In-Bond

In-bond refers to imported goods that move within a country under customs control without immediate payment of duties. The cargo is “bonded”—guaranteed by a customs bond—until it reaches its final destination or is formally entered for consumption.

How In-Bond Works

Basic Concept

• Goods arrive at port of entry
• Not immediately cleared for consumption
• Move to another location under bond
• Duties deferred until final entry

Movement Example

Container arrives: Long Beach, CA
                   ↓
          In-Bond Movement
                   ↓
        Final destination: Chicago, IL
                   ↓
         Customs entry made
                   ↓
           Duties paid

Types of In-Bond Entries

Immediate Transportation (IT)

• Port to port within US
• Goods must be cleared at destination
• Most common in-bond type
• 30-day limit to arrive

Transportation and Exportation (T&E)

• Moving through country for export
• Example: Japan → US (Seattle) → Canada
• No US duties paid
• Passes through in-bond

Immediate Exportation (IE)

• Arrived, immediately exported
• No entry into commerce
• For transshipment purposes
• Quick turnaround

Why Use In-Bond

Business Reasons

• Defer duty payment
• Use different customs port
• Access bonded warehouses
• Transship through country
• Delay entry decisions

Practical Examples

Scenario 1: Deferral
Ship arrives Seattle, goods go to
Denver warehouse. Clear customs later
when goods sell, pay duties then.

Scenario 2: Different Port
Arrive at busy LA port, in-bond to
Phoenix where broker/warehouse located.
Clearer locally.

Scenario 3: Transit
Canadian goods enter at Detroit,
in-bond to Buffalo for export back
to Canada (routing reasons).

In-Bond Requirements

Documentation

• In-bond entry (CBP Form 7512)
• Commercial invoice
• Packing list
• Bill of lading
• Carrier bond

Bond Requirements

• Customs broker bond
• Carrier bond
• Importer bond
• Sufficient to cover potential duties

Time Limits

• Immediate Transportation: 30 days
• T&E: 30 days
• Extensions possible but require approval
• Penalties for exceeding

In-Bond Movement Process

Step by Step

1. Arrival - Goods arrive at US port
2. In-Bond Filed - CBP Form 7512 submitted
3. Approved - CBP authorizes movement
4. Transit - Bonded carrier transports
5. Arrival - Goods reach destination
6. Close - Destination port closes in-bond
7. Entry - Formal customs entry made
8. Duties - Paid at final destination

Tracking

CBP tracks all in-bond movements:
- Origin port records departure
- Destination port records arrival
- Electronic notification
- Penalties if not closed properly

Bonded Carriers

Who Can Transport In-Bond

• Licensed bonded carriers
• Trucking companies with bond
• Railroads
• Airlines
• Bonded couriers

Carrier Responsibilities

• Maintain bond coverage
• Deliver to bonded facility only
• Meet time requirements
• Report to customs
• Prevent diversion

In-Bond to Bonded Warehouse

Common Flow

Port of Entry
     ↓
In-Bond Movement
     ↓
Bonded Warehouse
     ↓
(Goods stored without duty payment)
     ↓
Entry made when goods withdrawn
     ↓
Duties paid at withdrawal

Benefits

• Delay duty payment
• Sort and distribute
• Wait for buyer
• Quality inspection
• Re-export option

In-Bond Risks

Potential Issues

• Time limit violations
• Diversion (goods not reaching destination)
• Documentation errors
• Seal breakage
• Unauthorized access

Penalties

• Duty payment on diverted goods
• Liquidated damages
• Fines
• Loss of privileges
• Bond claims

In-Bond vs. Immediate Entry

Best Practices

For Importers

1. Know time limits
2. Use reliable bonded carriers
3. Track in-bond movements
4. Close entries promptly
5. Maintain adequate bonds

For Brokers

1. File accurately
2. Monitor transit times
3. Ensure destination closure
4. Communicate with carriers
5. Address exceptions quickly