How to Import into the US

Background

For many types of commodities, an endorsement by a foreign goverment or its representative is required to signify that the shipments are authorized for export to the United States. This endorsement, often in the form of an export certificate, certificate of eligibility, or license, serves to describe the type and quantity of merchandise, certifies the country of origin and authorizes the shipment to be charged against any applicable quota. The merchandise covered could be textiles/apparel related to a Tariff Preference Level (TPL) or agricultural commodities such as beef or dairy products. Foreign countries participating in the Electronic Certification System, eCERT, can now transmit export license/certificate data electronically. After transmissions are accepted by U.S. Customs and Border Protection (CBP), results are returned to the country of origin electronically. It should be noted that users of eCERT data that need information specific to the Message Implementation Guidelines (MIG) may go directly to the Technical Guidelines section of this site.

The Electronic Certification System (eCERT) is a system developed by CBP that uses electronic data transmissions of information normally associated with a required export document such as a license or certificate to facilitate the administration of quotas and ensure that the proper restraint levels are charged without being exceeded.

Foreign countries participating in eCERT transmit information via a global network service provider. This allows connectivity to the CBP Automated Commercial System (ACS). When making entry, specific data elements transmitted to CBP by the importer/broker must match eCERT data from the foreign country before any applicable quota is reported. The ability to have goverment-to-goverment transmission decreases the potential for circumvention of quotas resulting from counterfeit documents.

Although the release of the shipment is not precluded by the absence of certificate information, no claims for a preferential duty rate will be considered unless the information transmitted by the filer matches the information transmitted by the foreign goverment. Once this information is processed through ACS, information regarding certificate/license usage is made available to the participating country upon request.

Benefits

Here’s a discovery I thought might be of interest to our readers. Apparently, you can get a free web blog (also called blogs if you’re in the know) hosted by importassist.com if you’re involved in the field of international trade.

Blogs are an important communication tool for import/export companies because they allow them to publish their latest finds, solicit from new vendors, market themselves to the international trade community, etc. They’re also a great resource for import business advice.

I know a lot of our members have been looking to start their own blogs but are lacking either the resources or technical know-how to get one started. What I like about importassist.com is that they’ve taken the difficulty out of starting your own website and instead are hosting any and all the trade-related blogs that care to sign up.

As I see it, there are three benefits to using importassist.com to host your company’s import/export or international trade blog:

• It’s free and the sign up is relatively simple.
• The community is fairly new, and getting in on the ground floor is always a good thing.
• Since they’re concentrating just on import/export and international trade blogs it’s likely that they’ll become a resource for members of that community. A targeted audience like that would be very valuable to the members of the Informed Trade International community.

Take a minute and check out my blog at http://www.importassist.com/informedtrade. Comments are welcome and I look forward to hearing from you

Informal entries cover personal shipments, commercial shipments and mail shipments that are being entered for consumption, i.e. for use or sale. In most cases informal entry can be used if the merchandise is valued at $2000 or less. There are some exceptions such as textiles, certain types of footwear and other goods subject to quota/visa restrictions. Personal shipments valued over $2000 will also require a formal entry. The difference between an informal entry and a formal entry is the bond requirement and the liquidation process. Liquidation is the final computation of duties or drawback accruing to an entry and is the final step in the entry process.

Formal entries are generally commercial shipments supported by a surety bond to ensure payment of duties and compliance with Customs requirements. A bond is like an insurance policy that is payable to Customs in the event that the importer does not comply with import requirements. Having a bond on file, allows an importer to take possession of his merchandise before the payment of duties, taxes and fees. Bonds can be obtained from a surety, which is an insurance company that has been authorized by the Treasury Department to write Customs bonds.

A port director can require a formal entry for any importation if he or she deems it necessary for the protection of the revenue or for admissibility or enforcement issues.

