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Precautionary Seizure of Foreign Vehicles in Mexico

Due to family, business, and leisure ties, living in a border city is unique. This is because on both sides people live and mingle with two countries and even converge, as in the case of Ciudad Juárez, Chihuahua, three different federal entities that, therefore, have their own ‘legal system’ to regulate coexistence and dispute resolution.

It’s under these concepts that aspects as obvious as the purchase of real estate, obtaining permits or licenses, family relationships, etc., raise doubts about whether these or such acts have effects on both sides of the border or if, on the contrary, having the possibility of residing or transiting legally in both countries, the corresponding procedure must be carried out for each one.

In this sense, for the use of vehicles, both in Mexico and in other countries that share the border, the question always arises as to whether they can be circulated without another special permit in the border country as long as the Mexican regulations are complied with or if, on the contrary, a special procedure must be carried out.

For the specific case, in this entry I will allow myself to analyze the legal implications of circulating a foreign vehicle in Mexico through the border areas in the north. Therefore, I will explore what procedures must be carried out for its legal stay, what regulations must be considered and, above all, the consequences of not complying with them.

Without further ado, let’s start!

List of Contents

Translation

This entry is my translation of my original post Embargo precautorio de vehículos extranjeros en México.

1) Legal Circulation of Foreign Vehicles in the Border Area

First of all, Mexican lawmakers, recognizing this social dynamic in border cities, allow the ‘free circulation’ of foreign vehicles in our country pursuant to the General Rules of Foreign Trade for 2025, particularly 3.4.8 and regarding article 136 of the Mexican Customs Law[1]. To this end, it is stated that vehicles owned by residents abroad may circulate within a 20-kilometer strip parallel to the international dividing line and in the border region, provided that they meet the following requirements:

I.- That the vehicle has and carries the foreign license plates or the document proving circulation abroad in force when it crosses the international dividing line and during its stay in national territory.

II.- That there is a resident abroad on board the vehicle, without it being necessary for him to be the one driving.

A) Repairment of Foreign Vehicles

It’s also pertinent to clarify, since it is no secret to anyone, that another of the attractions of visiting Mexico is obtaining products and services cheaper than those that exist in the United States of America. A service that involves using foreign cars is, without a doubt, their repair. Well, considering this, our lawmakers also regulate the repair of foreign vehicles.

In this sense, vehicles that circulate in compliance with the general foreign trade rule 3.4.8 already mentioned may be repaired by automotive workshops located in border areas, provided that they have the order that accredits the provision of the service and that contains the key in the automotive workshop’s Federal Taxpayers Registry; otherwise, a copy of the key in the automotive workshop’s RFC.

If the above is met, they may even be driven by the owners or employees of said workshops to test them, provided that they circulate on business days and hours, within the authorized areas, and have on board the vehicle the documentation indicated above, as well as the document that proves that there is an employment relationship between the physical or individual who owns the workshop and the person driving the vehicle and which states the test order that was given to the driver.

2) General Verification Powers

Once the legal basis and its requirements for foreigners to move in border areas with their foreign vehicles have been set out, it’s time to answer what would happen if the general rule of foreign trade 3.4.8 requirements were not met? What would be the procedure to be followed by the customs authority? Could this have implications in the criminal field? Well, in this first part I will deal with what is related to the administrative headquarters and in a later entry the criminal aspect.

A) Customs Recognition

First of all, and as I already explored in the entry Customs Regulation in Mexico, it’s necessary to understand when the customs authorities in Mexico can detect that you do not comply with the requirements stipulated in the general rule of foreign trade 3.4.8. This is important because a lawyer will then be able to determine whether the subsequent precautionary seizure is legal.

In this sense, since you are not going to carry out an ‘import’ in the strict sense, even if it is temporary and, much less, definitive, you are of course not obliged to present the electronic request[2] at the time of crossing, but you do have to comply with the customs inspection[3]. That is, verify whether you comply with the requirements outlined in the general foreign trade rule 3.4.8 already mentioned. All of this, under article 43, sixth paragraph of the Mexican Customs Law[4].

For this, when crossing the Mexican border, the automated selection system will be activated to determine whether the customs inspection must be carried out, that is, carry out the verification I mentioned. For this, if the traffic light shows ‘green’, it means that you will be able to cross without implying a review. However, if it is marked ‘red’ you will be inspected and not only will the customs authorities be able to examine other merchandise that you are carrying in the vehicle, such as seats and trunk to verify if you were required to declare them, but when they notice the foreign license plates, they will require you to provide documentation proving compliance with the general foreign trade rule 3.4.8. All of this, of course, in the tax premises itself.

