IN SEARCH OF THE PERFECT BOND
At IB&M, we’ve seen a growing number of importers looking to direct marketing companies and other outlets to circumvent the customs broker in search of a more economical customs bond. While those other options are a viable choice in getting a bond placed with CBP, the old adage still applies: You Get What You Pay For – so importers should proceed with caution and be aware of what services they may be foregoing by not having a licensed CHB in the mix.
Over the years. Customs Brokers have always been the traditional route to securing customs bonds especially where there wasn’t much competition in the space. This has changed in the last decade or so with all kinds of direct marketing offers targeted at importers for their bond business. We have seen half-price the first year offers, three and five year premium offers, etc. anything to grab attention. Everyone likes savings, but at what cost? With all the changes going on in the industry, a customs broker’s supervision and care is more important than ever when dealing with bonds.
Here are a few reasons why:
Importer bond sufficiency is reviewed monthly by CBP and 30-day bond increase letters are sent to importers regularly to meet Customs sufficiency guidelines. Some of these bonds end up being rendered insufficient by the agency when not addressed in a timely manner. These insufficiencies can be prevented when CHBs work with their surety and use monitoring tools to stay ahead of the game.
CBP has also published directives for importers to avoid bond stacking liability. This is something most licensed CHBs have been educated on by their respective surety. Importers can lean on their broker partners who are most familiar with duty payment history and trends when forecasting the right bond amount. 5106 Address changes and updates are almost exclusively handled by Customs Brokers through their ABI connections to CBP (Automated Broker Interface). Lastly, Customs brokers are usually provided technology through their surety partners for monitoring any open duty bills or liquidated damage penalties.
With all these factors at play, the annual continuous bond charge from a customs broker is probably not the most prudent place for importers to find savings. If you pay for what you get, I’d opt to pay a little extra for the added service and technology customs brokers provide.
Jason Wieselman, V.P. Business Development
IB&M