LEGAL STRATEGY
costs than the fines, and that the trial could have taken much longer that the original PAMA, the manufacturer believed it had fully complied with Mexico’s import laws. It had evidence of its compliance and decided to appeal to safeguard its reputation. Therefore, in April 2018, a year after the first inspection, the manufacturer filed a complaint before the Administrative Court to initiate an annulment trial. The final verdict After almost six months of trial, the Administrative Court ruled that the PAMA was filled with inconsistencies and that the gaming machines were legally introduced into the country. The Administrative Court annulled the fines imposed by the MFT to the manufacturer and ordered that the gaming machines were immediately released. Why did the manufacturer choose to appeal? The answer seems simple, but it carries a deep meaning: any gaming manufacturer – especially those with a global presence – is subject to great scrutiny over its conduct in any jurisdiction; therefore, it would have been absolutely detrimental to set a negative precedent by the acceptance of guilt when, in fact, the gaming machines were legally imported. Appellate attorney, Donna Bader, has written that “there are three major standards of review for appeals: legal error, abuse of discretion, and substantial evidence. An appeal could involve a combination of these standards” . A clear legal error occurred when the MFT seized the gaming machines without giving the manufacturer the option to pay a guarantee for the taxes alleged to have been evaded. As is clear from the facts above, the seizure of the goods, at least in this case, was a precautionary measure, yet it was treated by the authority as a sanction. Now, was there an abuse of discretion?
Unfortunately, everything seems to indicate that this was the case. The evidence provided in the case showed that some MFT officials could have acted maliciously during the inspections by removing the labels that were stuck to the gaming machines; the above, to “justify” the seizures and sanctions. Finally, the evidence presented was substantial as the manufacturer was able to demonstrate that the gaming machines had been legally imported. All the paperwork was complete, including the importation documents, the commercial invoice and the certificates of compliance with all the applicable Mexican Official Standards. Conclusions Even though today most countries in the world are governed under the rule of law, acts of authority – in whatever form they occur – are not extent from error nor misjudgment, and in worst cases, abuse. In the specific case of Mexico, as our legal system acknowledges the rule of law, it is possible for every person or entity to appeal or contest acts of authority. However, just because every person has the right to appeal, not every decision is appealed because sometimes it may be easier and less expensive not to. At other times it takes more than solid argumentation, strong evidence or even courage to appeal. In the gaming industry, reputational aspects and good practices are a determining factor in whether to appeal or not to appeal. The Tamaulipas file is a perfect example of when it does make sense to appeal. Not only in order to avoid the economic damage resulting from the payment of fines and the loss of the gaming machines, without a cause, but also in order to set limits on the discretionary acts of the authority and safeguard the rule of law.
ALFREDO LAZCANO Chair, Lazcano Sámano, Mexico For information contact aab@lazcanosamano.com +52 55 5292 0065
ANDREA AVEDILLO Head of Legal,
PAGE 48
IMGL MAGAZINE | OCTOBER 2023
Made with FlippingBook flipbook maker