Therefore, if when crossing you had to go through customs freely (the traffic light was green) and you are still stopped for verification, you can prove this, either using the report drawn up by the authorities – very rare – or by various other pieces of evidence, the entire Administrative Procedure in Customs Matters (PAMA in Spanish) shall be flawed and, therefore, everything done afterwards is the product of a flawed act that would cause its nullity. For this purpose, see the judicial precedents (in Spanish): ORDER FOR VERIFICATION OF GOODS OF FOREIGN ORIGIN. IT VIOLATES ARTICLES 2, SECTION VIII, 10, 43 AND 50 OF THE CUSTOMS LAW, IN RELATION TO THE HUMAN RIGHT TO LEGAL SECURITY, THE PRACTICED IN THE SAME FISCAL PREMISES AND AT THE TIME IN WHICH THE INDIVIDUAL SUBMITTED TO THE AUTOMATED SELECTION MECHANISM AND OBTAINED THE GREEN LIGHT[5] and see also: VICIATED ACTS, THE RESULTS OF[6].

Hence, as I have already indicated, the first thing you must inform your Mexican lawyer when your vehicle is seized for having allegedly breached the general foreign trade rule 3.4.8 is where you were asked for the supporting documentation of said rule and, if applicable, the evidence you have.

However, the law is very clear that the fact that you have been given free customs clearance does not prevent them from subsequently exercising their verification powers, in accordance with the powers and competences of the customs authority. However, it is insisted that this could not occur at least at the time of crossing and passing through the aforementioned automation system.

B) Verification of Goods

The fact that you have been lucky enough to have a customs clearance does not mean that the customs authority cannot subsequently verify compliance with rule 3.4.8 mentioned above. This is because compliance with foreign trade and customs regulations is permanent. Hence, express provisions empower the authority to verify such compliance. Of course, as long as it is the competent authority. And it is precisely the powers contained in article 144, sections VII and XI[7], among others, of the Customs Law that empower the customs authorities to verify compliance with those regulations, even outside the fiscal precincts.

Thus, I have encountered cases where the taxpayer was so unlucky that, stopping to help another driver with a mechanical failure just as he was leaving the tax premises, he was noticed by the customs authorities and asked to prove the legal ownership of the foreign vehicle based on their powers of verification and that, by not doing so, it triggers the precautionary seizure and all the legal consequences explained below. As well as the invitation, but not its retention[8], to continue with the verification powers in the tax premises.

Finally, it is pertinent to emphasize that the only authority authorized to request verification of compliance with the general rule of foreign trade 3.4.8 is the customs authority. However, this is not an obstacle for another authority, in exercising its powers, to detect irregularities in the circulation of a foreign vehicle and, with this, notify the customs authorities for the verification. This is legal, so a simple traffic fine can trigger that even if the traffic agent does not initiate the Administrative Procedure in Customs Matter, he does notify the customs authorities to do so. In this regard, it is pertinent to bring up the following binding precedent issued by the Supreme Court of Justice of the Nation: VEHICLES OF FOREIGN ORIGIN. THE FEDERAL POLICE ELEMENTS MAY ORDER THE DETENTION OF THEIR CIRCULATION AND REQUIRE THE EXHIBITION OF DOCUMENTATION RELATED TO THEIR LEGAL STAY IN THE NATIONAL TERRITORY[9].

3) Administrative Procedure in Customs Matters (PAMA in Spanish)

Once the customs authorities detect, either during customs inspection, verification of goods or by exercising their powers of verification, the illegal circulation of foreign vehicles, they will initiate the administrative procedure in customs matters that may go as far as precautionary seizure.

A) Act of Initiation

For the above purposes, the authority shall initially draw up the act of initiation of the administrative procedure in customs matters, which shall record:

I.- The identification of the authority that carries out the diligence.

II.- The facts and circumstances that motivate the initiation of the procedure.

IV.- The description, nature and other characteristics of the vehicle.

V.- The taking of vehicle samples, if applicable, and other evidence necessary to issue the corresponding resolution.

At this start, the authorities shall require you to designate 2 witnesses and, in turn, indicate an address to receive notifications within the territorial jurisdiction of the authority that detained you or the one competent to resolve the PAMA, under the warning that if you do not do so, or if those designated do not accept to act as such, whoever carries out the diligence shall designate them. In addition, if no address is indicated, the notifications shall also be considered to have been made on the notice boards of the customs authority.

B) Procedure to Disprove Illegal Circulation

The act of initiation, in addition to what has been stated above, must indicate that the interested party has a period of 10 business days, counted from the day after the notification takes effect, to offer evidence and formulate the legally required arguments. In any case, a copy of this record will be given to the interested party so that he is aware of this right.

