Opening a container freight station means clearing a defined set of hurdles with U.S. Customs and Border Protection before any imported cargo touches your floor. The container freight station requirements sit in 19 CFR Part 19, Subpart C (sections 19.40 through 19.49), and they cover application and approval, a continuous custodial bond, facility security, employee reporting, cargo transfer procedures, recordkeeping, and the grounds on which CBP can shut you down. Because the merchandise inside a CFS often hasn’t cleared customs yet, CBP treats every operational detail as a revenue-protection issue.
How to Apply and Get Approved
Applications go to the CBP port director with jurisdiction over the proposed location. Under 19 CFR 19.40, you file a written application along with a customs bond executed on CBP Form 301 carrying the custodial bond conditions in 19 CFR 113.63. The port director sets the bond amount based on the expected volume and value of merchandise the station will handle.
Plan on paying a fee to establish, relocate, or alter the station. CBP calculates it from the officer time the service requires, using the formula in 19 CFR 24.17(d), and publishes updated fee schedules in the Federal Register and Customs Bulletin. Moving or modifying the facility later means a new application and a new fee.
The package typically includes a blueprint or floor plan, the executed bond, and evidence that the facility meets security and construction standards. A CBP officer then inspects the premises to confirm the station can securely receive, hold, and release bonded cargo. If the review clears, the port director approves the application and the station can begin accepting containers.
The Bond You Must Post
The CFS bond is a basic custodial bond under 19 CFR 113.63, and it must be continuous. Single-transaction custodial bonds are not an option. The bond obligates you to receive only authorized merchandise, safeguard everything in your custody, keep the required records, and promptly report each container arrival by delivering the manifest and transfer application to CBP.
You execute the bond on CBP Form 301 and file it with CBP’s Revenue Division Bond Team in Indianapolis. Submission can go by email or fax; CBP prefers email. The packet includes the completed Form 301 (both pages if applicable), any addendum forms, and supporting documentation such as a power of attorney or partnership papers.
The minimum continuous bond amount is $50,000. CBP calculates the required figure by taking 10 percent of the total duties, taxes, and fees paid or expected over a 12-month period, then rounding up to the nearest $10,000. If that math produces a number below $50,000, the minimum still applies. CBP can require more for operators with compliance problems, prior penalties, or involvement with high-risk commodities. If the bond later becomes insufficient — whether the surety withdraws or the cargo volume outgrows the coverage — the port director can demand a replacement, and failure to provide one is grounds for revocation.
Facility and Security Standards
Because a CFS handles merchandise still under customs custody, the facility has to keep unauthorized people out. Under 19 CFR 19.4, the proprietor must maintain the premises in a safe and sanitary condition and establish procedures adequate to secure all bonded merchandise. Construction quality is a factor the port director weighs when deciding whether to approve the application: the building must be put together so that forcing entry would leave obvious evidence of a break-in.
If any portion of the facility will also hold non-bonded merchandise, the port director designates how the two areas must be separated. Acceptable separations include a wall, a fence, or a painted line, depending on what the port director deems effective for that layout. All inlets and outlets to bonded storage, such as tank valves for liquid cargo, must be secured with locks or in-bond seals. Bonded merchandise must be stored to minimize damage, avoid hazards to people, and comply with applicable local, state, and federal rules for the specific type of goods.
Many operators also pursue voluntary membership in the Customs-Trade Partnership Against Terrorism (C-TPAT) program, which carries its own minimum security criteria. C-TPAT requires physical barriers or deterrents at all cargo handling and storage facilities. Cameras, intrusion detection systems, and access control devices are strongly recommended but not universally mandatory. Where cameras are deployed, C-TPAT requires that they cover key areas related to the import and export process and record 24/7 at the highest practical picture quality. Written policies governing use, maintenance, and testing of any security technology are mandatory for members who rely on it.
Employees You Must Report to CBP
CBP will not issue permits to transfer containers to a CFS operator who has not provided a written employee list. Under 19 CFR 19.46, the operator must furnish the list within 30 calendar days of a written demand from the port director. For each employee who handles imported merchandise, the list carries the name, address, Social Security number, and date and place of birth.
The duty continues after the initial submission. When you hire new employees to handle bonded cargo, you have 10 calendar days to notify the port director in writing with the same identifying details. When an employee leaves, the port director must be notified within 10 calendar days of the departure. Workers employed by an independent contractor you hire are not your employees for this requirement, but you remain responsible for what happens to the cargo either way.
Failure to keep a current employee list is one of the specific grounds for revocation under 19 CFR 19.48. If the port director learns that a corporate officer of the CFS operator has been convicted of a felony, or a misdemeanor involving theft or smuggling, that is also grounds for suspension or revocation, even if the officer resigned or was fired before the conviction.
When Liability Shifts From Carrier to Operator
Knowing exactly when liability shifts matters more than almost anything else in daily operations, because the party holding liability is the one whose bond gets hit if cargo goes missing.
