Highlights of the XI Academic Conference on Customs Law in Uruguay

The 2024 Academic Conference on Customs Law recently concluded in Montevideo, Uruguay, being the eleventh conference held in this country. The theme of the event “Customs Sanctioning Law” focused on the dogma and praxis of customs offenses and the objective of national and international Customs Law. 

Uruguay was able to attract more than 420 registrants, in addition to generating the interest of various institutions such as the International Association of Professional Customs Agents (ASAPRA), the Ecuadorian Institute of Customs Law (EC), the Supreme Court of Justice (UY) and the National Tax Court (ARG).

The opening was led by Gonzalo Lorenzo (Dean of the Faculty of Law of the University of the Republic), Gabriele Gambaro (President of the Association of Customs Brokers of Uruguay) and Andrés Varela (General Coordinator of the Conference).

Fifteen experts from Argentina, Brazil, Colombia and Uruguay discussed general topics of Customs Sanctioning Law, specific aspects of the same and issues of Procedure and Processes for customs offences.

Below are the highlights of each intervention.

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Andrés Varela – “Dogmatic bases of the Customs Sanctioning Law”

Andrés Varela, who is an Adjunct Professor at the University of the Republic, provided a description of the Sanctioning Customs Law, defined as the set of legal norms and principles that regulate the punitive power of the State, with the obligation to guarantee the preservation and restoration of the legal order in customs matters, by establishing sanctions that deter and eventually reward the transgressions that are actually verified, safeguarding, at the same time, the individual guarantees of the subjects to whom said consequence could be imposed. 

Varela stressed its relevance, since the purpose of these rules and principles is to guarantee the preservation of the customs order, safeguarding the guarantees of citizens. 

He also recalled that the sanctioning norms encourage a desired behavior and if it does not happen, the complementary norm imposes the legal consequence. Since the State is the one that imposes the sanction, it is worth recognizing what the guarantees of the citizens are in front of a State in its punitive action. Hence the importance of the principles to limit the actions of the State.

“Although there is only one law, it is appropriate to distinguish between criminal customs law, infraction customs law and corrective or disciplinary customs law,” he explained. He suggested “observing how the same irregular act comes together in criminal customs law and infraction customs law, considering that a limit must be set from the customs sanctioning law because it is only one. 

When discussing the sanction and its purpose, Varela said that “it has a dual objective”, given that, on the one hand, it is dissuasive or preventive (coercively encouraging compliance with certain customs regulations), but it is also retributive or punitive, since when non-compliance with these is observed, the sanction is applied. These concepts apply to both crimes and infractions. He clarified that the duplication of figures to sanction the same act (Crime and Infraction) should be eliminated, and there should be a correct determination.

Varela proposed the standardization of the principles of Customs Sanctioning Law without qualifications and of the subjective liability regime. “The search for material truth must guide Customs Sanctioning Procedures, and it is the duty of the Administration to demand unrestricted respect and caution for the principle of innocent status as a guarantee of protection,” he stressed.

Diego Bianchi Fazolo – “Customs Sanctioning Law: internationalization as the driving force of the 'new' legal discipline”

Bianchi is a specialist in Customs Law from the University of Curitiba (Brazil). He dedicated his twenty minutes to the Brazilian customs system. “Although at the beginning it had a guarantee-based and progressive approach, considering trade as something necessary - hence the basis of the doctrine developed by Eduardo Viveiros de Castro - history has not always aligned with progress,” he said; “Hence, the authoritarianism in Brazilian customs legislation as an impediment to building a reasonable customs dogma.” 

“This has been seen with the concentration of powers by the Executive, which defines and applies customs sanctions, observing a repression of legality and reduction of guarantees by establishing objective liability, reducing the role of the lawyer, establishing the presumption of damage, the reduction of deadlines, finding secret decisions and procedures,” explained Bianchi Fazolo. 

“With these authoritarian bases, the sanctioning customs law remains in force, which brings about local problems such as the case of having in Brazil an Administrative Court that does not disseminate its decisions, does not create jurisprudence; they are secret resolutions, administrative decisions are superior to judicial ones,” explained the Brazilian lawyer. And he maintained that this leads - as an alternative - to resorting to international customs law based on agreed criteria.  

"Legitimate international trade is essential and must therefore be protected in order to change the sanctions system towards facilitating trade," he said.

Juan Patricio Cotter – “Customs infringements: key issues”

Cotter is an Argentine academic dedicated to consulting and litigation related to international trade in goods. His analysis of customs violations began by referring to the Kyoto Convention (WCO) and the Trade Facilitation Agreement (WTO). He said that “the repressive customs issue is the least harmonized and has a local imprint.” Some advances in harmonization are observed in international agreements, although the debate is on whether such agreements are directly applicable norms or need regulations to be put into effect. 

Referring to the Kyoto Convention, Cotter said that the “principle of legality is established. It accepts the principle of typicity – the founding principle of the repressive order – although it does not clarify what it defines as national legislation, and it is where the presence of different frameworks in each country can be observed: some have a Customs Code; others, laws and laws that delegate to the regulatory decree, with the Executive being the one that changes, with which, the principle of legality will have scientific and dogmatic rigor depending on the country.”

