Current Issues

Updated 2/1/08

[Conflicts between Surety Agent Limits Printed on the CBP 301 Form and
Authorized POA Amounts Recorded with CBP]{.underline}

The Revenue Division Bond Team has been advised that completed CBP 301
forms with printed 'liability limitations' associated with the surety or
surety agent are not acceptable. An example of this type of language is
"power of attorney limited to \$200,000".

Surety and surety agent authorizations are formally recorded with CBP
via a separate, distinct process. As such, printed limitation language
on the CBP 301 bond form can unnecessarily confuse or mislead parties
who use that form. This is especially true in the numerous identified
instances wherein the printed limitations on the CBP 301 form *[do not
match]{.underline}* the formally authorized limits recorded with CBP.

In July, 2007, the Revenue Division Bond Team informed the Trade
Community via internet posting of concerns surrounding CBP 301 forms
containing 'liability limitation' language associated with the surety or
surety agent. The Revenue Division advised at that time that all CBP 301
forms containing any extraneous liability limitation language would be
rejected beginning on an undetermined future date.

This notice serves to inform the Trade Community that effective 2/11/08,
any CBP 301 form or bond rider submitted to the Revenue Division which
contains any liability limitation language (whether or not that language
matches the power of attorney information currently on file with CBP)
will be rejected.

[Withdrawing of Bond Submissions]{.underline}

Effective immediately, the Bond Team will withdraw any bond submission
which has been in reject status for more than 30 days. These are
inactive files which have been rejected by the Bond Team, but a response
has not been received to the rejection notice. The filer will no longer
receive a notice advising them that the submission has been withdrawn.
Instead, it is incumbent on the bond filer to track all bond submissions
made to the Revenue Division. If a bond submission has not been
approved, nor has a reject notice been received within three weeks from
the date of submission to the Revenue Division, the filer is obligated
to follow-up by making a status inquiry with the Bond Team. If bond
filers diligently follow-up in this manner, they will be made aware of
pending bond rejections before they are withdrawn and discarded by the
Bond Team.

[Riders and Termination Requests for Activity Code 1A, 2, 3, 4, and 5
Bonds]{.underline}

Effective August 20^th^, 2007, the Revenue Division will process bond
riders and termination requests for ***[all]{.underline}*** continuous
bonds. These types of requests may be submitted directly to the Revenue
Division via email (<cbp.bondquestions@dhs.gov>) or fax (317-614-4517).
Please note that applications for new continuous bonds (other than
activity code 1 bonds) must continue to be submitted to the Service Port
or Drawback Office.

[Canadian Province Codes]{.underline}

Several years ago, CBP revised the acceptable 2-digit Canadian province
codes for Quebec and Newfoundland (incl. Labrador) to conform to
Canadian postal standards. The correct codes for these provinces are
"QC" and "NL" respectively (please note instructions on the reverse side
of the CBP 5106 form, available at [www.cbp.gov](http://www.cbp.gov/)).
In the past, CBP had required code "PQ" for Quebec and "NF" for
Newfoundland (incl. Labrador) respectively.

All importer record additions or changes filed with CBP should utilize
the correct Canadian province codes as noted on the reverse side of the
CBP 5106 form.

The Revenue Division Bond Team has determined that approximately 7000
active importer records referencing one of these incorrect province
codes remain on file with CBP. The Revenue Division will assist the
Trade Community with replacing these two obsolete codes on all existing,
active importer records. Effective on or around July 27, 2007, all
active importer records on file with Canadian province codes "PQ" or
"NF" will be corrected as follows: records with code "PQ" will be
changed to "QC", and records with code "NF" will be changed to "NL".

Please note that no other changes will be made to these importer records
beyond simply correcting the invalid province code. CBP will not require
bond riders for the impacted importer records. Questions about this
process may be submitted via email to <casey.horn@dhs.gov>.

[Bond Submissions via Fax]{.underline}

The Revenue Division Bond Team receives most bond submissions via email
or fax directly from the bond filer, and has previously advised the
Trade Community that email submissions tend to be of a higher quality.
Please note that CBP has undertaken an initiative to image all existing
continuous bond paperwork. As a result of that initiative, the quality
of bond paperwork is of even greater consequence because poorer quality
documents cannot be successfully imaged.

In order to insure the success of our imaging efforts, please be advised
that the Revenue Division Bond Team will continue to reject illegible
(or otherwise unreadable) bond documentation. Based on our experience,
submissions received via fax are more likely to lack the quality and
consistency required to be converted into viable electronic images.

[Continued Use of Insufficient Bonds]{.underline}

The Revenue Division Bond Team has identified isolated instances wherein
principals and brokers are using continuous bonds that have been deemed
insufficient. In most instances, ACS / ABI edits will prohibit
insufficient continuous bonds from being used on entry transactions.
However, the Revenue Division Bond Team has identified parties who are
circumventing these edits.

Effective immediately, the Revenue Division may take one or more of the
following actions when it identifies that a principal has been made
aware of the insufficiency of their continuous bond yet continues to use
that bond for any CBP transaction(s):

-   Other continuous bonds which the principal is using in combination
    with their own bond will be re-evaluated and may be rendered
    insufficient (example -- a broker's bond is used for entry, and the
    principal's bond is used for summary)

-   The Revenue Division, in conjunction with the Ports of Entry, may
    input cargo criteria to preclude immediate release of the
    principal's goods

-   As a last resort, the importer record may be voided