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  6. Frequently Asked Questions: Bonds Securing Customs Activities for Suspended or Debarred Persons

Frequently Asked Questions: Bonds Securing Customs Activities for Suspended or Debarred Persons

Change in U.S. Customs and Border Protection’s Bond Policy for Suspended or Debarred Persons 

For information on suspension or debarment, navigate to the Suspension and Debarment section of CBP.gov at: www.cbp.gov/trade/programs-administration/suspension-and-debarment.

A Frequently Asked Questions document is also available at: https://www.cbp.gov/trade/programs-administration/trade-compliance/suspension-and-debarment/faqs.

Should you have questions about suspension and debarment, please contact the Suspension and Debarment Division at CBPsuspensionanddebarment@cbp.dhs.gov

The word “person” means any individual, corporation, partnership, association, unit of government, or legal entity, however organized.  See 2 C.F.R. § 180.985.

For details on CBP’s change to bond policy for suspended or debarred persons, see CSMS message #47894086 issued May 21, 2021.

The Government-wide suspension and debarment system exists to protect the public interest, the public’s money, and the integrity of Federal programs by ensuring that Federal agencies only conduct business with presently responsible persons. To further protect the public interest, the public’s money, the integrity of Federal programs, and the expenditure of CBP staffing resources, CBP will no longer permit a person who is suspended or debarred, to meet the bond requirements of any customs activity using a continuous bond, for the duration of that person’s suspension or debarment, unless a continuous bond is the only form of bond acceptable for that activity, such as operating a foreign trade zone.

This policy is effective May 11, 2021, the day CBP’s Senior Official Performing the Duties of the Commissioner signed a memo revoking the authority of all CBP officials to permit a person who is suspended or debarred by CBP, to meet the bond requirements of any customs activity using a continuous bond, for the duration of that person’s suspension or debarment, unless a continuous bond is the only form of bond acceptable for that activity, such as operating a foreign trade zone.  For persons who are suspended or debarred by another Federal agency, the memo authorized the Office of Trade, Trade Policy and Programs, to evaluate and decide, either categorically or on a case-by-case basis, whether to permit such persons who are suspended or debarred by another Federal agency to use a continuous bond to secure that person’s customs activities during the period of that person’s suspension or debarment. This new policy impacts any person suspended or debarred by CBP, or suspended or debarred by another Federal agency, that CBP has decided not to permit use of continuous bonds to secure that person’s customs activities, on or after May 11, 2021.

Any person suspended or debarred by CBP can be located on the System for Award Management website, SAM.gov. See CSMS message #47894086 issued May 21, 2021 and  Finding CBP Exclusions on SAM document, for visual instructions on how to conduct a search. 

Any person suspended or debarred by another Federal agency that CBP has decided not to permit use of continuous bonds to secure that person’s customs activities will receive written notice from the Office of Finance, Revenue Division. Sureties and surety filers are encouraged to work with their clients to determine if written notice has been issued to the person.

The Office of Trade, Trade Remedy Law Enforcement Directorate, Suspension and Debarment Branch, will ensure that persons suspended or debarred by CBP are listed as excluded by CBP on the System for Award Management (SAM) website (www.SAM.gov). See CSMS message #47894086 issued May 21, 2021 and the attachment, Finding CBP Exclusions on SAM, for instructions on how to search for persons suspended or debarred by CBP on the SAM website.

Yes, the Office of Finance, Revenue Division, will provide written notice to any person suspended or debarred by CBP or any person suspended or debarred by another Federal agency that CBP has decided not to permit use of a continuous bond to secure that person’s customs activities, and that person’s continuous bond surety (as applicable), at least 15 calendar days prior to the first customs activity that cannot be secured by a continuous bond under this policy. 

The Office of Finance, Revenue Division, will continue to monitor continuous bonds and will ensure that any continuous bonds that are not terminated after issuance of the written notice described above are rendered insufficient, as necessary, for persons suspended or debarred by CBP or for persons suspended or debarred by another Federal agency that CBP has decided not to permit use of a continuous bond to secure that person’s customs activities. In addition, any new or replacement continuous bonds will be rendered insufficient, as necessary, if filed for persons suspended or debarred by CBP or for persons suspended or debarred by another Federal agency that CBP has decided to not to permit use of a continuous bond to secure that person’s customs activities.

SAM.gov lists the effective date and termination date of the suspended or debarred persons exclusion.

