NAVIGATING GLOBAL TRADE: CBP PROGRAMS YOU SHOULD BE USING

As trade policies shift, geopolitical dynamics fluctuate, and tariffs are adjusted, navigating global trade has never been more difficult. With the consequences having a significant impact on shippers' bottom lines, identifying ways to optimize international shipping operations for this uncertain environment is crucial to ensure your business remains competitive.

One of the levers that you can pull to do this is to understand and take advantage of Customs and Border Protection (CBP) programs, regulations, and tools. These can help you streamline your supply chain operations and can even help you limit your tariff liabilities. 

In this guide, we’ll break down key CBP programs—outlining their core benefits, eligibility requirements, and actionable steps to leverage them effectively. We’ll also provide specific recommendations of programs that you should take advantage of based on the type of business you are in. 

First, Consider a Partner

We will dive into the different programs and recommendations here in a second, but the reality is that these programs can be complex to navigate on your own. 

That’s where a trusted logistics partner like VinWorld steps in. With over 35 years of experience in international logistics, we know how to steer businesses through these regulatory complexities. Our team understands the nuances of CBP programs and can tailor solutions that not only ensure compliance but also optimize your supply chain for maximum efficiency and savings.

If you’re interested in learning more about us, check out the rest of VinWorld’s website or reach out today.

An Overview of CBP Programs

CBP offers a variety of programs that can help importers improve operational efficiency, reduce tariff exposure, and enhance supply chain security. In this section, we’ll explore some of the most impactful CBP programs—breaking down what they are, how they work, and how you can leverage them to optimize your import operations. 

Customs-Trade Partnership Against Terrorism

What is CTPAT?

The Customs-Trade Partnership Against Terrorism (CTPAT) is a voluntary public-private sector partnership program led by U.S. Customs and Border Protection (CBP) that enhances supply chain security against terrorism. By joining CTPAT, businesses commit to securing their supply chains, identifying potential security gaps, and implementing specific security measures throughout their operations.

In return, CTPAT-certified companies enjoy many benefits, including:

• Expedited border clearance with reduced inspections.
• Access to Free and Secure Trade (FAST) Lanes at U.S. land borders, allowing for faster processing of shipments.
• Priority processing during CBP inspections and post-incident recovery.
• Enhanced reputational standing with supply chain partners and customers.

How to Apply for CTPAT

Participating in CTPAT is straightforward, voluntary, and free of charge. Companies don’t need an intermediary to apply—the process is handled directly with CBP online. Here’s a step-by-step overview of how to get started:

1. Review the CTPAT Minimum Security Criteria: Each business entity type (e.g., importer, carrier, freight forwarder) has specific security criteria. Review these guidelines to ensure your company meets the necessary requirements for eligibility.
2. Submit a Basic Application via the CTPAT Portal: Create an account and complete a simple application form, indicating your commitment to voluntarily participate in the program.
3. Complete a Supply Chain Security Profile: This profile details how your company meets CTPAT’s minimum security standards. It should reflect a thorough risk assessment of your supply chain, outlining processes and controls implemented to address potential vulnerabilities.
4. CBP Review and Certification: Once your application and security profile are submitted, a CTPAT Supply Chain Security Specialist is assigned to review your materials and offer ongoing program guidance. CBP typically has up to 90 days to either certify or reject your application. If approved, your company will undergo a validation process within one year of certification.

Another Option: Work with a CTPAT-Certified Partner

While direct enrollment in CTPAT is a great option, businesses can also reap many of the same benefits by partnering with a CTPAT-certified logistics partner like VinWorld. This allows you to seamlessly integrate CTPAT benefits into its operations—helping you achieve faster border processing and greater peace of mind.

Use the Automated Commercial Environment (ACE)

What is ACE?

The Automated Commercial Environment (ACE) is the primary system used by U.S. Customs and Border Protection (CBP) for facilitating the import and export process. It serves as a centralized platform for importers, exporters, and their logistics partners to electronically file required documents, track shipments, manage compliance, and streamline customs clearance. 

