A basic custodial bond shall contain the conditions listed in this section and shall be a continuous bond.
Basic Custodial Bond Conditions
(a) Receipt of Merchandise. The principal agrees:
(1) To operate as a custodian of any bonded merchandise received, including merchandise collected for transport to his facility, and to comply with all regulations regarding the receipt, carriage, safekeeping, and disposition of such merchandise;
(2) To accept only merchandise authorized under Customs Regulations;
(3) To maintain all records required by regulations relating to merchandise received into bond, and to produce the records upon demand by an authorized Customs officer;
(4) If authorized to use the alternative transfer procedure set forth in Sec. 144.34(c) of this chapter, to operate as constructive custodian for all merchandise transferred under those procedures, thereby assuming primary responsibility for the continued proper custody of the merchandise notwithstanding its geographical location;
(5) If authorized to operate a container station under the Customs Regulations, to report promptly to Customs each arrival of a container and its merchandise by delivery of the manifest and the application for transfer, or by other approved notice.
(b) Carriage and Safekeeping of Merchandise. The principal agrees:
(1) If a bonded carrier, to use only authorized means of conveyance;
(2) To keep safe any merchandise placed in its custody including, when approved by Customs, repacking and transferring such merchandise when necessary for its safety or preservation;
(3) To comply with Customs Regulations relating to the handling of bonded merchandise; and
(4) If authorized to use the alternative transfer procedure set forth in Sec. 144.34(c) of this chapter, to keep safe any merchandise so transferred.
(c) Disposition of Merchandise. The principal agrees:
(1) If a bonded carrier, to report promptly the arrival of merchandise at the destination port by delivering to Customs the manifest or other approved notice;
(2) If a cartage or lighterage business, to deliver promptly and safely to Customs any merchandise placed in the principal's custody together with any related cartage and lighterage ticket and manifest;
(3) To dispose of merchandise in a manner authorized by Customs Regulations; and
(4) To file timely with Customs any report required by Customs Regulations.
(5) In the case of Class 9 warehouses, to provide reasonable assurance of exportation of merchandise withdrawn under the sales ticket procedure of Sec. 144.37(h) of this chapter.
(d) Agreement to Redeliver Merchandise to Customs. If the principal is designated a bonded carrier, or licensed to operate a cartage or lighterage business, or authorized to use the alternative transfer procedure set forth in Sec. 144.34(c) of this chapter, the principal agrees to redeliver timely, on demand by Customs, any merchandise delivered to unauthorized locations or to the consignee without the permission of Customs. It is understood that the demand for redelivery shall be made no later than 30 days after Customs discovers the improper delivery.
(e) Compliance with Licensing and Operating Requirements. The principal agrees to comply with all Customs laws and regulations relating to principal's facilities, conveyances, and employees.
(f) Agreement to comply with Customs Regulations applicable to Customs security areas at airports. If access to Customs security areas at airports is desired, the principal (including its employee, agents, and contractors) agrees to comply with the Customs Regulations applicable to Customs security areas at airports. If the principal defaults, the obligors (principal and surety, jointly and severally) agree to pay liquidated damages of $1000 for each default or such other amount as may be authorized by law or regulation.
(g) The principal agrees to comply with all Importer Security Filing requirements set forth in part 149 of this chapter including but not limited to providing security filing information to Customs and Border Protection in the manner and in the time period prescribed by regulation. If the principal defaults with regard to any obligation, the principal and surety (jointly and severally) agree to pay liquidated damages of $5,000 per violation.
(h) Reimbursement and Exoneration of the United States. The principal and surety agree to:
(1) Pay the compensation and expenses of any Customs officer as required by law or regulation;
(2) Pay the cost of any locks, seals, and other fastenings required by Customs Regulations for securing merchandise placed in the principal's custody;
(3) Pay for any expenses connected with the suspension or termination of the bonded status of the premises;
(4) Exonerate the United States and its officers from any risk, loss, or expense arising out of the principal's custodial operation; and
(5) Pay any charges found to be due Customs arising out of the principal's custodial operation.
(i) Consequence of Default. (1) If the principal defaults on conditions (a) through (e) in this agreement, the obligors (principal and surety, jointly and severally) agree to pay liquidated damages equal to the value of the merchandise involved in the default or three times the value of the merchandise involved in the default if the merchandise is restricted or prohibited merchandise or alcoholic beverages, or such other amount as may be authorized by law or regulation.
(1) If the principal defaults on conditions (a) through (e) in this agreement, the obligors (principal and surety, jointly and severally) agree to pay liquidated damages equal to the value of the merchandise involved in the default or three times the value of the merchandise involved in the default if the merchandise is restricted or prohibited merchandise or alcoholic beverages, or such other amount as may be authorized by law or regulation.
(2) It is understood and agreed that the amount to be collected under conditions (a) through (e) of this agreement shall be based upon the quantity and value of the merchandise as determined by Customs. Value as used in these provisions means value as determined under 19 U.S.C. 1401a.
(3) If the principal defaults on conditions (a) through (e) in this agreement and the default does not involve merchandise, the obligors agree to pay liquidated damages of $1,000 for each default or such other amount as may be authorized by law or regulation. It is understood and agreed that whether the default involves merchandise is determined by Customs. [T.D. 84-213, 49 FR 41171, Oct. 19, 1984; 49 FR 44867, Nov. 9, 1984, as amended by T.D. 86-178, 51 FR 34959, Oct. 1, 1986; T.D. 88-46, 53 FR 29230, Aug. 3, 1988; T.D. 88-72, 53 FR 45902, Nov. 15, 1988; 54 FR 33672, Aug. 16, 1989; T.D. 92-81, 57 FR 37701, Aug. 20, 1992; T.D. 94-81, 59 FR 51495, Oct. 12, 1994; T.D. 97-19, 62 FR 15840, Apr. 3, 1997; T.D. 01-26, 66 FR 16854, Mar. 28, 2001; CBP Dec. 08-46, 73 FR 71781, Nov. 25, 2008]