What is a Customs bond?
A Customs bond is a financial guaranty between 3 parties: the Insurance/Surety company issuing the Customs bond, the Principal (who is required to file the bond), and Customs & Border Protection (CBP). The Customs bond guarantees Customs & Border Protection that if they cannot collect monies due from the Principal they can seek remedy, up to the bond amount, from the Insurance/Surety company. The Customs bond also indemnifies the Insurance/ Surety company, allowing them to use any legal means to collect from the Principal any monies that were paid to CBP on the Principal’s behalf.
Types of Customs bonds
There are many types of bonds required by Customs & Border Protection (CBP) for various reasons. The most common types issued are the import bond, custodian bond, international carrier bond, foreign trade zone bond and airport security bond. Most Customs bonds, overall, are Activity Code 1 Import Bonds. The import bond is required by CBP from all importers in order to clear entries through Customs. An importer may file a “Single Entry” import bond or a “Continuous” import bond.