How ACE Streamlines Operations

Implementing ACE into your operations can yield significant benefits by simplifying customs compliance and improving financial management. One of the most impactful tools within ACE is the ability to manage Periodic Monthly Statements (PMS). Here’s how this works to your advantage:

• Defer Duty Payments Up to 45 Days: Rather than paying duties on individual shipments at the time of entry, importers enrolled in PMS can bundle multiple entries into a single monthly statement. This allows for a payment deferral of up to 45 days—enhancing cash flow and giving businesses more flexibility in managing finances.
• Simplify Financial Reconciliation: Consolidating entries into a single statement reduces administrative overhead, streamlines accounting, and makes financial reconciliation easier and more transparent.
• Gain Greater Visibility: ACE provides a comprehensive view of all entries and duties owed, ensuring you’re always aware of your financial commitments and compliance status. This level of oversight helps avoid surprises and allows for proactive decision-making.
• Enhance Compliance with Trade Regulations: By automating and centralizing the submission of documentation, ACE helps ensure your filings are accurate, timely, and compliant with CBP regulations, reducing the risk of penalties or delays.

ACH Payments

What Are ACH Payments in Customs?

Automated Clearing House (ACH) payments are an electronic payment method used by importers to pay U.S. Customs and Border Protection (CBP) duties, taxes, and fees. This system allows businesses to move funds directly from their bank accounts to CBP, simplifying and expediting the payment process for import-related expenses.

Benefits of Using ACH Payments

Utilizing ACH payments as part of your customs strategy offers several key advantages:

• Faster Clearance and Release of Cargo: Since payments are processed electronically and securely, CBP can confirm receipt almost immediately. This enables quicker release of shipments, reducing delays at the border or port.
• Streamlined Financial Operations: Electronic payments reduce paperwork, manual processing, and administrative burdens. They allow for automated reconciliation between your accounting systems and CBP payment records, enhancing accuracy and efficiency.
• Minimized Risk of Late Penalties: With ACH, payments are scheduled and processed predictably, reducing the chance of missing due dates. This helps avoid costly penalties or delays that could arise from late payments.

Duty Drawback Program

What is the Duty Drawback Program?

The Duty Drawback Program allows importers to recover up to 99% of duties, taxes, and fees paid on imported goods that are subsequently exported, destroyed, or used in the production of exported goods. This program is designed to encourage U.S. manufacturing and export activity by reducing the overall cost of imported inputs, helping businesses stay competitive in global markets.

By participating in the Duty Drawback Program, companies can significantly lower their total import costs—improving margins and cash flow—without compromising supply chain needs.

Types of Duty Drawbacks

There are several types of duty drawbacks, each designed to address different scenarios within international trade. Here’s an overview:

1. Manufacturing Drawbacks: This type of drawback applies when imported materials are used in the manufacturing of goods that are later exported. For example, if a company imports raw steel to produce machinery that is then sold overseas, they can reclaim duties paid on that steel. This encourages domestic manufacturing by reducing the net cost of imported inputs.
2. Unused Merchandise Drawbacks: If imported goods are never used and are later exported in the same condition, the importer is eligible to claim a drawback. This is common for distributors or retailers who import products but then resell them internationally. As long as the goods remain in essentially the same condition as when imported, duties can be refunded.
3. Rejected Merchandise Drawbacks: When imported goods are found to be defective, non-conforming, or shipped without consent, and are subsequently exported or destroyed under CBP supervision, importers can claim a drawback on those goods. This protects businesses from being financially penalized for supplier errors or product defects.

Foreign Trade Zones (FTZ)

What Are FTZs?

Foreign Trade Zones (FTZs) are designated geographic areas within the United States, located near ports of entry, where imported goods can be stored, handled, manufactured, or re-exported without being subject to immediate U.S. customs duties or tariffs. These zones are treated as if they are outside the customs territory of the United States for the purpose of tariff laws, even though they are physically located within the country.

Companies operating within an FTZ can defer, reduce, or even eliminate duties on goods, depending on how the goods are processed or where they are ultimately shipped.

