Permanent imports play a huge role in the world of eCommerce and international trade. It’s how people are able to run import/export businesses or simply purchase a product that they’d like to keep stateside. In some cases, however, a product only needs to be imported temporarily to fulfill its purpose - and that’s where temporary import bonds come into play.
According to Customs and Border Protection (CBP), temporary import bonds (TIB) allow businesses and individuals to temporarily import goods into the U.S. duty-free. To qualify for a TIB, the goods cannot enter the U.S. marketplace. The products must also be re-exported or destroyed within a given timeframe - typically one year.
Check out our guide to learn more about temporary import bonds, including how to get one, what products qualify for a TIB and how a customs broker can help.
Informally known as a temporary import bond, or a TIB, the proper name for this process is temporary importation under bond. When an importer secures a TIB, they are allowed to temporarily import a product into a country without paying any duty or taxes (including Merchandise Processing Fees, or MPF).
Instead, the importer will post a bond for twice the dutiable amount owed on the product if it was imported permanently. This can be done using a single entry bond or a continuous entry bond, assuming it’s large enough to cover the TIB entry. The importer will then agree to either export or destroy the product within a specified period of time.
If the importer abides by the agreement, they will receive their deposit back once the TIB is completed (however, this can take many months). In a non-compliance scenario, the importer will be required to pay liquidated damages in the form of twice the duty owed on the imported product.
In order to complete the TIB, the importer has two options.
A TIB can either be purchased at the time of entry or pre-arranged ahead of time. Entries must be filed within 15 working days of arrival for Customs clearance. However, CBP recommends that it be done within five days to avoid being charged storage fees by the carrier.
If the goods are accompanying an importer at the time of entry, an importer will be required to visit the port’s entry branch where they will have to fill out CBP Form 7501 (Entry Summary). Additionally, the importer will be required to obtain a customs bond from a licensed surety to cover the temporary import.
Alternatively, the importer may work with a Licensed Customs Broker to obtain a TIB ahead of time. By doing so, an importer can pre-clear all cargo through Customs and ensure that a bond for twice the amount of import duty on their goods is obtained. CBP recommends that importers work with customs brokers to ensure that TIBs are secured in advance so that there are no issues during the import process.
A third option is to obtain an ATA Carnet. While slightly different than a TIB, an ATA Carnet may also be used to temporarily import products. ATA Carnets can be secured in advance and are good to be used for a calendar year.
Most goods imported under a TIB are good for one year from the original date of importation. There are some exceptions, however.
Most products may be granted a one-year extension of the TIB, up to three total years. The extension must be applied for before the current year is up and cannot be requested retroactively. On the other hand, some goods are only covered by a TIB for up to 6 months and are not subject to extensions.
It’s worth noting that in order to comply with a TIB, a product must be permanently exported from the country. Shipments to U.S. territories and insular possessions do not qualify as permanent exports. If you’d like to import the product back into the country, you must obtain a new TIB after the product is officially exported.
The short answer is no. Once you agree to a TIB, it must be completed by either exporting or destroying the product. If you decide you’d like to import the product permanently, you will still be required to pay two times the duty amount owed on that product if it is not exported or destroyed within the agreed-upon timeframe. Alternatively, you can complete the TIB and then re-import the product at the normal duty rate.
The same goes for a product that is misplaced while under a TIB. If you can’t provide proof that the product was exported or destroyed, you will be required to pay liquidated damages for that product instead of the duty owed on a permanent import.
It’s also worth noting that this counts for every item listed under a TIB. If you have five products covered under a TIB, but misplace one and are unable to provide proof of its export or destruction, you will be required to pay liquidated damages on the entire TIB.
This may go without saying, but a temporary import bond is only required on products imported into a country that has no trade agreement in place with the country of origin. If the country you plan to import from has a trade agreement with the United States, you will not be required to pay duty or secure a TIB.
If there is no trade agreement in place, the decision of whether or not to secure a TIB is up to you. A TIB can absolutely save you money on imports that only need to be shipped abroad for a limited amount of time, however, it does come with some risks.
If the products covered by a TIB are lost or stolen, or if the TIB is not completed correctly, you could end up owing twice the amount of money you would have if you had imported the products without the TIB.
Like a TIB, an ATA carnet allows an importer to temporarily import goods into a country. So how does a temporary import bond differ from an ATA carnet?
Unlike a TIB, an ATA Carnet can be used more than once. A carnet can be used to import and re-export goods in and out of multiple countries as many times as necessary during a 12-month period. No other documents are required for your goods other than the carnet.
An ATA Carnet can also only be used to cover specific items, like goods that are used commercially. Some of the most common products imported under an ATA Carnet are:
Not all products are eligible to be imported using a temporary import bond. Only goods listed in subheadings 9813.00.05 through 9813.00.75 of the Harmonized Tariff Schedule of the U.S. (HTSUS) qualify to be imported under a TIB. This encompasses 14 subheadings:
It’s important to note that goods covered by subheading 14 (9813.00.75) may only be imported for six months (as opposed to one year) and cannot be granted extensions. Similarly, if goods covered in subheading 10 (9813.00.50) are seized for any reason other than personal lawsuit, the requirement to export the product will be suspended during the time that the goods are seized.
Goods imported into the U.S. for the purpose of resale will not be granted coverage by a TIB under any circumstance, even if the goods in question fall under one of the above subheadings.
If a product is not exported or destroyed within the agreed-upon amount of time, the importer will be required to pay liquidated damages in the form of twice the dutiable amount owed on the imported product.
For example, let’s say you were planning on importing a shipment of bicycles (specifically those having both wheels not exceeding 63.5 cm in diameter) from Germany for a race in the United States. These bicycles fall under HTSUS code 8712.00.1500, meaning you would owe a duty rate of 11-percent.
If the entire shipment cost $5,000, the duty rate would be $550. If you wanted to import these bicycles temporarily using a TIB, you would be required to post a bond double that amount - in this case, $1,100. Once the race is completed and the bicycles are exported, the $1,100 would be returned. However, if you failed to complete the TIB correctly, you would owe that $1,100 in liquidated damages.
|Bicycle Shipment||Duty Owed (11%)||Temporary Import Under Bond|
If it’s found that a TIB was broken intentionally, the importer may be subject to additional penalties, depending on the importer’s level of culpability.
Whether this is your first time importing or you’re a seasoned vet, partnering with a Licensed Customs Broker is the simplest way to import. Customs brokers help facilitate international trade by ensuring that your shipments are legal, compliant and cleared through Customs. They can also help walk you through some of the more complicated steps involved in the importing process.
One of the best uses for a customs broker is getting help securing a temporary import bond. As discussed above, it’s critical that every aspect of a TIB is followed to the letter to ensure that you’re not left paying penalties twice the amount you would have had you just imported the products normally.
Not only can a Licensed Customs Broker walk you through the process, but they can also help ensure that all required documentation is filled out and submitted. That includes providing proof of completion of your TIB sent to the original port of entry’s customs office.
USA Customs Clearance, powered by AFC International, has among the best customs brokers in the industry. We offer 1-on-1 consulting sessions and can help you secure a continuous customs bond if you plan on importing throughout the year. Give us a call at
(855) 912-0406 and we can help you get started today.
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