Multiple ACH Accounts Funded by Single Bank Account Isn't 'Customs Business,' CBP Says

The use of a single bank account by multiple companies to fund CBP Automated Clearinghouse (ACH) accounts doesn't count as "customs business," CBP said in a June 3 ruling (here). CBP weighed in on the issue in the ruling, HQ H261011, at the request of one of the companies that is considering the use of a joint bank account. The ACH accounts are programmed to automatically sweep monies out of an account electronically to pay duties to CBP.

Two undisclosed companies, which are both subsidiaries of the same parent corporation, are considering funding individual ACH accounts through a single bank, CBP said. One of the companies, represented by Grunfeld Desiderio lawyer Arthur Bodek, asked CBP whether maintenance of such an account should be considered "customs business" and would then require a licensed customs broker. As proposed, "there would be no change as to how the ACH accounts are established with CBP or in the way that CBP receives its payments from either company," the company told CBP. The main difference would involve an internal reconciliation between the primary bank account holder and the other company to cover the amount withdrawn by the other company for its ACH, the company said.

The scenario at issue would not require a broker because the bank account that funds an ACH doesn't fall within the definition of "customs business," CBP said. "To comply with the statutory definition of customs business, a transaction with CBP to pay customs duties must be structured in such a manner that only a licensed broker or the importer of record tenders the payment to CBP," CBP said. In this case, the companies at issue here continue to pay their respective duties to CBP as "importers of record despite consolidating the bank accounts," CBP said. "Whether the companies pay CBP with funds obtained from a single bank account or separate bank accounts does not affect each company’s transaction with CBP for the payment of duties. Thus, the use of a single bank account to fund separate ACH accounts does not amount to customs business."

Additionally, CBP previously ruled "that it does not regulate a private financial arrangement like payments to a vendor on behalf of a sister company as they do not constitute customs business," it said. CBP "would similarly not regulate a transaction of money between two companies" and "the proposed consolidation of bank accounts merely changes the internal management of money in the single account used by the two companies, while maintaining each company’s ACH account to individually transact with CBP, and thus, does not constitute customs business."