A customs bond is a financial guarantee to CBP that duties, taxes and fees will be paid and that the importer will comply with regulations. It is not insurance for the importer. If the surety pays a claim, it recovers from you.
When a bond is required
Any formal entry of commercial goods into the United States requires one, and formal entry generally applies above a value threshold set by CBP. Bonds are also required for specific activities regardless of value, including goods subject to certain partner government agency requirements, temporary importation, warehouse entries and in-bond movements.
If you are importing commercially by ocean, assume you need one.
The two types
Single transaction bond. Covers one entry. Priced per shipment, with the bond amount typically based on the value of the goods plus duties, taxes and fees. For goods subject to additional agency requirements, the amount can be set at a multiple of the value.
Continuous bond. Covers all entries at all ports for a year. The standard minimum amount is calculated from the duties, taxes and fees paid in the previous twelve months, and it renews annually.
| Single transaction | Continuous | |
|---|---|---|
| Scope | One entry, one port | All entries, all ports, one year |
| Cost basis | Per shipment | Annual premium |
| Also covers ISF | No, an ISF bond may be needed separately | Yes, ISF is covered |
| Best for | Occasional importers | Anyone importing regularly |
The breakeven is lower than most first time importers expect. Once you are importing more than a handful of formal entries a year, the continuous bond usually costs less in total, and it removes a per shipment task from the process.
The ISF connection
The Importer Security Filing carries its own bond requirement. A continuous bond covers it. With a single transaction bond, an ISF bond may be needed on top, and shipments have been held because the entry bond was arranged while the ISF bond was not. The filing itself is covered in ISF filing requirements.
How the amount is set
For continuous bonds, the standard formula uses ten percent of the duties, taxes and fees paid in the previous year, subject to a minimum. Importers whose duty bill rises sharply, for example because of additional tariff actions on their goods, can find their bond becomes insufficient, and CBP will require it to be increased. That is a common surprise for importers whose classification is subject to extra duties, so it is worth modelling alongside the calculation in how to calculate US import duty.
Getting one
Bonds, like most of the terms on an entry, are explained in our freight glossary. They are issued by surety companies, usually arranged through a licensed customs broker. The application asks for the importer of record number, the corporate details and the expected import activity. Approval is generally quick for established companies and can require additional underwriting for new ones or for high duty exposure.
Non-resident importers can obtain a bond but face additional requirements, and many suppliers who agree DDP terms discover this only after the sale. Check the importer of record position before agreeing delivered terms, as covered in door to door ocean freight.
FAQ
When is a customs bond required?
For formal entries of commercial goods, for shipments subject to certain agency requirements, and for warehouse, temporary import and in-bond movements.
Is a customs bond insurance for the importer?
No. It guarantees payment to CBP. The surety recovers any claim from the importer.
How much does a continuous bond cost?
The premium depends on the bond amount, which is based on the prior year's duties, taxes and fees. Brokers quote it annually.
Does a single entry bond cover the ISF?
Not automatically. A separate ISF bond may be required, whereas a continuous bond covers both.
Can a foreign company be the importer of record?
Yes, subject to additional requirements including a bond, but it should be confirmed before agreeing DDP terms.
Importing regularly into the United States? Ask us how the bond, the filings and the freight fit together on your lane.