With rising tariffs, U.S. Customs and Border Protection (CBP) is busy sending importers bond insufficiency notices advising them that their existing customs bond no longer covers their obligations. 

What is a Customs Bond

A customs bond, sometimes called a surety or import bond, is a financial guarantee that ensures importers meet CBP regulations and pay all applicable duties, taxes, fines, and penalties related to importing goods into the United States.

The most common type of bond is an import bond, which is required on all commercial shipments of goods valued over $2,500. An import bond is also required for shipments that are subject to other U.S. government agency requirements.

A single transaction bond can be used for a single entry. However, most importers utilize continuous bonds, which self-renew yearly and cover all customs transactions through any port of entry.

Insufficiency Notices on the Rise

CBP reviews the sufficiency of all active continuous import bonds on a monthly basis. If an importer’s bond has exceeded its capacity, CBP will issue a demand for a larger bond in the form of an insufficiency notice. The recent increase in tariffs means increased bond amounts, and many importers are struggling to properly calculate their bonds to keep them current. The number of bond insufficiency notices issued has quadrupled since 2017 and has accelerated recently with the volatile tariff environment. 50% of insufficient bonds are for bonds under $100k.