Novedades April 1995 Monthly Newsletter of the National Law Center for Inter-American Free Trade Secured Financing Project Significant progress was made toward the modernization of Mexican personal property secured transactions law and registry systems, and their harmonization with Canadian and U.S. systems during a recent conference in Hermosillo, Sonora. The conference was co-sponsored by the NLCIFT and the Institute of Assessment and Registration for the State of Sonora. These reform efforts are aimed at fostering the availability of commercial and consumer credit in Mexico at affordable rates, one of the country’s most intractable economic problems. Credit cost and access are, of course, closely linked to the availability of collateral. It is a simple economic fact that a secured loan will be both significantly less costly and more readily available than an unsecured loan. But loan securitization methods depend on a legal system for their creation. In Mexico, that system has not changed substantially since the early part of the century and is still geared toward an agrarian economy. Consequently, it is very difficult to secure commercial loans in Mexico with inventory, accounts and other intangibles. These problems are exacerbated by antiquated registry systems which make lien filings and searches at best an uncertain proposition and a system of enforcement which often leads to long delays and unfavorable outcomes. In addition to experts from The World Bank and academic institutions in Canada and the United States, conference participants included representatives from the Association of Mexican Notaries, the Mexican Banking Association, and the Mexican business sector (COESE) along with practicing lawyers and registrars from Mexico. The conference was also attended by federal government representatives from the Secretaría de Comercio y Fomento Industrial (SECOFI) which would be primarily responsible for introducing any legislative changes to the Mexican Congress. On the following day, a working meeting was held at which it was agreed to provide SECOFI, by June 30, 1995, with a report which thoroughly analyzes existing Mexican secured financing law and registry operations, and which contains conclusions and general recommendations for legislative changes. It was further agreed that this report will be produced as a joint effort among the NLCIFT, the National Association of Mexican Notaries, the Association of Mexican Banks, the Public Registries of Commerce and Property and, tentatively, COESE, all of whom agreed to appoint the personnel needed to complete the task. For more information on this project, please contact Todd Nelson John Wilson, Andrés Felix or Jesús Madrazo at the NLCIFT. ** Transportation (NACST) Meeting Update NACST will be meeting in Quebec City on April 24 and 25. The primary purpose of this meeting is to revise the draft of the Unifor Rules for Surface Transportation Documentation and Practice. The first draft of these rules was prepared and presented by Jim Hickling of California Cartage Co's at the January NACST meeting. The rules will act as transport guidelines for companies moving goods internationally. The rules may also be incorporated by reference in the North American Uniform Surface Bill of Lading (NAUSBL). Also at the Quebec meeting, NACST will review revisions to the NAUSBL made by the NACST E.D.I. Working Group on March 9th in Tucson. The NAUSBL will be used for all international shipments by truck between the NAFTA countries. The E.D.I. working group is preparing the NAUSBL for publication in the 1996 ANSI X.12 standards. Cargo insurance problems will also be addressed in Quebec. NACST's Insurance Working Group has been asked by the Asociacion Mexicana de Instituciones de Seguros (AMIS-Mexican Assoc. of Insurance Institutions) to assist in developing a cargo policy that will meet international standards. The Working Group is also drafting an insurance endorsement for motor carriers to ensure their compliance with cargo liability requirements. NLCIFT researchers are currently working on a comprehensive study of transportation insurance in Mexico. For more information, contact Gary Doyle at the NLCIFT. ** InterAm SM Database Update Juan Balderas of Publicaciones Electronicas de Mexico, S.A. de C.V. (PEMSA), a leading Mexican company specializing in information processing and electronic publications, visited the NLCIFT in mid- March to establish a plan for a cooperative relationship that would help expand the