U.S. Customs Bonds
Any corporation, company or individual wishing to import goods into the United States, or engage in other import related activities or operations, is required to post a surety bond or its cash equivalent with the U.S. Customs & Border Protection (CBP). The custom bond, a form of insurance or financial gaurantee, guarantees that the importer of Record will faithfully and in a timely manner abide by all laws and regulations governing the importation of merchandise into the commerce of the United States and is intended to protect the Treasury in case an importer defaults on his debts to Customs.
CBP requires all importers to file an Import Bond in order to clear their imports, even if the goods are duty free.
The bond is designed to protect the Treasury not the importer. The customs bond does not relieve the importer of its obligations or duties. The surety company, by bonding the importer, assumes the same duties and responsibilities of the importer.
In the event the importer will not or is unable to fulfill the obligations imposed on by the United States Government, the surety company will be called upon for payment of the obligation. The surety company has the right of full recovery from the importer for any loss.
Types of Customs Bonds
At the discretion of the importer, the bond form can be used to cover imports on either a single transaction or continuous basis. When the bond is completed for single transactions, the bond covers only one import entry. When executed as a continuous bond, it will normally cover all your transactions at all U.S. ports (excluding anti-dumping and countervailing duty entries).
There are several different types of bonds required for various activities coming under the jurisdiction of the United States Customs & Border Protection.
Activity 1 Customs Bond
Use: They are used for entries for immediate delivery, temporary importations, inbond moves, warehouse withdrawals and or entries, or consumption
For Who: Bond for an Importer or Broker. They are the most common of customs bonds (usually 50,000.00)
Types:
• Single Entry Bond for an Importer or Broker
•Covers a single import entry or used for single transactions
•Continuous Bond for an Importer or Broker
•Will cover most all import transactions at every U.S. Port.
Activity 1a Customs Bond
Alternative name: Drawback Payment Refunds Bond
Use: Bond for Drawback Payment Refunds. This bond allows an importer to obtain a refund of 99% of the duties paid on imported goods upon providing proof these goods were exported.
Types:
• Accelerated Drawback
•Allows an importer to immediately obtain a refund of customs duties paid before customs determines the validity of a claim.
• Same Condition Drawback
•Should the goods be already imported into the United States, and all duties are paid and the goods are not altered in any way, and the product is later re-exported, by obtaining this bond, the importer can claim a refund of the duties paid.
Activity 2 Customs Bond
Alternative Name: Custodian of Bonded Merchandise
Use: An activity 2 Customs Bond covers the activities of bonded merchandise warehouses, bonded carriers, container freight stations, and bonded cartmen. All of these business types are responsible, in the course of their work, for merchandise which has not yet been officially “entered” into the commerce of the United States, and for which duties are still due. Such goods are referred to as being “in-bond”.
Bond Amount: The District Director of Customs, determines the proper bond amount. Such a determination depends on average loads and type of commodities to be in the care of the bondholder. The minimum bond amount accepted by Customs is $50,000.00.
In the event that the bond is not sufficient, customs will advise the importer and the surety company to increase the bond amount to an appropriate requirement.
Activity 3 Customs Bond
Alternative Name: International Carrier Customs Bond
Use: A C3 Customs Bond relates to the clearance and or entry of vessels or aircrafts arriving from outside of the United States. This bond ensures operators properly manifest all goods and passengers they carry, compensate Customs for overtime services of its officers and comply with all regulations related to the clearance of the respective vehicle.
Bond Amount: Customs will dictate what the value of the bond should be. As of 2004, the minimum bond amount is $150,000.00
Activity 3a Customs Bond
Use: Activity 3a customs bond is used to cover the movements and clearances of containers which move internationally. Without this provision each container moved into the United States would have to be entered and duty paid upon entry.
Activity 4 Customs Bond
Alternative Name: Foreign Trade Zone Operator
Use: In foreign trade zones, non-U.S. territory for custom’s purposes, foreign goods may be deposited into such areas to be manufactured, repacked, and or exported without paying duties as mandated by Customs. The Activity 4 Customs bond, required by all Foreign Trade Zone operators, is a financial guarantee to the U.S. Government that the Foreign Trade Zone Operator will follow all rules governing the foreign trade zone. If the Foreign Trade Zone operator does not follow the rules or regulations and if any duties, fines or penalties are levied, the foreign trade zone operator must pay Customs & Border Protection. Should they not pay, the surety company will be forced to pay. Any monies that the surety company pay can be recouped against the foreign trade zone operator.
Activity 5 Customs Bond
Alternative Name: Public Gauger Customs Bond
Activity 6 Customs Bond
Alternative Name: Wool and Fur Products Liability Act
Activity 7 Customs Bond
Alternative Name: Bill of lading customs bond
Activity 8 Customs Bond
Alternative Name: Detention of Copyrighted Material customs bond
Activity 9 Customs Bond
Alternative Name: Neutrality customs bond
Activity 10 Customs Bond
Alternative Name: Court costs of condemned goods
Click Here for our Continuous Custom Bonds Application →
