Customs Bonds: Everything an Importer Needs to Know

Customs bonds ensure that an importer complies with all Customs regulations, and guarantees that all duties, taxes, and other fees owed on a shipment are paid to the U.S. government. We’ll explain how to get one, how much they cost and cover, and more.

Last Modified:

September 13, 2024

Customs Bond Definition

A customs bond is a legal contract between an importer (the principal), a surety company, and U.S. Customs and Border Protection (CBP), ensuring that all duties, taxes, and fees owed on a shipment are paid. Customs bonds are required for all commercial imports valued at more than $2,500, including shipments containing duty-free items.

U.S. customs bonds are also commonly known as:

Import bonds
Customs entry bond
Customs surety bonds
Activity code 1 bonds (C1 bonds)

The two types of activity code 1 bonds used by importers are known as single entry bonds and continuous bonds.

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What is a Single Entry Bond?

A single entry bond (SEB) is best suited for importers needing only to import a single shipment at a specific port of entry. This type of customs bond works well if you occasionally import merchandise that has a low cost value.

The value of the bond you need can vary too. At minimum, a single entry bond should be worth the value of the goods you are importing, plus any applicable duties, taxes, and fees.

If your imports are regulated by another federal agency, you’ll need to get a bond worth three times the value of the goods imported. This means that if you are importing $8,000 in toys regulated by the Consumer Product Safety Commission, you’ll need a bond worth at least $24,000.

If you are shipping your imports by sea, you’ll be required to obtain additional bond coverage to meet International Security Filing (ISF) requirements.

What is a Continuous Customs Bond?

A continuous customs bond covers all of an importer’s shipments at all U.S. ports of entry for a calendar year. If you need an annual customs bond, these can be set to renew automatically.

Continuous bonds are best suited for importers that plan on importing multiple shipments, or using multiple ports of entry, over a 12-month period.

You must purchase at least $50,000 in coverage when getting a continuous bond. The total cost may rise depending on the tariff rates and taxes owed on your shipment.

Bonds are calculated to cover at least ten percent of the duties and taxes collected by the CBP. It’s worth noting that a continuous customs bond will also cover ISF bond requirements when shipping goods by sea.

What Amount Does a Customs Bond Cover?

A customs bond acts as a financial guarantee of any fees (including duties, taxes, and fines) owed to CBP on a shipment into the U.S. The amount that a bond covers is relative to the size of bond needed for the fees owed on the imported goods.

The continuous bond amount must equal at least 10% of the total duties and fees paid to the CBP (minimum $50,000). A single transaction bond, on the other hand, must equal one to three times the value of the merchandise, plus duties, taxes, and fees, to adequately cover your merchandise.

If you need a larger bond amount, please refer to CBP’s calculation table below:

Total Duties & Taxes	Bond Size
$0 to $499,999	$50,000
$500,000 to $599,999	$60,000
$600,000 to $699,999	$70,000
$700,000 to $799,999	$80,000
$800,000 to $899,999	$90,000
$900,000 to $999,999	$100,000
$1,000,000 to $1,999,999	$200,000
$2,000,000 to $2,999,999	$300,000
$3,000,000 to $3,999,999	$400,000
$4,000,000 to $4,999,999	$500,000
$5,000,000 to $5,999,999	$600,000
$6,000,000 to $6,999,999	$700,000
$7,000,000 to $7,999,999	$800,000

When Do I Need a Customs Bond?

There are two main situations in which you’d require an Activity Code 1 bond. These situations include:

Commercial imports valued at $2,500 or more (even if your shipment contains duty-free items).
Imports of goods subject to regulations from U.S. government agencies (i.e. USDA regulates wood, CPSC regulates toys, FDA regulates pharmaceuticals). In this case, the bond amount must be equal to three times the value of the shipment.

Think of a customs bond as the ticket you pay for your merchandise to gain entry to the United States. Before you purchase that bond, your imported goods will be held at customs pending approval until you show proof of that bond. You need the bond to gain final approval to release your goods.

How Much Does a Customs Bond Cost?

At USA Customs Clearance, a continuous customs bond provides you with $50,000 worth of coverage for 12 months from the date of purchase.

If you need more coverage, contact our team and we’ll be happy to accommodate your importing needs.

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How Do I Get a Customs Bond?

Customs bonds are usually obtained through a licensed customs broker, and require you to fill out a customs bond application in the form of CBP Form 301. These bonds are provided by sureties licensed by the U.S. Department of the Treasury, but customs brokers act as agents for these entities, providing a simpler purchase experience for the importer.

Information required when applying for a customs bond includes:

The type of bond being applied for.
The name and CBP identification number of all parties involved in the bond.
The general description of the merchandise to be imported.
The estimated duties, taxes, and fees anticipated for the current calendar year or the next 12 months.
The duties, taxes, and fees paid during the previous calendar year or the past 12 months.

At USA Customs Clearance, you can fill out the application and obtain your customs bond directly on our website. The process to get a customs bond through USA Customs Clearance is as follows:

Purchase your continuous customs bond from us
Complete the simple & quick online application
Receive approval for your application the same day
Begin importing with your bond within 2 days of CBP application activation

When you utilize the services of a licensed customs broker, you ensure your bond is correct, complete, and secured. Licensed brokers can handle the behind the scenes work involved in getting the bond for you.

Connect with a customs broker and let our helpful, knowledgeable staff answer your questions and guide you through the customs bond application process.

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Frequently Asked Questions

What Does It Mean if a Shipment is Bonded?

That means you did the right thing and got a customs bond! In short, a bonded shipment means your goods are covered for customs charges, including all duties, taxes and any penalties that may occur during the import process.

What is Bond in Freight?

When you are shipping goods in-bond, that means your products are moving within the United States, but are still waiting on official customs clearance from Customs before the goods can officially be sold. Customs brokers can help your goods obtain official approval from CBP.

How Is My Import Bond Used?

Import bonds are used by customs brokers to clear goods. The bond is critical because it:

Contains a unique bond number tied to your company’s importer number (Tax ID)
Is valid at all U.S. port of entry
Remains tied to all importing documents filed for your goods

What Happens If I Don’t Pay My Import Duties?

If you fail to pay any of the fees owed on your shipment, the surety who issued your bond will pay the amount owed to CBP and then seek payment from you in full using legal means.

Are There Other Types of Customs Bonds?

Yes, there are many different types of customs bonds, used for a variety of situations. Each type of bond is labeled with a different Activity Code.

Activity Code 1 - Import Bond
Activity Code 1a - Drawback Payment Refunds Bond
Activity Code 2 - Custodian of Bonded Merchandise Bond
Activity Code 3 - International Carrier Bond
Activity Code 3a - Instruments of International Traffic
Activity Code 4 - Foreign Trade Zone Bond
Activity Code 11 - Airport Security Bond
Activity Code 16 - Importer Security Filing Bond

How Do I Look Up My Customs Bond and Verify Its Status?

Looking up and verifying the status of your customs bond is a simple process. No matter where you purchased your bond, you can check its status via the CBP ACE portal. To do so, use your IRS-issued Employer Identification Number (EIN) to query the portal for your information. Go to the "bond" subject area and choose the REV-001 option for bond details. This report is available for importers, sureties, and CBP itself. From there, you can easily verify and monitor the bond's status.

Can I Renew My Customs Bond?

Yes, continuous customs bonds typically expire after one year, but you can work with a customs broker to set your bond to auto renew. Depending on the surety, this can be done annually, or on a multi-year basis. At USA Customs Clearance, we make that process simple, allowing an easy way to renew your bond, and cancel at any time.