What is a surety bond?

What is a Surety Bond?

U.S. Customs and Border Protection requires that an importer purchase a surety bond to ensure it will pay the required duties and taxes when importing an item. A bond is like an insurance policy that guarantees payment to U.S. Customs and Border Protection (CBP) if a required act is not performed. Surety bonds can be purchased through Scarbrough, regardless if we clear the goods or not.

Bonds have a number of uses in CBP. The most common use allows importers to take possession of their goods before all CBP formalities are completed. Another common use allows a carrier to move goods under bond from one place to another before those goods are actually entered for consumption with duties paid.

Two types of Surety Bonds:

Single Transaction Bond 

A single transaction bond is a one-time bond. An importer should purchase this bond only if it plans to import 1-2 times and the value isn’t extremely high or there is no Partner Government Agency (PGA) involved. Note, if an importer is importing via ocean transport, it is also required to purchase an ISF bond. Click here for pricing.

Continuous Bond

A continuous bond is valid for 12 months from date of purchase and is automatically renewed each year until it is terminated, which can be done so free of charge. An importer should purchase this bond if it plans to import more than 2-4 times in the next 12 months, the value is high, or if a PGA (such as FDA, USDA, etc.) is involved. Note, a continuous bond is required if there is a late ISF.  Click here for pricing.

 

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