Peru, and 
with the MERCOSUR trade bloc. 
Table II.2 
Free-trade agreements (FTAs) signed by Mexico, 1993-2006 
Agreement Entry into force 
(publication in the D.O.F.) Notification to the WTO Areas covered 
North American Free 
Trade Agreement 
(NAFTA) (with the 
United States of America and Canada) 1 January 1994 
(20 December 1993) L/7176 (01.02.1993) 
S/C/N/4 (01.03.1995)  
The WTO Committee on 
Regional Trade Agreements completed its 
factual examination in 
September 2001, without finalizing its report (WTO 
document WT/REG/W/43 
of 21 September 2001). National treatment and market access for goods;  rules 
of origin;  customs procedures;  energy and basic 
petrochemicals;  agricultural sector and sanitary and 
phytosanitary measures;  emergency measures;  standardization measures;  government procurement;  
investment;  cross-border trade in services;  
telecommunications;  financial services;  competition policy;  temporary entry of business personnel;  
intellectual property;  dispute settlement on anti-
dumping and countervaili ng duties;  institutional 
arrangements and dispute settlement. 
G-3 FTA (with 
Columbia and 
Venezuela)a 1 January 1995 
(9 January 1995) Pending Rules of origin;  customs procedures;  contingency 
measures;  sanitary and phytosanitary measures;  
technical standards;  services;  telecommunications;  financial services;  temporary entry of business personnel;  investment;  government procurement;  
intellectual property and dispute settlement. 
Table II.2 (cont'd) 
                                                      
31 The G-20 consists of Argentina,  Bolivia, Brazil, Chile, China, Cuba, Ecuador, Egypt, Guatemala, 
India, Indonesia, Mexico, Nigeria, Pakistan, Paraguay, Peru, Philippines, South Africa, Thailand, the United 
Republic of Tanzania, Urugua y, Venezuela and Zimbabwe. 
32 This report only considers dispute settlement cases initiated since 2002 (inclusive), i.e. disputes for 
which the request for consultations was presented in that year or later. WT/TPR/S/195/Rev.1 Trade Policy Review 
Page 24 
 