He considered that the most complex issue for harmonization is the open standards (known as blank penal standards), linked to the operational regime.

He referred to responsibility, as defined in the agreements. In this regard, he asked what happens with responsibility, given that most countries rely on the theory of removing the guilty, which leads to the assessment that the sanction seems to have a compensatory character. And this contradicts norms of a supranational nature.

As for sanctions, it will depend on the facts and circumstances of the case. Continuing with the analysis of international agreements, Cotter referred to fines, observing that penalties must be applied according to the type of infringement and that their severity will depend on the seriousness of the infringement and the background or - as the Facilitation Agreement refers to - on proportionality, which leads to evaluating whether it refers to the existence of a gradation and not applying flat sanctions. Reflecting on this, these frameworks help us to think but do not define, they are a point to start harmonizing.

Finally, Cotter referred to the statute of limitations and the timeframes of litigation. He stressed that prior consultations can speed up the timeframe. He stressed that the framework of the defence hearing must be based on a legal structure that is sufficient to guarantee the defence in court, with its consequent derivation of the nullity of all actions taken, in the face of such omissions, and then with the right to retain the reported cargo, enabling the release of that cargo not affected by an infringement, with the release having to be protected under the guarantee regime, as contemplated by the Kyoto Convention.

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Lorena Bartomioli – “On proportionality in the imposition of sanctions”

Bartholomew She is an Argentine academic and legal advisor to the Presidency of the National Tax Court. In her theoretical presentation, she analyzed that proportionality does not simply mean applying the same penalty to everyone, but rather adjusting the sanction so that it is not excessive in relation to the particularities of each situation. “This leads us to the concept that something should not be excessive for the purposes of proposing a more equitable justice,” she said.

The measure of what is excessive can vary depending on who is involved. Ultimately, it is the norm - through maximum and minimum scales - that will establish the amount, so that the authority that is going to apply the norm can determine the amount. And this amount will depend on the specific case. In order to do so, proportionality is a principle that requires that the severity of a sanction, such as a fine, be in balance with the severity of the offence committed. Therefore, a sanction should not be more severe or more lenient than the offence justifies.

This principle has a liberal basis. It was one of the foundations of modern criminal law constructed in Europe at the end of the 1789th century and its purpose is to protect individual rights against the punitive power of the administration. Dr. Bartomioli stressed that the Declaration of Man and the Citizen of 8, in the first part of article XNUMX, already states that it is the law that must establish strict - and evidently necessary - penalties and this, in the mention that it is the law that must establish proportionality, gave the doctrine the guideline to ask the question if, by referring to the law, this determines that it is in the head of the legislator when designing penalties in the abstract or also in the head of the sanctioning authority. 

This raises the question of what abstract proportionality and concrete proportionality are. The former is considered to be the one that examines whether the penalty provided for in the law is proportionate, while the latter analyses whether the sanction imposed in a specific case is adequate. Based on this, there are many cases of tension between the two, since the Law can establish a sanction without the possibility of giving the authority room to apply it. Therefore, the sanction may deviate from this principle; this is the case of flat sanctions. While, in contrast to the above, graduation gives the authority more room to apply it to the specific case. 

In order to do so, Bartemoli, when evaluating the proportionality of a penalty, considered that abstract proportionality should be differentiated from concrete proportionality. And then it will be necessary to evaluate the scope of the review and the powers that the judge may have to consider the affectation of this principle, when it is necessary to resort to the analysis of proportionality beyond the concrete. But ultimately, the analysis changes if it is a fixed penalty or margins to apply the proportional sanction. It is very common to apply penalties without analyzing the reasons that led to establishing the penalties from the legislator, on abstract proportionality. Now, with concrete proportionality, what can the judge do? In most cases it is annulled so that Customs can issue a new resolution adjusted to this principle and bases on which the Court reviewed it. But he considers that it would be more advisable for the same judge to address the issue and resolve it, to avoid delays and above the specialty that certain Courts have. But, ultimately, there is jurisdictional control regarding this issue of sanctions and their proportionality. 

Bartomioli stressed that there are international standards that mark a path regarding the proportionality of penalties, such as Article VIII of the GATT 1947 Agreement and the recent Trade Facilitation Agreement. Based on this analysis, he referred to the Argentine Customs Code, alluding to articles 915, 917 and 927, which act as the executing arms of this principle of proportionality. He pointed out that, with respect to the margin of attenuation, the power to apply it should reside with the judge, and not be conceived as an attribution of the administration. Attentive to the application of the principle of proportionality, the judge must have the possibility of adjusting the sanction using this tool. 

"The principle of proportionality lives on its own, it can be supported without resorting to criminal law, observing in Customs Law itself the scope of its corresponding application scheme," he concluded.  

