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What are Customs Bonds?
There are over 300 ports of entry into the United States and the U.S. Customs & Border Protection (CBP) agency has jurisdiction over all of them. Ports of entry conduct the daily, port-specific operations like clearing cargo,
collecting duties and other monies associated with imports. Customs bonds, are a type of surety bond that guarantees payment of duties and monies owed the CBP. The most common type of customs bond by far is the Activity Code 1, continuous customs bond. This bond covers all entries by an importer for a one year period. The Activity Code 1 single entry customs bond covers a single entry into the U.S. (Surety1 does not offer single entry bonds—we provide continuous customs bonds only). These cover you for a year and renew annually.
How to Get a U.S. Customs Bond
We make it easy to obtain your customs bond. Our 3 step process is:
- Complete the easy to navigate and secure online application.
- Review the free, no obligation quote from one of Surety1’s professional surety bond agents, usually within one to five business days. 1
- Sign some paperwork and pay the bond premium
Once these steps have been completed, the customs bond will be filed electronically with the CBP.
1- Subject to underwriter approval.
Surety1.com is a service of AssuredPartners one of the largest and fastest growing insurance agencies in the nation. Representing over a dozen surety bond companies, Surety1.com is the premier online provider of surety bonds nationwide since 2003.
What is the Cost of the $50,000 Bond?
The cost for a $50,000, continuous Customs bond for as low as $349** per year for most customers. Apply Now!
**USA Based importers – Currently registered with CBP – No ADD -Subject to underwriter approval, no payment required until bond is approved.
It costs nothing to apply and obtain a firm quote. We offer an easy to use online application and FAST approvals. Surety bonding since 2003 and A+ rated by the Better Business Bureau. All of our markets are A rated and Hold Certificates of Authority as Acceptable Sureties on Federal Bonds, per Circular 570.
What Amount Does the Surety Bond Need to be?
The bond limit of liability amount is fixed by the CBP, however, the minimum bond amount is $50,000. The bond can increase in multiples of $10,000 nearest to 10 percent of duties, taxes and fees paid by the importer or broker acting as importer of record during the calendar year preceding the date of the application. The CBP will tell you if you need a bond larger than $50,000.00.
For new importers, if no imports were made during the preceding calendar year, the bond amount will be based on the estimated duties, taxes and fees that accrue on imports during the calendar year, provided that the district director is satisfied with the accuracy of the estimate. Under no circumstances will a bond of less than $50,000 be accepted.
Do I Need a Customs Broker?
The law does not require you to utilize a customs broker, however, customs brokers are the only persons who are authorized by the CBP to act as agents for importers in the transaction of their customs business. Customs brokers are private individuals or firms licensed by CBP to prepare and file the necessary customs entries, arrange for the payment of duties found due, take steps to effect the release of the goods in CBP custody, and otherwise represent their principals in customs matters. In short, a good customs broker can be a great asset.
FAQ’s
- What size customs bond do I need? The bond amount is usually based on 10% of the duties, taxes and fees paid by the importer during the previous 12 months. The minimum bond amount, however is $50,000. CBP will periodically review each bond on file to determine whether the bond is adequate to protect the revenue and ensure compliance with applicable law and regulations. If CBP determines that a bond is inadequate, the principal and surety will be promptly notified in writing. The principal will have 15 days from the date of notification to remedy the deficiency.
- How do I know what the customs duties are? The Harmonized Tariff System (HTS) provides duty rates for virtually every item that exists. The HTS is a reference manual that is the size of an unabridged dictionary. The U.S. International Trade Commission-Tariff Database, is an interactive data base that will enable you to get an approximate idea of the duty rate for a particular product. Use of this data base will require that you register to receive login credentials. There is no cost to register. Please be aware that the duty rate you request is only as good as the information you provide. The actual duty rate of the item you import may not be what you think it should be as a result of your research.
- What if I am not a USA based importer? None USA based importers can still purchase their customs bond from Bonds4Customs. The annual fee for the $50,000 continuous bond will usually be $349.00 and the approval process can take a few days longer.