 
Agreement Entry into force 
(publication in the 
D.O.F.) Notification to the WTO Areas covered 
Mexico- 
Costa Rica FTA 1 January 1995 
(10 January 1995) WT/REG218/N/1 
(20.09.2006) S/C/N/374 (15.09.2006) Market access for goods;  rules of origin and customs 
procedures;  industrial sector and technical standards;  agricultural sector and sanitary and phytosanitary 
measures;  services;  temporary entry of business 
personnel;  investment;  dispute settlement;  institutional arrangements;  government pr ocurement and intellectual 
property. 
Mexico-Bolivia FTA  1 January 1995 
(11 January 1995) Pending Market access for goods;  rules of origin and customs 
procedures;  industrial sector and technical standards;  
agricultural sector and sanitary and phytosanitary measures;  services;  telecommunications;  temporary 
entry of business personnel;  financial services;  
investment;  dispute settlement;  government procurement;  and intellectual property. 
Mexico-Nicaragua FTA  1 July 1998 
(1 July 1998) WT/REG206/N/1 
(02.11.2005) S/C/N/359 (01.11.2005) Market access for goods;  rules of origin;  customs 
procedures;  industrial sector and technical standards;  agricultural sector and sanitary and phytosanitary 
measures;  services;  telecommunications;  temporary 
entry of business personnel;  financial services; investment, dispute settlement;  institutions;  government procurement;  a nd intellectual property. 
Mexico-Chile FTA  1 August 1999 
(28 July 1999) WT/REG125/N/1 
(08.03.2001) S/C/N/142 (14.03.2001) Market access for goods;  rules of origin;  technical 
regulations, sanitary and phytosanitary measures, safeguard measures;  investments;  cross-border trade in 
services;  air transport;  temporary entry of business 
personnel;  telecommunications;  competition policy; intellectual property and dispute settlement.  In 2007, 
negotiations were completed on government 
procurement and negotiati ons began on financial 
services. 
Mexico-European Union FTA  1 July 2000 
(26 June 2000) WT/REG109/N/1 
(01.08.2000) S/C/N/192 (21.06.2002) Market access for goods;  rules of origin;  technical 
regulations;  sanitary and phytosanitary measures;  safeguards;  investments;  trade in services;  maritime 
transport;  financial services;  government procurement;  
competition policy;  intellectual property;  and dispute settlement. 
Mexico-Israel FTA  1 July 2000 
(28 June 2000) WT/REG124/N/1 
(08.03.2001) Market access for goods;  rules of origin; customs 
procedures;  standards;  safe guards;  competition policy; 
government procurement and dispute settlement. 
Mexico-Northern Triangle FTA (with El Salvador, 
Guatemala and 
Honduras) 15 March 2001 with 
El Salvador and Guatemala, and 
1 June 2001 with 
Honduras (14 March 2001) WT/REG212/N/1 
S/C/N/367 (30.05.2006) WT/REG213/N/1 
S/C/N/368/Rev.1 
(12.07.2006) WT/REG214/N/1 S/C/N/369 
(12.07.2006) Market access for goods;  custom s procedures;  rules of 
origin;  technical standards,  sanitary and phytosanitary 
measures, safeguards, trade in services;  financial 
services;  temporary entry of business personnel;  
telecommunications;  investments;  intellectual property and dispute settlement. 
Mexico-European Free Trade 
Association FTA 
(with Iceland, Liechtenstein, 
Norway and 
Switzerland) 1 July 2001 
(29 June 2001) WT/REG126/N/1 
(22.08.2001) 
S/C/N/166 (22.08.2001) Market access for goods;  rules of origin;  services and 
investment;  competition;  anti-dumping and subsidies;  
government procurement;  intellectual property;  
institutional arrangements and dispute settlement. 
Mexico-Uruguay 
FTA  15 July 2004 
(14 July 2004) Pending Safeguards;  unfair trade practices;  competition 
policies;  rules of origin;  sanitary and phytosanitary 
measures, technical standards;   intellectual property;  
investment;  trade in servi ces;  cross-border trade in 
services;  telecommunications;  temporary entry of 
business personnel and dispute settlement.  In 2006, negotiations began on fi nancial services and 
government procurement. 
Table II.2 (cont'd) Mexico WT/TPR/S/195/Rev.1 
 Page 25 
 
 
Agreement Entry into force 
(publication in the 
D.O.F.) Notification to the WTO Areas covered 
Mexico-Japan 
Economic Association 
Agreement 1 April 2005 
(31 March 2005) WT/REG198/N/1 
(22.04.2005) S/C/N/328  
(22.04.2005) Market access for goods;  rules of origin;  customs 
procedures;  sanitary and phytosanitary standards;  technical standards;  safeguard s;  investment;  services;  
financial services;  temporary entry of business 
personnel;  government procurement;  competition;  and dispute settlement.  In addition, cooperation in areas 
such as trade and investment promotion, SMEs, support 
industry, science and technology, agriculture and tourism. 
a Since 19 November 2006, only Mexico and Colombia  have been participating in the G-3 FTA. 
Source : WTO, with data provided by the Mexican Ministry of the Economy. Consulted at: 
http://www.economia.gob.mx/work/ snci/n egociaciones/ficha_  publica_tlcs.htm. 
43. Consequently, most of Mexico's trade is with its  preferential trading partners (Chapter I(3)).  
The North American Free Trade Agreement (with  the United States and Canada) remains of 
fundamental economic importance:  70 per cent of Mexico's total trade was with Canada or the 
United States in 2006 (80 per cent in 2001).  In 2 006, roughly 7.9 per cent of Mexico's total trade was 
with the European Union, 3.3 per cent with Jap an, and 2.1 per cent with other Latin American 
countries with which it has preferential agreements.  Trade with the other preferential partners as a 
whole accounted for 1 per cent of the total.  In 2006, imports from countries with which Mexico has 
FTAs amounted to some US$189.8 billion, of which 60 per cent received preferential treatment. 
44. The large number of trade agreements signed by Mexico gives rise to some concern regarding 
the complexity and cost of their administration by  the authorities and economic agents.  For instance, 
each of these agreements has its own certificates of or igin and requires an inde pendent administration, 
which can raise transaction costs for trade operators. 
45. According to Zabludovsky (2005), apart from making customs administration more difficult, 
the proliferation of trade regimes and instrume nts maintained by Mexico generates incentives for 
circumvention, tax evasion and smuggling.33  The high MFN tariffs maintained by Mexico 
(Chapter III(2)(iv)) also penalize users of inputs obtained from third countries and have made it 
necessary to introduce liberalization programmes in  specific sectors in order to counteract the 
negative impact of protection on the competitiven ess of Mexican enterprises.  According to the 
aforementioned study, this situation, compounded by the complexity of the customs regime, begs the 
question of whether it would not be in Mexico's inte rests to unilaterally eliminate MFN tariffs (which 
cover just 15 per cent of its foreign trade) and thus  facilitate customs administration, reduce incentives 
for smuggling and circumventi on and make the national econom y more competitive generally. 
46. In this regard, the authorities have pointed out that Mexico constantly monitors the different 
trade regimes and instruments with a view to simplifying their administration;  and it has taken steps 
such as reducing tariff lines requiring prior permits and automatic import notices, unilateral lowering 
of MFN tariffs, simplification of other instrument s (maquila and PITEX), together with various 
measures to make customs operations more tr ansparent and efficient (see Chapter III(2)). 
                                                      
