Changes to Sufficiency Letters


For several years, U.S. Customs has been periodically monitoring the sufficiency of active bonds they have on file.  If Customs finds that an active Importer bond is not sufficient based on the import activity of the principal, they will provide a sufficiency notice to the principal and surety company that requires the active bond to be rewritten at a higher amount.  Customs previously provided 30 days for the principal to comply with this letter; however as of November 2015 Customs now provides only 15 days.

Based on this change, if one of your accounts receives a sufficiency notice from Customs, it is in the best interest of the principal to work on obtaining the new bond at the higher amount immediately.  Failure to comply with this letter will result in the bond being deemed insufficient and unusable.

For example, if Customs mails a notice to the principal, dated December 1st, the notice would indicate that a new bond must be filed at a higher amount no later than December 15th.  Since Customs guidelines do not permit concurrent bonds and require 15 days to terminate an active bond, the insufficiency notice also indicates that the current bond must be terminated by December 31st.  Therefore, as long as the termination request is filed by December 15th, the termination date for the current bond would be prior to December 30th.  Once the termination date is input in the Customs database, the new bond at the higher amount may be filed for the next day.

If the termination and new bond were not filed by the deadline, the principal would most likely not experience any issues utilizing the current bond until the 31st day from the date of the notice.  Customs’ current procedure is to review all the bonds that received insufficiency notices 31 days after the date of the notice.  If Customs does not find a prior termination date, Customs would deem the bond insufficient, regardless if a termination and new bond were filed between the 15th and 30th.  In our example, if the termination request and new bond were filed with Customs on December 23rd and took effect on the earliest possible date, January 7th, Customs would review the current bond on December 31st and deem this bond insufficient.  Once insufficient, the principal would not be able to utilize the current bond until the new bond takes effect.  While the current bond is insufficient the principal would need to wait until the new bond takes effect to import or will be required to post single transaction bonds for each entry made.  If the principal waited and filed the termination and new bond on or after the 31st day, the principal may be left with an insufficient bond for at least 16 days based on the termination guideline indicated above.

Due to the shorter deadline supplied by Customs, it is very important that the principal ensures the mailing address on file with Customs is the correct address as any loss in days could make all the difference in complying with the sufficiency letter.