Pablo Labandera – “The legal right protected in customs violations of the 21st century: a new disruptive concept”

Labandera holds a PhD in Law and Social Sciences from Uruguay. He has been Technical Coordinator of the UNITED NATIONS/IDB Program and of the Ministry of Economy and Finance of the Eastern Republic of Uruguay, for the Modernization of the Tax Administration – Customs Administration of Uruguay. 

Based on this experience, Labandera presented a presentation at the Conference on the protected legal asset. He considered that in customs law, customs control acts as an intermediate asset that serves to protect interests of a different nature than fiscal income. 

He pointed out the three basic functions of the protected legal asset. The first is “protective”, linked to a specific time that is the object of protection; when circumstances change, the protected legal asset is modified in some way. The second is “classifying” since it groups the different types of infringements by virtue of the function of the legal asset that is protected. The third is a qualifying function that allows us to know the nature of the infringement. And it is here where the Doctor considered its connection with the issue of tax income, given that there has been a substantial modification with respect to its protection. This has caused various qualitative and quantitative changes that are taking place at an international level. In this sense, he maintained that as of the Trade Facilitation Agreement, it is no longer tax income but legitimate trade that needs to be protected.

He also explained the process of deglobalization caused by the growth of preferential trade agreements (more than 600 agreements signed by the WTO), which has been delocalizing trade and generating the need to establish a regime of origin that avoids breaching the common external tariff. “These consequences lead to the review of tax revenue as a protected legal asset.” 

Claudio Augusto Gonçalves Pereira – “The practical nature of under-invoicing in customs matters: axiological approach and case analysis”.

Gonçalves Pereira is a lawyer with a Postgraduate Degree in Tax Law from the University of São Paulo (Brazil). He spoke about the under-invoicing in customs matters. In his opinion, Brazil is experiencing a period of construction in terms of customs law.

Based on this premise, he then went on to address issues relating to the treatment of under-invoicing. Brazil has no customs regulations, therefore customs fraud is not regulated. 

When a person chooses to import a product, he must pay for certain goods; when it arrives under-invoiced, he falsifies a physical invoice, thus observing a maneuver between the importer and exporter to circumvent customs control. On the other hand, he indicated that, when other aspects arise, classifications, etc., if there is an indication to get to the specific issue, the production of evidence is limited. This is a big problem for Brazil, regarding the strength of the burden of proof, but we agree that it is the duty of the State to allow the right to prove. In order to do so, arbitrary actions appear, to which must be added that the Administrative Court has no jurisprudence and the lack of judges who know about customs law.

He stressed that there is a money laundering mechanism within under-invoicing that impacts customs itself. Within this set of situations, the question is: How can we reconcile this with international agreements, especially those on trade facilitation?

He concluded with the need for a dogmatic construction on the import declaration, more repressive customs control and modern customs.  

Harry Schurig – “Design and implementation of customs sanctions. Comparative analysis with the rules of Criminal, Tax and Administrative Sanctioning Law”

Schurig is a lawyer specialising in tax law, with a Master's degree in Finance and a postgraduate degree in Customs Law and Integration. His analysis of the design and application of customs sanctions began with the differentiation between crimes and customs infringements. "The question is whether or not they have the same ontology."

Although it seems that this issue has been overcome, it is still taught that these are different situations, justifying them on the subjective aspect, fraud, fault, or on the protected legal asset. Both tax and customs law are observed, the latter in comparison with art. 863 and art. 947, which speak of smuggling as a crime or infraction. It is also used to differentiate the seriousness of the offense, which is ambiguous, with respect to who applies the penalty. 

It is accepted that they have the same nature and the Court is responsible for repeating it over and over again. Highlighting the ruling Alpha Shipping, They continue to be taught as if they were separate issues. And there are manifestations that differentiate them primarily in terms of the attenuation of the principles of criminal law to the area of ​​infractions, such as the attenuation of the principle of legality, the principle non bis in idem, the presumption of innocence, the prohibition of analogical interpretation, among others, leading to a attenuation of their application in the area of ​​infractions. 

Schurig also stressed that this attenuation is observed with the insufficient broad review of the jurisdictional Courts, which appears in the Tax Court, since it does not have a possibility of broad review, to the extent that the individual has not provided evidence in the administrative instance. Another attenuation is the double instance, the existence of reflected responsibility and blank criminal types, as occurs in art. 995. The crime of smuggling itself, where it is not entirely clear but is fed back by requests for control made by other agencies with respect to customs, objective responsibility is not a minor issue but also a substantial aspect. 

He then focused on two issues; the first, proportionality in the sanction. In principle, it is noted that -for the application- the penalties are not determined in a minimum or maximum amount, as occurs in the Argentine tax procedure system. In customs matters, the penalty is linked to a criterion that resides in the value of the merchandise, the amount of the taxes, or the foreign currency that should or should not have left the country. In this regard, Schurig pointed out that in this way the penalties do not need to be updated, the problem is whether this way of setting the fine is constitutional.

