On February 20, 2026, the US Supreme Court ruled that the President’s imposition of tariffs under the International Emergency Economic Powers Act (“IEEPA”) were unconstitutional. In its decision, the Supreme Court struck down the IEEPA Trafficking Tariffs and the IEEPA Reciprocal Tariffs. Following the Supreme Court decision, CBP ceased the collection of all duties imposed pursuant to IEEPA at 12:00 am ET on February 24, 2026.
While the Supreme Court ruled that the IEEPA tariffs are illegal, the Court did not address the issue of relief for importers who have paid the IEEPA tariffs. The Court of International Trade (“CIT”) will need to address and resolve the issue of relief. While the administration has stated that it will follow the court’s direction, it has declined to provide any guidance or to act independent of a CIT ruling.
On March 4th, the CIT issued an order instructing CBP to liquidate unliquidated entries without regard to IEEPA duties and to reliquidate any entries that have been liquidated but are not yet final without regard to IEEPA duties. The CIT did not yet address entries that are liquidated and final. The Government also has the opportunity to appeal the court’s order. On March 6, 2026, CBP stated in a filing that it was not prepared to process the court-ordered IEEPA tariff refunds immediately, but that it could have ACE programmed to do so in the next 45 days. After consideration of CBP’s filing, the CIT suspended its March 4th order directing CBP to immediately begin paying refunds.
On March 12th CBP filed an update outlining the ACE IEEPA refund programming which will be the Consolidated Administration and Processing of Entries (CAPE). CAPE will have four components:
Claim Portal:
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The Claim Portal will serve as the entry point for importers and brokers to submit IEEPA refund requests (“CAPE Declaration”) to CBP. This will be a new tab available in importer and broker ACE Portal accounts.
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Filers will be able to upload CSV files containing a list of entry summaries for which they are requesting IEEPA refunds.
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ACE will then conduct file validations and entry validations
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CBP estimates that development of the Claim Portal is 70% complete
Mass Processing:
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This component will automatically remove any applicable IEEPA HTS numbers from the entry summaries that have been submitted and validated by the Claim Portal.
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The program will then run the ACE duty calculation validations, which is the same entry summary process that exists today.
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The Mass Processing component will then calculate duties as if the IEEPA duties had never been declared.
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The system will then accept the CAPE Declaration.
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CBP estimates that development of the Mass Processing component is 40% complete.
Review and Liquidation/Reliquidation:
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The next step will initiate the review and liquidation/reliquidation process for the entries identified in the accepted CAPE Declaration.
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Entries will be set to liquidate/reliquidate on a specific number of days from the acceptance date, allowing manual review by CBP as needed.
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The underlying entry summaries will be updated to reflect the new total duties paid and will automatically calculate interest.
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Liquidations/reliquidations of entries will be processed Monday through Thursday each week.
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Development of this component is 80% complete.
Refund:
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ACE will direct the entry summaries in the accepted CAPE Declaration to a CAPE-specific refund process within the ACE Collections refunds module when they reach the scheduled liquidation/reliquidation date.
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Refunds will be consolidated by date and IOR (or the party designated to receive refunds on its behalf).
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Refunds will be sent electronically to the designated bank account.
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The Refund component is 60% complete.
CBP plans a phased development for CAPE and will add more functionality in subsequent phases to address more complicated scenarios.
To ensure refunds can be processed without delay, importers should ensure that their ACH refund authorization is active in the ACE portal. CBP indicated that this process might take months or more to complete the refunds to all affected importers.
Importers should consult their legal counsel regarding the appropriate means, if any, of preserving the right to seek refunds of the IEEPA duties paid.
This is a preliminary analysis and based upon the current statements and facts publicly available. PSA BDP is closely monitoring the situation and will keep the community informed as new information becomes available.
PSA BDP is not responsible for any changes to the information provided herein. PSA BDP is not providing legal advice and does not assume liability for detrimental reliance on the information provided herein as conditions are subject to change. The information provided is for informational purposes only and does not constitute legal advice. Please consult with your legal counsel regarding the information presented herein. Please refer to the PSA BDP Terms and Conditions, published electronically on PSA BDP’s website at Terms and Conditions.