33 Zabludovsky (2005), pp. 68-69.   Among many other positions, th e author held the post of 
Negotiations Chief for the Mexico-European Union FTA, a nd served as Under-Secretary for International Trade 
Negotiations within the Ministry of Trade and Industrial Promotion (now the Ministry of the Economy).  See also Ministry of the Economy (2007), p. 22. WT/TPR/S/195/Rev.1 Trade Policy Review 
Page 26 
 
 
North American Free Trade Agreement (NAFTA) 
47. In accordance with the corresponding tariff reduction schedule, most trade between Mexico 
and its NAFTA partners, including im ports of new motor vehicles, was liberalized on 1 January 2003.  
Consequently, practically all imports from the Unite d States and Canada entered Mexico duty-free in 
2007, except for a few agricultural products (beans, maize, powdered milk and sugar), for which full 
liberalization is scheduled for 2008.34  Imports of used vehicles can remain protected until 2009, after 
which restrictions will gradually be lifted to achie ve full liberalization by 2019.  During the review 
period, Mexico and its NAFTA partne rs introduced a number of changes to the rules of origin set out 
in NAFTA Annex 401 (Chapter III(2)(iii)). 
48. On several occasions Mexico has made use of the dispute settlement mechanism contained in 
Chapter XIX of the NAFTA, which provides for judi cial review by binational panels of any anti-
dumping or countervailing measures adopted by the parties.  Between 2002 and March 2007, Mexico 
participated as a defendant in an investigation in itiated by a United States producer in relation to 
bovine meat and edible offal.  In March 2007, tw o decisions of the Mexican authorities were under 
review.35  Under NAFTA Chapter XI, investment dis putes are resolved through investor-State 
arbitration procedures.  Since 2002, five new cases have been brought against the Mexican 
Government under this Chapter.36  As of March 2007, an arbitral award had been made in just two of 
them, both of which were favourable to Mexico.37 
49.  In March 2005, NAFTA member countries created the Security and Prosperity Partnership of 
North America (SPP).  This seeks to promote greate r integration in North America and, despite not 
having any legal link with the NAFTA, many of the points in its "prosperity agenda" address NAFTA 
issues.  On trade matters, the aim is to redu ce regulatory barriers, make standards mutually 
compatible, liberalize rules of origin, introdu ce mechanisms to enhan ce the competitiveness of 
specific sectors (textiles, steel, automotive), and combat smuggling and piracy.38 
FTAs with Latin American countries 
50. The FTA with Guatemala, Honduras and El Salvador (Mexico-Northern Triangle FTA) 
establishes an asymmetric tariff reduction progra mme governed by different schedules between 
Mexico and each of the Central American countries.  When it entered into force, over 65 per cent of 
exports from Honduras, Guatemala and El Salvador benefited from duty-free entry into the Mexican 
market.  Full tariff reduction for trade in indus trial products among the four countries should be 
achieved in 2010.  The agreement includes a speci al safeguard for sensitive agricultural products. 
                                                      
