Importers across the United States are navigating a deeply uncertain legal landscape surrounding refunds for IEEPA tariff payments on finally liquidated entries.
The Court of International Trade has ruled that importers are entitled to refunds of IEEPA tariff payments on entries that are more than 80 days beyond liquidation, placing them outside CAPE Phase 1 processing.
Despite that ruling, the Department of Justice has appealed the question of whether importers that did not file protective actions under 28 U.S.C. § 1581(i) are entitled to those refunds at all.
The DOJ’s position is that the CIT cannot order refunds for importers that never filed their own protective actions, limiting relief to plaintiffs that preserved their rights through litigation.
This dispute has created a meaningful divide between two groups of importers, each facing a different combination of legal and operational risk going forward.
Importers that filed Section 1581(i) protective actions have a clearer path to refunds, though timing remains uncertain because CBP has not yet opened CAPE Phase 3 due to programming constraints.
Importers that did not file protective actions face far greater uncertainty, as their entitlement to any refund now depends on the outcome of the Federal Circuit appeal, and potentially a further Supreme Court review.
CBP did not meet its earlier announced target of opening CAPE Phase 3 by August 20, 2026, though resolution of its programming and testing issues is expected relatively soon.
Companies relying solely on protests rather than Section 1581(i) filings may find themselves in an awkward middle ground, having preserved some rights but not in the form the DOJ now argues is necessary to obtain CAPE Phase 3 relief.
Importers holding both protests and Section 1581(i) actions should maintain protests while monitoring CAPE Phase 3 developments, then evaluate whether to withdraw protests once that phase becomes operational.
The category of finally liquidated entries may also be broader than many importers initially assume, capturing lower-value informal entries and entries affected by post-summary corrections that liquidated earlier than expected.
Filing a Section 1581(i) protective action now can reduce the risk that refund rights depend entirely on the DOJ’s appeal outcome, improve positioning for CAPE Phase 3, and mitigate the prospect of extended delay.
Refunded IEEPA tariff payments will include interest, adding further financial significance to the question of when and whether importers can successfully secure their claims.
IEEPA tariffs subject to refund include the fentanyl-related tariffs announced in February 2025 on China, Mexico, and Canada, and the global reciprocal tariffs announced in April 2025, among others.
Companies can determine their IEEPA tariff exposure by reviewing data in Customs’ Automated Commercial Environment, filtering for entries containing the relevant Chapter 99 tariff provisions associated with IEEPA measures.
Section 1581(i) actions are generally subject to a two-year statute of limitations, but significant uncertainty remains as to when that period begins to run, making prompt evaluation of protective filing essential.
In the worst case, an importer that does not file a protective action may be entirely unable to recover refunds for finally liquidated entries, regardless of the CIT’s current favourable ruling.
The prudent course for companies with significant finally liquidated exposure is to remain engaged, preserve optionality, and position for refund recovery through CAPE as soon as that process becomes available.