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@title: Customs Broker Agreement
@version: 19.25
@copyright: CC-BY-NC-ND-2.5
@notice: U.S.A Customs
@file: customs-broker-power-of-attorney.md
@params: [BRACKET]

Customs Broker Agreement

This Customs Broker Agreement ("Agreement") is made as of [DATE] (the "Effective Date") by and between [BROKER NAME], having a place of business at [BROKER ADDRESS] ("Broker"), and [CLIENT NAME], a [STATE] [ENTITY TYPE], having a place of business at [CLIENT ADDRESS] ("Client"). WHEREAS, Broker is duly licensed by US Customs & Border Protection to conduct business as a Customs Broker; and WHEREAS, Client is engaged in business which includes importing[ and exporting] goods between points in the United States on the one hand and points in other countries on the other hand; NOW THEREFORE, in consideration of the respective covenants and agreements of the parties herein contained and for other good and valuable consideration, the mutual receipt and legal sufficiency of which the parties hereby acknowledge, the parties agree as follows:

1. Definitions.

1.1 "CBP" means US Customs & Border Protection.

1.2 "Customs Duties" means any duties or taxes levied on imported goods under any US laws or regulations relating to imports and duties,

including the Tariff Act of 1930, as amended (19 U.S.C. §§ 1202 — 1683g), excluding any penalties, interest, or fines imposed under any of the aforesaid laws or regulations.

1.3 "Disbursements" means Customs Duties, taxes, freight charges, storage charges, penalties, interests and fines, and any other

payments, including payments for goods on cash on delivery (COD) shipments, made by Broker on behalf of Client.

1.4 "Protest" means a challenge to a CBP decision made under 19 U.S.C. § 1514, whether made on CBP Form 19 or otherwise.

1.5 "Services" means the services set out in Section 3 hereof.

2. Appointment as Customs Broker.

2.1 Client hereby constitutes and appoints the Broker as its agent to transact business on Client's behalf with respect to: (a) matters relating
to CBP and laws and regulations administered by CBP; and (b) matters relating to the accounting for, payment and refund of Customs Duties, in
respect of imported goods.

2.2 Client agrees to execute any requisite CBP form powers of attorney as may be required to appoint Broker as Client's customs broker, in
a form reasonably acceptable to Client.

 2.3 [Client hereby authorizes Broker to appoint sub-agents when and as required[, provided that Broker shall notify Client in writing of any
 such sub-agents[ and shall not appoint any sub-agent without Client's prior written approval]].]

3. Services.

Broker will provide the following customs brokerage services to Client, when requested by Client:

3.1 Preparing or assisting Client in preparing documents required by CBP for Client's importation of goods into the US.

3.2 Filing documents with CBP on behalf of the Client as required to clear Client's goods through CBP and making any necessary changes
thereto, including preparation and filing of any required corrections, including but not limited to Post Summary Corrections.

3.3 Services relating to entry and clearance through CBP of Client's imported goods, making payment of requisite Customs Duties by or on
behalf of the Client, and obtaining release of the goods from CBP.

3.4 Services relating to tariff classification and value of Client's goods to minimize Customs Duties payable in accordance with applicable
laws and regulations, as well as submitting binding ruling requests or Protests as necessary.

3.5 Services relating to Customs Duties refunds and duty drawbacks.

3.6 Any other services necessary and incidental to the provision of the foregoing Services.

4. Fees and Disbursements.

The fees for Services provided by Broker to Client pursuant to this Agreement shall be in accordance with Schedule A attached hereto, as such Schedule may be amended [by Broker/upon mutual agreement] in writing from time to time. Client shall reimburse Broker for all disbursements that are pre-authorized by Client in writing and incurred by Broker on behalf of Client pursuant to this Agreement.

5. Invoicing and Payment.

Broker shall issue invoices [monthly/[OTHER PERIOD]] to Client for all fees and disbursements pertaining to Services rendered to and on behalf of Client. Payment of all [undisputed] invoices shall be payable net 30 days after the date of [Client’s receipt of] each invoice. All payments shall be in US dollars and shall be made by check or electronic transfer.

6. Client’s Duties and Responsibilities.

Client shall provide to Broker all information reasonably necessary for Broker to provide the Services, including all information required to complete CBP documentation. [Client shall review all information provided by Client to Broker to ensure to the best of its knowledge that the information is accurate and complete.] Client shall review all documents delivered by Broker to Client and, as soon as practicable, notify Broker of any inaccuracies, errors, or omissions found by Client therein; and advise Broker of any corrections or additions to be made on such documents.

