Prepare for the Withdrawl of the Tomato Suspension Agreement
June 23, 2025****REVISADO CON CORRECCION****Prepararse Para El Retiro Del Acuerdo De Suspensión Del Tomate
June 23, 2025Dear Client’s & Friends,
As you may already be aware, the Department of Commerce (DOC) notified the Mexican signatories of the 2019 Suspension Agreement on Fresh Tomatoes from Mexico that the Department intends to withdraw from the Agreement on July 14th, 2025. Unless a new agreement is negotiated, the 2019 Agreement will terminate on July 14,2025.
Attached please find the continuation of the official notice from the Federal Register for your review:
Although there is still a lot of uncertainty and the negotiations are still ongoing; to be proactive, we would like to encourage all tomato importers to apply for their own ACH account (Automated Clearing House) and ACE account with CBP. ACH is a U.S. financial network used for electronic payments and money transfers. ACH payments are a way to transfer money from one bank account to another without using paper checks, credit cards, wire transfers, or cash. The ACE Secure Data Portal is a web-based application providing a single, centralized on-line access point to the ACE system that connects to CBP, the trade community and government agencies involved in importing goods to the U.S. The ACE portal gives users access to view their account information as it exists with CBP and monitor daily operations.
If the withdrawal is finalized and fresh tomatoes become dutiable in the near future, having an ACH and ACE account already set up will make for a smoother transition by facilitating the entry process without interruptions of the day-to-day operation.
Below please find the links with information and instructions on how to apply for an ACH and ACE account:
- ACH: https://www.cbp.gov/trade/trade-community/automated/automated-systems/gs-automated-systems/ach/signing
- ACH Application Form: https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/db723385-3514-0e6d-5724-3ab764ca3ba4/CBP_Form_400_Apply_For_ACH.pdf
- ACE: https://www.cbp.gov/trade/automated/getting-started/portal-applying.
Please be sure to provide us with your PUN once your ACH account has been activated.
Additionally, if there is a withdrawal from the agreement, please note the requirements for the importers Continuous Bond may be affected as well. While there still aren’t any final options on how exactly the surety companies will change, their underwriting policies and what additional information and/or collateral might be required, we have created a simple formula based on other ADD cases we’ve encountered not related to this agreement to give you a broad idea what surety companies may require in the event the withdrawal is finalized. Surety companies may possibly treat the matter as a regular antidumping exposure and could require the importer to raise their bond limit depending on the entered value of the merchandise, antidumping (AD) and countervailing (CVD) margins. The bond amounts are normally calculated at 10% of the duties, taxes and fees (DTF) within a 12-month period, however, please note that the percentage used for the calculation could vary. It is also very important for an importer to estimate and project how many shipments they are expecting to import for the following 12-month period to ensure their current bond amount remains sufficient.
Applying/Updating your Continuous Bond to cover the possible duties imposed:
A continuous customs bond is an ongoing financial guarantee required by customs authorities to ensure compliance with import and export regulations. All importers of record must have a valid continuous bond on file which is valid for a 12-month period from the date of issue; it can be renewed annually. When it comes to calculating your bond size/amount it is based on 12 months of duties, taxes, fees (DTF) paid on import transactions.
The calculation for a Continuous Bond amount is the estimated DTF for the previous or next 12 months (whichever is greater), multiplied by 10%. Round up to the nearest $10,000 to get the total bond amount. The minimum Continuous Bond amount for import bonds is $50,000. For bonds that the DTF for the 12-month period are more than $1,000,000, the bond amounts are rounded up to the nearest $100,000 value.
The chart below provides a simple demonstration of how the estimated DTF equate to a Continuous Bond amount. Please note that this chart is only to demonstrate the bond amount calculation. Bond amounts may be much higher. The important thing to understand is how to valuate and round up to the correct amount.
| Total 12 Month Taxes, Duties, and Fees | Bond Amount |
| $0 – $499,999 | $50,000 |
| $500,000 to $599,999 | $60,000 |
| $600,000 to $699,999 | $70,000 |
| $700,000 to $799,999 | $80,000 |
| $800,000 to $899,999 | $90,000 |
| $900,000 to $999,999 | $100,000 |
| $1,000,000 to $1,999,999 | $200,000 |
| $2,000,000 to $2,999,999 | $300,000 |
If we are your broker of record (BOR) for your company’s continuous bond, please run the calculation listed above based on “All others Rate” of 17.09% tariff on most imports of tomatoes coming from Mexico. Provide us with the total bond about you will need so we can get the process started with the surety company to raise your bond limit. If we are NOT your BOR for your continuous bond, please be sure to contact your BOR immediately to get this process started.
Please be informed you MUST have a valid ACH account and Continuous Bond that covers the duties and take into consideration that the RECONCILIATION PROGRAM does not apply to any ADD Entries.