The second issue concerns the presumptions and fictions that apply to tax matters in Argentina. On this matter, he illustrated with the Hermitage ruling, determining that these presumptions imply an inequity of the reliable verification of their existence, because the presumptions must be limited to specific cases and the impediment of proof to the contrary violates the principle of reasonableness of Art. 28 of the Constitution. Customs law has tax fiction as its basic pillar. This can be seen from the fact that the Customs Code, without admitting evidence to the contrary, considers that a taxable event occurred, highlighting Art. 142 inc. 2 of the Customs Code -lack of discharge-, the same occurs in other cases and situations as noted in articles 151 p.2; 157 p.2; 164 p. 2; 211 p.1; 274 p.1,;293 p.1; 310; 311 of the Customs Code. 

The autonomy of customs law is a necessity, since it prevents the forcing of the institutes of tax law. The lawyer highlighted the doctrine in the ruling on Materia Pampa when applying the transfer rules to determine the value of a customs export operation. In establishing the opinion, Attorney Monti stated that, from the parliamentary debates of Law 25784, there is no expression that allows inferring the intention of the legislator to integrate customs legislation with prescriptions on transfer prices of the law of profits, much less that it was intended to displace the provisions specific to the customs field such as the valuation rules that the Customs Code regulates regarding export duties.

In this regard, Schurig indicated two options: we have a large number of norms that are unconstitutional or we accept that customs law has full autonomy, and that these variants contained in customs legislation derive from the very nature of the specific operations that it is trying to regulate. “We are in a hurry for customs law to be fully recognized as an autonomous branch of legal science.”

 Juan Pablo Rizzi – “The guarantee of a reasonable period and customs offences”

Rizzi is Director of the Diploma in Customs Law at the Catholic University of Córdoba. At the conference, he presented an analysis of an old and important topic: the guarantee of a reasonable period of time.

He highlighted the advantages of the Argentine Customs Code, such as its duration, given that in Argentina there are variations in different aspects. But he acknowledged that this fact has concepts of time and consequent tools that are from 1982. Obviously, certain tools that are currently presented were not observed; which leads to the need for the interpellation to be harmonized with a reasonable term.

The guarantee of a reasonable period of time is the right to timely jurisdictional certainty, respectful of due process and the right to defense. It is not about issuing quick sentences or resolutions, but rather it will be an aspect of the right to defense, which, according to the system of each country, is expressly recognized in the Constitutions of Bolivia and Brazil and implicitly in Argentina and Uruguay.

The importance of this guarantee is, on the one hand, individual, since it allows the realization of human rights, and on the other hand, social, to the extent that, if it is fulfilled, there will be public confidence in the judicial system and if this happens, the rule of law can be upheld. And what is particular about it in the field of customs law and customs offences? What is meant by the fact that there is a double standard, understanding that in customs and commercial law legislation, application has to be rapid due to different circumstances generated by international trade, and often a greater overriding of the functions of Congress by the regulations is admitted or tolerated as a consequence of this cause.

The violation of this guarantee will affect the individual and, in the case of illegal acts, as the Supreme Court of Justice maintains, it will affect the dignity of the accused. In the precedent, Mattei maintains that every person has the right to free themselves in their own time from the state of suspicion that the accusation of a crime implies. But it also affects the facilitation of trade, observing that in the Trade Facilitation Agreement one of the functions is to reduce trade costs, focusing this cost measurement on the pre-release stage. But the Agreement says nothing about post-release costs, where there are situations in which, faced with a specific conflict hypothesis, a guarantee must be used to release the merchandise and there is a risk of breaching the reasonable period, with immeasurable costs, and this guarantee must be maintained until a final resolution is issued or the action expires, further aggravating cases in which subordination is applied. In short, instead of facilitating trade, it actually prevents it, with consequences that result in an increase in liabilities that imply harm to the company. 

Thirdly, the infringement of this guarantee - a reasonable time frame - attacks the integrity of the penal system, because if it is not resolved, there would be a great increase in the impunity of those who commit crimes. And if a conviction is reached but with a long time gap between the act and the punishment, the sanction loses its effectiveness.

Rizzi said that at the regional level there is the American Convention on Human Rights, which covers all legal matters, requiring that this guarantee give rise to rights of any nature, including customs law. 

He also referred to the European Court of Human Rights, which has established that the application covers the administrative instance and the start of the calculation begins from any act that substantially affects the situation of the accused, and ends with its execution. And it establishes the State's duty to organize in order to comply with this guarantee.

The guarantee should not be considered in the abstract, but rather on the basis of the specific case and should be evaluated on four aspects or factors, considering then the factual complexity of each case, the conduct of the accused in order to observe if there are no delaying actions, the conduct of the intervening authority, taking into account that it must have due diligence in the process, and finally the situation of the accused and the merchandise.

