Imagine importing a product from another country. The government wants to ensure you’ll pay all associated taxes and fees. That’s where a customs bond comes in. Think of it as a financial safety net for the government, guaranteeing your compliance with customs regulations.
What is a Customs Bond?
A US customs bond is a financial guarantee required for all commercial shipments in the United States. It’s a contract between an importer of record (IOR), a surety company, and U.S. Customs and Border Protection (CBP). This bond ensures that the importer will fulfill their obligations, including paying customs duties, taxes, and penalties, so goods can enter the country legally and sufficiently.
Types of Customs Bonds
A single bond is required for each transaction, including ISF and entry filings. It covers a single shipment and is suitable for occasional importers.
The bond amount must equal or exceed the total entered value of the goods, plus any estimated duties, taxes, and fees. A minimum bond amount of $100 applies, even for low-value shipments. For products regulated by other government agencies (e.g., FDA, EPA, APHIS), the bond amount must be three times the total entered value.
ISF Single Bonds: Importers are limited to a maximum of five ISF filings within a 12-month period. Once this limit is exceeded, the importer must either obtain a continuous bond or request approval from the surety company for each additional single bond. The surety may impose additional requirements or deny approval based on risk considerations.
Entry Single Bonds: The maximum accumulated bond amount per importer is $350,000 within a 12-month period. Beyond this threshold, the importer must either transition to a continuous bond or seek case-by-case approval for each additional entry. The surety company may apply stricter conditions or reject further requests. For entries not regulated by Partner Government Agencies (PGAs), the required bond amount must equal the total entered value plus applicable CBP charges (duties, taxes, and fees), rounded to the nearest thousand. For entries regulated by PGAs, the bond amount must be three times the total entered value, also rounded to the nearest thousand.
Continuous Bond
Covers multiple shipments throughout the year. Ideal for frequent importers.
The bond covers all Entry and ISF filings within the 12-month bond period, as long as the bond remains sufficient. The bond amount is calculated monthly based on the importer’s previous 12 months of duties, taxes, and fees. This flexible approach streamlines the import process and reduces the administrative burden associated with individual bonds.
You can refer to the specific bond formulas on the U.S Customs and Border protection website.
When Is a Customs Bond Not Required? (And When It Still Is)
A bond isn’t required if:
- Shipment value is under $2,500 and
- Goods are not regulated by agencies like FDA, USDA, CPSC, etc.
- No special licenses or quota restrictions apply
Even if the value of a shipment is under $2,500, a bond may still be required if special regulations apply.
What to consider when acquiring a customs bond
Shippers should carefully consider several factors when obtaining a US customs bond. The required bond amount varies based on the value of imported goods and the importer’s creditworthiness. Choosing a reputable surety company can provide valuable guidance and support throughout the process. Additionally, it’s important to be aware of specific bonding requirements that may differ depending on the type of goods and their country of origin.
Important Considerations for Non-Resident Importers
Due to increased scrutiny around mis-declared shipments and fraudulent activity, several major bond certificate insurance companies have updated their underwriting policies. As of mid-2025, many no longer issue single transaction bonds to non-resident importers located in China (including Hong Kong and Macau), Vietnam, Thailand, Malaysia, Laos, Indonesia, and Cambodia.
While continuous bonds may still be available for these regions, they typically require full collateral or additional documentation to mitigate risk.
It’s important for customs brokers and importers to ensure full transparency and compliance. Insurance providers are seeing an increase in shell companies without a U.S. presence, which has led to denied bond approvals or unrecoverable claims. Importers without a physical U.S. location or registered agent are strongly encouraged to work with an experienced broker to validate eligibility and secure proper bond coverage.
How does the process work?
A customs bond involves three primary parties: the importer, the surety company, and CBP.
Working with a customs broker can streamline the process of obtaining a customs bond. Customs brokers often have established relationships with surety companies and can assist importers in selecting a suitable option.
Once a surety company is selected, the importer enters into a contract with them, outlining the terms and conditions of the bond. The bond is then provided to CBP as part of the customs clearance process. By partnering with a customs broker like Dimerco, our team can assist you in obtaining the necessary customs bond efficiently and effectively.
Why Bond Sufficiency Matters More Than Ever
With ongoing tariff changes like Section 301 duties on Chinese goods or reciprocal trade measures, importers face a growing risk of under bonding, where the bond amount no longer covers the required duties and taxes. It’s not about just having a customs bond; it’s about making sure your bond is large enough to meet your current risk exposure.