Under 19 CFR 19.44, the importing carrier (or the bonded carrier, if the merchandise arrived via in-bond transportation) stays liable for safekeeping and delivery until the CFS operator formally receipts for the cargo. The carrier must confirm that the person accepting the container is an authorized representative of the operator and must provide an abstract manifest showing bill of lading numbers, container marks and numbers, and the usual manifest description for each shipment inside.
The transfer itself requires a written application under 19 CFR 19.42. The CFS operator files a duplicate application identifying the containers, the carrier, the arrival date, and the pier of origin, with an attached abstract of the carrier’s manifest. Both the operator and the carrier’s agent sign the application. Once the operator signs the receipt on the transfer record, responsibility shifts, and the operator’s custodial bond covers the merchandise from that moment forward.
One wrinkle catches some operators off guard. If you collect merchandise directly from within the port district rather than waiting for delivery, you receipt for it at the point of collection and assume bond liability there. You don’t have to wait until the cargo reaches your facility to become responsible for it.
Records You Must Keep
You must account for every piece of bonded merchandise from receipt through final withdrawal. Under 19 CFR 19.12, records must provide an audit trail covering deposit, manipulation, and withdrawal, detailed enough that CBP can efficiently verify compliance. The standard is essentially what a prudent business handling the same type of cargo would be expected to maintain.
Transfers of imported merchandise between parties are documented on CBP Form 6043, the Delivery Ticket, which captures consignee information, the importing carrier’s name, the origin and destination of the goods, and a description of the merchandise.
Per 19 CFR 19.4, all records on bonded merchandise must be retained for five years after the date of the final withdrawal under the entry. Records have to stay readily available for CBP review at the facility, and CBP officers can conduct unannounced inspections to compare documentation against physical inventory.
Any theft, suspected theft, or extraordinary shortage or damage must be reported to the port director immediately on discovery, then confirmed in writing within five business days. “Extraordinary” means a shortage or damage equal to one percent or more of the merchandise’s value in an entry, or duties and taxes exceeding $100 on the missing goods.
Penalties for Violations
When a CFS operator breaches bond conditions, most often by releasing merchandise without authorization, CBP issues a formal notice on CBP Form 5955A (Notice of Penalty or Liquidated Damages Incurred and Demand for Payment). The surety is notified at the same time. The operator has 60 calendar days from the date of issuance to petition for relief. If no response arrives in that window, CBP sends a demand directly to the surety.
Financial exposure depends on what happened to the cargo and whether it was designated for examination. CBP’s mitigation guidelines run on a sliding scale. If the operator can prove the goods were never received or landed, or if the violation came solely from a CBP mistake, the claim is canceled with no payment. Unauthorized release of informal-entry-eligible goods may be reduced to the duties, taxes, and fees that would have been owed, plus $100 to $500. Unauthorized release of goods not designated for exam runs between $250 and $2,000 if duties were paid, and the full duties plus $300 to $2,500 if they were not. Releasing goods that CBP had designated for exam ranges from $2,500 to $20,000 even when duties were paid, and climbs higher when goods were restricted, prohibited, or duties went unpaid. For restricted or prohibited merchandise, the claim equals three times the value of the goods.
Operators who voluntarily disclose a violation to CBP before it is discovered can often negotiate the claim down to duties owed plus a $50 surcharge. Self-disclosure consistently produces the best outcomes.
What Can Cost You the Operating Privilege
The port director can suspend or revoke a station’s operating privilege under 19 CFR 19.48 for any of seven enumerated reasons:
- The privilege was obtained through fraud or a material misstatement in the application.
- The operator refuses or neglects to follow any proper CBP order or regulation governing container station operations.
- The operator, or a corporate officer, is convicted of a felony, or a misdemeanor involving theft, smuggling, or a theft-connected crime.
- The station releases cargo that CBP designated for inspection before the inspection occurs.
- The station does not provide secure facilities or properly safeguard merchandise.
- The operator fails to furnish a current employee list as required by 19 CFR 19.46.
- The bond is insufficient in amount or lacks adequate sureties, and the operator does not furnish a satisfactory replacement within a reasonable time.
Revocation permanently closes the station’s ability to operate as a CFS at that location. Suspension is temporary but still devastating for a logistics operation that depends on continuous cargo flow. The criminal-conduct ground is notably broad: the provision applies even if the corporate officer was fired or resigned before conviction, as long as the acts occurred while that person was a corporate officer.
Restricted and Hazardous Cargo
A CFS may encounter merchandise that requires additional federal permits beyond the station’s standard operating authority. CBP enforces import restrictions on behalf of more than 40 other government agencies, including the U.S. Fish and Wildlife Service, the U.S. Department of Agriculture, and the Centers for Disease Control and Prevention. Firearms, certain agricultural products, animal by-products, and some food and beverage items require special licenses or permits from the relevant federal agency before they can legally enter the country. If restricted merchandise turns up during deconsolidation, hold the cargo and coordinate with CBP rather than releasing it into commerce. Unauthorized release of restricted goods triggers the highest tier of liquidated damages, calculated at three times the merchandise value.