Many manufacturers and online sellers outside the United States import their own goods. They act as nonresident importers of record, often shipping “delivered duty paid” to U.S. customers or into Amazon and other fulfillment centers. Executive Order 14411 and CBP’s interim final rule of November 6, 2026 put new conditions on that model. The rule takes effect January 5, 2027. Here is what our clients in China and elsewhere are asking.
Who is a “foreign importer of record” now?
Anyone who is not a “U.S. importer of record.” An individual is a U.S. IOR only if he or she is a U.S. citizen or green-card holder. A company is a U.S. IOR only if it is organized under U.S. law, genuinely located in the United States, and either at least 51% owned and controlled by U.S. citizens or permanent residents, or the direct owner of a significant amount of unencumbered U.S. real property. So the foreign-IOR group includes not only foreign companies importing in their own name, but also many U.S.-formed companies owned by foreign parents or investors. Our companion article on U.S. IORs explains the test in detail.
Could a foreign company import before this rule?
Yes, and it still can. A nonresident company can obtain an importer number by filing CBP Form 5106, must post a customs bond with a U.S. surety, and, if it is a corporation, must have a resident agent in the state where entries are made who can accept service of process (19 C.F.R. §141.18). It usually works through a licensed customs broker under a power of attorney. All of that remains. The new rule adds conditions on top.
What changes on January 5, 2027?
- CTPAT or a CTPAT broker. A foreign IOR may make consumption entries only if it is validated in CBP’s Customs Trade Partnership Against Terrorism (CTPAT) program or uses a licensed customs broker that is CTPAT-validated.
- Only Canadian companies can be validated as foreign IORs. Under current CTPAT rules, a manufacturer in China, Vietnam or Mexico cannot get validated as a foreign importer, so in practice it must use a CTPAT-validated broker.
- If you do not own the goods, the broker is the importer. When the foreign party is not the owner or purchaser of the merchandise, the CTPAT-validated broker it designates must act as IOR. This targets arrangements where a party lends its name and importer number without having any real stake in the goods.
- Formal and informal entries alike. These conditions apply to both. CBP did not ban informal entries by foreign IORs in this rule, but it said it will monitor them and may ban them later, as the executive order directs.
- A declaration on every entry. Entry and entry-summary forms will state whether the IOR is a U.S. or foreign IOR, and the broker must have checked.
How many brokers qualify?
Not many. CBP’s own numbers show that only about one in five active brokers is CTPAT-validated. The good news is that about two-thirds of foreign IORs already use a validated broker. If yours is not one of them, start looking now, because validated brokers will be busy and selective, and they are required to do heightened due diligence on foreign IOR clients.
Why is CBP doing this?
CBP points to unpaid bills and seizures. In the rulemaking, it reported that non-CTPAT foreign IORs owed about $1.01 billion in unpaid customs bills opened since October 2020, and that their seizure rate was more than five times higher. When an importer has no assets in the United States and does not pay, CBP has little to collect against. The rule shifts responsibility to a vetted broker based here.
What about bonds?
The executive order directs that foreign IORs generally should not use continuous bonds, unless CBP finds the revenue fully protected. The November rule does not itself make that change. Separately, CBP’s October 8, 2026 proposal on low-value shipments would require a bond for informal entries of $2,500 or less, with liquidated damages tied to the value of the goods. Expect bonding to get stricter, more expensive and more closely tied to your duty exposure.
What does this mean for cross-border e-commerce sellers?
De minimis duty-free treatment is already suspended, so low-value parcels now go through informal or formal entry. Sellers who used freight forwarders or “IOR service” providers to import in the seller’s name, or in the provider’s name without owning the goods, should look closely at whether that arrangement survives. If the importer does not own or buy the goods, the CTPAT-validated broker must be the IOR, and that broker will want to know who you are, what you are selling, how it is classified and valued, and who pays if CBP sends a bill.
We have a U.S. subsidiary. Does that solve the problem?
Often not. A subsidiary owned by a foreign parent is itself a foreign IOR unless it directly owns a significant amount of unencumbered U.S. real property. It may still be useful for sales, warehousing, tax and liability reasons, and it can sometimes be built into a qualifying U.S. business over time, but a shell set up only to hold an importer number will not pass, and may draw attention.
What are the realistic options?
- Keep importing as a foreign IOR through a CTPAT-validated broker. Budget for higher broker fees, deeper document requests and possibly a larger bond.
- Let your U.S. customer be the importer. Sell FOB, FCA or DAP instead of DDP, so the U.S. buyer, if it qualifies as a U.S. IOR, clears the goods. Prices, payment terms and risk allocation have to be renegotiated.
- Build a real U.S. presence. A U.S. company with genuine U.S. ownership and control, or substantial U.S. real property, may qualify as a U.S. IOR. This is a business, tax and sometimes immigration decision, not a paperwork fix.
What should a foreign IOR do before January 5, 2027?
- Confirm in writing whether your broker is CTPAT-validated and has asked CBP for delayed compliance.
- Update CBP Form 5106: legal name, addresses, ownership, contacts. CBP has said it will void importer numbers with inaccurate registration information.
- Check your resident agent, power of attorney and bond.
- Prepare a compliance file for each product: classification, valuation, country of origin, and any Section 232, 301 or antidumping duties.
- Look at past entries for errors and consider a prior disclosure, because the order also calls for tougher penalty mitigation.
- Review contracts and Incoterms with U.S. customers and logistics providers.
- Consider commenting on the rule by January 5, 2027.
How can we help?
We advise manufacturers, exporters and online sellers, in Mandarin and English, on whether they are foreign IORs, which model fits their business, how to set up or restructure a U.S. company, what their contracts should say, and how to handle CBP requests, seizures and penalties. Send us your Form 5106, ownership chart and a recent entry summary, and we can tell you where you stand.
Sources: Executive Order 14411 (June 3, 2026), secs. 2 and 10; CBP interim final rule, Heightened Requirements for Foreign Importers of Record, CBP Dec. 26-19 (Nov. 6, 2026); CBP proposed rule, Low-Value Shipments, 91 Fed. Reg. 64532 (Oct. 8, 2026); 19 C.F.R. §§141.18, 141.46 and part 113. As of November 14, 2026. This article is general information, not legal advice.