Goods admitted as informal entries do not require the posting of a bond and goods are liquidated on the spot. After the importer receives notification of the arrival of merchandise from the carrier and it is determined that all shipping charges are satisfied an invoice is presented to Customs. When an informal entry is being made, the inspector, not the importer, is responsible for determining the classification number of the goods being imported. The inspector also completes the Customs forms used for informal entry.

To make or file a consumption entry (for imported goods going directly into the commerce of the United States without any time or use restrictions placed on them) the following documents are generally required:

1. A bill of lading, airway bill, or carrier’s certificate (naming the consignee for customs purposes) as evidence of the consignee’s right to make entry.
2. A commercial invoice obtained from the seller, which shows the value and description of the merchandise.
3. Entry manifest (Customs Form 7533) or Entry/Immediate Delivery (Customs Form 3461).
4. Packing lists, if appropriate, and other documents necessary to determine whether the merchandise may be admitted.

When a consumption entry is filed, the importer indicates the tariff classification and pays any estimated duty and processing fee. A surety bond containing various conditions, including a provision for paying any increased duty that may be found to be owed at a later date, may also be required.

The Free and Secure Trade (FAST) program is a Border Accord Initiative between the United States, Mexico, and Canada designed to ensure security and safety while enhancing the economic prosperity of each country. In developing this program, Mexico, Canada and the United States have agreed to coordinate, to the maximum extent possible, their commercial processes for clearance of commercial shipments at the border. This will promote free and secure trade by using common risk-management principles, supply chain security, industry partnership, and advanced technology to improve the efficiency of screening and clearing commercial traffic at our shared borders.

Eligibility for the FAST program requires participants (carrier, drivers, importers, and southern border manufacturers) to submit an application, agreement, and security profile depending on their role in the Customs and Trade Partnership Against terrorism (C-TPAT) and FAST programs. The FAST program allows known low risk participants to receive expedited border processing. This enables U.S. Customs and Border Protection (CBP) to re-direct security efforts and inspections where they are needed most – on commerce that is high risk, or unknown risk – while ensuring the movement of legitimate, low-risk commerce.

When decisions are made to elevate the national threat level, all CBP personnel must be cognizant of the heightened threat of terrorism as well a mandated increase in examinations of cargo and conveyances. Elevated alert levels should have no adverse impact on FAST processing. While other conveyances and cargo will be subject to a greater degree of inspection, FAST shipments are considered known low risk. As such, their processing should continue under normal guidelines during heightened alert levels.

Benefits of FAST

The FAST program is voluntary. The benefits for those that apply and are accepted into the FAST program include:

• Dedicated lanes (where available) for greater speed and efficiency in the clearance of FAST Trans-border shipments;
• Reduced number of examinations for continued compliance with Customs FAST requirements as well secondary priority processing;
• A strong and ongoing partnership with the Canadian Partners in Protection (PIP) and Customs (C-TPAT) administrations;
• Enhanced supply chain security and safety while protecting the economic prosperity of the United States, Mexico, and Canada; and,
• For carrier participants, the knowledge that they are transporting shipments for a C-TPAT approved importer, and on the southern border, a C-TPAT manufacturer.
  

  Basic Participation Requirements

  FAST is a clearance process for known low-risk shipments, thus, any truck using FAST lane processing must be a C-TPAT approved carrier, carrying qualifying goods from a C-TPAT approved importer, and the driver in the possession of a valid FAST Commercial Driver Registration ID Card. Although FAST participation requirements along the northern and southern border are very similar, on the southern border there are two additional requirements. The manufacturer must be an approved C-TPAT participant, and they must also adhere to CBP high security seal requirements.

  C-TPAT is a joint government business initiative to build cooperative relationships that strengthen overall supply chain and border security. C-TPAT recognizes that CBP can provide the highest level of security only through close cooperation with the ultimate owners of the supply chain, importers, carriers, brokers, warehouse operators and manufacturers. Through this initiative, CBP asks businesses to ensure the integrity of their security practices and communicate their security guidelines to their business partners within the supply chain.

