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Colleen Clarke Elected to AAEI Board of Governors

Roanoke Insurance Group, Inc.  is proud to announce the election of Colleen Clarke, Vice President of Surety & Trade Relations, to the Board of Governors for the American Association of Exporters and Importers (AAEI). Clarke serves as co-chair of the AAEI Customs Committee and continues her industry leadership by advising members on the facilitation of lawful trade. Members of the AAEI organization will benefit from Clarke’s expertise in customs and government trade topics as well as her past experience in assisting importers and customs brokers through surety bond issues of all kinds. This appointment further acknowledges Roanoke’s ongoing commitment to provide resources and actively participate in the industry.     “Working alongside Colleen for many years, I’ve seen how dedicated she is to helping clients,   sharing knowledge with colleagues and advocating for the industry. She truly “knows her stuff” and I’m confident she will be also be a great asset to the AAEI. Congratulations Colleen. We are proud to have you on our team.” – Karen Groff, President, Roanoke Insurance Group Inc. Clarke began her career in 1988 with Washington International Insurance Company. She handled a range of important responsibilities for the surety across the organization including the customs claims and underwriting units. Clarke has also served  with the following organizations: Customs Commercial Operations Advisory Committee (2009-2012). Member of the Trade Support Network Trade Leadership Executive Committee. Member of the Global Alliance for Trade Facilitation private sector working group. President of the International Trade Surety Association (2015-2020) In response to her election, Clarke says, “I am honored to be elected to the Board of Governors by the AAEI members.  I sincerely appreciate the trust instilled in me by the members.  I look forward to working with AAEI’s leadership and the Board of Governors to accomplish the goals of the association on behalf of its members.”

Are You CARM Ready?

What Is CARM? CARM is a multi-year initiative implemented by Canada Border Services Agency  (CBSA). CARM stands for CBSA Assessment and Revenue Management and is intended to modernize and streamline the process of imports into Canada. Under CARM, importers will need to secure and post their own import bond in order to participate in the Release Prior to Payment Privilege (RPP). This is a significant change that impacts importers and customs brokers. Prior to CARM, customs brokers were allowed to extend use of their own customs bond to any importer. CARM Customs Bond Requirement Details CARM Phase 0  went into effect in January of 2021. Release 1 is scheduled to launch Spring 2021 and Release 2 in the Spring of 2022. As of Release 2, an importer must post security using one of the following two options to be eligible for RPP: A surety bond for 50% of their highest monthly accounts receivable with a minimum bond of $25,000 – OR – a cash security for 100% of their highest monthly accounts receivable The RPP Bond will allow the importer to: Obtain the release of goods from the CBSA before paying duties and taxes Defer accounting for goods Defer payment of duties and taxes (including GST) What Can You Do To Be CARM Ready? Although CARM Release 2 is scheduled for Spring of 2022, customs brokers and their import clients should begin discussions now with their surety bond provider. We recommend that brokers take the following steps now to prepare: Confirm accurate information (importer address, business number)​ Review all importer clients to determine bond amount​ For bonds greater than $25,000 – underwriting may be required​ and should be sent to Roanoke or your surety partner for review​ Work out a schedule to ensure an orderly process to obtain bonds for your clients Visit CBSA’s website to learn more about CARM. CBSA provides information specific to importers, customs brokers, trade consultants, surety companies and other trade partners in an effort to assist all parties in preparing for Release 1 and 2. Roanoke and their surety partners are already working closely with CBSA on the business requirements they need to enhance their online customs bond issuance system FastBond™ for the upcoming bond changes. Once these negotiations are finalized, the digital platform will be updated to provide a convenient and fully compliant application for customs…
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Be CyberSmart: Don’t Let Your Business Be Held For Ransom

