Brazil and Mexico agree to extend limits on duty-free imports of light motor vehicles

On March 9, 2015, Brazil and Mexico renewed their 2012 agreement that established limits on the value of light-duty motor vehicles that Mexican manufacturers may export to Brazil free of duty each year. Brazil had originally agreed to provide unrestricted duty-free treatment to Mexican light-duty vehicles by March 19, 2015, but that deadline has been extended for four years.

The agreement allows limited duty-free exports of light-duty vehicles from Mexico to Brazil each year, as follows:

• March 19, 2015 to March 18, 2016: US $1.560 billion
• March 19, 2016 to March 18, 2017: US $1.606 billion
• March 19, 2017 to March 18, 2018: US $1.655 billion
• March 19, 2018 to March 18. 2019: US $1.705 billion
• March 19, 2019: no limitation or quota is expected

The agreement requires a minimum of 35 percent Mexican content in order to avoid duties. This requirement increases to 40 percent in 2019.

Please do not hesitate to contact the Plante Moran Global Services team with any questions or concerns.