Solutions can be found: one is the full reparation of the damage, to the extent that the legal asset is eminently patrimonial, highlighting Res. Gral AFIP No. 5/2024 which establishes guidelines for this figure that has its normative source in Art. 59 inc. 5 - principle of opportunity - and 6 - reparation of damage - of the Penal Code, Art. 30 of the Federal Penal Code. Another way would be the hearing of Art. 1151 of the Customs Code, making it possible to reach a point of negotiation between Customs (DGA) and the parties, with the criterion of opportunity of Art. 59 of the Penal Code, remembering that customs violations have a criminal nature. To this is added the possibility of carrying out the procedures, as could also be the introduction of arbitration, observing that this figure appears in the recent regime called RIGI, on large investments, providing that the violations have a criminal nature and may be subject to arbitration.

In conclusion, Rizzi said that the reasonable time period can be assessed specifically, taking into account the circumstances of the case, the accused and the goods. The determination that a process has generated an unreasonable time period is inappropriate, because there are two interests at stake: the individual and the social. And only the individual is covered by declaring the extinction of the criminal action, and the social is relegated. Consequently, work must be done on the means necessary to achieve this social interest, verifying whether it is reasonable to have actions that prescribe after five years, their acts of interruption or suspension and, finally, analyzing alternative measures.

Raúl González Berro – “Jurisdictional control of tariff classification in customs processes”

González Berro is Academic Director of the International School of Foreign Trade and Customs in Uruguay. His analysis began with an observation about merchandise. According to him, “legally, all merchandise has a tariff position.” This presents a problem, because in practice this is not the case. These types of discrepancies are even noted among Customs authorities, which is why “the WCO has a Harmonized System Committee to harmonize criteria.” 

The academic also referred to customs violations. In Uruguay, the Judiciary determines them, with the exception of the violation of contravention. Here, the taxpayer must go to the Judiciary. And it is then that the Courts have proceedings in which the correct tariff classification turns out to be part of the object of the trial.

There are two situations. First, before the conflict occurs, there may be administrative resolutions referring to the alleged classification. The second occurs when there is no resolution and the conflict occurs when a customs control is carried out.  

Berro then clarified that Customs is not responsible for classifying goods and establishing mandatory classification criteria. “In Uruguay, binding consultations have existed for a long time, the only thing that has changed is that silence has been given a positive value,” he said. He also highlighted that Article 264 of the Customs Code provides for a Classification Board. 

The question is whether they are administrative acts. And taking into account that in Uruguay it is held that administrative acts do not bind the judge, who can disapply them if he considers them illegitimate, the classification criterion is not obligatory; the judge must evaluate, and therefore has the duty to analyze, the tariff classification.

The problem arises, the Classification Board is convened because the question arises: what character does the Board have? The proceduralists estimate that it cannot be considered as an expert opinion, arguing that the expert must essentially be impartial with effect for both parties, so having an interest forces one to recuse oneself. The Customs -which is part of the Classification Board- shows that there is an interest, they are not impartial third parties. The doctrine says that it is a technical opinion of an organ, which must be evaluated.

There is no control over the expert opinion; when the judge is faced with an issue and considering that he is not a specialist in classification, he ends up following the position of the Customs, which leaves the party in a state of defenselessness, this being the first problem. And the second, that these grounds are based on rules 1 and 6, limiting themselves to that. Therefore, if it is an administrative act, it would be null due to lack of grounds, and if it is considered as an expert opinion, it would not be admissible because it does not explain the reason, therefore, invalid.

Classification is a technical procedure, but regulated by the harmonized system. When classifying, it is essential to know the goods, which is a matter of fact, i.e., possible to prove. After knowing the product, arriving at the classification is purely legal. Based on this, taking into account that judges are lawyers, there must be a minimum capacity to review the issue through analysis, which leads the judge to be able to carry out a review of this issue. Despite the lack of specialization of the courts, it is possible to make a correct application to define.

The Board's opinion means that the judge will not deviate from this decision. However, he should consider that the grounds for such a decision are not met.

In closing, Berro said that "the issue is to see what happens if the judge does not analyze the issue and leaves the citizen defenseless. By not doing so, he subjects individuals to the opinion of Customs. This creates uncertainty, when in Uruguay it is considered to have broad legal security, but on this point there is no such thing. This uncertainty totally conspires against investments."

Christian González Palazzo – Reflections on the infraction procedure in Argentina

González Palazzo, who works as a Judge in the National Tax Court, opened his presentation on the “inquisitorial model of Customs” because the Justice intervenes for crimes, but Customs does so in violations, becoming judge, investigator and party.  

With this approach, González Palazzo developed the legality control. The criminal action prescribes five years after the event, “which is not exactly the case.” In reality, there are five years to instruct the summary, thus generating another five years for the statute of limitations to expire. In addition to this, the instruction order of the summary also requires the suspension of the prescription of the tax authority to pursue taxes. In Argentina, until not long ago, there was an interest rate on imports that reached 36% in dollars. 

On this subject, he reminded Enrique Barreira, who had pointed out to him the dysfunctionality of the customs officer; that is, all these deadlines are reasonable in matters that are complex to resolve. “The time set is not the rule, it is the exception.”  

The lawyer also argued that this distortion of the legislator's intention leads to the prolongation of the proceedings, which "generates harm to the subjective rights of the taxpayer and the country." 