7. Broker’s Duties and Responsibilities.

Broker shall provide the Services in compliance with all applicable laws, rules, regulations, and other requirements of CBP and other governmental authorities applicable to the Services. Client will have the right to inspect and obtain, [at its expense ]at any time, copies of all licenses, approvals, or permits issued by CBP or other governmental entity or agency to Broker or its subcontractors which are applicable to the performance of the Services. Broker shall maintain, at its own expense, all forms of insurance required by law, as well as a comprehensive general liability policy, insuring against all types of liability in such amount as is customary in its industry for the performance of similar services.

8. Representations and Warranties.

8.1 Mutual. Each party represents and warrants to the other party that:

(a) it has the full right, power, and authority to enter into this Agreement and to perform its obligations hereunder;

(b) the execution of this Agreement by each of the individuals whose signature is set forth at the end of this Agreement has been duly
authorized by all necessary corporate action on the part of such party; and

(c) this Agreement has been executed and delivered by such party and constitutes the legal, valid, and binding obligation of such party.

8.2 Broker. Broker represents and warrants that it is fully insured and duly licensed by CBP to conduct business as a customs broker.

9. Confidentiality.

Broker and its sub-agents, if applicable, shall keep confidential all information and documentation provided by Client under this Agreement [and identified in writing as confidential], and release such information only to governmental authorities or the Client’s surety as required by Broker for the purposes of providing the Services or as required by law. Upon Client’s request, Broker shall promptly return all documents and other materials received from Client. Client shall be entitled to injunctive relief for any violation of this Section.

10. Security.

Broker represents and warrants that it is a certified member of the US Customs Trade Partnership Against Terrorism (CTPAT) program, or if it is not a member, that it shall comply with the CTPAT Minimum Security Criteria for US Customs Brokers.]

11. Term and Termination.

This Agreement will begin on the Effective Date and will continue for a period of [one (1)/OTHER NUMBER] year[s]. Thereafter, this Agreement shall automatically renew on a year-to-year basis unless earlier terminated as provided herein. This Agreement may be terminated at any time by either party under the following circumstances:

(a) if there is a material breach of any of the terms hereof by the other party,
and the breach is not cured within [fourteen (14)/OTHER NUMBER] days after the complaining party gives written notice of breach to the defaulting party;

(b) effective immediately, if the other party becomes insolvent, makes an assignment for the benefit of creditors, or is placed in receivership, reorganization, liquidation or bankruptcy (voluntary or involuntary); or

(c) for any reason and without penalty upon [sixty (60)/OTHER NUMBER] days' prior written notice.

If this Agreement is terminated and there are any outstanding matters pertaining to Client for which Broker has been engaged by Client, this Agreement shall continue in force with respect to such matters until such matters are concluded.

12. Assignment; Successors.

Neither party may assign or delegate its obligations under this Agreement, either in whole or in part, without the prior written consent of the other party[, which consent shall not be unreasonably withheld, conditioned, or delayed]. Any purported assignment of rights or delegation of performance in violation of this section is void. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

13. Indemnification.

Broker shall indemnify, defend, and hold Client and its officers, agents, employees, and affiliates harmless from and against all claims, causes of action, damages, fines, third-party claims, penalties, losses, expenses, costs (including reasonable attorney’s fees), and liabilities Client incurs which relate to or arise out of any breach of this Agreement by Broker or of any express or implied representation or warranty by Broker, or any negligent or willful acts or omissions of Broker or its subcontractors.

14. Governing Law; Dispute Resolution.

All matters arising out of relating to this Agreement shall be governed by and construed exclusively in accordance with the laws of [STATE], without reference to its conflicts of law principles. Any disputes arising out of or relating to this Agreement shall be exclusively submitted to a court of competent jurisdiction in the [FORUM LOCATION]. The parties hereto consent to such exclusive venue and to the jurisdiction of those courts and waives any claims of improper venue or forum non conveniens with respect thereto.

< FREIGHT TRUST ARBITRATION FORUM CLAUSE OPTIONAL >

15. Entire Agreement; Amendments.

This Agreement constitutes the entire agreement between the parties pertaining to the subject matter of this Agreement and supersedes all prior agreements, understandings, negotiations, and discussions, whether oral or written. Notwithstanding the content of any Broker invoice or any other document relating to the subject matter of this Agreement, whether written or electronic, the provisions of this Agreement shall govern, and any conflicting, inconsistent, or additional terms contained in such other documents shall be null and void. Any amendments to or modifications of this Agreement, may only be made by mutual written agreement signed by an authorized representative of each party.

16. Relationship of the Parties.

No partnership, joint venture, employee/employer relationship, or other similar relationship exists between the parties except as expressly set forth herein. Broker shall be responsible for its own costs and expenses incurred in performing the Services, and for payment of any federal and state payroll and self-employment taxes attributable to payments received for its Services.