Benefits of Using FTZs

Utilizing an FTZ provides several strategic advantages for companies engaged in global trade:

• Deferment of Duties: No duties or tariffs are assessed on goods while they remain in the FTZ. Duties are only paid when goods enter U.S. commerce. This can defer cash outflows and improve liquidity.
• Duty Reduction (Inverted Tariff Benefits): If goods are manufactured within the FTZ and the duty rate on the finished product is lower than that of the imported components, companies can pay the lower duty rate.
• Duty Elimination on Re-exports: Goods that are exported from the FTZ to another country are not subject to U.S. duties at all, making FTZs ideal for businesses that import materials for manufacturing or assembly and then export the finished products.
• Streamlined Customs Procedures: FTZs offer simplified customs documentation and inventory controls, which can result in operational efficiencies and fewer administrative burdens.
• Other Cost Savings: Merchandise processing fees (MPF) can be reduced or consolidated, and weekly entry filings can lower the cost of customs processing compared to filing for each individual shipment.

Bonded Warehouses

What is a Bonded Warehouse?

A bonded warehouse is a secure storage facility authorized by U.S. Customs and Border Protection (CBP) where imported goods can be stored without the immediate payment of duties or tariffs. Duties are only required when the goods are formally entered into U.S. commerce. If the goods are re-exported or otherwise removed from the warehouse under CBP supervision without entering U.S. commerce, no duties are paid at all.

Bonded warehouses are especially useful for companies that import goods but are uncertain whether they will sell those goods domestically or export them. This storage arrangement provides significant flexibility and cash flow advantages by deferring or eliminating duties based on the final disposition of the goods.

How Does a Bonded Warehouse Differ from an FTZ?

While both bonded warehouses and Foreign Trade Zones (FTZs) allow for deferred duty payments, they have distinct differences in structure, use cases, and regulatory oversight:

• Time Limits: Imported goods can be stored in a bonded warehouse for up to five years without duties being paid. In contrast, FTZs generally have no storage time limits.
• Scope of Activities: Bonded warehouses primarily allow for storage, repackaging, and cleaning of goods. Manufacturing or manipulation of goods is more restricted in bonded warehouses compared to FTZs, which offer broader permissions for manufacturing and assembly.
• Compliance Requirements: Bonded warehouses tend to have stricter customs oversight compared to FTZs, and goods are under CBP custody while in storage.

First Sale Rule

What is the First Sale Rule?

The First Sale Rule is a customs valuation method that allows importers to declare the transaction value based on the price paid in the first sale of goods within a multi-tiered supply chain—often between a manufacturer and a middleman—rather than the price paid by the importer to the middleman. 

In essence, the First Sale Rule enables an importer to base customs duties on the original manufacturer's price, rather than the potentially higher price paid to intermediaries or resellers. This can provide substantial cost savings for businesses that import goods through multi-step supply chains.

How It Works

Consider a common scenario:

• A manufacturer in China sells goods to a trading company (middleman).
• The trading company then sells the same goods to a U.S. importer at a higher price.

Without the First Sale Rule, the U.S. importer pays duties based on the higher resale price. With the First Sale Rule, the importer can instead pay duties based on the original manufacturer’s price, which is lower—resulting in reduced duty costs.

Requirements for Eligibility

To utilize the First Sale Rule, the transaction must meet specific CBP requirements:

• Bona Fide Sale: There must be a legitimate sale between the manufacturer and the middleman (or the first buyer), and the goods must be clearly destined for export to the United States at the time of this sale.
• Arm’s Length Transaction: The first sale must be conducted at arm’s length—meaning it reflects the market value between unrelated parties (in other words, you can’t have a special deal with the manufacturer for a lower price than would be given to other similar buyers).
• Proper Documentation: Importers must provide sufficient documentation to CBP proving that the transaction qualifies.

Section 301 & Product Exclusions

What is Section 301?

Section 301 of the Trade Act of 1974 authorizes the United States Trade Representative (USTR) to investigate and respond to unfair trade practices by foreign governments. In recent years, Section 301 tariffs have been widely applied to imports from China as a response to findings of unfair intellectual property practices, forced technology transfers, and other trade-related concerns. These tariffs, imposed in multiple rounds, have added significant duty rates on thousands of Chinese-origin products across various industries.

For many importers, Section 301 tariffs have increased costs substantially, creating financial strain and challenging supply chain strategies. However, the U.S. government has provided a mechanism for product exclusions that allow specific goods to be temporarily exempted from these additional duties.

