Customs broker and customs bond: what a new clothing importer needs

When you buy on FOB terms, you bring the goods into the United States yourself. In customs language, you are the importer of record. Setting this up is a one-time job, and once it is done every later order runs the same way.

1. An importer number

US Customs and Border Protection identifies an importer by an IRS employer identification number (EIN) or, for some importers, a number CBP assigns on its Customs Form 5106. Your customs broker normally helps you complete this. Use the company name and details that match your registration.

2. A customs bond

A customs bond is a guarantee, issued by a surety company, that duties and fees on your imports will be paid. There are two common types:

• Single-transaction bond for one shipment, which suits a one-off or first test order.
• Continuous bond that covers all your imports for a year and renews, which usually suits a brand that will ship regularly.

Your customs broker can usually arrange either type. Ask which is cheaper for the number of shipments you expect this year.

3. A licensed customs broker

A licensed customs broker files your entries with CBP, classifies your garments in the Harmonized Tariff Schedule, calculates duty and advises on documentation. You give the broker a power of attorney so they can act for you. When choosing one, ask:

• Do they handle apparel and textile entries regularly?
• What do they charge per entry, and what is included?
• Can they quote the duty for each of your styles before you place the order?
• Do they work with the freight forwarder you plan to use, or can they recommend one?

4. The paperwork for each shipment

• Commercial invoice from the factory, showing the FOB price, the quantity and a clear description of each style, including fiber content.
• Packing list showing cartons, pieces per carton and weights.
• Bill of lading from the carrier, issued once the goods are loaded.
• Importer Security Filing (ISF) for ocean cargo, which your broker files before the goods are loaded onto the vessel bound for the United States. The factory or forwarder supplies the details your broker needs.
• Textile declarations that CBP requires for apparel, such as the country of origin and fiber content. Your broker will tell you what applies to your styles.

A simple order of operations

• Choose your customs broker and arrange the bond.
• Send the broker your style details to confirm classification and duty.
• Ask a freight forwarder to quote the route from the named port to your US port or warehouse.
• Place the order with the factory on FOB terms, with the named port in the contract.
• Give your broker the factory's shipping details so the ISF is filed before loading.
• Keep the commercial invoice, packing list and bill of lading together for your records.

This guide is general information, not legal or customs advice, and requirements change. Confirm the details for your products with a licensed broker.

Put it into a cost sheet

Broker, bond and customs fees are all part of your real cost. Our guide to the landed cost sheet shows where each one goes. To talk through an FOB order, contact Dragon Charm.