Importing goods into the U.S. comes with a lot of moving parts, and one of the biggest (but often overlooked) concerns is Customs bond sufficiency. If you’ve ever received a letter from U.S. Customs and Border Protection (CBP) saying your bond is insufficient, you’re not alone. But what does that mean, and how do you avoid bond stacking—a costly mistake that can seriously dent your cash flow?
Let’s break it down.
What is Bond Sufficiency?
Every importer is required to have a continuous Customs bond covering at least 10% of their total duties, taxes, and fees (DTF) from the past 12 months. CBP monitors this on a rolling basis, meaning that as import volumes change, your bond might need adjusting.
“If your bond isn’t keeping up with your imports, CBP will send a letter mandating an increase,” says Andrea King-Warren, Bond and Insurance Manager at Coppersmith Global Logistics. “Once that happens, importers are responsible for ensuring their bond is sufficient—not CBP.”
Why Should Importers Care?
If your bond is too low, CBP requires an immediate increase, and that’s where things get tricky. Many importers simply buy the next bond tier listed in CBP’s letter, but that number is often just a minimum estimate—meaning you could be setting yourself up for another increase in a few months.
Failing to forecast your true import activity can lead to:
- Multiple bond increases in a short period
- Bond stacking, which increases financial liability
- Sureties requiring collateral (cash or a letter of credit)
- Delays in clearing goods due to compliance issues
What is Bond Stacking?
Bond stacking happens when multiple bonds for the same importer are active at the same time. This happens because Customs entries don’t liquidate immediately—they can take 314 days or more to finalize. So, when a new bond is issued before the old one is fully released, the insurance company (Surety) is on the hook for both bonds at the same time.
As bond stacking liability increases, insurance companies get more cautious. This can trigger:
- A financial review of your business
- Collateral requirements to secure the bond
- Higher overall costs due to increased risk exposure
How to Avoid Bond Issues
- Monitor your bond sufficiency regularly, not just when CBP sends a notice.
- Forecast future import activity before buying a new bond—don’t just default to CBP’s minimum recommendation.
- Work with a Customs Broker to analyze your import trends and prevent unnecessary increases.
- Avoid stacking risk by securing a bond amount that covers expected imports for the next 12 months.
Final Takeaway
Bond sufficiency is about more than just meeting CBP’s requirements—it’s about protecting your bottom line. A properly calculated bond keeps you compliant, reduces financial risk, and prevents you from getting caught in the costly cycle of bond stacking.
If you’re unsure about your current bond, talk to your Customs Broker or Surety Provider today. Making the right move now can save you from a financial headache down the line.
