July 6, 2018 marks the effective date of the U.S. Section 301 25% duties on imports of Chinese-made products included in this list: Chinese Line Items. U.S. importers should be aware that they may need to increase their bond amounts to address the increase in duties on these specific imported goods.
Bonds are based on the value and duty on imported goods. A continuous bond is a contractual agreement between the U.S. Importer, U.S. Customs and Border Protection (CBP), and the Surety. The bond is required by CBP to protect the revenue and ensure compliance with regulations of the United States pertaining to importing and related activities. According to the Customs Directive 3510-004, “the bond limit of liability amount shall be fixed in an amount the district director of customs deems necessary to accomplish the purpose for which the bond is given”. The bond amount is set at 10 percent of the duties, taxes and fees paid in the previous 12-month period, with a minimum of $50,000.
The additional 25% duties may significantly increase your liability, with the possibility of exceeding the threshold of your current bond. If you are incurring additional duties and believe your bond may be insufficient, please contact your MIQ Logistics representative. Two options are available:
- Be proactive and engage MIQ and the Surety to rewrite a new continuous bond to a sufficient level.
- Wait and measure the impact on your current bond. Note that CBP routinely reviews bond amounts for their sufficiency. Once your bond threshold is exceeded, a letter of bond insufficiency is issued. You will then have 15 days to engage MIQ and the Surety to rewrite a new continuous bond to a sufficient level.
For further information, please contact your local MIQ Logistics representative.