By Kevin J. Bonnett, CPA,
Vice President & Director
Vice President & Director
On February 20, 2026, the U.S. Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not grant authority to impose tariffs through executive order. As a result, all tariffs imposed under IEEPA were invalidated. Importantly, however, the Court’s decision did not address whether or how previously paid IEEPA tariffs would be refunded.
It is important for importers to understand that this ruling applies only to tariffs imposed under IEEPA. Tariffs imposed under other authorities—such as Sections 232, 301, and 122 of the Trade Act—remain in effect and are not impacted by this decision.
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On March 4, 2026, the Court of International Trade (CIT) took the first step toward addressing refunds by ordering U.S. Customs and Border Protection (CBP) to immediately begin refunding all IEEPA duties paid by importers of record. The Court further directed that interest be calculated and paid on all such refunds. This order applied to two categories of entries: (1) entries that had not yet liquidated, and (2) liquidated entries still within the 180-day protest period.
Shortly thereafter, during a March 6 settlement conference, CBP advised the Court that its current systems were not equipped to process IEEPA refunds efficiently on a large scale. CBP indicated it was developing a centralized refund solution, and as a result the CIT temporarily paused its March 4 refund order while that system is being built.
On March 12, CBP provided an update indicating that it is developing a centralized refund mechanism known as Consolidated Administration and Processing of Entries (CAPE), within CBP’s existing Automated Commercial Environment (ACE) platform. While CBP has not confirmed an exact launch date, it has indicated that CAPE is expected to be operational in April 2026.
Although CBP has not yet released detailed guidance on how refunds will be requested through CAPE, it is anticipated that importers will be required to submit a CSV file identifying all entries for which IEEPA duties were paid.
What Eligible Importers Should Do Now
To prepare for the rollout of CAPE and the issuance of refunds, we recommend that importers who paid IEEPA duties should take the following steps:
• Compile entry summary details for all imports that included IEEPA duties
• Gather proof of payment for all IEEPA duties paid
• Confirm that ACE accounts are active and properly configured
• Ensure electronic refund authorization within ACE is in place
We will continue to monitor updates on CAPE and the related IEEPA refunds and provide updates.