The Tax Court is seeing cases that have been going on for 15 years. This is a “warning.” There is a delay in the process at the mercy of the tax authorities. On the other hand, it is noted that fines, when imposed in pesos, are depressed. In light of this, the question is: “Is non-compliance being encouraged?”

Based on this, González Palazzo developed “the reasonable period”, based on article 75, paragraph 22 of the National Constitution, which incorporates International Treaties, with constitutional hierarchy. In this regard, the Inter-American Court of Human Rights provides guidelines. 

Within the “conventional guarantees” appears the ruling, which must be contextualized within a reasonable period, which determines whether there was an abuse by the State in the issuance of a resolution. 

When we talk about “conventionality”, we must consider that there is an obligation to exercise such control. The bodies must carry out conventionality control. But the Chambers, which control, consider that the Tax Court does not have such power to exercise constitutionality control, but here the conventionality control is being carried out.

He concluded with an optimistic view that the discussion will allow for the enrichment of customs law. 

Flavia Figueredo – «Guarantee of the administered before the Customs Administration and Justice«

Figueredo is an assistant professor in the undergraduate course on “International Trade” at the University of Montevideo. She opened her presentation by quoting a book by Dr. Daniel López Rosetti (physician) that refers to the way of thinking, how decisions are made, distinguishing between fast thinking, which is more mechanical, intuitive thinking, which allows for functioning, while on the other hand there is slow thinking, which occurs with deep reflection, with greater analysis. And it is then that we observe that biases appear in thinking.

He stressed that he thinks: “Law is learned by studying but it is exercised by thinking” (Eduardo Couture). Thought is not pure thought, it is also intelligence, intuition, sensitivity and action.

From this, he went on to discuss examples of biases that have to do with customs practice, pointing out the formal bias, when observing a certificate of origin due to a formal error, which generates an entire process, instead of evaluating what the type of infraction requires. The fiscal bias, applying in certain cases (e.g. expiration of deadlines by the Public Prosecutor's Office) considerations framed in sanctioning law, and making a restrictive interpretation prevail over the general interest - fiscal income - over the form, omitting guarantees of the administered. The consequence of the biases is, precisely, the elaboration of the entire legal basis around what we already concluded in the first instance, instead of making a slow thought process, leading to the bias permeating it and not allowing something different to happen.

In this way, Dr. Figueredo warned that there is no guarantee without respect for basic principles. Among these, she considered three as important, which she knew how to choose because they are the core of rights and duties. She pointed to the State as guarantor; on the other hand, without them, the other principles, norms and developments have no meaning and also represent the need for the absence of bias.

Starting from the state of innocence, he clarified that it is not a principle, but a state, which implies the absence of bias. If one starts from this, the reasoning on the analysis of guilt will be free, rescuing different articles of the Constitution of Uruguay that recognize it, as well as the definitions made by Dr. Luigi Ferrajoli. 

He then elaborated on the principle of legality, both objective, in which lies the duty to provide guarantees acting as a counterweight in the imbalance facing the exorbitant powers of the Administration, as well as legality in procedural and judicial activity, where it must be observed that the processes are regulated by law, and exclusively by law, not by norms of lower hierarchy or by judicial discretion. He added that objective legality is noted with impartiality, which is structural in the absence of specific interest in the object of the process, and functional, which has to do with independence, in order to manage the parties under a framework of equality, which leads to greater relevance when the State is also a party to the process. 

He then referred to the effects of what the use of artificial intelligence (AI) may bring, considering that in the analysis of the rules there are principles and values, where it will be noted that AI has not yet been able to reach them. He added that, if in his case, something is decided by AI and there is an appeal review, AI - acting in this second stage - would give us the same result.

In conclusion, the effective implementation of guarantees ultimately depends on the moral system and values ​​that underlie the rules, justify us as human beings and differentiate us from AI. It drives us to do the right thing, which, first of all, is to do what we should. It is the duty of the State, in any of its functions, to recognize the state of innocence of those under administration and, to ensure it, to observe the principle of objective legality and impartiality. 

Figueredo concluded with a quote from Winston Churchill: “A man does what he must, despite the personal consequences, despite the obstacles, dangers and pressures, and that is the basis of human morality.”

Marcelo Sica – «Issues that must be resolved in the Knowledge Process by Customs Violations in Uruguay«

Marcelo Sica is a founding partner at the Uruguayan Institute of Customs Law. He dedicated his presentation to the problems that arise in processes where there is a lack of guarantees, for different reasons. 

He explained that the customs process in Uruguay is regulated by the Code (CAROU). This framework determines that the process -except for the violation-, is carried out before the Judicial Branch, from beginning to end.

Sica noted some obstacles in the preliminary hearing. The first problem is that the law establishes that the person being investigated may appear without legal assistance. This framework should be reformulated, changing where it says “may” to “must.” 