34 In the case of Mexico-Canada tr ade, dairy and poultry products were excluded from the agreement. 
35 MEX-USA-2005-1904-01 and MEX-USA-2006-1904-02. NAFTA Secretariat, "Reviews by NAFTA 
panels".  Consulted at:  http ://www.nafta-sec-alena .org/defaultSite/index_ s.aspx?DeatilID=757. 
36 International Thunderbird Gaming Corporation vs. United Mexican States, 1 August 2002;  GAMI 
Investments, Inc. vs. United Mexican States, 9 April 2002;  Archer Daniels Midland Co. and Tate & Lyle 
Ingredients Americas, Inc. vs. United Mexican States, 14 October 2003;  Corn Products International, Inc. (CPI) 
vs. United Mexican States, 21 October 2003;  and consolidation of the following cases:  Corn Products 
International, Inc. (CPI) vs. United Mexican States, (ICSID Case No. ARB(AF))/04/01) and Archer Daniels Midland Co. and Tate & Lyle Ingredients Americas, Inc. (ICSID Case No. ARB(AF))/04/05), 
8 September 2004. 
37 The cases in question were:  GAMI Investments,  Inc. vs. United Mexican States, Final Award, 
15 November 2004;  and International Thunderbird Gaming Corporation vs. United Mexican States, Final 
Award, 26 January 2006.  Both cases can be  consulted at:  www.economia.gob.mx/work/ 
snci/negociaciones/Controversias/Casos_Mexico/. 
38 Ministry of the Economy (2006a). Mexico WT/TPR/S/195/Rev.1 
 Page 27 
 
 
51. During the review period, Mexico participated  as a defendant in a dispute initiated by 
El Salvador under Chapter XIX of the Mexico-N orthern Triangle FTA concerning procedures applied 
by Mexico for granting health registration to medi cines from El Salvador.  The arbitral panel that 
heard the dispute concluded that the requirement fo r a factory or laboratory to be located on Mexican 
soil ("plant requirement") in order to obtain this re gistration was not consistent with the principle of 
national treatment contained in the agreement.39  In November 2006, the "plant requirement" for 
granting health registration to medicines from El Salvador was eliminated. 
52.  Since its last Review, Mexico has continued and completed the liberalization of trade under 
FTAs signed with Bolivia, Costa Rica and Nicaragua .  As a result, trade in industrial products 
between Mexico and these countries was fully liberal ized in 2004 in the case of Bolivia and Costa 
Rica (except for a small list of products); and in 2007  with respect to Nicara gua (except automobiles, 
for which full liberalization is scheduled for 2012).  Food and fisheries products, mostly subject to 
tariff reduction programmes, became duty-free in Ja nuary 2005 with Bolivia and Costa Rica, and in 
July 2007 in the case of Nicaragua. 
53. The FTA among Mexico, Colombia and Venezu ela (G-3) was renounced by Venezuela and 
rendered void in that country in November 2006;  but it remains in force between Mexico and 
Colombia.40  Under the 10-year linear tariff reduction programme stipulated in the agreement, most 
trade between Mexico and Colombia has been duty -free since January 2005.  A number of mainly 
agricultural products have not been included in the tariff reduction programme.  In June 2004, new 
conditions were negotiated for bringing the auto motive sector within the trade liberalization 
programme and these entered into force in January 2 005;  full liberalization of the sector is scheduled 
for January 2011.  In addition, negotiations to incorporate new products into the tariff reduction 
process and amend certain rules of origin began in January 2007. 
54.  As established in the Mexico-Chile FTA, tariffs  on the majority of originating merchandise 
in trade between these two countries were eliminated  as soon as the agreement entered into force.  
Goods excluded from duty-free treatment by both pa rties include certain dairy products, shrimp and 
lobster, wheat and wheat flour, edible vegetable o ils, sugar, tobacco products and various petroleum 
products.  Mexico eliminated the tariff and q uotas on imports of apples from Chile as from 2006. 
55. As a LAIA member country41, Mexico has partial scope and economic complementarity 
agreements (ECAs) in force with variou s member countries of that Association.42  During the review 
period, Mexico concluded an ECA with th e MERCOSUR countries (ECA No. 54, signed on 
5 July 2002), and a partial scope agreement on the au tomotive sector with the same group of countries 
(ECA No. 55 of 5 July 2002).43 
56. The Mexico-MERCOSUR ECA establishes a co mmitment to achieve a free-trade zone 
between the two parties through periodic negotiations.  It encompasses the agreements signed or to be 
                                                      