When ransomware strikes, business stops. You may be in the middle of writing an email or arranging a shipment or paying a bill when your familiar screen disappears and is replaced by an ultimatum: pay up or lose your data forever. A typical ransomware screen might inform you that your system’s data has been encrypted and to get the key to unlock it, you need to pay a ransom – usually in the form of bitcoin. Ransomware notices will also include a timeframe to pay, maybe in the form of a clock counting down to the second that your payment window closes, and your data is destroyed or distributed across the web. A unique and particularly malicious form of cyberattack, ransomware has become a widely distributed threat in the last several years, targeting businesses and organizations of all sizes in all industry sectors including the transportation and logistics industry. Ransomware attacks against third-party logistics providers can be particularly insidious as they not only compromise a the data of the customs broker, forwarder, or 3PL/4PL but also that of your clients and partners. What Is Ransomware? Ransomware is a money-making scheme utilizing malicious software, or malware, that encrypts a business’s computer data and makes it inaccessible to its rightful owner. Criminals demand a fee to be paid in order for the data to be unencrypted and available. Like other types of malware, ransomware is a computer program that may be installed through deceptive links in an email message, instant message program, via a removable drive or device or through unprotected widgets, plugins or other entry points in a website. This malicious software is like an infiltration unit that sneaks into your computer and sets up shop. Once it’s there, it runs like any other program installed in the system. Most recently, bad actors have upped their game utilizing a double-extortion ransomware tactic. They demand a ransom payment to decrypt the stolen data and another payment to keep that data private. If the ransom is not paid within a specified timeframe, the criminals threaten to publish the data for all to see or reveal it to a competitor or industry segment. The High Cost of Ransomware In addition to a shift in the disruptive tactics used by cyber criminals, a 2020 study performed by NetDiligence reveals that the average amount of ransom…
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Roanoke Opens Office in Toronto

Roanoke’s Expansion into Canada Explained On March 17, 2021, Roanoke announced a major milestone that positively impacts our customers, our business and our team. We issued a press release that proudly announced the opening of a new Canadian company headquartered in Toronto, ON. The new organization, Roanoke Insurance Group Canada, Inc., part of Munich Re Specialty Group, N.A., leads our expansion into Canada. RIG CA is a retail and wholesale broker representing several top-rated insurance and surety bond companies. The new organization is led by one of Roanoke’s own industry veterans, Glenn Patton. He will serve as Managing Director of the Canadian operation. “I am very excited for this new opportunity to expand Roanoke’s presence and serve the logistics industry in this growing market. I have had the privilege of working in the Canadian insurance marketplace for over 3 years, and I look forward to building strong relationships with our Canadian partners and clients”, states Glenn Patton. Although Roanoke has been working with Canadian partners for over 25 years, establishing a Canadian entity enables Roanoke to provide a stronger and more seamless service experience to clients with cross border operations. RIG CA is positioned to support the Canadian trade industry with unique and expertly crafted insurance and surety bond solutions designed to meet the needs of freight brokers, freight forwarders, customs brokers and others in the supply chain. RIG CA is an affiliate of Roanoke Insurance Group Inc. (RIG), a prominent specialty broker to the logistics and trade industry in the United States since 1935. Roanoke focuses on a  full scope of insurance, surety bond, ATA Carnet products and risk management services for companies involved in transportation, logistics or shipping whether your operations are digital or traditional. Contact us at 800.ROANOKE (762-6653) or infospot@roanokegroup.com to learn more about our Canadian and cross border products and services.

Roanoke Whitepaper – An Importers Guide to Antidumping & Countervailing Duties

Overview Many Customs and trade laws carry significant financial consequences for importers, and of these laws, antidumping and countervailing duties pose some of the most dangerous ramifications. These provisions exist to protect domestic industries and producers from unfair foreign competition. Under U.S. law, goods are subject to assessment of “ordinary duties” based on their classification under the Harmonized Tariff Schedule of the United States. However, U.S. law also defines certain situations in which goods are being sold to the U.S. at prices below cost of production or below “fair market value”. This is referred to as “dumping”. Like ADD, CVD is designed to combat unfair advantages enjoyed by foreign suppliers. If a foreign government is paying a subsidy, bounty, or grant on exports of certain goods, the foreign supplier receiving the funds is able to price those goods lower than a U.S. supplier not receiving such payments from our government. The assessment of CVD in addition to ordinary duties offsets or “countervails” these subsidies. But exactly what are they and what are the hidden financial exposures they create for importers and the sureties who provide their bonds? How does the ADD/CVD process work? What makes the ADD/CVD rates so volatile? Get the answer to these questions and many more by downloading the full whitepaper below! Download