How Product Exclusions Work

Importers can request product exclusions for specific items affected by Section 301 tariffs. If granted, these exclusions remove the additional duty for that product, offering critical relief for businesses.

Key points about the exclusion process:

• Exclusions are temporary: Initially granted for a specific period (often 12 months), after which they can expire unless extended by USTR.
• Extensions can be requested: Importers or industry groups can petition for an extension of the exclusion before it expires, often citing ongoing hardship or lack of viable sourcing alternatives.
• Retroactive refunds: If a product exclusion is granted, importers can typically retroactively claim refunds on duties paid during the eligible period, even on shipments processed before the exclusion was approved. This provides an opportunity to recover funds already spent on tariffs.

Why Exclusions Matter

For importers of products subject to Section 301 tariffs, securing an exclusion can:

• Eliminate additional duty costs, restoring competitiveness in the U.S. market.
• Reduce supply chain pressures by alleviating financial burdens tied to sourcing strategies.
• Provide retroactive financial relief, bolstering cash flow.

In an environment where trade tensions and tariff policies fluctuate, product exclusions offer critical flexibility for managing costs and supply chain risks. Staying proactive in tracking and applying for these exclusions is key to maximizing their benefits.

Importer Self-Assessment (ISA) Program

What is the ISA Program?

The Importer Self-Assessment (ISA) Program is a voluntary compliance initiative offered by U.S. Customs and Border Protection (CBP) that empowers importers to take control of their customs compliance processes. Under this program, approved importers commit to self-monitoring and evaluating their internal controls, identifying and correcting any issues related to customs regulations without the need for frequent CBP audits or interventions.

In return for their commitment to maintaining robust compliance systems, ISA participants benefit from fewer CBP audits, reduced penalties, and a stronger partnership with customs authorities. The program is designed to build trust between CBP and importers, allowing compliant businesses to operate more efficiently and with greater predictability.

How Different Companies Can Make Use of the Programs Above

While the CBP programs outlined in the previous section offer broad benefits for improving customs compliance, managing tariff exposure, and enhancing operational efficiency, the real value lies in selecting the right mix of programs for your specific business model. Whether you’re a manufacturer, retailer, distributor, e-commerce company, or importer with high exposure to tariffs, the programs that make sense for you will depend on factors such as import volume, supply chain complexity, product types, and international sourcing strategies.

In this section, we’ll explore how different types of businesses can strategically leverage CBP programs.

Large Retailers

For large retailers, managing global supply chains comes with a unique set of challenges. With high import volumes, diverse product categories, and multiple sourcing regions, even small inefficiencies in customs processes can snowball into significant costs. Fortunately, several CBP programs can help retailers. 

Programs Retailers Should Use

To optimize operations and control costs, large retailers should focus on the following key CBP programs:

• Automated Commercial Environment (ACE): ACE is essential for managing high volumes of customs entries. Retailers can centralize import documentation and compliance processes, and also utilize periodic monthly statements to bundle duty payments across multiple entries—defering payment up to 45 days.
• First Sale Rule: Many large retailers purchase goods through multi-tiered supply chains, often from intermediaries. The First Sale Rule allows importers to declare the manufacturer’s original sale price as the dutiable value, rather than the higher resale price from intermediaries. This can lead to substantial duty savings, especially on high-tariff items, directly improving profit margins.
• Foreign Trade Zones (FTZs): Retailers using FTZs can store, assemble, or package goods in a designated zone without paying immediate duties. Duties are deferred until goods enter U.S. commerce—and are eliminated altogether if the goods are re-exported. FTZs also allow retailers to take advantage of inverted tariffs, where the duty rate on a finished product manufactured in the FTZ is lower than its imported components, reducing overall costs.
• Section 301 & Other Product Exclusions: For goods affected by Section 301 tariffs, particularly those sourced from China, applying for product exclusions can temporarily eliminate additional duty costs. Exclusions can be retroactive, allowing retailers to recover duties paid during the exclusion period. Monitoring these opportunities—and renewing them as necessary—provides ongoing protection against tariff fluctuations.