39 El Salvador vs. Mexico - Current measures for granting health registration and access to medicines. 
Final Report of the Arbitral Panel, 14 August 2006. 
40 Under a decree published in th e D.O.F on 17 November 2006, th e G-3 agreement ceased to have 
effect between Venezuela and Mexico as from 19 November 2006. 
41 LAIA member countries are Argentina, Bolivia, Brazil, Chile, Colombia, Cuba, Ecuador, Mexico, 
Paraguay, Peru, Uruguay and Venezuela. 
42 The agreements reached within the LAIA framework have been notified by this organization to the 
WTO Committee on Trade and Development.  The most recent notification is contained in WTO document 
WT/COMTD/59 of 25 January 2007 (LAIA Communication, Biennial Report to the World Trade Organization). 
43 Amendments were made to the ECA on the automotive sector in relation to trade between Uruguay 
and Mexico in June 2004 (ECA No. 55 IV.1), and between Brazil and Mexico in May 2005 (ECA No. 55 II.1). WT/TPR/S/195/Rev.1 Trade Policy Review 
Page 28 
 
 
signed between Mexico and that trade bloc, as well as bilateral agreements between Mexico and each 
of countries concerned.  The agreement thus lays the foundations for future negotiations aimed at 
deepening both the bilateral agreements and th e agreement between Mexico and MERCOSUR as a 
bloc.  In mid-2007, negotiations were ongoing to expand the agreement with Brazil (ECA No. 53);  
and coverage of the agreement with Argentina (ECA No. 6) was expanded to encompass roughly 
3,100 tariff lines. 
57. Under the automotive sector ECA between Mexico and MERCO SUR, bilateral annual quotas 
were established for duty-free imports of au tomobiles between Mexico and each MERCOSUR 
member country.  The agreement envisages free tr ade for light vehicles among all parties in 2011. 
58. In November 2003, under the Mexico-MERCOSUR ECA, Mexico signed a free-trade 
agreement with Uruguay (ECA No. 60).  Once this en tered into force, roughly 93 per cent of tariff 
lines became duty-free, exceptions being oil and petroleum products, automotive products44, and the 
items contained in each country's schedule of ex ceptions.  In the case of Mexico, these include 
products that remain subject to a reduction rate of 28 per cent or 30 per cent, and in some cases 90 per 
cent, as well as sensitive products for which there is no reduction.  The latter include chicken, tuna 
fish, certain seafood products, beans, wheat, maize, apples, coffee, sugar, tobacco, edible oils and 
made-up articles of various fibres.  Other products  remain subject to quotas (woollen fabrics and 
cheese).  Mexico applies a maximum tariff of 7 per cent on bovine meat products; the footwear sector 
will be fully liberalized by both parties after 10 years. 
59.  Also within the LAIA, Mexico maintains EC As with Peru (ECA No. 8) and Cuba (ECA 
No. 51), as well as partial scope agreements  with Ecuador, Pana ma and Paraguay. 
FTAs with European countries 
60. Pursuant to the tariff reduction schedules estab lished in the European Union-Mexico free-
trade agreement (EUMFTA), the EU eliminated all tariffs on Mexican imports  of industrial products 
in 2003, and Mexico reciprocated in January 2007.  The EU will eliminate import duties on 
agricultural and fisheries products as from 2008, and Me xico will do so in 2010, except for a small list 
of sensitive items that include m eat, cereals and dairy products.  Th e agreement also establishes tariff 
quotas for certain agricultural and fisheries pr oducts.  Mexico and the EU are implementing a 
Co-operation Programme 2007-2013, wh ich contains projects in the ar eas of trade facilitation, support 
for SMEs, and promotion of competitiveness, inter alia .45 
61. The FTA with the European Free Trade Asso ciation (EFTA) establishes the same tariff 
reduction schedules as the EUMFTA.  Consequently, Mexico eliminated all tariffs on imports of 
industrial products from its EFTA partners as from 1 January 2007.  In return, these countries granted 
duty-free access to all Mexican industrial and fisher ies products when the agreement entered into 
force.  Trade in agricultural products is subject to  the bilateral agreements signed between Mexico and 
each EFTA member State. 
Other FTAs 
62. Following the entry into force of the agreement to strengthen the Mexico-Japan Economic 
Partnership Agreement (EPA), in April 2005 Japan eliminated import duties on 91 per cent of tariff 
lines and, within five years (2010), will do the same for a further 4 per cent of the tariff.  The 
                                                      