- What if I am not currently registered with Customs? Bonds4customs will get your importer number registered for a one-time fee of $100.00. To register with CBP, Form 5106 needs to be completed.
Other Types of U.S. Customs Bonds
Activity Code 2- Custodial Bonds Custodian of Bonded Merchandise:
This type of customs bond is required for operations which carry or hold merchandise not yet entered into the commerce of the United States, for export or entry at a later time or place. This typically includes: cartmen/lightermen, warehouse proprietors, general order warehouses, carriers, container freight stations, and central examination stations. The bond amount for an Activity Code 2 bond must be approved by customs. The annual rate for this bond is 1.2% of the bond amount, which includes a .2% filing fee.
The company’s most recent year‐end financial statement** will be required by the underwriters.
What does a custodial customs bond cover? The principal agrees to comply with all Importer Security Filing requirements of CFR 149 – IMPORTER SECURITY FILING including but not limited to providing security filing information to CBP in the manner and in the time period prescribed by regulation. If the principal defaults with regard to any obligation, the principal and surety (jointly and severally) agree to pay liquidated damages of $5,000 per violation. Apply Now
What is the bond amount for a Category 2 customs bond?
The bond amount varies and is determined by the CBP. IT will also varies by port, for instance the minimum C-2 or C-3 bond in Long Beach is $50,000 and it is $100,000 at LAX. There is no way for us to know what bond amount you will need. You will have to have this information prior to applying for the bond.
Activity Code 3 International Carrier Bond:
This customs bond type is for operators of ships, airlines, and other conveyors (NVOCC’s) of international merchandise. (This includes: any company that transmits data through Automated Manifest System (“AMS”), any airline required to pay passenger user fees, vessel repair duty, requirements for airport security and ISF.) The bond amount for an Activity Code 3 bond must be approved by customs. The annual rate for this bond is 1.2% of the bond amount, which includes a .2% filing fee.
The company’s most recent year‐end financial statement** will be required by the underwriters. As this bond type can be used for multiple operations, additional information on why the bond is being will be required by the underwriters. Apply Now
Activity Code 4 Foreign Trade Zone Bond:
Covers area within a port’s limits which are designated as Foreign Trade Zones (FTZ). The bond amount for an Activity Code 4 bond must be approved by customs. The annual rate for this bond is 1% of the bond amount, which includes a .2% filing fee. The company’s most recent year‐end financial statement** will be required by the underwriters. Apply Now
Activity Code 10 – Court Costs for Condemned Goods
May be written as a single transaction bond only. This bond guarantees payment of court costs, should judicial proceedings result in the property to be condemned.
Activity Code 11 Airport Customs Security Area Bond:
This bond type guarantees that the principal will comply with the customs regulations applicable to customs security area in and around airports. The bond amount for an Airport Customs Security Area bond must be approved by customs. The annual rate for this bond is 2.25% of the bond amount, which includes a .2% filing fee.
The company’s most recent year‐end financial statement** will be required by the underwriters. Apply Now
Activity Code 14 In‐Bond Export Consolidation Bond:
Required for export consolidators who consolidate conveyances for export under 19CFR§192 outside the port of exportation. The bond amount for an In‐Bond Export Consolidation Bond must be approved by customs. The annual rate for this bond is 2.25% of the bond amount, which includes a .2% filing fee.
The company’s most recent year‐end financial statement** will be required by the underwriters. Apply Now
How to Get Your Customs Bonds – Surety Bonds Required by the CBP
- Complete an online application. It’s free and no-obligation.
- One of our surety experts will contact you with a firm quote and an agreement to sign.
- Provide payment and your signed agreement, and then you will receive your Surety Bond!
If you have any questions, please call us at 877-654-2327.
Surety1 was founded in 2003 and helps thousands of clients find the best prices on their surety bonds. We take pride in our work so that we can give you great service. Learn more about Surety1.