  1. Importer Registration: Importers must complete an application for C-TPAT participation with CBP. Importers authorized to use the FAST program for clearance into the United States will have a demonstrated history of complying with all relevant legislative and regulatory requirements, and will have made a commitment to security enhancing business practices as required by C-TPAT.

  2. Carrier Registration: Carriers must complete the FAST Highway Carrier Application Process requirements that include corporate information, a security profile, and a written Highway Carrier Agreement.

  Northern Border: In order to qualify for FAST Highway Carrier membership into the U.S. and Canada, two separate applications must be submitted to each country’s respective FAST Processing Centers. Each country will perform an independent risk assessment and each country will issue independent approvals for participation. For the United States, a FAST approved carrier will have met all aspects of C-TPAT through the FAST registration process.

  Southern Border: To qualify for the U.S./Mexico border highway carriers agreement, the carrier must have demonstrated a history of complying with all relevant legislative and regulatory requirements set forth by CBP. The applying carrier must have made a commitment to security-enhancing business practices as required by C-TPAT and use drivers that are in possession of a valid FAST commercial driver card when using FAST clearance.

  3. Commercial Driver Application: Two separate driver application processes exist for FAST, 1) Northern Border and 2) Southern Border. For northern border applicants, drivers must complete a FAST Commercial Driver Application for the United States and Canada. The application will first be risk assessed by a Canadian consortium of the Canada Border Service Agency (CBSA), Citizenship and Immigration Service for Canada (CIC), and Canada’s Agence de Revenu (ARC). Upon approval from Canada, CBP will conduct a full U.S. based risk assessment. Applicants identified as low risk will report to an enrollment center where they will be interviewed, have their original identification and citizenship documents reviewed, fingerprinted and have a digital photo taken. Low-risk applicants will then be issued a FAST Commercial Driver Card.

  The procedure for the southern border is similar however the FAST driver application is submitted to the Mellon Financial Corporation in Pittsburgh, Pennsylvania prior to being forwarded to the CBP risk assessment center in St Albans, Vermont. Applicants identified as low risk will report to an enrollment center where they will be interviewed, have their original identification and citizenship documents reviewed, fingerprinted and have a digital photo taken. Low-risk applicants will then be issued a FAST – Commercial Driver Card.

  FAST Processing Availability
  The initial phase of FAST processing for U.S. bound commercial shipments began in December 2002 at the port of Detroit, Michigan. Today, CBP has implemented FAST processing at the following northern and southern border crossings:

  Northern Border
  Southern Border
  Alexandria Bay, New York
  Brownsville, Texas
  Blaine, Washington
  Calexico, California
  Buffalo, New York
  El Paso, Texas
  Champlain, New York
  Laredo, Texas
  Derby Line, Vermont
  Nogales, Arizona
  Detroit, Michigan
  Otay Mesa, California
  Houlton, Maine
  Pharr, Texas
  Pembina, North Dakota
  Port Huron, Michigan
  Portal, North Dakota
  Sweetgrass, Montana

  Future FAST expansion sites will include:
  Northern Border
  Southern Border
  Houlton, Maine
  Tecate, California
  Calais, Maine
  San Luis, Arizona
  Massena, New York
  Douglas, Arizona
  Ogdensburg, New York
  Santa Teresa, New, Mexico
  Sault Ste Marie, Michigan
  Eagle Pass, Texas
  International Falls, Minnesota
  Del Rio, Texas
  Oroville, Washington
  Rio Grande City, Texas

  CBP anticipates to have these indicated FAST expansion sites available for FAST processing by July 1, 2005.

  Cargo Release Method(s)

  The two cargo release methods for FAST eligible shipments are the Free and Secure Trade system formerly known as the National Customs Automated Prototype (NCAP), additionally the Pre-Arrival Processing System (PAPS) is also recognized as eligible method of cargo release processing for FAST.

  1. FAST: FAST is the first fully electronic and completely paperless cargo release mechanism put into place by CBP. Paperless processing is achieved through advanced electronic data transmissions and transponder technology. FAST is highly automated and allows for the expedited release of highly compliant cargo from major importers, reducing congestion at our land borders.