Yes, when a person’s suspension and/or debarment terminates, use of a continuous bond to secure customs activities may resume.

Yes, cash in lieu of surety can be used but only for single transactions. In addition, STBs secured by a surety may be used.

CBP announced this policy in CSMS message #47894086 issued May 21, 2021. The policy will also be published in the Bond section of CBP.gov, and in the next version (version 10.75) of the Automated Commercial Environment (ACE) Entry Summary Business Process Document.

Questions related to this new policy should be directed to Office of Trade, Trade Policy and Programs, Bond Policy at otbonds@cbp.dhs.gov

No. CBP sees value in having such an indicator on the person’s ACE account profile to assist the Trade in identifying suspended or debarred persons that cannot use a continuous bond to secure their customs activities, unless a continuous bond is the only form of bond acceptable for that activity, such as operating a foreign trade zone. CBP will investigate this ACE enhancement to the ACE account profile, as well as the possibility of inclusion of an indicator in the importer/bond query.

CBP does not foresee imposing consequences on sureties who mistakenly submit a continuous bond for a person suspended or debarred by CBP or a person suspended or debarred by another Federal agency for whom CBP has decided not to permit use of a continuous bond for that person’s customs activities, and who promptly take corrective action; however, CBP always reserves the right to take enforcement action when appropriate and necessary, such as when egregious, intentional, or repeated violations occur.

The written notice will identify the bond principal (the person suspended or debarred), the bond number, the bond amount, the surety name, and the surety code.

Per 19 CFR Part 113, certain customs activities may only be secured by a continuous bond: Custodian of Bonded Merchandise operations (Activity type 2), Instrument of International Traffic (Activity type 3a), Foreign Trade Zone operations (Activity type 4), Airport Security operations (Activity type 11), In-Bond Export Consolidator Operations (Activity type 14), and Marine Terminal Operations (Activity type 17).  If CBP did not permit suspended or debarred persons to use a continuous bond for these activities, the persons would not be able to engage in these activities at all.

Brokers will not receive written notice from the Office of Finance, Revenue Division. The Office of Finance, Revenue Division, will continue the existing process of providing written notice to any person suspended or debarred by CBP or any person suspended or debarred by another Federal agency that CBP has decided not to permit use of a continuous bond to secure that person’s customs activities, and that person’s continuous bond surety (as applicable), at least 15 calendar days prior to the first customs activity that cannot be secured by a continuous bond under this policy. Brokers are encouraged to work with their clients to determine if written notice has been issued to the person.

No. CBP sees value in having the written notice issued to persons suspended or debarred by CBP or suspended or debarred by another Federal agency that CBP has decided not to permit use of that person’s continuous bond, available in ACE. CBP will investigate this ACE enhancement.

CBP expects the members of the trade community to take all steps that any prudent business would to make sure it is dealing with responsible persons.  A list of all persons and entities that are currently suspended or debarred by any Federal agency, including those suspended or debarred by CBP, is publicly available through the System for Asset Management (SAM) website.

Yes. The Trade may contact the Suspension and Debarment Branch at cbpsuspensionanddebarment@cbp.dhs.gov

Not at this time. The importer/bond query does not currently contain any output related to a person’s suspension or debarment status. In addition, a person’s ACE account profile does not currently contain an indicator or other information to reflect that a person is suspended or debarred by CBP, or that a person is suspended or debarred by another Federal agency and CBP has decided not to permit use of a continuous bond for that person’s customs activities. CBP sees value in having such an indicator on the person’s ACE account profile to assist the Trade in identifying suspended or debarred persons that cannot use a continuous bond to secure their customs activities, unless a continuous bond is the only form of bond acceptable for that activity, such as operating a foreign trade zone. CBP will investigate this ACE enhancement as well as the importer/bond query enhancement.

Suspension and debarment are always finite. Each exclusion listing on www.SAM.gov will contain an ‘activation date’ and a ‘termination date’. It should be noted that the initial period of suspension or debarment may subsequently change. Depending on the circumstances of each situation, the period of suspension or debarment could be mitigated down or further extended. The Trade should monitor www.SAM.gov to ensure that continuous bonds are not submitted for affected persons until the suspension or debarment has terminated. A person remains suspended or debarred if the ‘Exclusion Status’ on the exclusion listing is ‘Active’.

Last Modified: July 16, 2021