Bond Spotlight (Benny’s Clues)
Bond Increase Letters continue to roll in monthly from CBP and time is crucial. CBP allows importers up to 30 days to terminate an existing bond from the date of the letter. This is not a substantial window of time once you factor in busy schedules, vacations, and internal approvals often needed to release company information such as financials. We recommend that Brokers document their requests and follow up regularly to avoid costly lapses in bond coverage. Stay ahead of the game by using our sufficiency monitoring tools in Bond Catalyst™. The best defense is a good offense so get out in front of these early!
Risk-Based Bonding Update. As many of you are aware, CBP is looking to reform the way AD/CVD duty collections are being handled. They have called on the sureties to work on the implementation of a separate bond to cover AD/CVD.
There are approximately 71,000 unpaid bills for antidumping and countervailing duty
(AD/CVD), totaling $5 billion (principal and interest) over a 26-year period (FYs 1993 to 2019),
for which U.S. Customs and Border Protection (CBP) currently is pursuing collection or has
determined to be uncollectible.
In phase one of the risk-based bonding initiative, CBP used an additional single transaction bond to protect revenue related to AD/CVD entries. For phase two of the initiative, CBP plans to use a new risk-based, continuous bond formula.
The Sureties have been working diligently with CBP for a solution. Once implemented, an additional continuous bond covering AD/CVD will go further to help protect government revenue. We will continue to provide status updates on the implementation progress and any proposed rulemaking from CBP.
Benito (Benny) Munoz is a surety bond underwriter that has worked on customs bonds for over 25 years with IB&M.