  2. Pre Arrival Processing System (PAPS) -The Pre-Arrival Processing System (PAPS) is a ACS (Automated Commercial System) border cargo release system that utilizes barcode technology to expedite the release of commercial shipments while still processing each shipment through Border Cargo Selectivity (BCS) and the Automated Targeting System (ATS).

  Each PAPS shipment requires a unique barcode label, which the carrier attaches to the invoice and the truck manifest while the merchandise is still in Canada or Mexico. The barcode consists of the Standard Carrier Alpha Code (SCAC) and Pro-Bill number or entry number. The licensed U.S. Customs broker in the United States must indicate this sequencing of SCAC code and unique number (Pro Bill, Entry number or unique set of numbers) in the BCS entry in ACS. Upon the truck’s arrival at the border, the CBP officer scans the barcode, which automatically retrieves the entry information from ACS. If no examination is required, the CBP officer then releases the truck from primary reducing the carrier’s wait time and easing congestion at the U.S. border.

Export License and Textile Visa Requirements A textile visa is an approval in the form of a stamp on an invoice or export control license which is issued by a foreign government. It is used to restrict the exportation of textiles and textile products to the US and to prevent the unauthorized entry of the merchandise into this country.

A visa system is the most efficient way to prevent illegal trans-shipments and quota fraud. It ensures that both the foreign government and the US tally merchandise and charge quotas in a similar way so that overages, incorrect quota charges and country embargoes can be avoided. If a visa has an incorrect quantity, category, or other missing or incorrect data, or a shipment departs without a visa, the entry is rejected and the shipment is not released until the importer reports the error to the foreign government and receives a new visa or a waiver from the government.
By issuing a new visa or waiver the foreign government is acknowledging that it has been made aware of the category under which US Customs is classifying the shipment and charging the quota, if any, and/or the amount that is being charged.

However, a visa does not guarantee entry of the shipment into the US. If the quota is closed between the times the visa is issued in the foreign country and the merchandise arrives in the US the shipment will not be released to the importer until the quota opens again.

A visa may cover either non-quota or quota merchandise. Conversely, quota shipments may or may not require an import visa depending upon the country of origin. As of this date, the US has entered into visa agreements with many other countries but is enforcing quotas (administered by the US Customs Service) on merchandise from other countries with which the US has no visa agreements. Therefore, shipments from the countries without a visa agreement do not require a visa but are charged to the necessary quota.

Occasionally, when bilateral agreements end and quotas are not in effect, the visa agreement, which is a separate agreement that remains in force, requires that shipments continue to be accompanied by a formal visa.

Visa agreements are unique and most are comprehensive agreements. This means that all commercial shipments of textiles products or textiles of vegetable fibers, man-made fibers, wool and silk blends covered by a category number from a country with which the US has such an arrangement must travel with a visa in order to enter the US However, other agreements cover only a limited number of categories, (e.g., only cotton of categories 300-369). Also, some agreements have exemptions for shipments valued at $250.00 or less (note: this exemption is being phased out of all new or renegotiated agreements), or for traditional cottage industry products. Distinct differences are found in agreements which require a visa to show exact categories and quantities in the shipment while others do not.

To regulate these agreements, textile products are grouped under three digit category numbers. The category numbers were developed by the Committee for the Implementation of Textile Agreements (CITA), an interagency committee comprised of representatives from the Departments of State, Commerce, Labor, and the Treasury and the Office of the US Trade Representative. These category designations cover some several thousand 10-digit legal/statistical item numbers under which the merchandise is classified in the Harmonized Tariff Schedule of the US Annotated (HTSUSA).

The category system was developed to simplify the control of textile imports and to facilitate bilateral agreements by combining the thousands of HTSUS item numbers into only 167 categories.

