How does a Running bond work?
Thursday, October 27, 2016     Category : For Beginners

The information provided here is part of Guide on howtoexport and import 


How does a  Running bond work?


Running bond is commonly used at various government and private authorities against security requirements. What is running bond? How running bond works?


In imports and exports, running bond is commonly used at customs authorities under various requirements.


How does running bond work?How does a Running bond work copy


A bond is executed with the authorities to fulfill certain terms and conditions legally. Once after fulfilling the terms and conditions mentioned in the bond, the executor does not cancel the bond but carries over to next obligation against same terms and conditions mentioned in the bond.


If a running bond has been executed by a customer with authorities, once after fulfillment of required obligation under running bond, such running bond do not be cancelled, but carry over to the new obligation executing.


Here the benefit for the customer is that, he need not execute each and every time against each obligation.



For example, if a customer executes a bond worth 10 billion, he can use the said bond for more than one transaction below 10 billion. He can submit proof of obligation for each transaction time to time and reduce bond obligation. In turn, the customer can execute new jobs subjected to maximum 10 billion in this example. While fulfillment of obligation under each bond after necessary formalities by submitting necessary documentary proof, the value of each bond replenishes, to enable him to execute new transactions.


Let me explain once again in simple terms:



A bond for 10 billion has been executed by an importer to avail import duty exemption against his import shipment. This importer imports goods worth of import duty of 2 billions. The bond value came down to 8 billion. The said importer can further import goods worth import duty of 8 billion. Now the bond value is 0. During this period, if he fulfills his obligation against bond worth 2 billions against his first imports, the bond value comes up to 2 billions again. So he can further import goods worth import duty of 2 billion maximum. So the bond value replenishes when completing obligation under each import. In other words, If an importer executed a bond worth 10 billions against import duty exemption worth 10 billions, the said importer can import goods up to duty worth 10 billion at any point of time. The bond value should not exceed more than 10 billions at any point of time.


Would you like to share your experience in handling Running Bond?


 The above information is a part of Online export import training guide 

Comment below your thoughts on Running bond.


Other posts about Import Export online tutorial

Difference between BRC and FIRC

What is customs bonded area in exports and imports

Bank Release Order (BRO) or Bank Delivery Order in Imports

Mode of payments in international trade

What is Terms of Delivery in Imports and exports

Difference between Demurrage and Detention in import

Excise and Customs - Click here to read complete notification under Budget 2014

How to get Export Orders?

How to settle dispute in Exports and Imports?

Click here to know India Trade Classification(ITC)

Click here to know HS code of other product/commodity

Pre shipment bank finance to suppliers for exports through other agencies

Types of export containers
Measurement of export containers
Exim Policy of India 2015-20
MEIS, Merchandise Exports from India Scheme
SEIS, Service Exports from India Scheme
Merge your Commercial Invoice and Packing List for all your future exports
Export procedures and documentation




 What happens, once Bill of Entry for Imports files?

 What is ‘Combined Bill of Lading’

How to obtain a duplicate BL, if original bill of lading lost.

How to obtain GSP - Certificate of Origin?

How to obtain Phyto sanitary certificate. What is phytosanitary certification

 How to obtain waiver on detention/ demurrage on imported goods/container from Shipping company/CFS

What is ‘Late BL release charges’

What is ATA carnet and how ATA carnet works?

What is Bank Guarantee to customs in Import

What is Bond execution with customs in imports and exports

Transferability of Bill of Lading

Transhipment - A redefinition

Travelers to India under import duty exemption, Frequently Asked Questions Part 2

Triangular export

 Triangular shipment

Types of Insurance Documents.

What is Brand Rate in Duty Drawback

What is BVQI inspection on export goods?

What is charter party bill of lading ?

 What is CIF terms of delivery in Exports and Imports?

What is Clean on board Bill of Lading

What is co-loading

What is Commercial enforcement hold for import cargo in US

 What is consolidation of cargo What is LCL cargo less container load cargo

What is Crating in Exports and Imports

What is CT3 form. How to get CT3. Why CT3 required

What is customs bonded area in exports and imports

What is DDP terms in an export Import Business?

What is Dry Port

What is DTA in export import trade?

What is ECGC and how does ECGC protect exporters?

What is EPCG How EPCG works in Export Import trade?

What is Ex-factory terms in Imports and Exports





Nitin Acharya Says :
Wednesday, February 18, 2015
Our management would like clarification regarding the exporter's duties with regard to FEMA and FERA Act / DGFT rules. Specifically, when we export books, we will receive payment for the same after 3-6 months or so, when we accrue $100 in sales whichever earlier . We already have registration with DGFT and they have issued an IEC code. Moreover, we don't seek any benefits, concessions, credits, or export/import incentives. Our (transaction) ticket size will be limited, as each book is priced from $8 to $15 (inclusive of $4 shipping charges by air mail), in keeping with our charitable mission. Whom do we have to report these sales to? What documents must be maintained? What obligations do we have to discharge with the RBI and FEMA/FERA authorities?
Admin Says :
Wednesday, February 18, 2015
Dear Nitin Acharya, please approach your banker's overseas department and learn more about payment accounting under your small value exports and imports.
Raju. Says :
Thursday, February 19, 2015
Kindly advise me how much will be presently charged towards custom duty including cess, if I carry an 50 inch LED TV (6 months used) to any airport in india..

Discussion Forum

You can also share your thoughts about this article.
Any one can answer on question posted by Readers

  Your Name - required  
  Email ID will not be published - Required  
(Enter above code)  


Track Your Air Shipment Here 
Track Your Sea Shipment Here 
Most Recent Articles
» Central Tax Notification No 66 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 65 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 64 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 63 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 62 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 61 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 60 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 59 of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 58of 2017 dt 15th November, 2017 under GST
» Central Tax Notification No 57 of 2017 dt 15th November, 2017 under GST
  Import  |
  Export  |
  For Beginners  |
  Track Your Shipment  |
  Abbreviations  |
  Inco Terms  |
  Export India  |
  Import India  |
  Import US  |
  Export Import Terms  |
  Export incentives and benefits  |
  FAQ  |
  Bill of Lading  |
  Foreign Trade Policy 2015-20  |
  Start your own Export Import Business  |
  HS code  |
  Indian Budget 2014-15  |
  Banking (India)  |
  India Trade Classification (ITC)  |
  How to Import  |
  Containers  |
  Indian Budget 2015-16  |
  Income Tax  |
  Forms  |
  How to export  |
  Foreign Trade Policy 2014-19  |
  Freight forwarding Terms  |
  Business Terms  |
  Terms in Banking  |
  Shipping Terms  |
  Import Terms  |
  Export Terms  |
  Customs Terms  |
  Excise Terms  |
  International Business Terms  |
  Notifications  |
  GST  |
  SVB  |
  Indian Budget 2016-17  |
  Income Tax  |
  HS Codes  |
  GST Law  |
  GST,FAQ  |
  HSN Codes for GST  |
  SAC for GST  |
  Indian Budget 2017-18  |
  Service Tax 2017  |
  GST rates  |
  Logistics  |
  GST service code  |
  GST exemptions  |
  GST tariff  |
  GST rate  |
  GST Circulars  |
  Me  |  Privacy policy  |  Terms and conditions  
Designed and Hosted by Adsin Media