The second is that at the end of the preliminary hearing, the Public Prosecutor's Office is given a request for a summary or closure, and the Public Prosecutor's Office requests the instruction of a summary and the accused is given a hearing. This hearing is not expressly established in the CAROU, but the court, in order to safeguard the guarantees of defense and the principle of equality, carries it out. Here there is a contraction, since when the Public Prosecutor's Office requests 10 days to study the issue and then decides to request the instruction of a summary, the accused is not given a hearing. Likewise, Sica said that there are processes where those 10 days expire and the Public Prosecutor's Office does not respond, without there being any type of sanction regarding non-compliance, which would not happen if the party forgets to comply with a deadline.

Another important issue - continued the speaker - and which is not given importance within the process, are commercial operations or value reports, where it is observed that values ​​are established that exceed double in comparison with the market, as a result of adding values ​​that do not correspond and which lead to determining calculations of taxes on a base value that is not correct. He highlighted: "The process does not have a stage that allows to dispute commercial operations, and therefore it must be decided to open an incident for the treatment of this issue. But in various cases, it may be seen lacking a resolution, considering the judging authority that it must wait for the final sentence and, if necessary, oppose the liquidation, which is nothing more than the update of these commercial operations." He added that taxes are calculated at a higher percentage than due, which generates the need to establish a regime so that it can be opposed, through the review of commercial operations.  

Continuing with the violations of guarantees in the proceedings, Sica pointed out the one corresponding to the sole instance, an aspect that has been attempted to raise as unconstitutional, which brings about a serious situation when observing sentences that have no basis whatsoever, reduced to a sheet of paper without knowing the reason for the decision to condemn. He warned that the same happens with the appeal of the evidence, being reduced to a deferred effect, which leads to the appeal not being relevant in the face of a conviction that is resolved without that evidence. On the other hand, he referred to the preparation and its effects as another problem that impede the exercise of defense, considering that, if there is an -administrative- preparation of the fact constituting the infraction, the Public Prosecutor's Office is notified and then a sentence of conviction is issued. This rule should be repealed. 

The third issue is the difference in treatment regarding peremptory deadlines for the Public Prosecutor and the parties. Here, the principle of equality is affected, since in the event that the Public Prosecutor does not respond within 30 days, it is established that the subrogation will be passed on to the person who is substituted and will have a new equal deadline. While the party clearly does not have temporary extensions of this type; on the contrary, if they do not comply, the peremptory deadline will be applied. 

Sica also highlighted customs violations, which must be classified as fraudulent or negligent, an issue that is often omitted at the time of sentencing. This is seen to be relevant in order to request a reduction in fines when the offence is committed out of negligence. 

Additionally, Sica highlighted the problems generated by seizure measures. Thus, he concluded with some proposals: 1) Celebration of payment agreements after the sentence; 2) Existence of a norm authorizing the Public Prosecutor's Office to suspend or cancel or force the party to pay the levies. 

Francisco Menéndez – “Three relevant issues regarding customs violations”

Menéndez is an Argentine academic who began his career at the Argentine Tax Court and has a long career in the practice of law. His analysis began with a question: how are guarantees implemented? He responded that this must be implemented with nullities in the absence of them in the process. 

Based on this statement, the academic highlighted that the offender is entitled to the guarantees of criminal law, an aspect that has been recognized by the Supreme Court of Justice itself. He recalled that the summary is a procedure before the customs administration. Here he observed that Customs judges, but occasionally the summary deals with issues that do not comply with legal precepts. He referred to the administrative act called "order to open the summary", which has the effect by Law (Customs Code) of interrupting the prescription period. This administrative act, at least until Decree 70/23 that came into force on December 29, 2023, was not required to be notified and this led to situations where after the order to open the evidence, an excessive period of time elapsed to reach the hearing, an act by which the offending party is informed of the charge. He warned that when the prescription period is interrupted, the deadlines are extended. Furthermore, this administrative act could have flaws due to non-compliance with the requirements established by law; when it reached the reviewing courts - the Tax Court - the theory of correction was initially applied. He considered that this type of issue has changed and these acts began to be annulled, consequently, the statute of limitations began to apply. 

Menéndez said: “The administration must be an example of thoroughness.” 

Another point developed was “the reasonable period”, which the Court, at some point, decides should be applied in the event of an excess of the period, analyzing the specific case, its complexity, the activity of the administration and also the conduct of the administered party.

The academic mentioned the issue of evidence, recalling that the Court ruled in an infringement case that it had not been proven whether there was an inaccurate declaration and that - according to the law in force - it must be proven, not validating that the burden of proving that he did not incur in such inaccuracy and of that difference is placed on the importer; and if something else is intended, it is the legislator who must provide other terms. 

He concluded by saying that these changes warn that battles must be fought in order to achieve these results, so we must not give in and try to pursue the principles, the concepts that are positive and that the rules are complied with. Enough has been given in accepting by praetorian means and allowing the administration to judge what has been established by the Court, but only if there is a sufficient and broad judicial review, in fact and in law. If we do not give in, the jurisprudence may be different at one time or another. “It is the duty of Justice to resolve questions that deal with classification; even when they are technical questions, they must be the subject of a decision by the Judicial Branch. In these cases, the Administration must comply with these judicial decisions,” he said.