Another Tip: Centralize Customs Brokerage Operations

Beyond these programs, large retailers should consider centralizing their customs brokerage operations. By consolidating brokerage services, retailers can:

• Standardize product classifications under the correct Harmonized Tariff Schedule (HTS) codes, minimizing classification errors and overpayments.
• Systematically track exclusions and refunds, ensuring no opportunities for duty savings are missed.
• Maintain better control and visibility across multiple suppliers, ports, and entry points.

This centralized approach complements the CBP programs above, driving greater efficiency, compliance, and cost control across the retail supply chain.

Manufacturers

For manufacturers, especially those involved in global sourcing and export operations, the key to optimizing customs processes lies in reducing duty costs on imported materials while maintaining a flexible and efficient supply chain. With the right mix of CBP programs, manufacturers can recover a significant portion of duties, defer payments, and streamline production operations—ultimately enhancing competitiveness in both domestic and international markets.

Programs Manufacturers Should Use

• Duty Drawback Program: The Duty Drawback Program allows manufacturers to recover up to 99% of duties paid on imported materials that are used in the manufacturing of exported goods. By tracking the flow of imported components into finished products and maintaining proper documentation on the finished materials that are exported, manufacturers can significantly lower their effective duty costs.
• Foreign Trade Zones (FTZs): FTZs offer manufacturers the flexibility to import raw materials or components without paying duties upfront. Duties are deferred until the goods enter U.S. commerce—and if the finished product is exported, no duties are paid at all. Additionally, if the duty rate on the finished product is lower than that of the imported components, manufacturers can pay the lower duty rate, reducing overall production costs. 

Another Tip: Optimize Tracking and Documentation

For manufacturers, the ability to track imported components accurately—from entry to final disposition—is essential for maximizing duty recovery and maintaining compliance. To take full advantage of duty drawbacks, manufacturers should implement robust tracking systems and maintain detailed records of exports.

Distributors

For distributors—especially those involved in global sourcing and international resale—customs cost management is critical to maintaining healthy margins. Since distributors often handle large inventories of imported goods, some of which are later exported or resold internationally, taking advantage of CBP programs that focus on duty recovery and deferral can unlock significant savings.

Programs Distributors Should Use

• Duty Drawback Program (Unused Merchandise): Distributors frequently import goods for resale, and not all inventory may remain within the U.S. market. The Duty Drawback Program offers a refund of up to 99% of duties paid on unused merchandise that is later exported in the same condition as when imported. By tracking export activity and maintaining proper documentation, distributors can recover duties on goods that are moved across borders—improving margins without changing supply chain strategies.
• Foreign Trade Zones (FTZs): FTZs provide distributors with the ability to store, sort, or repackage goods without paying duties until the goods enter U.S. commerce. For inventory that is re-exported, no duties are paid at all. FTZs are particularly valuable for distributors that manage international sales networks, offering the flexibility to shift inventory between domestic and foreign markets without incurring unnecessary customs costs.
• Bonded Warehouses: Distributors handling goods that may be held in inventory for extended periods—particularly while awaiting export orders—can benefit from bonded warehouses. These facilities allow goods to be stored duty-free for up to five years. If the goods are exported before entering U.S. commerce, no duties are ever paid. 

E-Commerce

For e-commerce companies engaged in international trade, maintaining a balance between speed, compliance, and cost-efficiency is crucial. With the rise of direct-to-consumer international sales, e-commerce businesses often face complex customs processes, unpredictable tariff exposure, and high transaction volumes. 

