What Canadian Businesses Need To Know About The U.S. Tariff Refund Appeal

The United States tariff refund process is in flux, and Canadian businesses should pay attention to the associated developments. As explained in our previous Insight, U.S. Supreme Court strikes down emergency tariffs: What Learning Resources, Inc. v. Trump means for Canada, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act (United States) (IEEPA) were unlawful, holding that IEEPA does not authorize the President to impose tariffs. The U.S. Court of International Trade (the CIT) subsequently ordered U.S. Customs and Border Protection (CBP) to refund approximately US$166 billion in collected duties to all Importers of Record.

On June 2, 2026, the Trump Administration appealed, arguing the CIT exceeded its authority by ordering refunds to importers who never filed a lawsuit. The Appeal could determine whether tens of billions of dollars are returned to businesses or retained by the U.S. Government.

The refund dispute

Subsequent to the U.S. Supreme Court’s decision in Learning Resources, Inc. v. Trump, the CIT directed the CBP to refund all affected importers, not just those who had sued. The Appeal by the U.S. Department of Justice (the DOJ) organizes the US$166 billion of tariffs into the following three categories:

• Unliquidated or non-final entries – The CBP is already processing these refunds and does not contest its obligations. As of May 22, 2026, the CBP had accepted applications totaling approximately US$85 billion.
• Finally liquidated entries (importer filed suit) – The DOJ argues these require importer-specific court orders before refunds can be issued.
• Finally liquidated entries (no suit filed) – This is the heart of the dispute in the Appeal. The Trump Administration contends importers who did not file complaints are not entitled to relief.

The Appeal is now before the U.S. Court of Appeal for the Federal Circuit. Separately, the CIT ordered the CBP Commissioner Rodney S. Scott to appear on June 9, 2026, to address the refund timeline for approximately 330,000 potentially eligible importers. Plaintiffs have also moved to certify a class action on behalf of importers currently locked out of the refund process.

The broader tariff landscape

Following Learning Resources, Inc. v. Trump, President Trump replaced the IEEPA tariffs with a 10% tariff on most global imports under Section 122 of the Trade Act of 1974 (United States). For Canadian goods:

• Exports compliant with the Canada-U.S.-Mexico Agreement (CUSMA) remain exempt from the foreign replacement tariff
• Non-CUSMA compliant goods are subject to the new 10% replacement tariff
• Sectoral tariffs on steel, aluminum, automobiles, softwood lumber and other products, imposed under separate statutory authority, remain in force and are unaffected by the Learning Resources, Inc. v. Trump ruling

Impact on Canadian businesses

Canadian businesses that were the “Importer of Record” and paid IEEPA tariffs on non-CUSMA compliant goods between February 4, 2025, and February 24, 2026, may be eligible for refunds. According to the Canadian Federation of Independent Business, roughly one-third of small Canadian exporters faced IEEPA tariffs and about 26% of those exporters were the Importer of Record.

The Appeal creates uncertainty in several areas, including:

• Refund eligibility may narrow – If the Federal Circuit sides with the DOJ, refunds on finally liquidated entries may be limited to importers that have filed lawsuits
• Timing is uncertain – The Appeal could slow refund processing even for uncontested categories.
• The process is complex – Claimants need a U.S. customs account, a U.S. bank account and must file through the CBP’s Consolidated Administration and Processing of Entries (CAPE) portal, typically with the assistance of a U.S. customs broker

Key takeaways

Given the ongoing uncertainty and the evolving legal landscape, Canadian businesses should take the following proactive steps to assess their exposure and position themselves to preserve any potential refund entitlements:

• Quantify your exposure – Identify whether your business was the Importer of Record and calculate the IEEPA tariffs paid during the tariff period (February 4, 2025 to February 24, 2026)
• Determine the liquidation status of your entries – Whether your entries are unliquidated, non-final or liquidated will dictate your refund category and the associated legal risk
• Consider filing a protective complaint – If the universal refund order is overturned, only importers that have filed (or joined) litigation may recover on liquidated entries
• Monitor the class action – If certified, the class action could offer a lower-cost path to recovery for smaller businesses without requiring individual litigation

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.