Managing Your Customs Bonds – The Financial Review

Last updated on March 1st, 2021 The Purpose of the Customs Bond Risk Assessment Why does a surety underwriter choose to to review the customs bond principal’s financial position? Because the bond represents a financial risk to the surety. The customs bond is a three-party contract between the surety company, US Customs and Border Protection (CBP), and the importer who is the principal on the bond. It is the principal’s responsibility to pay CBP all duties, taxes, and fees on entries made, and the bond is a guarantee that, if the principal can’t or for some reason doesn’t pay the duties, taxes, and fees on an imported shipment, the surety will make that payment to CBP. As they are obliged by the bond to pay only if the bond principal fails to do so, it is in the surety’s best interest to be as certain as possible that the importer will be financially stable enough to make payment. It is important for all parties in the bonding process that the surety payments to CBP stay as low as possible. Low loss ratios help to keep bond rates low and the issuing authorities of customs brokers high. Due to the pandemic, the so-called “trade wars”, and other economic factors, increased numbers of importers have been defaulting on standard payment of duties, taxes, and fees, causing liquidated damages claims for these payments to skyrocket from 10% of all bond damages in 2018 up to 30% in 2020. For this reason the underwriters are focusing even more closely on an importer’s financial condition and liquidity – indicators for their ability to pay duties, taxes, and fees as well as any damages issued by CBP. The Underwriter Financial Assessment When they ask for “financials” the surety underwriters are looking for a complete year-end report that is usually defined as a 12-month, CPA-prepared financial statement including: Income Statement Balance Sheet Statement of Cash Flows Accompanying Notes If there is not a CPA-prepared 12 month financial statement available, the surety underwriters will typically accept the income statement and balance sheet available via internal accounting platforms such as Quickbooks. On these self-produced financials, the surety usually requires a company officer to attest to the accuracy via a signature to confirm that all the information presented is true and valid. These internal reports may also accompany a CPA-prepared…
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How to Navigate a General Average Webinar

General Average (GA) is an often overlooked and poorly understood risk with significant financial consequences for cargo owners. Navigating through a GA can be a difficult and frustrating experience for logistics providers and cargo owners, but it doesn’t have to be. Join us on Wednesday, February 24th at 12pm CT as our panelists delve into the details about what you and your cargo owner clients can expect when a General Average is declared. They will share lessons learned from hands-on claims experience and provide answers to FAQs about General Average. This information is intended to help you and your clients avoid frustration and delays when the next GA occurs.

