Trade & Tariff Update #25 - IEEPA Refunds & More
Most recent trade announcements as of 4/21/26
Regulatory Article Contents
As the IEEPA Refund Process Begins, an Alternate Section 301 Tariff Regime Gains Momentum
As the IEEPA tariff refund process (detailed below) begins, plans for a replacement Section 301 tariffs regime are progressing quickly. Last week Treasury Secretary Scott Bessent stated that the Administration’s tariffs could be restored under Section 301 by July when the temporary Section 122 duties are set to expire. Buoyed by reports last week that the U.S. trade deficit declined by a record 55%, tariffs remain a bedrock of the Administration’s economic policy. Although there are competing explanations for this drop, it nonetheless bolsters the Administration’s confidence in the effectiveness of its policy.
It also appears from a report last week that U.S. business leaders are beginning to accept tariffs as the new normal for the long term. Given the apparent movement towards a Section 301 tariff regime and the fact that no such duties from the first Trump Administration were altered during President Biden’s term, this reasoning seems sound. On the bright side, the Section 301 process does have a formal exclusion process that could be exploited.
IEEPA Refunds
Beginning yesterday Customs and Border Protection began accepting IEEPA tariff refund requests through the new Consolidated Administration and Processing of Entries (CAPE) tool within the Automated Commercial Environment (ACE) portal. Brokers and Importers of Record (IORs) can submit eligible CAPE declarations, which will be validated, and refunds and interest payments will be consolidated and paid out in one lump sum.
Mass Processing: The CAPE system is designed to consolidate refunds of IEEPA tariffs instead of requiring the processing of refunds on an entry-by-entry basis.
1. For accepted entries on the CAPE declaration, all applicable IEEPA HTSUS Chapter 99 numbers will be removed.
2. Duties owed will be recalculated as if the IEEPA duties were never owed. The projected refund will be the difference between the duties, taxes, and fees paid on the entry summary and the recalculated total.
3. Once the mass processing is complete, unliquidated entries will be set to liquidate 45 days from the CAPE declaration acceptance date, except for entries in suspended, extended, or under review liquidation status.
4. Liquidated entry summaries will reliquidate the next business day.
Scope of Phase One: Initially, CAPE will only process most entries that are either unliquidated or up to 80 days past their liquidation date. Following review, the entries will be liquidated or reliquidated and refunds issued.
Note: A variety of more complex entries will not be accepted by CAPE in this first phase. These include:
1. Entries flagged for Reconciliation, including Entry Type 09
2. Entries associated with a drawback claim, including Entry Type 47 and Entry Type 08 USMCA Duty Deferral
3. Entries with an Open or Suspended Protest
4. Entries without a liquidation status in ACE
5. Entries subject to AD/CVD duties
6. Entries for which liquidation is final
David Forgue, a partner with Barnes Richardson Global Trade Law, who was featured in IHA’s recent webinar on the tariff refund situation, has offered the following observation:
- People who filed blanket "IEEPA protests" and are otherwise within the Phase 1 parameters probably would be better served by relying on the Phase 1 process. So, for them withdrawal makes sense. For people with protests of other issues and IEEPA claims, they need to weigh the risk of losing the other issues they are protesting.
- Otherwise, we continue to believe that Phase 1 represents the entries CBP has the statutory authority to voluntarily reliquidate and that all of the issues we were concerned about with all the other entries remain. However, we are telling clients to jump into Phase 1 and try to get back what they can as quickly and easily as possible.
Refund Timeframe: The notice indicates that “valid [emphasis added] IEEPA refunds will generally be issued within 60 - 90 days following acceptance [emphasis added] of a CAPE Declaration, unless a compliance concern requires further CBP review.” Note that the qualifications of validity and acceptance leave significant uncertainty about the actual timing, and the volume of refund requests could result in time frames longer than 60-90 days from the date of submission.
Disclaimer: APPA does not make any representations about the completeness, suitability, or adequacy of the information provided during the Office Hours or Trade Talks. Any information provided are intended for general informational purposes only, they do not constitute a recommendation or solicitation to do or omit to do any action and should not be interpreted as legal, regulatory, or compliance advice. You should seek independent advice from qualified professionals before acting on any information provided and/or to evaluate specific regulatory obligations and operational decisions.
Disclaimer from Progressive Trade Consulting: PTC is not a law firm, does not practice law, and does not provide legal advice. The Client should consult legal counsel for any legal matters, including trade compliance. The Importer of Record (IOR) is responsible for complying with customs regulations and managing the import process. This includes obtaining required licenses and permits, classifying and valuing goods correctly, declaring goods accurately, paying duties and taxes, following import rules, and maintaining proper records.