Importer Bonds Under Customs: Continuous Bonding Single Entries, CARM and the D120

Importer Bonds Under Customs: Continuous Bonding Single Entries, CARM and the D120

Last week’s post dived into what it means to be a bonded carrier and the kinds of bonds that can matter most to those carriers. This week, we are going to take in the one or two common types of surety bonds that are most valuable to the importer on both sides of the US/Canada border. If you’ve ever wondered what the difference between a single entry and a continuous bond in the US is or what CARM is going to mean for commercial importers in Canada, then this is the post for you. 

Before we get to that, however, let’s have a refresher on the basics of Customs bonds: 

What is a Customs Bond? 

In case you are coming here fresh and you haven’t read our previous posts on the subject, a Customs bond is a type of surety bond that acts as a guarantee to the US or Canadian government that they will be paid what they are owed by importers. It is essentially an insurance arrangement between Customs, the importer, and a surety provider. Should an importer face financial issues or simply need to move their shipment through bonded carriers, the bond steps in to ensure that the Canada Border Services Agency (CBSA) or Customs and Border Protection (CBP) are protected and ultimately get paid. 

In this post, we are going to talk about Customs bonds as they appear or will appear in the near future, namely the US single entry and continuous bonds and the Canadian commercial importer-only bond, the D120. 

Who Needs a Customs Bond? 

Most ‘global trade’ imports need some form of bond backing them, and in this post, our focus is on commercial importers. As one might expect, the requirements are different in Canada and the US, and with the introduction of CARM on the Canadian side - they have gained an additional level of complexity in recent years. 


When asking the question, ‘Who needs a Canadian customs bond?’ the answer is predicated on when your question is being asked because things are changing quickly in the North.

In Canada, the option to pay duties and tax ‘in cash’ at Customs for an import is viable, available, and somewhat inconvenient for most large-scale importers. Most commercial importers rely on Release Prior to Payment (RPP) Privileges - which essentially allow an importer to have their goods released into the commerce of Canada before duties and taxes are paid. 

Before CARM, the bond required for this privilege was typically borrowed from your Customs broker in what is referred to as “Broker Backed Security,” and that could still be the case today, provided you read this before CARM’s full implementation date.

Many programs that served in the place of or supplements to bonds, like Importer and GST Direct, have now been folded into the new framework of CARM. Those who were part of the Importer Direct program likely need to increase their bond to meet the new regulations, and those in the GST Direct program are starting from scratch and will need to acquire their financial security, which we’ll discuss in a moment.

If you are a commercial importer and you intend to take advantage of the RPP privilege after CARM has gone live, you will need to secure your own financial security, and you will need to provide it yourself either through a cash bond or the D120


In the US, it’s currently more straightforward, largely due to it not being actively reshaped. Every import into the US over $800 requires the backing of a Customs bond, and even regardless of value, depending on the commodity. Attempting to cross without one is a surefire way to have your shipment held until you do. 

Importer Bond Types

For commercial importers, the kinds of bonds available depend on what country you are dealing with. The US has Single Entry Bonds and Continuous Bonds, while Canada operates through the CARM Client Portal with cash bonds and the D120.

US Bond Types

Single Entry Bond or Single Transaction Bond

It makes sense to acquire this kind of bond if you are only importing infrequently. Generally, the key difference between a single entry bond and a continuous bond comes down to how many times you are shipping and the duration of time you are looking to ship within.

In the US, ‘single entry’ bonds work for a single shipment. Multiple entries require multiples of these bonds. For example, an importer that has three different shipments arriving at the same port will still need to have three different bonds for each of those entries.

The cost of this bond and the amount it covers are typically equal to the combined value of your shipment plus duties and fees.

It is worth mentioning that food products, electronics, and other goods regulated by Partner Government Agencies (PGAs) will require a bond calculated at three times the value of the shipment plus duties and fees, so be aware that depending on your shipment - this could end up being a significant additional cost.

Continuous Bond

The reality of the Single Entry/Transaction Bond is that if you are getting multiples of them, they stack up in cost. If you are an importer who makes many transactions, then a continuous bond is the more streamlined and affordable option, which, in the long run, will grow your business. 

It is an ongoing bond that runs for a duration of time - most typically a rolling 12 months that begins when you acquire the bond but can be renewed. In effect, a continuous bond allows for multiple imports and multiple types of entries to occur under the same bond, which can reduce costs and allow more flexibility when importing. When compared to the single entry bond, it’s considered a wise practice to get a continuous bond if you make three or more shipments a year. 

Canadian Bond Types

Broker Backed Security

While ending in October with the implementation of CARM, importers currently have the option to utilize the bond of their customs brokers to qualify for the RPP program. Additionally, this has allowed customs brokers to pay the duty and tax on behalf of their clients. 

D120 Bond

When CARM goes live, the option for importers to be broker backed ends. In its place, commercial importers have two options when it comes to qualifying for the RPP program. The first option is the D120 bond - a purchasable bond that is applied for externally but managed in the CARM Client portal and has to be equal to 50% of the highest monthly accounts receivable with CBSA in the past 12 months with a minimum of $5,000 for the importer to qualify for the program. For help getting your own D120 bond, please reach out to our team today

Cash Bond

The second option once CARM is fully implemented is the option to simply post your own securities in the form of a credit card or cash deposit equal to 100% of your highest monthly accounts receivable with CBSA in the past 12 months.

Bonds are a vital piece of the global trade puzzle, and choosing the right one for your business needs is just as important to an importer as it is to a carrier. For more information, help choosing what kind of bond makes the most sense for your business or assistance applying, please get in touch with our import specialists today. We can help you get the advice and the bonds you need.

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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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