An ISF bond is a financial guarantee between three parties:
As is the case with other customs bonds, an ISF bond guarantees that Customs will receive all monies “considered necessary for the protection of the revenue or to assure compliance with any pertinent law, regulation, or instruction.” Therefore, If CBP is unable to collect the monies from the IOR, the bond guarantees the insurance company will pay up to the bond amount.
The bonding requirements for Importer Security Filing can be met using one of three options:
Because every importer is different, the best option will vary between IORs. Typically, either an ISF single entry bond or continuous importer/broker bond are the most cost effective options. This is due to the fact that a Continuous Importer/Broker Bond meets the requirements for both entry and ISF.
The cost associated with an ISF bond is especially relevant to most importers. Although fees vary between Surety/Insurance Agencies, Customs Brokers, and Freight Forwarders, ISF bond fees are typically between $50 and $500.
Consequently, the most cost effective option for most importers with as few as only 1 or 2 ocean shipments each year is typically a Continuous Importer/Broker Bond. This is despite the fact that a Continuous Importer/Broker Bond offers the most overall coverage, including satisfying Entry and ISF bond requirements.
With the recent change to the “Three-Strikes” ISF Enforcement rule, is it especially noteworthy that ISF bond fees may be subject to additional costs or underwriting requirements if you file late.
In conclusion, the best option for your ISF bond needs may any of the options mentioned. Speak with your bonding agent, customs broker, or freight forwarder to determine the best option for your company.