distribution of information from the NLCIFT's database on Mexican legislation. These materials would be organized by subject area such as customs procedures and regulations, banking law, labor law, etc., and would be marketed as CD-ROMS. The NLCIFT INTERAM database is currently the only full-text source of Mexican trade and investment laws and regulations available online in the North America. INTERAM will be accessible on the Internet in approximately six weeks. ** Intellectual Property Research On March 15, NLCIFT Intellectual Property Project Coordinator, Christina Moeckel attended a seminar on “Intellectual Property in the Year 2000” in Washington, D.C. organized by the U.S. Council for International Business and the Landegger Program of Georgetown University School of Foreign Service. Speakers included U.S. Trade Representative Mickey Kantor, Senator Hatch of Utah, as well as high-level representatives from various industries who expressed views on the evolution of the protection of intellectual property during the next millennium. Unanimously, the speakers emphasized the increasing importance of adequate protection of intellectual property. The pharmaceutical industry voiced concerns about the inadequate protection of drugs in countries like India, Turkey or even Canada. Similar problems exist with respect to the enforcement of intellectual property rights especially in China but also in Mexico. Because most U.S. exports involve intellectual property rights, the protection of these rights is vital to American industry today. New contacts for the National Law Center will help contribute to the ongoing research. The enforcement of intellectual property rights in Mexico and the better protection of pharmaceuticals in Canada are the main problems which will be addressed. ** Mexican Law Expert Speak on International Practice On Feb. 28, the NLCIFT co-sponsored a conference featuring Dr. Miguel Acosta Romero, Professor of Law at the Universidad Nacional Autónoma de México (UNAM) and Coordinator of Mexico's Committee on the International Practice of law, and Michael Mandig, President of NAFTA Arbitration and Mediation, P.C. Prof. Acosta Romero discussed the work of the Mexican committee in drafting legal criteria regulating the activities of foreign legal consultants. Mr. Mandig discussed the impact of Arizona's recent amendment to rules 33 and 46(b) , Ariz. R. Sup. Ct., entitling Arizona attorneys licensed in one of 16 jurisdictions to practice as foreign legal consultants in Mexico. For more information, contact Anna Torriente at the NLCIFT. ** John F. Molloy, and co-editor, Prof. Boris Kozolchyk have completed a compendium of U.S. laws affecting trade, and foreign investment in the United States which has been commissioned by the Mexican government and is expected to be in print in November. The team of academicians and practitioners who wrote chapters for the book are known nationally and internationally for their expertise in the various subjects. Authors include: Prof. Thomas E. Kauper of the University of Michigan Law School on anti- trust, Prof. Egon Guttman of University of Washington College of Law on securities, Prof. Roger W. Findley of Loyola Law School on environmental law, Prof. Michael H. Davis of Cleveland-Marshall College of Law on intellectual property, Prof. Phaedon John Kozyris of Ohio State University College of Law on business organizations, Prof. Arthur I. Rosett of U.C.L.A. College of Law on the law of contracts, Prof. Dan B. Dobbs of the University of Arizona College of Law on torts, Prof. Roger C. Henderson of the University of Arizona College of Law on insurance, Prof. Donald B. King of St. Louis University College of Law on consumer protection laws, Lawrence W. Newman of the Baker & McKenzie law firm on international litigation, Prof. Emeritus Charles J. Morris, Professor Emeritus of Law at Southern Methodist University, Prof. Roger D. Fisher of Harvard Law School on arbitration and mediation, and Prof. Dale Furnish of Arizona State University Law School on securities. John Molloy said he is pleased with the assemblage of talent that has resulted in a textbook that will have no peer. The various chapters of the book will be translated into Spanish by the NLCIFT's sister-center in Mexico, and will be published by the Fondo de Cultura Económica. ** Arizona/Sonora Environmetnal Cooperation LL.M. students Lisa LeGrand and Rocio Algora met in Hermosillo, Sonora with Maria Elena Barajas Olvera, Director of Ecological