Customs Bonds 101: Types, Costs, and Requirements

What Is a Customs Bond?

A customs bond is a legally binding contract between three parties: the principal (you, the importer), the surety (an insurance company authorized by the US Treasury), and the obligee (CBP). The bond guarantees that you will pay all duties, taxes, and fees owed to CBP and comply with all laws and regulations governing your import activities. If you fail to pay or comply, the surety pays CBP on your behalf, and then comes after you for reimbursement. Think of it as an insurance policy for the government.

When Do You Need a Customs Bond?

• All formal entries: Any commercial shipment valued at $2,500 or more requires a bond.
• Regulated goods at any value: Products regulated by FDA, CPSC, FCC, EPA, or other agencies require a bond even if under $2,500.
• Temporary importations: Goods entering under a Temporary Import Bond (TIB) require their own bond.
• Foreign Trade Zone entries: Admissions to an FTZ require a bond.
• Bonded warehouse entries: Goods entering a bonded warehouse require a bond.
• Transportation and exportation: In-bond movements require a bond.

Single Entry Bond vs Continuous Bond

There are two main types of customs bonds. A single entry bond covers one specific import transaction and expires after that entry is liquidated (typically 314 days after entry). A continuous bond covers all import activity for one year from the effective date and automatically renews until canceled.

• Single Entry Bond: Cost is typically $50-$100 per entry. Good for infrequent importers (1-3 shipments per year). Coverage equals the total entered value plus duties, taxes, and fees.
• Continuous Bond: Annual premium typically $400-$2,000. Required minimum bond amount is $50,000 or 10% of total duties/taxes/fees paid in the prior year, whichever is greater. Cost-effective for importers with 4+ entries per year.

How Bond Amounts Are Calculated

For single entry bonds, the amount equals the entered value plus all duties, taxes, and fees for that entry. For continuous bonds, CBP requires a minimum of $50,000. If your total duties, taxes, and fees exceeded $50,000 in the prior calendar year, the bond amount must be at least 10% of that total. CBP can require a higher bond amount based on your compliance history, the risk profile of your products, or enforcement actions. Bonds for importers of AD/CVD merchandise often require significantly higher amounts.

How to Obtain a Customs Bond

1. Step 1: Contact a licensed customs broker or surety bond agent. Most brokers can arrange bonds directly.
2. Step 2: Complete a bond application with your business information, import history, and financial details.
3. Step 3: The surety evaluates your creditworthiness and import profile.
4. Step 4: If approved, you pay the premium and the surety issues the bond.
5. Step 5: The bond is filed electronically with CBP through the eBond system.
6. Step 6: For continuous bonds, it becomes effective on the date specified and renews annually.

What Happens If You Don't Have a Bond?

Without an active customs bond, CBP will not release your goods. They will sit at the port or airport accumulating storage charges (demurrage, detention, warehousing) until you obtain a bond. For ocean shipments, these charges can reach $300-500 per day within a week. If you cannot obtain a bond in a reasonable time, your goods may be moved to a general order warehouse and eventually sold or destroyed to recover charges. Always have your bond in place before your goods arrive.

Bond Sufficiency and Increases

CBP monitors bond sufficiency through its Revenue Division. If your import volume increases significantly, your duties exceed the bond amount, or you have compliance issues, CBP may demand a bond increase. You typically have 30 days to obtain additional bond coverage. If you fail to increase the bond amount, CBP can refuse to release your goods until the bond is sufficient. This is particularly common for importers of AD/CVD merchandise where duty deposits can be large and unpredictable.

Bond Claims and Breaches

CBP makes claims against your bond when you fail to meet your obligations: unpaid duties, failure to redeliver goods, failure to comply with marking requirements, or other regulatory violations. When a claim is made, the surety pays CBP and then seeks reimbursement from you. Multiple claims can result in the surety canceling your bond, and a pattern of claims makes it difficult and expensive to obtain a new bond. In extreme cases, importers with severe compliance problems may find it impossible to obtain a bond at any price, effectively barring them from importing.

“A customs bond is the price of admission to US importing. It is not expensive, but not having one is extremely expensive. Get a continuous bond as soon as you start importing regularly — it saves money and shows CBP you are a serious, compliant importer.”

— Camtom Team