This is very important because, for example, the administrative authority may seize and impound the foreign vehicle as a precaution because, in its opinion, none of the people who were driving it were residents or citizens of the United States of America. And since at the time there was no supporting documentation, compliance with this requirement could not be proven.

This is why, within this period, we can refute the alleged non-compliance with the general foreign trade rule 3.4.8 and obtain the immediate return of the foreign vehicle, without any penalties other than the loss of the days in which it was retained. The above, as indicated in article 153 of the Customs Law.

However, when no evidence is presented or does not refute the violation of the general foreign trade rule 3.4.8, the interested party must wait for the customs authority to issue a final resolution, which must be issued within a period not exceeding 4 months counted from the day after the day on which the file is duly compiled, that is, when the period of 10 business days for presenting evidence and arguments has expired or, in any case, when the authority in charge of issuing the resolution has carried out the necessary procedures for the discharge of the evidence offered by the promoters.

Finally, it is extremely important to consider the period for issuing the final resolution, since based on article 153 of the Customs Law itself, the federal legislator established that if the final resolution is not issued within the reference period, the actions of the authority that initiated the procedure shall be void, including the precautionary seizure of the vehicle and, therefore, its return.

C) Precautionary Seizure

Upon the start of the PAMA, the customs authorities may seize the foreign vehicle as a precautionary measure. This seizure is intended to guarantee the fiscal interest. And while it’s true that in general terms the precautionary seizure of goods can be replaced by the payment of a guarantee in terms of the Federal Tax Code, as established in article 154 of the Customs Law, it’s also true that according to article 183-A, section V of the Customs Law[10], in the case of foreign vehicles, the replacement of the seized vehicle by a guarantee is not applicable. That is, there is no preliminary way to request its return, except by carrying out the definitive import procedure and paying the applicable contributions, updates and sanctions.

D) Auction and Sale of Seized Foreign Vehicles

The danger of the precautionary seizure of foreign vehicles is that if the alleged illegality of their circulation in the border area is not disproved, the federal treasury can sell them after the 4-month period has elapsed to issue the final resolution based on article 157 of the Customs Law[11]. This, even if the account resolution has been challenged, is because, as I have already explained, it is not appropriate to guarantee fiscal interest with any of the forms contained in the Federal Tax Code. Alienation that has been validated by the Supreme Court of Justice of the Nation as constitutional. As an example, see the following precedent: PROCEDURE FOR THE SALE OF VEHICLES OF FOREIGN ORIGIN DECLARED PROPERTY OF THE FEDERAL TREASURY. IT DOES NOT VIOLATE THE RIGHT TO PRIVATE PROPERTY[12].

However, it is also worthwhile to challenge the final decision if there are grounds for doing so, because if the vehicle has not been sold, it could be returned. However, given the manifest impossibility of returning it by sale, as we will see in the following section, the return of its updated value will be ordered.

E) Return of the Updated Value of the Vehicle

In the event that the foreign vehicle has been auctioned by the Administration and Sale of Goods Service, the legislator contemplated in the same article 157 of the Customs Law, in its fifth paragraph[13] that it has 2 years to request from the Tax Administration Service the payment of the value of the merchandise in accordance with article 27 of the Federal Law for the Administration and Sale of Goods of the Public Sector in accordance with the determination of the tariff value of the vehicle, plus the update of the price following the provisions of section 14) Update of Contributions. The following precedent complements and supports this calculation: GOODS SUBJECT TO PRECAUTIONARY SEIZURE IN A CUSTOMS PROCEDURE. WAY OF CALCULATING THEIR VALUE IN THE FACE OF THE MATERIAL IMPOSSIBILITY OF RETURNING THEM BECAUSE THEY HAVE BEEN TRANSFERRED BY THE SERVICE OF ADMINISTRATION AND DISPOSAL OF PROPERTY (SAE)[14].

4) Legal Remedies

Once the consequences of illegally driving a foreign vehicle and its immediate legal consequences have been explained, it’s now time to briefly explain the legal remedies available to taxpayers to challenge both the tax resolution and, where appropriate, the judgments and actions related to this issue.

A) Revocation Relief

The revocation relief is the first legal remedy against the determination of omitted contributions—non-payment of the Value Added Tax and the General Import Tax—, fines, updates, and other accessories. This legal remedy is resolved by the authority that issued the act, but through its hierarchical superior. This legal remedy is based on article 117, section I, subsection D) of the Federal Tax Code[15].