44 Trade in automotive goods is governed by Partial Scope Agreement No. 55 and its protocols, signed 
between Mexico and the MERCOSUR member  countries within the LAIA framework. 
45 Ministry of the Economy (2007). Mexico WT/TPR/S/195/Rev.1 
 Page 29 
 
 
remaining 5 per cent will be liberalized over a 10-y ear period, although the products in question may 
be given duty-free access on a quota basis.  For its part, Mexico granted immediate duty-free access 
for 44 per cent of tariff lines, including high-techno logy inputs and products.  It will liberalize an 
additional 9 per cent of the tariff within five year s;  and the remaining 47 per cent, which includes 
both industrial products (minerals, chemicals, r ubber, glass, and others) and agricultural products 
(e.g. bananas, maize flour and fruit products), will become duty-free in 2015.  Special tariff reduction 
schemes are set out for the automotive and steel sectors. 
63. Under the Mexico-Israel FTA, trade in industr ial products became fully liberalized as from 
2005;  the agreement covers roughly 96 per cent of trade in agricultural products. 
64. As of mid-2007 Mexico was in negotiations to c onclude trade agreements with Peru and the 
Republic of Korea;  and it had announced its inte ntion to start negotiations with the Dominican 
Republic.  In the near future, it is expected that agreement will be reached on expanding and 
deepening the ECA with Peru, with a view to concluding an FTA with that country. 
(iii) Other agreements and arrangements 
65. Since 1993, Mexico has been a member of Asia-Pacific Economic Cooperation (APEC), and 
in 2002 served as headquarters of that forum.  It has also participated in negotiations to establish the 
Free-Trade Area of the Ameri cas (FTAA), an initiative embark ed upon in 1994 with a view to 
progressively eliminating barriers to trade in goods and services between 34 western-hemisphere 
nations.  Although the FTAA negotiations should have ended in January 2005, in mid-2007 the 
process was suspended and no dates had been set for resumption.  Mexico hosts the FTAA 
Administrative Secretariat in the city of Puebla. 
66. Under the Generalized System of Preferences (GSP), Mexico benefits from preferential 
access schemes offered by Canada, the Russian Fede ration, Japan, New Zealand, Turkey and the 
European Union.  In 2006, a total of 3,876 certific ates of origin were issued for Mexican exports 
under GSP schemes. 
67. Mexico also forms part of the Global System of Trade Preferences among Developing 
Countries (GSTP), and is currently participati ng in the third round of negotiations among the 
members of this agreement, which began in June 2004 in Brazil.  Nonetheless, in 2007, Mexico was 
not granting any concessions under this scheme nor  was it issuing certificates for Mexican products 
exported under its auspices.