Customs Bond Sufficiency
Hi, my name is Linda Zyvoloski, Licensed Customs Broker and Senior Customs Associate for GHY USA. Today I want to talk about Customs bond sufficiency.
Since 2002, the Revenue Division of U.S. Customs and Border Protection (CBP) has done the best they can at monitoring Customs bond sufficiency for US Importers. Until recently they have not had full or timely visibility into bond saturation. With the recent transition from ACS to ACE solidified, the Revenue Division now has more reliable data which is necessary to calculate bond sufficiency.
So, how does this impact US Importers and Customs Brokers? With the recently imposed additional chapter 99 duty tariffs for sections 232 and 301, on a wide range of products, there is increased risk, liability and exposure to not only Importers, but also the surety companies underwriting these bonds.
All that being said, it is still the Responsibility of Importer to ensure bond sufficiency under the informed compliance requirements.
By using the Customs Bond Analytical and Bond Reviewer calculations, the Revenue Division has rendered over 3,000 Customs Import Bonds insufficient in the last 9 months, with over 2,000 being issued in the month of September alone.
As a member of the trade, GHY USA would like to make a couple of suggestions to Imports to avoid bond insufficiency and potential supply chain disruption:
- Be proactive. Do not, wait for CBP to issue a bond insufficiency letter. Forecast your import volume and take responsibility for knowing what your potential duty liability and exposure is based on the goods being imported.
- With the high volume of insufficient bonds, CBP is starting to feel less leniency.
- Create an ACE portal account as to ensure full access to the same information that the Revenue Division of CBP and Customs Brokers are viewing to monitor bond sufficiency. Having access to this data will assist in forecasting future import activity.
- If you have your own ACH payment method set up, call your bank and ensure that there are no restrictions that would inhibit Customs from making a withdrawal and if you know you will have a large payment deduction, call your financial institution. It is not uncommon for banks to have limits on the maximum amount that can be paid at one time.
- Ensure all addresses are updated on the Customs bond. In the event Customs needs to send any letters, it is important that they are received, addressed and not ignored.
The US government has established the parameters in how to calculate Customs bond sizes, it is the responsibility of the trade to understand and comply.
For more information see the link below or give GHY USA a call. Our team would happily discuss any questions about bond sufficiency or the implications of sections 232 or 301. We're here to help.
- How to Apply for ACE Account
- Benefits of signing up for ACH Payer Unit Number
- Directive 3510-004 Monetary Guidelines for Setting Bond Amounts