The relief must be submitted through the tax mailbox within 30 business days following the day on which the notification has taken effect. In this regard, the revocation relief must contain the following:

I.- The name, the denomination or company name, and the tax address stated in the Federal Registry of Taxpayers are used to establish the authority’s jurisdiction and the code that corresponded to it in said registry.

II.- The resolution or act that is being challenged.

III.- The arguments against the resolution or the challenged act.

IV.- The evidence and the disputed facts in question.

V.- The email address to receive notifications.

Likewise, the following must be attached to this legal remedy in which the relief is filed:

I.- The documents that prove your personality when you act on behalf of another or of legal entities.

II.- The document in which the challenged act is recorded.

III.- Proof of notification of the contested act, except when the promoter declares under oath that he did not receive proof or when the notification was made by certified mail with return receipt or it is a fictitious refusal. If the notification was by edict, the date of the last publication and the body in which it was made must be indicated.

IV.- The documentary evidence offered and the expert opinion, if applicable.

Likewise, the authority must issue a resolution and notify it within a period not to exceed 3 months from the date of filing the revocation relief. The silence of the authority will mean that the contested act has been confirmed and, if applicable, the appellant may decide to wait for the express resolution or challenge the alleged confirmation of the contested act at any time.

Finally, filing this legal remedy is optional, since one may validly resort to the Contentious Administrative Trial before the Federal Court of Administrative Justice.

B) Administrative Contentious Trial

Another legal remedy against the final resolution of the Administrative Procedure in Customs Matters is the Administrative Litigation regulated in the Federal Law of Administrative Litigation Procedure, which implies resolving the dispute before the Federal Court of Administrative Justice, of which the interested party will also have 30 working days to file it, counted from the date on which the notification of the final resolution of the PAMA takes effect.

For now, I will not stop exploring the ABC of Administrative Litigation since it will be the subject of a different series. However, it must be said that both the formulation of the claim and its processing (in terms of deadlines) are similar to that of the revocation relief. The difference is that in the trial, it is resolved by an administrative court, and there is no fictitious refusal in case of not resolving it within the term established by law.

Finally, I always recommend going directly to the Administrative Litigation Trial, since the customs authority rarely accepts its errors and, therefore, the only thing the taxpayer gains by appealing to it is wasting time.

C) Indirect Amparo Proceeding

According to the rules that govern the Amparo Proceeding, both Direct and Indirect, it could well be thought that in the indirect amparo there would be few cases in which the trial would proceed. This is due to the causes of inadmissibility related to exhausting the principle of finality, of only challenging acts or omissions of the customs authorities that violate the substantive rights of the taxpayers, etc. However, it’s very common for the customs authorities, without having the authority to do so and without the consent of the taxpayers, to transfer the taxpayers to the tax premises or various facilities, when the illegal circulation of a foreign vehicle is detected.

The above is, of course, illegal because, as I have already explained, other authorities can collaborate with the customs authorities so that they can carry out their verification duties, it is also illegal that outside the tax premises, the customs authorities cannot transfer taxpayers to another place, much less detain them, as often happens. Therefore, if a person is left incommunicado and is transferred without his knowledge to the tax premises or other customs station, indirect protection against such illegal detention would be applicable, as well as the request for suspension of the contested act. See, for example, the following precedent: VERIFICATION OF GOODS IN TRANSPORT IN CUSTOMS MATTERS. IT IS ILLEGAL FOR THE AUTHORITY TO TRANSFER THE DRIVER OF THE VEHICLE TO THE TAX PREMISES AND TO DETAIN HIM THERE WITHOUT HIS CONSENT[16].

Finally, and without being exhaustive for this topic, since I will have to make a special series to explain the amparo trial, it must be said that taxpayers have 15 business days to promote indirect amparo against the acts and omissions of the customs authorities in this and other matters.

D) Direct Amparo Proceeding

Finally, the last legal remedy against this matter is direct amparo. Even though against its resolution, compliance and non-compliance, there are various resources such as amparo’s review, non-conformity and even a side claim for non-compliance. However, there would be little value in exploring all these extremes if the reader of this entry only wants to know what legal channels he has to defend himself briefly.

For the specific case, this type of trial will be the most common since it proceeds against the final judgment—and in this case, the order that confirms the dismissal of the claim—of the Contentious Administrative Trial. Thus, this would be the last bastion to challenge the final resolution of the Administrative Procedure in Customs Matters. This trial must also be initiated within the following 15 business days counted from when the notification of the final judgment of the Contentious Administrative Trial that is adverse to you takes effect.

By Omar Gómez

Mexican Tax, Administrative and Constitutional Attorney

[1] Article 136.- For the purposes of this Law, the border strip is considered to be the territory between the international dividing line and the parallel line located at a distance of twenty kilometers towards the interior of the country.