Noel Lascano – “Suspension of operating as an importer and exporter: current debates in Argentina”

Lascano is an Argentine lawyer, specializing in Customs Law and Foreign Trade. She closed the event with a presentation on the suspension of operations as importers and exporters, a topic that has generated certain debates since Decree 70/23. 

The specialist referred to two axes of analysis: “first, the suspension for serious violations in the exercise of their activity, which is still applied after a disciplinary investigation. Second, the suspension for non-payment of fines and/or taxes, which customs historically applies in the event of non-payment, but continues to apply despite the changes in the aforementioned decree.”

He argued that this type of suspension implies the impossibility of requesting assignments, operating, and jurisprudence has maintained that it compromises the right to work, to trade, to exercise industry, which are constitutional rights: "Therefore, certain care must be taken before its application."   

She was critical of the measures, saying that before Decree 70/23 there were “Registry” and the rule determined the need to enter these registries to act. But with Decree 70/23, this is deregulated, leaving this type of registry without effect and enabling the request for customs destinations and carrying out foreign trade operations without the need to register in any registry. She clarified that although the registries have been eliminated, what is called the “Profile” of importers and exporters has been established, a simple procedure that requires not having a criminal record and having some tax obligations. 

Lascano also referred to how the suspension operates in the face of the modifications brought by the decree, because these "registries" of importers and exporters are no longer kept. Thus, when referring to the suspension for serious violations in the exercise of their activity, before the decree there were two clear rules: articles 97 and 100 of the Customs Code (CA): both allowed Customs to suspend up to two years in the face of certain situations. Now, Decree 70/23 repeals Art. 97 of the CA, but maintains the sanctions referred to in Art. 100 of the CA, with some changes. Namely: the warning and the suspension are maintained, but this period of up to two years is removed and it is clarified that the suspension is the prohibition to carry out foreign trade operations. In addition, by leaving the registries without effect, the sanction of elimination is not maintained, which is consistent. 

In light of this, the lawyer specializing in Customs Law noted that in all cases the corresponding procedures must be followed to allow for defenses. She objected to maintaining the suspension in the figure of Art. 94 of the CA - on repeated misconduct or serious offenses - for legal persons. In her words: "Will these suspensions be applied from the moment that there are no longer records or does the elimination of records leave this type of sanction without factual support? If the answer is affirmative, will they only be applied to foreign trade operations or do they also affect customs destinations that are not mentioned among operations and destinations?"

In question, he raised: "How will these suspensions be applied, since the records no longer exist? In short, there is a practical problem." And he added the last question referred to, to the defense of that subject who ends up with a sanction of this type when it is not provided for in Art. 94 of the CA. 

He completed the statement with a recent ruling by the Federal Administrative Litigation Court (22.4.2024) of Court No. 12, when the interested party -administrated- requested that the sanction -suspension- not be applied by requesting a precautionary measure, in order to protect the appeal that is being filed against this customs decision. The Customs, in response, maintained that the issue becomes abstract, since the Records had been eliminated. Based on this, the judge takes this statement from the Customs and considers a pronouncement on the precautionary measure required by the Company to be insubstantial, recognizing the modifications brought by Decree 70/23 by resolving to reject the precautionary measure and declare the process terminated. She added a Legal Opinion from the Ministry of Economy, agreeing with what was referenced in the court ruling, stating that in the absence of a current legal interest in the opinion of that legal service, the appeal (before that Ministry) would have become abstract due to the regulatory change that took place. Additionally, the speaker disclosed a ruling of July 4, 2024 from the Federal Administrative Litigation Chamber, which although it does not refer to the Registry of Importers and Exporters, it does refer to the Registry of Customs Brokers, which was also eliminated by the aforementioned decree, resolving the issue as "abstract."

In explaining the suspension for non-payment (Art. 1122 of the CA), Lascano said that “after the elimination of the registry, there is no doubt that this Art. 1122 of the CA is left without factual support.” She clarified that reality does not support her in this thought, given that importers/exporters continue to be suspended and this measure is reflected in the Malvina Computer System (SIM), a system that enables the registration of customs destinations, thus resulting in an “operational blockage.” Customs justifies this action on the grounds that Art. 1122 of the CA has not been repealed and on the “Profile” that has been created.

After a detailed statement, Lascano argued that Customs continues to apply suspensions despite the elimination of the “registries.” He clarified that with respect to those imposed by Art. 94 of the CA on legal persons, which was not repealed, it allows Customs to not allow foreign trade operations to be carried out, as well as to apply preventive suspensions, which will cease in the event of a guarantee to be constituted to the satisfaction of Customs. On the contrary, Customs could not apply suspensions for non-payment, without thereby violating these principles that have been referred to. 

“Decree 70 raises doubts and merchants need clear rules: to know what is punishable, what the sanction is. This is to contribute to legal security,” he concluded.