U.S. Customs and Border Protection Agency Finalizes New Rules on Bonds
U.S. Customs and Border Protection Agency (CBP) issued a final rule on Nov. 13, 2015, regarding the regulations that serve to centralize the processing of continuous bonds at CBP’s Revenue Division. To view the rule in the Federal Register, click here.
The new regulations, which will take affect December 14, 2015, pertain to all entry types and provide for the filing of both continuous and single transaction bonds, primarily on the CBP Form 301, as regulated by title 19 of the Code of Federal Regulations (19 CFR).
Many provisions of the most significant changes in the proposed rule—relating to the application, approval and execution of bonds—were not implemented, in large part due to the ongoing test of electronic bonds (eBond). For eBond test participants, the provisions of 19 CFR are suspended “to the extent that they conflict with the terms of the eBond test.”
One significant change the rule does finalize is that CBP Form 301 bonds may be scanned and emailed to CBP as a computer file attachment (e.g., in a .pdf or .tif format) or submitted by fax or mail. The rule also amends CBP regulations to allow the scanning and emailing of single transaction bonds.
The rule also allows agents and attorneys acting for a corporate surety to identify themselves with a surety-generated 9-digit alphanumeric identification number instead of a Social Security number on submissions to CBP.
NASBP called to CBP’s attention that while the Notice of Proposed Rulemaking had planned to remove “the 30-day time period from the date of notification within which a principal must remedy a bond deficiency,” a change that NASBP approved of, the final rule, amended in response to comments, instead read: “CBP views a 30-day response period as too lengthy to adequately protect the revenue and ensure compliance with applicable law and regulations, and therefore this provision is amended to prescribe a 15-day period.”
NASBP noted that the 15-day time frame is the same time frame to terminate a bond in the eBond regulations, so unless an importer receives the bond insufficiency letter immediately, the importer will not be able to terminate the existing bond in time to get a replacement to CBP within the 15 days.
CBP responded that, while it will move the deadline for demand letters to 15 days, it will also add in an additional 15-day “buffer” period before actually turning off the bond, similar to the current practice. This change will be effective on the demand letters sent out for the month of November.
NASBP’s representative on the Customs Surety Executive Committee (CSEC) is John J. Sheppard, II (pictured) of the NASBP member firm of C.A. Shea & Company, Inc. in Chester, NJ.
NASBP will keep you apprised of any future changes to 19 CFR and the eBond regulations.