Trade Certifications
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US Customs Bonded Carrier
A US Customs Bonded Carrier is not a specific trade certification, but rather a designation given to carriers who have met certain requirements and obtained a surety bond from U.S. Customs and Border Protection (CBP). This allows them to transport unreleased imported goods within the United States.
Here’s a breakdown of the key points:
- Function: Bonded carriers handle the movement of imported goods before they are formally released by CBP and duties are paid. This allows for efficient transportation to inland locations or other ports of entry for further processing.
- Requirement: To become a bonded carrier, a company needs to secure a financial guarantee (bond) from a CBP-approved surety company. This bond ensures that the carrier will fulfill its obligations to CBP, including properly handling and delivering the bonded goods.
- Benefits: Holding a bonded carrier designation allows companies to offer their services for a wider range of international trade activities. It can also facilitate smoother and faster movement of goods through the import process.
It’s important to note that being a bonded carrier is not the same as obtaining a Customs Broker license. While bonded carriers handle the physical transportation, customs brokers are licensed professionals who assist with the complex paperwork and regulations involved in importing and exporting goods.
Canadian Customs Bonded Carrier
Similar to the US system, a Canadian Customs Bonded Carrier is not a trade certification, but a designation granted by the Canada Border Services Agency (CBSA) to carriers who meet specific criteria and post a security deposit. This allows them to transport unreleased imported goods within Canada.
Here’s a closer look:
- Function: Bonded carriers in Canada can move in-bond shipments. These are goods that haven’t been cleared by CBSA at the initial point of entry and are destined for:
- An inland CBSA office for official release.
- Another importing country “in transit” through Canada, without requiring CBSA release.
- Requirement: To become a bonded carrier, companies need to:
- Complete an application with the CBSA.
- Provide proof of business ownership.
- Post a Customs bond or other approved security deposit with the CBSA. The amount typically ranges from $5,000 to $25,000.
- Benefits: Being a bonded carrier in Canada offers various advantages, including:
- The ability to move goods to inland CBSA locations for easier release.
- The facilitation of “in-transit” movement of goods through Canada.
- The potential to participate in programs like the Customs Self Assessment Program and the Free and Secure Trade (FAST) Program.
It’s important to distinguish Canadian bonded carriers from non-bonded carriers. Non-bonded carriers can only transport imported goods that are cleared and released by CBSA at the border.
C-TPAT
The acronym “C-TPAT” stands for Customs-Trade Partnership Against Terrorism. In the context of trade certifications in the US and Canada, it’s not a traditional certification program itself, but rather a voluntary public-private partnership program offered by:
- U.S. Customs and Border Protection (CBP) in the United States.
- Canada Border Services Agency (CBSA) in Canada.
Here’s what C-TPAT entails:
Purpose:
- To strengthen international supply chains and improve border security by working collaboratively with businesses involved in international trade.
Participation:
- Voluntary for companies in various sectors, including:
- Importers and exporters
- Carriers (air, sea, land)
- Customs brokers
- Manufacturers
- Port authorities
Benefits:
- Reduced cargo examinations at ports of entry, leading to faster processing and potentially lower costs.
- Improved communication and collaboration with CBP or CBSA.
- Increased visibility within the trade community.
Membership:
- Companies go through an application process and undergo a security assessment.
- If successful, they are granted membership in one of three tiers:
- Tier 1: Low-risk companies with basic security measures.
- Tier 2: Companies with a comprehensive security plan and undergo a validation visit.
- Tier 3: Highly trusted partners with the most stringent security measures.
Key points to remember:
- While not technically a “certification,” C-TPAT membership is a highly recognized indicator of a company’s commitment to supply chain security.
- It does not replace other mandatory import/export requirements set by CBP or CBSA.
PIP
PIP, or Partners in Protection (PIP), is similar to C-TPAT in the realm of trade certifications for the US and Canada, but with key differences:
Similarities:
- Both are voluntary public-private partnership programs offered by:
- U.S. Customs and Border Protection (CBP) in the U.S.
- Canada Border Services Agency (CBSA) in Canada.
- Both aim to strengthen border security and facilitate trade by working with companies involved in the international supply chain.
Differences:
- Focus:
- C-TPAT: Primarily focuses on supply chain security and risk management.
- PIP: Primarily focuses on physical security at facilities and infrastructure within the trade chain.
- Participants:
- C-TPAT: More broad, involving various companies in the supply chain (importers, exporters, carriers, etc.).
- PIP: More specifically, targeting businesses that own or operate facilities or infrastructure critical to the trade chain (e.g., ports, airports, logistics providers).
- Benefits:
- Both offer benefits like reduced cargo examinations, faster processing, and improved communication with customs agencies. However, PIP may offer additional benefits specific to physical security concerns, depending on the program level.
Membership:
- Both programs involve an application process and security assessments tailored to their respective focus areas.
- Both offer tiered membership based on security measures implemented, with the highest tier granting the most benefits.
Key takeaway:
While both C-TPAT and PIP are valuable programs for enhancing security in international trade, they have distinct areas of focus and target different participants within the supply chain. Selecting the appropriate program depends on your specific role and security needs.
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