CHANDLER, Ariz. -- A litany of new tariffs is creating a number of issues that brokers need to be aware of as they interact with their importer clients, including bond insufficiency and a potential increase in CBP requests for information, according to speakers on an April 8 panel at the National Customs Brokers & Forwarders Association of America’s annual conference.
As additional tariffs are implemented and stacked upon each other, importers' bonds will become saturated, according to Joanne Slapinski, vice president of retail insurance broker servicing for International Bond & Marine Brokerage. And the tariffs also can lead to the stacking of liability for sureties -- where multiple bonds remain open for different periods covering the same unliquidated entries -- which then leads to heightened underwriting requirements, she said.
And as tariff liability for importers increases, they'll face more requests for financial statements, and will be subject to higher collateral requirements to cover their higher bonds, Slapinski said.
To ensure bond sufficiency, brokers and importers should have an understanding of the customs bond limit formula, as well as realize that saturation has nothing to do with the bond period, she said.
While CBP's insufficiency notices will note the importer's current dollar amount of tariffs, importers also need to forecast their future duty spend, Slapinski said. “Customs does not have a magic crystal ball that they can see into the future. They do not know how much that importer is going to pay in the months to come. They don’t know if their imports are going to surge in next month or in three months or in six months. Customs only knows the duties that they paid in so far.”
Beyond bond issues, the additional tariffs will "undoubtedly" cause an increase in Customs Form 28 Requests for Information and Customs Form 29 Notices of Action that importers receive from CBP, said Ryan Raynak of HG Enterprises. The agency will be on the lookout for situations where, for example, an importer of USMCA goods suddenly starts adding the USMCA Special Program Indicator (S or S+) to qualify for the exemption from Mexico and Canada International Emergency Economic Powers Act tariffs, or suddenly starts putting on a different country of origin for its goods.
Brokers should make sure their importers see those CF-28s and CF-29s as soon as possible, whether by monitoring them via their own ACE reports, or having the importer clients sign up for ACE to monitor them on their own, Raynak said.
“If we’re going to see a flood of requests coming in, we want to make sure that our clients are getting those on day one and they’re not coming through Postal Service and they’re getting them on day 28 and it’s ending up in the wrong person’s desk,” said Karen Damon, vice president of regulatory compliance for Mohawk Global Logistics and NCBFAA treasurer. “So, encourage them to go in and elect that indicator to receive them electronically.”
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