Top 7 things you should know about customs bonds in 2024

In the realm of international trade, a customs bond serves as a silent guardian, ensuring the smooth flow of goods across borders and protecting the interests of both governments and importers. For medium and large businesses in the US, understanding the role of customs bonds is crucial for successful and compliant import operations.

Put simply, a customs bond is a legal agreement between three parties:

1. Importer– is responsible for fulfilling import obligations.
2. Surety– a company that guarantees payment to Customs and Border Protection (CBP) if the importer fails to meet their obligations.
3. CBP– the US government agency responsible for regulating imports and collecting duties.

While customs bonds serve as a protective measure, it’s important to remember that they come with financial liability. If you fail to meet your import obligations, such as paying duties or complying with regulations, the surety may be required to pay CBP on your behalf. This could lead to claims against you or your business

Generally, if your business imports goods:

• For most commercial shipments valued at $2,500 or more, a bond is required. However, exceptions exist for certain types of goods or frequent importers with continuous bonds.
• Required for importers without another valid continuous bond covering ISF or using Single Transaction Bonds (STBs) for each ISF filing. The minimum amount is typically $50,000, but the port director can set a higher amount based on risk assessment.

A customs bond is required to secure their release from CBP custody. This ensures that duties and taxes are paid, and regulations are followed.

Beyond financial obligations, customs bonds also play a role in ensuring compliance with various import regulations, such as:

• Intellectual property rights enforcement
• Anti-dumping and countervailing duties
• Food and drug safety standards
• Environmental protection measures
• Avoiding Penalties and Delays

Failure to obtain one when required can lead to significant penalties, delays in the release of your goods, and potential disruptions to your supply chain.

There are several pitfalls that you might have while interacting with CBP and bonds in general. Let’s have a look at the most common ones.

Ensuring Enough Coverage
One common challenge businesses face is underestimating the bond amount needed, leading to potential liability issues. It’s crucial to accurately calculate the value based on your expected import volume and value.

Bond Approval Headaches and Streamlining the Process
Navigating the application and approval process can be time-consuming and complex, especially for businesses new to import regulations. Understanding the requirements and working with experienced partners can help streamline the process.

Compliance Pitfalls: Staying on the Right Side of CBP
Staying compliant with CBP’s extensive regulations is essential to avoid bond claims and penalties. This includes timely payments, accurate documentation, and adherence to import procedures.

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Atlantic Project Cargo is a US-based freight forwarder specializing in the global shipping of heavy and oversized equipment. The company is a leading player in agricultural and construction equipment logistics, known for their expertise in:

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• Extensive network – With 11 warehouses across North America and over 100 vehicles, they ensure efficient storage and drayage.
• Experienced team – Professionals handle heavy equipment shipping with a focus on safety and reliability.
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Whether you’re shipping tractors to India or yachts to Europe, Atlantic Project Cargo can handle it all, making them a trusted partner for complex and oversized freight needs.