Programs E-Commerce Companies Should Use

• Automated Commercial Environment (ACE): E-commerce businesses process high volumes of shipments, often with low individual values but frequent customs filings. ACE provides the framework to centralize these filings, giving full visibility into shipments and duties across markets. By utilizing Periodic Monthly Statements, e-commerce companies can bundle duty payments and defer them up to 45 days, which provides much-needed flexibility in managing cash flow across fluctuating sales periods.
• Automated Clearing House (ACH) Payments: With frequent customs transactions, ACH payments help ensure timely, automated payments to CBP, reducing manual intervention. This process not only accelerates cargo release but also avoids late penalties, which can quickly add up when dealing with frequent, smaller shipments.
• First Sale Rule: Many e-commerce companies source goods through complex, multi-tiered supply chains, often purchasing from intermediaries who buy from manufacturers. The First Sale Rule enables companies to declare the manufacturer’s original price as the dutiable value, rather than the markup added by intermediaries. This significantly reduces duty costs, which is especially important in the high-volume, low-margin world of e-commerce.
• Customs-Trade Partnership Against Terrorism (CTPAT): E-commerce companies with large-scale import operations can benefit from CTPAT certification, which enhances supply chain security and offers expedited customs clearance. With customer expectations for fast delivery, the ability to reduce inspections and border delays is a key competitive advantage.

Importers from China

For importers sourcing from China, navigating customs has become increasingly complex due to heightened tariff exposure. For businesses that rely heavily on Chinese suppliers, proactively managing tariff exposure is essential to protect profit margins and ensure long-term sustainability.

Programs Importers from China Should Use

• Section 301 & Other Product Exclusions: Given the elevated tariffs on Chinese imports, monitoring duty exclusion opportunities is crucial. Importers can petition for exclusions on specific products, which, if approved, can temporarily remove or reduce additional duties. These exclusions often provide retroactive refunds on duties paid, offering critical relief. Staying engaged with the USTR’s exclusion process and ensuring timely renewal requests are submitted can help manage ongoing tariff exposure.
• Foreign Trade Zones (FTZs): FTZs provide duty deferral or elimination for goods imported from China. Importers can store, process, or re-export goods within the FTZ without paying duties upfront. If the goods are exported to other markets, no duties are paid at all. This is especially valuable for importers who may not immediately know whether goods will be sold domestically or internationally.
• Duty Drawback Program: Importers who re-export goods from China, or incorporate Chinese components into products that are later exported, can leverage the Duty Drawback Program to recover up to 99% of duties paid.
• First Sale Rule: For products sourced through intermediaries, the First Sale Rule allows importers to base the dutiable value on the original manufacturer's price in China, not the higher price charged by the intermediary. This method helps reduce the total duty liability, providing a buffer against high tariff rates.

Another Tip: Diversify Sourcing for Long-Term Relief

While these programs offer immediate relief, a longer-term strategy for managing tariff exposure involves diversifying sourcing away from China. Shifting components or finished goods to alternative suppliers in other countries—such as Vietnam, India, or Mexico—can help reduce reliance on Chinese imports and lower exposure to tariffs. However, this transition requires careful supply chain planning, vetting of new suppliers, and logistics adjustments, making it a multi-year strategy rather than a quick fix.

In the meantime, staying proactive with CBP programs like FTZs, duty drawbacks, product exclusions, and the First Sale Rule ensures that importers from China can mitigate costs and maintain supply chain flexibility in an unpredictable trade environment.

Need Help To Take Advantage of These Programs: Partner with VinWorld

Why You Need a Logistics Partner

Navigating customs regulations, tariff exposure, and CBP programs requires more than just basic knowledge. Each of the programs outlined in this guide comes with its own set of requirements, deadlines, and compliance obligations. Missing an opportunity or misapplying a program can cost your business time, money, and operational efficiency.

That’s why partnering with an experienced logistics provider is critical. A strong partner can identify the right programs for your unique business model, ensure ongoing compliance, and help maximize your savings.

Why VinWorld?

With over 35 years of global logistics experience, VinWorld brings a level of expertise and global reach that few others can match. Our international presence—spanning the United States, United Arab Emirates, Saudi Arabia, Qatar, Kuwait, India, China, and Canada—gives us a deep understanding of regional regulations and global trade dynamics.

We don’t just offer a standard checklist. Instead, we take the time to analyze your supply chain, identify specific opportunities for savings, and implement solutions that fit your unique needs.

No two businesses are alike—your logistics strategy shouldn’t be either.

Ready to Optimize Your Supply Chain?

The global trade landscape is constantly shifting—but with VinWorld at your side, you can stay ahead. If you’re ready to take control of your supply chain, reduce your customs costs, and optimize your logistics operations, we’re here to help.

Request a quote from VinWorld today, and let’s talk about how we can tailor a solution that works for you.