Regulations for the State of Sonora, to obtain information on underground storage tank regulations. The researchers are comparing Mexican and U.S. regulations and analyzing the legal consequences of storage tank fuel leaks. In addition to being part of their thesis, the findings are part of an effort to establish and maintain contact between the two state governments on various environmental issues. For more information, contact the NLCIFT. ** Tucson to Host Group of U.S. Mexican Lawmakers The Mexico/U.S. Interparliamentary Group will meet in Tucson on May 12-14 . Senator Jon Kyl, Chairman of the U.S. delegation, was appointed by Senate Majority leader Bob Dole in February and is responsible for scheduling the meeting in Tucson for the first time. On the agenda is the continued implementation of the NAFTA, the struggle against drug trafficking and discussion of various other border issues that have gained national attention during the past year. The 35-year-old Interparliamentary Group is composed of 24 members of each nation's congress. For more information, please call Senator Jon Kyl's office (602) 840-1891. ** InterAmSM Database Mexico New Legislation •Mexico Revises Taxes on Foreign Trade (MX.09.1554;MX.09.1555) •Customs Resolution Issued for the Mex.-Col.-Ven. Treaty (MX.09.1556) •Bolivia, Costa Rica, Mexico Announce Customs Regulations (MX.09.1557;MX.09.1558) •Mexican Tax Pact signed by Britain, Northern Ireland, and South Korea (MX.20.1524;MX.20.1525) •Agriculture Secretaría sets Standards for Residues found in Animal Tissues (MX.01.1560; MX.01.1561) •Emission Tests Set for Trucks (MX.21.1548) ** INTERAM Database & Bulletin New Subscribers include: •EVD-Economische Voorlichtingsdienst - Holland •Northwestern School of Law - Portland, OR •Texas Workers' Compensation Fund For information or a free trial subscription, please contact George Arden at 1-800-LAW-FIND. ** Real Estate Financing The Center's Real Estate Financing Committee will meet on April 21st to continue its work studying the use of trust agreements to finance real estate in Mexico. For more information, contact Vince Russo at the NLCIFT. ** Borderland Trade Show 1995 Dustin Jones, assistant editor of the NLCIFT'S INTERAM database, and Virginie Drujon-Kippelen, a volunteer journalist, attended the 9th Annual Borderland Trade Show International Industrial Buyer Technical Conference in El Paso, TX March 14-15. Participants included over 450 border industry professionals, including vendors from the Paso del Norte maquila industry of the Camino Real Corridor (Chihuahua, West Texas and New Mexico). The NLCIFT representatives met with representatives of the El Paso Hispanic Chamber of Commerce, Rebecca Bailey of the University of Texas at El Paso and Coordinator for Borderbase Plus, an online database on economic and social data focusing on the U.S.- Mexico border. ** NLCIFT Press Coverage •Expansion Management "Shipping to Mexico" May 1995 - information from the NACST research •Journal of Commerce March 7, 1995 EDI Bill of Lading •Business Mexico Feb. 1995 - "Reforming the Lending Policy: Legal Changes could Encourage Financing to Small and Medium-sized Businesses" •Traffic World Feb. 27, 1995 - "Little Agreement on standardizing liability under NAFTA; efforts currently stalled". ** Reference Texts suggestions by Francisco Avalos, International Collection Librarian, University of Arizona College of Law Library •Foreign Investment and NAFTA by Alan M. Rugman 1992 •Glossary of NAFTA Terms Martinus Nijhoff Publishers 1994 •NAFTA and the Environment by Terry Lee Anderson 1993 •The NAFTA Guide: How NAFTA will affect you and your Business. by Alan Lederman - U.S. Harcourt Brace Prof. Publ. 1995. ** New Staff The staff at the NLCIFT would like to welcome Keith Rosenblum who will be writing the weekly bulletin, Inter-American Trade and Investment Law. Mr. Rosenblum speaks Spanish and has worked as a reporter covering northern Mexico for the Arizona Republic and the Arizona Daily Star. ** Volunteer and Inter Activities •Denise Coté is a University of Arizona student specializing in Latin American studies and business. She has been assisting with the marketing of the NLCIFT database and plans to continue her internship at the NLCIFT by working with assistant editor of Novedades, Diana Bermúdez, beginning in May. •Virginie Drujon has been contacting media sources about NLCIFT projects, sending press releases and keeping a log of press coverage. ** New Member •Alejandro Salas Franco, México, D.F.