CBP Posts "Latest News and Developments" on Processing Bond Applications (Part II - Final)

This is Part II,the final part of a two-part series of summaries on the July 8, 2005 document. See ITT's Online Archives or 07/28/05 news, 05072810, for Part I.

Certain Bond Changes Take Effect 30 Days from July 8, 2005

CBP states that effective 30 days from the July 8, 2005 posting of the guidance document:

the Bond Team will handle mail returned because of an incorrect address as follows:

• upon receipt of mail returned as "undeliverable" by the U.S. Post Office, the Bond Team will first confirm that the correct address was used by CBP;
• the Bond Team will fax or email the bond filer a short notification advising that the principal's mailing address on file with CBP must be corrected. The bond will be rendered insufficient 15 days from the date of the fax/email notification if the address has not been corrected; and
• if the bond has been rendered insufficient pursuant to this process, it will not be returned to sufficient status until the address correction has been completely processed;

bond applications submitted by a licensed customhouse broker must include the 3-digit CBP-assigned filer code as part of the application package;

CBP 301 forms that contain printed names or titles in signature blocks that are not being used (ex. co-principal blocks) will not be accepted. Bond filers should fix software applications used to generate CBP 301 forms so that all extraneous information is removed from that form;

the Bond Team will require that the surety information on the CBP 301 include the complete, physical address of the surety¹. This address should match either the address listed for the surety on the most recent Treasury Department Circular 570 listing (http://www.fms.treas.gov/c570/c570.htmlcertified), or the address currently on file with CBP; and

all bond riders and surety termination requests must show the 3-digit surety code assigned by CBP, the surety name, and the social security number of the authorizing surety agent. CBP notes that because some sureties have very similar names, providing the 3-digit code will reduce the chance of errors.¹

¹ These bond changes were previously summarized in Part I of this two-part series.

Periodic Monthly Statement

CBP states that general questions, comments, or requests with regard to the periodic monthly statement (PMS) program should be directed to the following email address: PMS.Mailbox@dhs.gov. The following email address should be used only for questions concerning the PMS bond rider in particular, or to submit these bond riders to CBP: periodicstatement@dhs.gov.

Complete Bond Application Packages

According to CBP, a bond application package must include the following:

The CBP 301 form must show the legal designation of any corporate principals and sureties. (Example - "Incorporated in Texas" or "A California corporation".)

In addition to a signature, the signature block on the CBP 301 for any principals/co-principals must include the printed name, title, and company of the person signing.

The back of the CBP 301 form must be provided - even if none of the fields are completed.

An application letter with signature, printed name and title of person signing, the date the application letter was completed, the total duties/taxes/fees paid by all companies listed on the bond in the previous 12-month period, and the "I certify" statement (see 19 CFR 113.12). If the importer has no history of imports, then an estimate of the duties/taxes/fees that will be paid in the next 12 months should be provided.

A completed CBP 5106 form if an importer record needs to be added or changed.

A cover sheet listing the name, phone number, fax number, and email address of a point of contact for the application. The 3-digit filer code assigned by CBP should also be shown if a licensed customhouse broker is filing the package.

Additional Requirements and Suggestions

The Bond Team recommends that filers submit bond applications via email rather than faxing the documentation if both options are available to the filer. The copy quality of the documents received via email is superior to faxed submissions.

When submitting a bond application via email, CBP requests that it include the following information in the subject line: "new bond", "reject" or "status request" as appropriate along with the principal's name. CBP states that email subject lines longer than 50 characters should be avoided as this may prevent the sender from receiving the system-generated confirmation/auto-reply email from CBP.

CBP states that an email address should be included as part of the filer's contact information on all submitted bond applications (whether submitted via fax or email).

Bond applications may be submitted up to 60 days before the effective date (see 19 CFR 113.26).

Bond termination requests must specify the CBP-assigned bond number to be terminated. Termination requests that do not have this information will not be processed.

CBP notes that multiple submissions of a bond application will delay the processing of any application for that principal(s). CBP also notes that importer records cannot contain the letter 'O'. Alpha characters are allowed in the last 2 positions of the importer record if that record is based on an employer identification number (EIN), but the letter 'O' is never acceptable due to Automated Commercial System (ACS) limitations.

Per 19 CFR 113.26, bond riders to add or delete trade names or unincorporated divisions on a bond should specify an effective date for the requested change. If an effective date is not specified on the rider, the day that rider is approved will be the effective date when adding trade names or unincorporated divisions. The effective date for deleting trade names or unincorporated divisions will adhere to the guidance contained in 19 CFR 113.26(e).

A surety agent signing a bond rider must have an authorized dollar limit equal to or exceeding the underlying limit of liability of the continuous bond. For example - an authorized surety agent with a recorded limit of $100,000 with CBP cannot authorize an addition rider to a bond that has a limit of liability of $300,000.

(See ITT's Online Archives or 06/21/05 news, 05062105, for BP summary on CBP's notice that all new Activity Code 1 bonds are to be handled by CBP's Revenue Division (and not the ports), etc. effective June 20, 2005.)

CBP notice (dated 07/08/05) available at http://www.cbp.gov/linkhandler/cgov/import/communications_to_industry/pilot_program/latest_news_and_developments/newsdev2.ctt/newdev2.doc.