Bonds Part 3 - Temporary Import Bonds, E29Bs, and Carnets.

Bonds Part 3 - Temporary Import Bonds, E29Bs, and Carnets.

Note - With the looming arrival of CARM, the E29B is likely to change. This information is accurate as of the day of writing but check with your Customs broker for the latest. 

The last of our bonds series tackles one of the more niche uses for a Customs bond - the Temporary Import Bond (TIB) or, as its equivalent is known in Canada, the E29B. Essentially, these two allow importers to bring items into their respective countries that are intended to be exported unchanged after a brief period - with the notable exception of repairs and overhauls. The most common example is trade shows. Exhibitionists looking to show off an item or put up posters or display pieces temporarily can import the necessary goods under the appropriate TIB or E29B without paying the appropriate duties and taxes on the condition they export them by a specific date. 

In this post, we will discuss these two processes, including their fundamental differences, while also highlighting the international cousin they are often mistaken for - the Carnet. 

What is a ‘Temporary Import Bond?’

A TIB is a US-only special entry type that is used when goods are coming into the country without the payment of duty or Merchandise Processing Fees. It effectively allows the importer to post a bond that ensures the goods will be exported within a set time frame. The TIB amount is usually twice the estimated duties and taxes.

Situations where you might put a TIB to use include: 

  • Trade shows (Demonstration only)
  • Conventions (Demonstration only)
  • Training
  • Assembly
  • Processing
  • Testing 
  • Repair or replacement of damaged goods
Exhibiting In A U.S. Trade Show: Consider A Temporary Import Bond

As one might expect, temporary imports under TIBs are highly regulated. Some of the more general rules include: 

- The goods cannot be sold while under a TIB, and if you decide that you would like to sell them, they must be exported and then reentered under a consumption entry.
- If goods are changed while in the US, the changes must be carefully cataloged and records of processing must be kept. 
- Typically, the period a good can stay in the US is either six months or one year, depending on the import, but it can be extended upon request and approval from US Customs. 
- Everything that comes in must come out, and a failure to export the goods within the timeframe will result in significant penalties and liquidated damages. 
- The only goods that can qualify for a TIB are those listed in the fourteen subheadings 9813.00.05 through 9813.00.75 of the Harmonized Tariff Schedule of the United States
- At the conclusion of an import's time in the US, it must check in with CBP before export and then present proof of that export to US Customs. Proof can include: 

  • A Customs Form 3495 Application for Exportation of Articles Under Special Bond
  • Certified copy of the entry that the goods are being imported to
  • Certified copy of the bill of lading

What is the CBSA’s E29B? 

Canada’s E29B is a temporary admission permit provided by the Canadian Border Service Agency (CBSA). It functions similarly to the TIB, but there are several vital differences between them. The first and most challenging thing when writing about both of them is that the E29B is not itself a bond. It is, functionally, a contractual understanding between the importer and the CBSA that the goods being imported into Canada temporarily will be exported by a set date. 

Unlike the TIB, there can be a deposit required that is returned when you export the goods or taken into account if you do not. This deposit is charged primarily at the discretion of the CBSA, but for most imports over $100 it is exceedingly rare for there to be no deposit required. At its maximum, the deposit is equal to the total Customs duty and tax that would be owed if the items were imported under normal conditions. 

You can pay for this deposit in most ways, with a few corner case exceptions like Government of Canada Savings Bonds and letters of credit being disqualified. But most interestingly to the day’s topic is that this can be paid for with a bond you post to the CBSA. If you choose to go through a broker, we charge for the deposit upfront and then return it to you upon receiving confirmation that CBSA has approved a successful export. 

One of the ways that the E29B is similar to the TIB is that there are many ways for it to go wrong in the paperwork phase. Filling out the paperwork required for both the E29B and the TIB can be a significant investment of time and requires a certain amount of knowledge about the bureaucracy that surrounds this. The surest way to make sure you are doing things as straightforward as possible is by leveraging your Customs broker. For a fee, your broker can utilize their own bond, help with the paperwork involved in this process, and differentiate what can be shipped under these conditions and what can’t. We’ve created a helpful guide to help you determine what you need to know before you begin. 

Do You Need a Carnet? 

It is worth discussing whether or not you need a TIB/E29B or a carnet. A ‘carnet’ is essentially a passport for objects that will be traveling with you internationally. You can apply for one from the Chamber of Commerce, and it lasts for a year. If you're curious about whether you need a bond for a carnet - you do, and the necessary financial security is typically set at 40% of the value of the goods listed on the Carnet. 

However, once you have one, it allows for duty-free travel across over 100 different countries over the course of that year. An excellent example of when a carnet makes sense is a traveling band or act with a lot of gear and equipment. Another example is a company that intends to show products at several international trade shows that year. 

As always, it is highly recommended that you work with a broker before making any import decisions - particularly when there are as many options and pitfalls in play as there are with TIBs and E29Bs. Please get in touch with our Customs broker team today for the whole picture and the support you need to import your goods effortlessly and temporarily.

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PCB Group

Pacific Customs Brokers Ltd., Pacific Customs Brokers Inc., PCB Freight Management

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.
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