This effort to simplify the system has been derailed by the fact that these 167 categories have been further divided by country into approximately 350-450 subcategories, sub-sub-categories and combined categories in order to establish quotas on a smaller range of products. Each of these subparts in itself has a separate quota. The narrow breakouts were made to protect different segments of the market for US domestic suppliers affected by the large volume of foreign imports.

When a shipment arrives at a port in the US, an import specialist reviews the visa documents for completeness and accuracy before release of the merchandise. The review requires that the category number, signature, date, quantity, and visa number are correct and match the merchandise involved. After this action is completed and the merchandise is charged to the quota (if required), the shipment is released to the importer.

Shipments – Personal Use:

Products imported for the personal use of the importer and not for resale (regardless of value and whether or not accompanying the traveler, excluding suits tailor made from Hong Kong) are exempt from visa, quotas, and exempt certification requirements.

For Hong Kong, tailor made suits of man-made fiber, wool, silk blend and vegetable fibers other than cotton, without regard to value, not accompanying the traveler, require visas (443/643/(1) or 444/644/(1)).

Personal use shipments are outline by chapter 98, subchapters IV, v, VI, vii, and xvi of the HTSUS, Code of Federal Regulations 143.21 and section 5.2 of the Customs inspector’s handbook. To be a personal shipment, the article must be for the household or personal use of the importer (including gifts) as well as not intended for resale or sale by commission.

Samples – Commercial:

Commercial sample shipments that have been properly marked and are valued at less than $800 from certain countries are not subject to quota and do not require a visa or exempt certification. Shipments may be entered under the informal entry procedures. The guidelines for “properly marked commercial samples” is found in paragraph 4a-h, dated February 28, 1986, of customs directive number 3500-07, or in telex #11061, dated august 3, 1988. The guidelines are below as follows:

A. The invoice for these shipments must contain the statement “marked sample – not for resale”.

B. The inside of the article must be indelibly stamped with the word “sample”. This stamping must be in contrasting color to the article, near the country of origin label, in one (1) inch or greater letters and physically placed on the article itself.

C. Articles which are transparent or incapable of being marked (such as briefs, bikinis, hosiery, blouses without collars, sheer or very thin scarves or garments, etc.) And for which the stamping of “sample” would render the article unsuitable for use as a trade sample, the following guidelines are provided:

1. Fabric labels, not smaller than 2 1/2″ by 1/2″ containing the words “sample-not to be sold”, must be conspicuously and permanently affixed to the article in close proximity to the country of origin label.

(Please note that paragraphs d, e and h of the directive are not pertinent to this section and have been omitted.)

F. The invoice must have been annotated with the notation required in paragraph 4a above and the article marked in accordance with the provisions of 4b and c above, prior to importation into the US The importer will not be allowed to do this after importation.

G. Although these “samples” may be entered under the informal entry procedures (and are exempt from quota, visa and exempt certification requirements) they do not qualify for entry under item 9811.00.60, HTSUS. Accordingly, they are subject to duty under the appropriate HTSUS item number.

Mutilated Samples – HTSUS 9811.00.60:

HTSUS classifications 9811.00.60 for samples are duty-free and do not require a visa or exempt certification. In addition, they are exempt from quota requirements. Reference telex #vbt-88-103 dated, January, 1988 for guidelines on mutilation.

Standard Visa Number:

Visa numbers are mandatory for all visas and export licenses. Most countries use a nine digit number (e.g., 9in123456) standard which is reported to the quota section. When a country is not on the standard system, do not report the visa number to the quota section.

The standard visa number is included in reports sent to foreign governments. A government can verify the categories and quantities authorized for export to the US against the quantities charged by US customs at the time of entry. This reduces re-verification of discrepancies to the specific shipments at rather than having to review individual entries covering a particular category.

Required Visa Number On CF 7501:

Under the authority of paragraph 34d of customs directive no. 3550 061, dated September 18, 1992, the visa number (whether it is the standard nine digit number or not) must be reported in column 34 on the CF-7501, entry summary, for shipments which require an export license or textile visa (including Hong Kong). The number must be shown for each line item covering individual category numbers. Failure to report this number will result in rejection of the entry summary and if it is a live entry (entry/entry summary) the shipment will not be released until the entry summary is in proper format.