Canada eManifest Update for Freight Forwarders

Last updated on April 6th, 2021 An important change written into CBSA Notice 20-28 went into effect as of January 4, 2021. Starting on this date only electronic house bills may be used for consolidated shipments, if not specifically exempted. This requirement directly impacts Freight Forwarders arranging shipments into Canadian ports. Freight forwarders are liable for the transmission of house bill data for all consolidated import, in-bond and in-transit shipments. Summary of CBSA eManifest Requirement Canada Border Services Agency (CBSA) requires Advance Commercial Information prior to entry into Canada. This is similar to the U.S. CBP’s Automated Manifest System (AMS) requirements. The data is received and validated by the CBSA prior to arrival within prescribed, mode-specific time frames: CBSA Notice 20-28 outlines the updated requirement for electronic filing of manifest data. January 4, 2021 is the required implementation date for electronic transmission of Advance Commercial Information (ACI) data. A six month period of informed compliance and zero-rated penalties began as of this date. The informed compliance period will then cease on July 4, 2021, and full monetary penalties will be issued going forward. Bonded Carrier Requirements for Non-Canadian Freight Forwarders & NVOCCs Freight forwarders must be bonded in order to move or transport goods that have been reported but not released within Canada. Foreign based freight forwarders and NVOCCs are required to apply for a Canadian carrier code as explained in CBSA Notice 16-29  [1]. For bonded carriers including freight forwarders and NVOCCs, the CBSA requires a $25,000 Canadian carrier bond. There is an option for non-bonded status, but it is limited to only filing the eManifest ACI data. The chart below provides a comparison between a bonded freight forwarder vs non-bonded freight forwarder: Bonded Freight Forwarder vs Non-Bonded Freight Forwarder   How to Apply for Bonded Status with CBSA Either a  BSF722 or BSF329-9 form must be submitted along with an executed CBSA bond. The BSF722 form is “Changing Bonded Status for Existing CBSA Carriers”:  Use this form to update status from non-bonded to bonded. The BSF329-9 form is the “Application to Transact Freight Forwarder Operations with the Canada Border Services Agency”: Use this form to obtain new authority. Roanoke’s Bond Program We have teamed up with our Canadian surety partner, Guarantee Company of North America, to provide the required bond for non-Canadian freight forwarders and NVOCCs. Roanoke has authority…
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Roanoke Whitepaper – The Path to Implementing A Sound Cyber Risk Management Plan

Last updated on January 13th, 2021Overview The transportation, trade and logistics sector, like any other industry vertical, has been hit by ransomware, social engineering and other cyber threats. These threats upend operations and increase the total cost of risk for companies. In fact, transportation ranks among the top five industry sectors vulnerable to ransomware. There are several reasons why the transportation and logistics sector is so cyber-exposed, including its dependency upon third-party networks; the speed with which logistics transactions are conducted; the number of stakeholders involved in sharing information; and the potential access to confidential and sensitive financial, employment and intellectual property records. Without a sound cyber risk management plan in place that includes cyber security measures, cyber support services, and cyber insurance, navigating today’s threats may leave your operation stranded and paying out hundreds of thousands of dollars in out-of-pocket expenses. Download

Planning Ahead for a Potential General Average

Last updated on January 8th, 2021 ONE Apus via Twitter   On November 30th, the cargo ship, ONE Apus, sailing from Yantian, China to Long Beach, CA, encountered severe weather. Swells exceeding 20 feet struck the vessel. An estimated 1816 containers were lost overboard, and containers remaining onboard received significant damage. Current estimates are that over $200 million worth of cargo was lost or damaged. The ship is now berthed in the port of Kobe, Japan, where operations are underway to remove containers.    One of the most pressing unknowns around this accident is whether or not the vessel owners will declare a General Average (GA). A General Average is a partial loss shared proportionally by all parties involved in the voyage, namely the cargo owners and the vessel owner. In a GA, cargo owners are expected to contribute financially to the voyage loss, and they need to post a financial guarantee, usually in the form of a bond, to have their goods released.   If you find yourself fielding calls from clients who have cargo damaged or lost at sea and may also need to navigate through the difficulties of a General Average, some general guidelines can help you walk them through this trying time.   Insured cargo: Cargo insurance is designed to respond to claims for damaged or lost cargo and expenses for the GA Contribution required to release cargo. The Roanoke claims team will work directly with the insurance company to post the security deposit or GA Guarantee and provide documents needed to expedite the cargo’s release. Please refer to the Claims section on our website for detailed instructions and a list of required documents. You can also contact the claims team directly at 847.969.7064 or via email at insuranceclaims@roanokegroup.com.   Uninsured cargo:  When cargo is uninsured, the cargo owner must inform the Average Adjuster as soon as possible, and the adjuster will require a cash deposit in the place of an insurer’s Average Guarantee. The cargo owner should contact the Average Adjuster directly to post the bond. It’s important to note that the cargo owner’s security is held until the GA adjustment is complete. This process can last for two years or more, and if it is less than the final adjusted amount, the security may never be returned.    Recommendations for NVOCC’s and Freight Forwarders   The NVOCC, who issued a bill of lading, should not…
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