By John Sheppard of C.A. Shea & Company, Inc.
Originally published February 15, 2024
The U.S. Customs and Border Protection (CBP) recently released detailed guidelines for determining minimum bond amounts. The guide can be found on their website here. This new guide is a step towards standardizing the process for setting bond amounts across most bond types.
CBP has worked to streamline the methodology for determining bond amounts, collaborating with industry leaders over several years. Our office has actively participated in multiple committees, assisting CBP in navigating the complexities of this process. While acknowledging that CBP’s release may not be flawless, many companies are likely to find these guidelines valuable.
In the past, specific bond amounts, particularly for Importer and Drawback bonds, were standardized. However, regulations gave local ports (Customs offices) flexibility in determining bond amounts for other types. Recognizing the need for consistency, CBP has worked to standardize the formulas, ensuring a more uniform approach across all bond types.
One significant change introduced by the guide is the establishment of minimum bond amounts. Previously, several bond types lacked defined minimums, a gap now filled by the guidelines. Among the notable minimum bond amounts set by CBP are:
· Custodian of Bonded Merchandise Bond: $25,000.00
· International Carrier Bond: $50,000.00
· Foreign Trade Zone Bond: $50,000.00
· Airport Security Bond: $25,000.00
Our office anticipates CBP’s thorough review of all active bonds, requiring a rewrite for any bond that falls below the specified minimums. If our office receives instructions from CBP concerning the bonds currently written, we will promptly inform the retail agent to start the rewrite process.
John Sheppard has been with C.A. Shea & Company, Inc. for over 22 years, and is currently the Vice President. He oversees the day to day operations of the bond department and is responsible for underwriting and dealing with Customs on both the local and executive levels. He can be reached at johnsheppard@cashea.com or 908.975.0912.