The statistical copy of the CF 7501 or the statistical information reported by the broker under the Automate Broker Interface (ABI) program must include this number before transmittal of this information to the census bureau. Exempt certification numbers will not be reported on the CF 7501 or through ABI.

Only one visa number is applicable to a single line. If a line has more than one visa number, then individual lines must be provided for each visa number.

Date of Export/Country of Origin Required On CF 7501:

Under the authority of section 12.130 (i) of the customs regulations, and paragraph 14 of customs directive no. 3550 061, dated September 18, 1992, for visa, quota, or export license requirements, and statistical purposes, if the country of export differs from the country of origin, the export date from the country of origin must be reported on the CF 7501 in column 34, for all textiles and textile products classified in chapters 50 through 63, including chapters 42 an 94 of the harmonized tariff schedule of the US annotated (HTSUS), regardless of whether the merchandise requires a visa or is subject to quota restraints. As in the case of the visa number, a failure to report this date may result in rejection of the entry summary and will delay release of the shipment.

Folklore Products Designation “F” Required On CF 7501:

Shipments of fabric loomed by hand, hand-made articles and traditional folklore merchandise of the cottage industry, are exempted from visa and quota requirements if they are a produced in a country with which the US has both a visa agreement and a bilateral agreement which outlines exemptions for such products if the foreign government has issued a proper and correct certification for exemption. These agreements only waive the visa and quota requirements but do not waive the duty.

Merchandise must be reported in column thirty four of the CF-7501 by placing the symbol F as a prefix to the appropriate HTSUS item number in accordance with statistical head note (1) of section 11, HTSUS and paragraph thirty of customs directive 3550 061, dated September 18, 1992. With the exception of the HTSUS numbers for folklore products shown below in the discussion of Generalized System of Preference exemptions for certain wall and rug hangings, the numbers will be the normal HTSUS item numbers for those articles. As in the date of export and visa number requirements, failing to provide the folklore prefix may result in rejection of the entry.

Merged and Part Categories:

Because of numerous merged and part categories included in textile agreements signed over the past several years, it is now necessary to combine this information into a single document. This report includes the merged categories that are permitted, for both special access and visa program exempt certifications, as well as the category part designations required on visas from those countries that require accurate categories. Countries presently omitted have no merged or part categories for exempt certification or visa purposes.

More current agreements contain verbiage specifying that merged or part categories for purposed of quota are automatically applicable to visa purposes as well.

In the past, quota and visa agreements had been signed separately and at different times, so that merged and part categories for visas were not the same as those for quota. For countries other than those included in this report, along with visa book telegrams and other publications relating solely to visa requirements may be used to determine correct merged and part categories for visas.

Agreements have provided a “catchall” category (e.g. 659-o) for Harmonized Tariff Schedule numbers remaining after some part categories (e.g. 659-h) have been blocked off. However, in some agreements this was not the case. In those cases where a “catchall” category does not exist, only the basic category number (excluding any suffix) is required, even though there are suffixes for the specific parts in the category.

Some merged categories may apply to exempt certifications for special access programs. They are listed separately where needed.

Descriptive language appears in this guide, for ease of reference, but is not exhaustive. The Harmonized Tariff Schedule numbers alone completely represent the part categories.

There are visa stipulations for the following country not listed on the status report. This country is:

(RU) Russia category 435 – subject to visa requirements.

Background

For many types of commodities, an endorsement by a foreign government or its representative is required to signify that the shipments are authorized for export to the United States. This endorsement, often in the form of an export certificate, certificate of eligibility, or license, serves to describe the type and quantity of merchandise, certifies the country of origin and authorizes the shipment to be charged against any applicable quota. The merchandise covered could be textiles/apparel related to a Tariff Preference Level (TPL) or agricultural commodities such as beef or dairy products. Foreign countries participating in the Electronic Certification System, eCERT, can now transmit export license/certificate data electronically. After transmissions are accepted by U.S. Customs and Border Protection (CBP), results are returned to the country of origin electronically. It should be noted that users of eCERT data that need information specific to the Message Implementation Guidelines (MIG) may go directly to the Technical Guidelines section of this site.

