hether you’re new to the world of import or have been involved in the industry for some time, the idea of obtaining a Customs Bond can be intimidating. We get lots of questions about what customs bonds. What are they? Why do I need one? Where can I get one? We put together this guide to help answer these questions and give you more confidence when importing goods into the United States.
What is a Customs Bond?
A Customs Bond is a type of surety bond required by U.S. Customs and Border Protection (CBP) to import goods into the United States. The purpose of the bond is to ensure that CBP is paid duties, taxes, penalties, and other charges assessed on imported merchandise or any other monies owed to the U.S. government by an importer. A Customs Bond also protects the U.S. government from any losses arising from imported shipments that do not comply with CBP’s regulations, such as those involving:
- Counterfeit products
- Unauthorized delivery of prohibited merchandise
- Fraudulent commercial transactions
What are the different types of Customs Bonds?
The type of bond you need depends on how frequently you import goods into the U.S., what type of merchandise you import, your financial situation, and whether or not you want to use a customs broker to assist with clearing your merchandise through customs. There are two types of customs bonds that you can opt for:
Single Entry Bonds
A single-entry bond (SEB) is used for a one-time shipment imported into the U.S. It is valid for only one entry, so if you’re importing more than once, you’ll need to apply for a SEB each time you bring in merchandise. That can be expensive and time-consuming, so many importers choose to apply for a Continuous Import Bond (CIB). Single-entry bonds are used for shipments valued at over $2,500 but less than US$ 50,000 duty value (or shipments of specific types of cargo).
A Continuous Import Bond (CIB) covers multiple shipments over a period of one year and can be used at any port of entry in the country. Although it has a higher face value than a single-entry bond, there are no additional costs associated with each shipment.
If this is your first time importing goods into the United States and you have no history with CBP, you will likely need to post a bond with a single-entry limit to import your goods.
Is a Customs Bond mandatory for U.S. imports?
Customs bonds are required for all shipments valued at more than US$ 2,500 imported into the U.S., whether shipped by ocean freight or air freight, from one individual country or multiple countries. Whether you’re importing goods for personal use or resale, it is also mandatory.
There are exceptions to this rule, such as gifts and personal effects. There is also an exception for goods imported under a Temporary Importation Bond (TIB).
What is the cost of a Customs Bond?
The cost of a U.S. customs bond is based on the bond type and value of the goods you import.
- A single-entry bond is the total value of your imported goods and must include all duties, taxes, and fees – with a minimum bond value of US$ 100.
- A continuous bond is calculated at 10% of the total taxes, duties, and fees that you have paid in the last year (or estimated total for the coming year) – with a minimum bond value of US$ 50,000.
Where can I get a Customs Bond?
There are several ways to obtain a customs bond. You can purchase a customs bond directly through a surety company or a licensed customs broker that collaborates with the surety company and obtains the bond on your behalf. If you’re new to the international trade industry and aren’t familiar with the importing process, it’s best to work with a customs broker to help you identify the best type of bond for your shipment.
In either case, every importer must first fill out an application for a single-entry bond or continuous bond. The application will ask for information about your business, what you’re importing, how often you plan to make shipments, and your products’ country of origin. There may also be questions about where your shipments will enter the U.S., whether they require special certifications or permits and if they’re subject to antidumping duties.
Want to inquire about Customs Bonds and fast-track your imports into the U.S.? Book a meeting with one of our U.S. Import Specialists to get a bond and clear your shipments through U.S. Customs today!