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Beginning in February 2025, the Trump Administration imposed sweeping tariffs under the International Emergency Economic Powers Act (IEEPA), including "fentanyl tariffs" on goods from Canada, China, and Mexico, and broad "reciprocal" tariffs on imports from virtually all U.S. trading partners. Both the U.S. Court of International Trade (CIT) and the U.S. Court of Appeals for the Federal Circuit held that IEEPA does not authorize the President to impose tariffs. The cases were appealed to the Supreme Court, which recently held that the tariffs were unlawful. While the Supreme Court's decision opened the door to potentially historic refunds, importers should act now to protect their refund rights.
The Supreme Court's Ruling and What Followed
On February 20, 2026, the Supreme Court held, in a 6-3 decision, that the President lacks authority to impose tariffs under IEEPA. More than 330,000 importers have made over 53 million entries subject to IEEPA tariffs, and U.S. Customs and Border Protection (CBP) has collected approximately $166 billion in IEEPA duties — all of which are now potentially refundable.
On March 4, 2026, the CIT responded to the Supreme Court's decision with an order in Atmus Filtration, Inc. v. United States, directing CBP to liquidate all unliquidated entries without regard to IEEPA duties, and to reliquidate any entries not yet final, effectively ordering refunds. Two days later, however, the CIT suspended that order after CBP declared it could not immediately comply, citing an unprecedented volume of refunds and insufficient technology, processes, and resources to handle them through existing systems.
CBP is now developing a new ACE module called CAPE (Consolidated Administration and Processing of Entries) to handle IEEPA refund claims at scale but has not announced a full implementation timeline. Furthermore, the Atmus order itself may be appealed, and the government may seek a stay of any refund obligation pending appeal. Therefore, the overall refund procedure remains uncertain.
What We Recommend
Although the IEEPA tariffs have been held unlawful, refunds are not automatic. Thousands of companies have filed suit in the CIT to preserve their rights to a full refund.
Importers should consider taking affirmative action now, rather than assuming the Atmus order alone will protect their rights to a refund:
CIT actions. Filing suit in the CIT is often the most comprehensive approach to preserving refund rights.
CBP protests. For entries that have already liquidated, filing a timely protest may serve as a critical backstop.
Acting now may significantly narrow the risks and preserve optionality as the refund framework continues to evolve.
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.
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