The Electronic Certification System (eCERT) is a system developed by CBP that uses electronic data transmissions of information normally associated with a required export document such as a license or certificate to facilitate the administration of quotas and ensure that the proper restraint levels are charged without being exceeded.

Foreign countries participating in eCERT transmit information via a global network service provider. This allows connectivity to the CBP Automated Commercial System (ACS). When making entry, specific data elements transmitted to CBP by the importer/broker must match eCERT data from the foreign country before any applicable quota is reported. The ability to have government-to-government transmission decreases the potential for circumvention of quotas resulting from counterfeit documents.

Although the release of the shipment is not precluded by the absence of certificate information, no claims for a preferential duty rate will be considered unless the information transmitted by the filer matches the information transmitted by the foreign government. Once this information is processed through ACS, information regarding certificate/license usage is made available to the participating country upon request.

Benefits

In simple cases involving small shipments or certain classes of goods such as bulk shipments, examination may be made on the docks, at container stations, cargo terminals, or the importer’s premises. The goods are then released to the importer. In other shipments, sample packages of the merchandise may be retained by Customs for appraisal or classification purposes and the remainder of the shipment released. These sample packages will also be released to the importer after examination.

Examination of goods is necessary to determine:
The value of the goods for Customs purposes and their dutiable status.

Whether the goods are properly marked with the country of their origin. Special marking or labeling may apply. Generally, imported merchandise must be legibly marked in a conspicuous place and with the English name of the country of origin. Certain specific articles are exempt from this requirement. (For further information see Customs Publication No. 539 Marking of Country of Origin on U.S. Imports.)

• Whether the goods have been correctly invoiced.
• Whether the shipment contains prohibited articles.
• Whether the requirements of other federal agencies have been met.
• Whether the amount of goods listed on the invoice is correct, and no shortage or overage exists.

If necessary, goods may be analyzed by a Customs laboratory to determine proper classification and appraisal, to determine that the goods meet safety requirements, or to ensure that they are not counterfeit or otherwise in violation of U.S. laws.

If Customs determines that the goods are different from the entered descriptions in quantity or value, that the classification of the goods is incorrect, or that a different rate of duty than the one indicated by the importer applies, an increase in duties may be assessed. If Customs determines that the importer has deliberately failed to properly classify and value his goods, he may be liable for a fine, or other penalty.

When all the information has been acquired, including the report of the Customs import specialist as to the customs value of the goods, and the laboratory report, if required, a final determination of duty is made and the entry is liquidated. At this time, any overpayment of duty is returned or under-payments billed.

A customs bond is a guarantee from a surety company to the United States government that the importer will faithfully abide by all laws and regulations governing the importation of merchandise into the United States. Any corporation, company or individual who wishes to import goods into the U.S. is required to post a bond or its cash equivalent. The bond is submitted on Customs Form 301. Customs bonds are issued by surety companies. The Treasury Department annually approves insurance companies for the issuance of Federal surety bonds. For a listing of approved surety companies please see the Department of the Treasury’s Listing of Approved Sureties (Department Circular 570).

A bond is not designed or intended to protect the importer. The purpose of a bond is to guarantee that all customs duties, customs penalties, and other charges assessed by U.S. Customs will be properly paid and that all trade procedures will be followed.

WHAT CUSTOMS BONDS DO

Customs bonds provide the following functions:

• Secures deposit of estimated duty and additional duty.
• Secures payment of duty on merchandise left in a bonded warehouse or improperly removed from a warehouse.
• Secures promise to make entry.
• Secures promise to produce any required evidence.
• Secures promise to redeliver conditionally released merchandise.
• Secures promise to bring conditionally released merchandise into compliance with U.S. admission requirements.
• Secures promise to hold conditionally released merchandise intact for examination.
• Secures promise to pay compensation of Customs officers and exonerate Customs officers.
• Secures promise to use merchandise entered free or at a reduced rate in the manner as entitled and to furnish proof of that use.