CBP requires that continuous bonds cover at least 10% of the previous 12 months’ duties, taxes, and fees. If your bond falls below that threshold, CBP may issue a “Demand for Increased Bond” which can delay your shipments or require additional collateral.
- Continuous Bond = 10% of last year’s duties + taxes + fees
- Minimum bond required is $50,000
- Tariff increases or volume spikes can trigger a bond insufficiency flag from CBP
For example, if your bond was based on $100,000/year in duties but due to new tariffs your annual duties jump to $250,000, CBP will require a new bond amount that matches the increase.
Tip: If you’re importing frequently or working under fluctuating tariffs, proactively review your bond with your customs broker every quarter or more often during volatile trade periods.’
Know Before you Import
Not sure if your shipment needs a bond? This quick reference table outlines the most common situations and whether a U.S. Customs bond is required and why.
| Scenario | Bond Required? | Why? |
|---|---|---|
| Shipment < $2,500 | No | Not regulated or quota-bound |
| FDA-regulated goods | Yes | Even if low value |
| Spike in tariff rates | Yes | May exceed bond coverage |
| Under CTPAT | Still yes | CTPAT reduces inspection risk, not bond need |
How to Know if your Bond Amount is Too Low?
If your customs bond coverage falls below 10% of your annual duties, taxes, and fees, U.S. Customs and Border Protection (CBP) may flag the shortfall and issue a “Demand for Increased Bond.”
A proactive customs broker can help you stay ahead of this risk by monitoring bond usage and providing monthly or quarterly reports. To avoid shipment delays and compliance issues, it’s smart to regularly request these reports and review them with your broker.
Understanding Customs Bonds and Free Trade Zones
Customs bonds and free trade zones (FTZs) are interconnected elements of international trade. Customs bonds ensure compliance and tax payment, while FTZs offer a duty-free environment for goods. When goods enter an FTZ, a customs bond is often required to guarantee compliance and ensure that duties and taxes are paid if the goods are released for domestic consumption. However, there are certain benefits associated with using FTZ’s:
Reduced MPF fees: MPF (Merchandise Processing Fee) fees can be directly reduced by using Estimated Weekly Entries in FTZs.
Deferral of duties: Duties aren’t paid to CBP until the cargo is sold and shipped from the FTZ.
Potential avoidance of duties and MPF: By exporting goods directly from the FTZ, duties and MPF can be eliminated altogether.
By understanding the relationship between customs bonds and FTZs, importers can:
- Utilize FTZs to reduce costs and improve efficiency.
- Benefit from the preferential trade policies offered by FTZs.
- Use customs bonds to protect against potential financial losses.
Dimerco offers services related to customs bonds and free trade zones. Our network of strategically located FTZs and bonded warehouses in major Asian markets, including Shenzhen, Taiwan, Shanghai, and Singapore, as well as the U.S., provides our clients with flexible and efficient solutions.
What Importers Should Do
Managing customs bond compliance isn’t just about meeting legal requirements, it’s about protecting your business from expensive delays, penalties, or shipment holds.
Here’s what importers should be doing to stay ahead of bond-related risks:
- Monitor your bond usage monthly to avoid exceeding coverage
- Review new tariffs that apply to your HS codes and product categories
- Coordinate with your customs broker to evaluate duty exposure
- Increase your bond proactively before CBP flags it as insufficient
U.S Customs Bond Monitoring Checklist
Use this checklist to help you stay on top of your bond coverage and avoid unexpected compliance issues:
- Check your annual import duty total vs. bond coverage (10% rule)
- Ask your broker for a monthly or quarterly bond usage report
- Watch for CBP “Demand for Increased Bond” letters
- Avoid large single-entry shipments that could exceed bond limits
- Reassess bond amount during tariff changes or volume increases
- Ensure Single Entry Bonds match the shipment value (if applicable)
Streamline Your International Trade
US customs bonds are essential for navigating international trade. Understanding them helps importers ensure compliance, protect revenue, and streamline operations.
To optimize your customs clearance process and mitigate risks, consider partnering with a customs broker like Dimerco. Our dedicated team of experts can handle all aspects of customs clearance, including obtaining and managing customs bonds. With Dimerco’s comprehensive solutions, you can focus on your core business operations while we navigate the complexities of international trade.
Let’s talk. We’ll help you stay compliant and confidently move your goods across borders.
Contact a Dimerco expert to learn how our customs bond and FTZ services can support your international trade.