17. Counterparts.

This agreement may be signed in any number of counterparts, each of which is an original and all of which taken together form one single document. Signatures delivered by email in PDF format or facsimile shall be effective and deemed to be original signatures.

18. Miscellaneous.

All notices required or permitted hereunder shall be in writing and shall be deemed to be duly given if personally delivered or if mailed (by certified or registered mail, or by reputable commercial courier) to the party concerned at its address as set forth on the first page of this Agreement (or at such other address as a party may specify by written notice to the other). A waiver by either party of any breach of any term or condition must be in writing and shall not be construed as a waiver of any subsequent breach of the same or any other term or condition. No failure on the part of either party to exercise, and no course of dealing with respect thereto, and no delay in exercising, any right, power, or remedy under this Agreement will operate as a waiver thereof. The rights and remedies set forth herein are not exclusive and are in addition to any other rights and remedies available. If any one or more of the provisions of this Agreement shall for any reason be held to be void, illegal, or unenforceable in any respect, such voidance, illegality, or unenforceability shall not affect any other provisions of this Agreement. The headings of the sections herein are for convenience only and do not constitute a part of this Agreement. ===

[1] PROTEST An importer may challenge a CBP decision using an administrative procedure set out in 19 U.S.C. § 1514. CBP provides a standardized form, Form 19, but it is not required if the challenge meets certain statutory criteria. For more information about protests, see Practice Note, Importing Goods into the US: Overview: Challenging CBP Decisions.

[2] CUSTOMS POWER OF ATTORNEY A customs power of attorney gives the customs broker legal authority to act as the importer’s agent related to customs business, including: Preparing and filing documents with CBP. Classifying and providing values for imported goods. Paying tariffs, duties, and other charges that CBP collects on imports. The power of attorney recites the specific activities the customs broker is authorized to conduct on the importer’s behalf, which should be consistent with the services set out in this agreement. CBP regulations contain a sample general power of attorney (19 C.F.R. § 141.32), but the CBP form is unlimited and may authorize the customs broker to do more than the importer needs or wants it to do.

[4] FEES AND DISBURSEMENTS This provision favors the importer, but the customs broker may insist on including language: Allowing it to adjust fees unilaterally if its rates generally change. Stating that the customs broker is not obligated to advance any funds on the importer’s behalf and instead that the importer must prepay any anticipated or required disbursements.

[5] INVOICING AND PAYMENT This Standard Document contemplates an ongoing relationship between the importer and the customs broker and calls for regular (typically monthly) invoicing and payment. For importers desiring infrequent or one-off customs brokerage services, an ad hoc invoicing procedure, with the customs broker issuing its invoice on completion of the services, may be more suitable.

The importer should include the bracketed term "undisputed" in the second sentence to allow it to withhold payment of disputed charges. The customs broker should try to exclude the term. For information about payment terms, see Standard Clause, General Contract Clauses: Payment Terms.

[10] SECURITY The Customs Trade Partnership Against Terrorism (CTPAT) is a program established by CBP after the terrorist attacks of September 11, 2001. It allows importers committing to specified supply chain security practices to receive certain benefits from CBP, including:

  • Fewer CBP inspections.

  • Shorter wait times for inspections at the borders.

The importer should include this optional provision if it is a CTPAT member, because it must ensure that its supply chain business partners, including its customs brokers, either:

  • Are CTPAT members.

  • Have processes in place to ensure compliance with the CBP’s published minimum security requirements.

An importer that is not a CTPAT member may include this provision as well if it wishes. In addition to including Section 10 in this in this agreement, the importer should also obtain back-up documents from the broker confirming these representations and warranties.

[12] ASSIGNMENT; SUCCESSORS Anti-assignment clauses are included in agreements to restrict the parties' ability to assign their rights under the agreement, often by requiring the non-assigning party’s prior written consent. Include the bracketed language at the end of the first sentence if a party wants to ensure the other party cannot withhold, condition, or delay its consent unreasonably. Assignment clauses also often deal with the parties' ability to delegate their obligations. The second sentence is included to render any assignment in violation of the section ineffective. Without this sentence, the non-assigning party may have only a breach of contract claim, but the assignment to a third party may remain effective.

[13] INDEMNIFICATION This provision favors the importer by requiring the customs broker to indemnify it against claims arising from the customs broker’s breach of the agreement or negligence. The customs broker should try to negotiate a reciprocal indemnification from the importer for claims it may face arising from: Inaccurate information the importer provides (see Section 6). Other claims, losses, and liabilities relating to the import or export of the importer’s goods. Other indemnities may be included in an accompanying transportation or freight forwarding agreement.


Last update: June 27, 2020