Customs Bonds Explained: Continuous vs. Single Transaction

A customs bond is a guarantee, issued by a surety, that an importer will pay its duties, taxes and fees and follow CBP's rules. Every formal entry needs one. A continuous bond covers all entries for a year and is generally set at the greater of $50,000 or 10% of the duties, taxes and fees paid in the prior 12 months. A single transaction bond covers one entry.

Continuous vs. single transaction

• Continuous bond: Covers every entry for a year and renews automatically. Most regular importers use one.
• Single transaction bond: Covers one entry. Useful for an occasional importer, but costly if used repeatedly.

How a continuous bond is sized

CBP generally sets the minimum at 10% of the duties, taxes and fees the importer paid in the previous 12 months, with a $50,000 floor, rounded up. When tariffs rise, duties rise, and the bond can become too small.

Bond insufficiency

When duty paid outgrows the bond, CBP issues a notice that the bond is insufficient, and the importer has to file a larger bond quickly. Higher tariff rates in recent years have pushed many importers into this, often without warning.

Other bonds importers may need

• Drawback bond: Required for accelerated payment of drawback.
• Bonds for specific activities, such as bonded warehouses and foreign trade zones.

How to get one

Bonds are purchased from a surety, usually through a customs broker, and filed with CBP electronically. The premium is a small percentage of the bond amount and depends on the importer's finances.

Frequently asked questions

Does the bond cover IEEPA refunds? Refunds are paid by ACH. The bond guarantees payments to CBP, not from it.

Can I lower my bond if duties fall? Yes, at renewal, if the prior 12 months support a smaller amount.

Where Caspian fits

Caspian's audits show the duty you actually paid and why, which feeds bond sizing, and our brokers handle drawback bonds. See our trade compliance advisory.

Works Cited:

• 19 CFR Part 113, CBP bonds
• CBP: Bonds