TYPES OF BONDS

There are two types of bonds: the single transaction bond and the continuous bond. Single transaction bonds cover single importations, and may cost as much as three times the value of the goods depending upon the goods. The bond covers only one import entry. Single importation bonds are used by the importer who conducts very few importations. The second type of bond is the continuous bond. This bond remains in force for one year and must be renewed annually. This bond is useful to the importer who is involved in trade throughout the year. The amount of this bond is usually equal to 10 percent of the total customs duties paid for the previous year or reasonably estimated for the current year, but not less than $50,000.

THE ROLE OF THE SURETY COMPANY

When goods are imported into the United States, the importer is responsible for making the goods available to the U.S. Customs Service for inspection, ensuring that labeling and packaging requirements have been met, making transaction records available for audit and paying estimated or additional duties and fees, where applicable. It is the surety company issuing the bond that guarantees that the importer will comply with U.S. Customs regulations. The surety company will be called on for payment when the importers cannot or will not fulfill their obligations to the United States government. In turn, the surety company is entitled to full recovery of any loss from the importer. If the importer fails to honor the conditions set forth in the bond, the surety company can be obligated to do so in the importer’s place

First Central American Nation to Target and Pre-Screen Cargo to U.S.

Washington, D.C. — For the first time, U.S. Customs and Border Protection’s (CBP) Container Security Initiative (CSI), an innovative program that works cooperatively with foreign governments to target and pre-screen maritime containerized cargo before it heads to the United States, is expanding to Central America. CBP Acting Commissioner Deborah J. Spero and the Republic of Honduras today announced the Port of Cortes as the 44th operational CSI port allowing cargo to be screened for terrorist and terrorist weapons.

A joint declaration of principles was signed on December 15, 2005 and, in addition to bringing the CSI program to Honduras, also brings the U.S. Department of Energy’s National Nuclear Security Administration’s (NNSA) MegaPorts Initiative. The Department of Energy will install large-scale and sophisticated radiological detection equipment to identify nuclear material as part of this initiative.

“The primary purpose of the Container Security Initiative is to protect the American public by securing the global trading system,” said Acting Commissioner Spero. “By bringing CSI to the Port of Cortes, the Republic of Honduras is helping to address the threat to global trade making it more secure against terrorist exploitation. CBP will continue to expand the CSI security blanket to additional foreign ports.”

“Through CSI, the Port of Cortes now has the chance to ship more containers to the United States which will directly benefit the Republic of Honduras because foreign investors will see the country as an easy and secure way to send their merchandise to the United States,” said Charles A. Ford, U.S. Ambassador to the Republic of Honduras. “This will open more job and commerce opportunities, especially once the Central America Free Trade Act (CAFTA) enters into effect.”

U.S. Customs and Border Protection will deploy a multidisciplinary team of officers to be stationed at the Port of Cortes to target maritime containers destined for the United States. Honduran Customs officials, working with CBP officers, will be responsible for screening any containers identified as a potential terrorist risk.

With the Port of Cortes, there are now 44 operational CSI ports in Europe, Asia, Africa, the Middle East, and North, South, and Central America. Approximately 75 percent of cargo containers headed to the U.S. originate in or are transshipped from CSI ports. CBP’s goal is to have 50 operational CSI ports by the end of 2006. At that time, 82 percent of all cargo imported into the United States will be subjected to pre-screening.

The Container Security Initiative will continue to expand to strategic locations around the world. The World Customs Organization (WCO), the European Union (EU), and the G8 support CSI expansion and have adopted resolutions implementing CSI security measures introduced at ports throughout the world. Today, a total of 27 customs administrations have committed to join CSI and are in various stages of implementation.