Customs bond processing is not terribly complicated, but it can seem that way without knowing the lay of the land. There are a few important things to keep in mind in regards to Customs and Border Protection (CBP) processing a Customs bond, whether obtaining one through a Customs broker, or directly through a surety agent. As always, it is essential to consult a licensed professional before making any major decisions about your company’s Customs bond, but it helps to have an understanding of the CBP processes that take place as a result of these decisions.
Processing Lead Time:
Just as with any other type of paperwork, Customs bond processing is not immediate. It takes time for the documents to be prepared on the importer’s side, and it takes time for Customs and Border Protection (CBP) to process the documents once received from the Surety or Surety Agent. Document preparation methods on the importer’s side can vary significantly, as there are practically as many different processes for dealing with paperwork amongst businesses as there are grains of sand on a beach.
Luckily, CBP follows a standardized procedure. They allow themselves 10 business days to process a Customs bond termination, which allows the new Customs bond to go into effect at the start of the next business day. Technically, that makes a minimum processing lead-time of 11 business days on CBP’s side.
It is possible for this processing to take place much more rapidly. On occasion, CBP is able to process bond documents in as little as five business days, but there is never any guarantee that will happen—it is always better to err on the side of caution regarding such important issues, and assume maximum processing time will be required. Even if CBP processes the Customs bond in less than 11 business days, the new bond will not go into effect until the 11th business day, unless there is no bond on file to terminate, which allows the effective date of the new bond to be less than 11 business days from today’s date.
It is also important to consider the maximum time in advance that CBP will accept a request for Customs bond processing. 60 days is that timeframe. That is approximately 2 months out; however, it is vital to understand that it is the amount of days (60 days) that CBP counts. If a request is sent 2 months out, but the amount of days in those two months add up 61 days, the request will be rejected.
One of the biggest mistakes an importer can make in procuring a Customs bond is to bring a shipment into port without a Customs bond in place, because without one, the goods will not be allowed Customs clearance. This leaves an importer in the particularly sticky (and expensive) position of scrambling to make a last-minute single entry bond (SEB) purchase, or paying substantial fees to have their goods held at port until their continuous bond goes into effect. SEB’s can cost more than double a continuous Customs bond, and for some commodities Customs does not allow SEB’s, so an importer would have to wait for the continuous bond to go into effect and incur demerge fees. Neither of these outcomes is desirable.
Since importers are solely liable for the shipments they bring in, it is crucial to have a fundamental knowledge of this administrative process. Understanding and accounting for lead-times regarding Customs bonds can significantly reduce the number of issues that might arise when making changes.
No comments:
Post a Comment