Rule Eight is one of the few instruments that drops an input’s duty to nearly zero without a trade agreement. What it is, who qualifies and how it fits with PROSEC is covered in the Rule Eight guide.
This article is about what happens after you decide it suits you: the filing. And about the detail that derails more operations than any application requirement — one that appears in no brochure:
The permit doesn’t authorize an input. It authorizes a quantity of that input.
The permit is a balance, not a key
This is the part worth understanding before filling anything in.
When Mexico’s Ministry of Economy authorizes a Rule Eight prior permit, the resolution covers specific tariff codes under heading 98.02, for set quantities and values. Every entry cleared under that permit draws down that balance, exactly the way an Annex 24 draws down inventory.
That gives you two ways to lose a permit:
- It expires. The permit has a validity period and the date arrives.
- It runs out. You consumed the authorized quantity before it expired.
The second one is what surprises people. A company that sized its permit against January’s production plan and then grew 30 % mid-year runs out of balance in September — permit still valid, production still running, and the next shipment landing at the general rate. Renewal isn’t instant: there’s a filing in between, and that filing takes time.
The two modalities
Before applying you have to decide the regime the input will enter under, because the permit differs:
- Permanent Rule Eight — for inputs imported permanently and incorporated into domestic production.
- Temporary Rule Eight — for inputs entering under temporary import, typically under an IMMEX program.
They aren’t interchangeable. Requesting the wrong modality isn’t fixed at clearance: it’s fixed with another application.
What the application asks for
The filing goes to the Ministry of Economy through VUCEM, signed with an e.firma, free of charge. What you enter, per input:
- Tariff code and NICO under 98.02 for the input — not the finished product’s
- Description of the goods, specific and consistent with the supplier invoice
- Quantity and unit of measure
- Total value and unit price
- Country of origin or provenance
- Justification: what that input does in your production process
Plus the file behind it: a current PROSEC covering your sector, a description of the production process, and company information.
The justification is the real filter
The hard data validates itself. What actually gets evaluated is the justification, and that’s where applications fail.
What the authority wants to see is a closed logical chain:
this input → enters this process → produces this good → in these quantities
A justification reading “raw material for our manufacturing process” doesn’t close that chain. One that says which component it is, at what stage it enters, how much is consumed per unit produced, and why it can’t be sourced domestically, does.
That last point is the heart of the instrument: Rule Eight exists for inputs not produced domestically in sufficient quantity or quality. If your justification doesn’t address that argument, you’re asking the authority to assume it.
How to size the quantities
This is where you decide whether the permit will last. The math isn’t “what I bought last year”:
- Consumption per unit produced. From your bill of materials, not an estimate.
- Times the production plan for the period the permit will cover.
- Plus real scrap, from your records — not the percentage that sounds reasonable.
- Plus a margin for demand variation. A 15–20 % cushion costs nothing in the application and keeps you from running short mid-year.
- Against the validity period. If the permit covers twelve months, the quantity has to cover twelve months of production, not eight.
Asking for more isn’t penalized; the permit doesn’t oblige you to import. Asking for less is paid for — in duty, or in idled production while it’s renewed.
Why an application fails
The five usual reasons, in order of frequency:
- PROSEC doesn’t cover it. The current program doesn’t reach the input’s sector or code. Check before, not after.
- Misclassified code. The input’s classification doesn’t match the enabled codes under 98.02.
- Generic justification. The logical chain doesn’t close.
- Inconsistent descriptions. What the application says doesn’t match the supplier invoice or what later gets declared on the entry.
- Unsupported quantities. Round numbers with no calculation behind them, which the authority trims or questions.
After it’s granted
An authorized permit isn’t the end of the filing. It’s the start of the control:
- Somebody has to track the drawdowns. Authorized balance, consumed per entry, available. If nobody does, the real balance surfaces the day a clearance doesn’t proceed.
- Reconcile the balance against your entries monthly. Same discipline as Annex 24, applied to a different document.
- Set an alert at 70 % consumption. That’s when renewal starts, not at 100 %.
- Check the description on every entry. What’s declared has to match what was authorized; a description that drifts invalidates the benefit on that operation.
- Keep the permit with each operation’s file. After the Customs Law reform, the documentary support behind every entry is scrutinized harder, and the permit is part of that support.
Checklist before applying
- Current PROSEC covering the input’s sector
- 98.02 code and NICO confirmed against the current list
- Correct modality: permanent or temporary
- Identical descriptions across application, supplier invoice and future entry
- Quantities built from the bill of materials, with scrap and cushion
- Justification that closes the input-process-product-quantity chain
- A named owner for tracking drawdowns
At TradeWay
We assess whether your inputs qualify, build the application with the justification the Ministry of Economy expects, and then run the drawdown control alongside clearance — because the permit and the entry are the same file seen twice. One point of contact, one invoice. If your inputs are paying general duty, let’s check whether Rule Eight applies.