The border region shall be understood as the territory determined by the Federal Executive.

[2] A customs declaration is a declaration in an electronic document, generated and transmitted regarding compliance with the regulations that tax and regulate the entry or exit of goods from the national territory, which contains information regarding the goods, the traffic and customs regime to which they are destined, and other data required to comply with the formalities of their entry or exit from the national territory, as well as that required in accordance with the applicable provisions.

[3] It’s the examination of the merchandise, as well as its samples, carried out by the authorities to obtain elements that help to verify the veracity of what has been declared before the customs authority, as well as compliance with the provisions that tax and regulate the entry or exit of merchandise from the national territory.

[4] Article 43.- […]

In cases where no request is required to activate the automated selection mechanism, the goods must be presented to said mechanism with the corresponding documentation, in the terms referred to in this article. […].

[5] Thesis: XV.1o.1 A (10a.) FIRST COLLEGIATE COURT OF THE FIFTEENTH CIRCUIT. Tenth Judicial Epoch. Not Binding Precedent. Digital Registration: 2008135.

[6] FIRST COLLEGIATE COURT ON ADMINISTRATIVE MATTERS OF THE FIRST CIRCUIT. Seventh Judicial Epoch. Binding Precedent. Digital Registration: 252103.

[7] Article 144.- The Secretariat shall have, in addition to those conferred by the Federal Tax Code and by other laws, the following powers: […]

VII.- Verify that the goods for whose importation a tax incentive, franchise, exemption or reduction of taxes was granted or that compliance with a non-tariff regulation or restriction was exempted, are intended for the purpose for which it was granted, are in the places designated for that purpose and are used by the persons to whom it was granted, in cases where the benefit was granted based on said requirements or any of them. […]

XI.- Verify exclusively during their transport, the legal importation or possession of goods of foreign origin throughout the national territory, including tax precincts, for which it may rely on the systems, technological equipment, any other means or service available, including the customs opinion referred to in article 43 of this Law. […]

[8] For such purposes, see the following binding precedent: VERIFICATION OF GOODS IN TRANSPORT IN CUSTOMS MATTERS. IT IS ILLEGAL FOR THE AUTHORITY TO TRANSFER THE DRIVER OF THE VEHICLE TO THE TAX PREMISES AND TO DETAIN HIM THERE WITHOUT HIS CONSENT.

[9] Thesis: 2a./J. 134/2017 (10a.) Second Chamber of the Mexican Supreme Court of Justice. Tenth Judicial Epoch. Binding Precedent. Digital Registration: 2015325.

[10] Article 183-A. Merchandise shall become the property of the Federal Treasury, without prejudice to other applicable sanctions, in the following cases: […]

V.- Vehicles, when non-tariff regulations and restrictions have not been complied with.

[11] Article 157.- In the case of perishable goods, goods that are easily decomposed or damaged, live animals, explosive, flammable, corrosive, contaminating, radioactive or radioactive goods, which are the subject of precautionary seizure and whose legal presence or possession in the country has not been proven within ten days following their seizure, the Tax Administration Service may proceed to their destruction, donation or assignment. In the case of motor vehicles, aircraft and vessels, they shall be transferred for sale to the Property Administration and Disposal Service, once the resolution that ends the administrative procedure in question has been issued, provided that their legal presence or possession in the country has not been proven.

[12] Thesis: 2a. I/2020 (10a.) Second Chamber of the Mexican Supreme Court of Justice. Tenth Judicial Epoch. Not Binding Precedent. Digital Registration: 2021425.

[13] Article 157.- […]

Any individual who obtains a final administrative or judicial resolution ordering the return or payment of the value of the merchandise or, where appropriate, declaring the nullity of the resolution that determined that the merchandise became the property of the Federal Treasury, and who proves through an appropriate document that he has a legitimately recognized subjective right over the goods, may request from the Tax Administration Service the return of the merchandise, or where appropriate, the payment of the value of the merchandise, within a period of two years, counted from the date on which the resolution or sentence became final.

[14] Thesis: 2a./J. 9/2014 (10a.) Second Chamber of the Mexican Supreme Court of Justice. Tenth Judicial Epoch. Binding Precedent. Digital Registration: 2005637.

[15] Article 117.- The revocation relief shall apply against:

I.- Final resolutions issued by federal tax authorities that:

[…] D) Issued by customs authorities.

[16] Thesis:  IV.1o.A. J/19 (10a.) FIRST COLLEGIATE COURT ON ADMINISTRATIVE MATTERS OF THE FOURTH CIRCUIT. Tenth Judicial Epoch. Binding Precedent. Digital Registratión: 2010823.

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