Additionally, please note you also have the option to apply for the PMS Program with CBP (Periodic Monthly Statement). This program allows you to shift the payment process from transaction-by- transaction process to an interest free periodic monthly process.
We highly request to read the documents we have attached which provide:
- Information on how the PMS program works
- How to apply
- Bullet points/simplified version on how to apply
- When payment will be deducted
- PMS (Periodic Monthly Statement)
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/c46da1de-9ccb-08fe-07f0-ac0bac37e6c6/Participating_in_Periodic_Monthly_Statements_1_.pdf
Application Process:
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/e5cb5773-7f6e-9ed6-428b-32e017b9ee48/ace_monthly_statement_capab_3.pdf
Bullet Points on How to Apply for PMS:
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/c561e9ea-c7eb-b553-bf23-8e0438dd699b/HOW_TO_APPLY_FOR_P.pdf
PMS Deduction Dates:
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/53ac0770-3a02-bfb7-b82d-23b884efce2f/periodic_monthly_statements_due_dates_for_2025_508c_0.pdf
Additionally, we are receiving a lot of questions regarding what value the duties will be calculated from. The following are the five (5) approved CBP valuation methods; please review to make sure you are utilizing the one that is best applicable to your operation.
- Transaction Value Link CFR
- Transaction Value of identical merchandise and similar merchandise Link CFR|
- 9 CFR § 152.104 Transaction value of identical merchandise and similar merchandise – Code of Federal Regulations
- Deductive Value Link CFR
- https://ecfr.io/Title-19/se19.2.152_1105
- Please note that Deductive Value is what is most likely to be used on consigned based shipments, and what we feel most of our clients will utilize for appraisement purposes to CBP. This contains all the details for your review in order to verify if your company may fall under this scenario. We have also attached a binding ruling issued by CBP on a case very similar to what may apply to consigned produce from Mexico and have been provided by very well-respected law firm a copy of a settled court case from the U.S. Court of International Trade on a similar matter and proper calculations. Please review attachment.
- Computed Value Link CFR
- 19 CFR § 152.106 Computed value – Code of Federal Regulations
- Fall Back Method Value Link CFR
- 19 CFR § 152.107 Value if other values cannot be determined or used – Code of Federal Regulations
Please find a notice from CBP which provides information on how to determine the customs value for fresh produce (Informed Compliance Publication):
Based on the above, we are providing a sample formula attached that may help your company calculate an appraised value to CBP on consigned shipments utilizing the “Deductive Value Method.” Please note that this is merely a sample, and not all listed deductions may fit your individual scenario; each sales contract and/or grower contract may differ on a per case basis. Before you proceed with any calculation, we strongly suggest that you consult with your legal counsel and accountants to ensure that you utilize the best method based on your individual situation. We will be more than glad to assist with any information and/or questions that your lawyer and accountants may have. If you do not have a lawyer and CPA, we strongly recommend that you hire one.
We would also like to emphasize that this exercise is merely for US Customs “Appraisement” purposes and is different from the actual liquidation process you may have with your clients and growers. Again, we strongly suggest you review the liquidation process with your legal counsel. With that being said, please review the valuation exercise attached.
- DEDUCTIVE VALUE SAMPLE:
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/1eba302c-1c9a-9253-cbca-fbad41b0a2bd/Udpated_Deductive_Value_Math_FOB_Price_2025.xlsx
SIMILAR CASE:
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/c760259f-8d5e-79c1-60ee-451de7bdd7d8/Similar_Case.pdf
BINDING RULING:
https://mcusercontent.com/d769bef9e880bc35a1d185cfb/files/5b77006c-9c7e-5ab4-f264-b59d2eeeb3a2/Binding_Ruling.dot.pdf
Please also note we have been advised that you may have to segregate the calculation of duties by line item on the sales invoice to your clients. Or, on the “comments” section of your invoice you may list the duties that are included in your sales price. Again, we strongly suggest you review this matter along with your liquidation procedures to your growers with your legal counsel to ensure that you are abiding with CBP valuation laws.
Lastly, please take note that any company importing tomatoes will be required to provide us with a copy of the “non-reimbursement certificate” per each grower. We’ve attached the form for your review:
In conclusion, although this is disappointing news, please note negotiations are still in progress and we are hopeful a new agreement will be reached that will be satisfactory to all parties involved. As your U.S. Customs Broker we feel obligated to advise you of what the future may hold and the actions you can take to be proactive and well prepared ahead of time should the withdrawal become finalized.
In the meantime, all buyers and sellers must continue to abide by the terms of the 2019 Tomato Suspension Agreement with Mexico until further notice. Please don’t hesitate to contact our office with any additional questions or concerns.
Thank you,