Court Orders Refunds of IEEPA Tariffs: What the CIT Ruling Means for Businesses

The U.S. Court of International Trade (CIT) has issued a major development in the ongoing tariff dispute, ordering Customs and Border Protection (CBP) to refund certain tariffs imposed under the International Emergency Economic Powers Act (IEEPA).

Judge Richard Eaton’s March 4 order requires CBP to remove IEEPA tariffs from specific import entries and return duties that were previously collected. Importantly, the ruling applies nationwide and is not limited to the company that brought the case.

For businesses that pay IEEPA tariffs directly as the importer of record, the decision may create an opportunity to recover duties. However, the impact could extend beyond those companies.

Businesses that absorbed tariff costs through suppliers, distributors, or other importers of record should review how those costs were passed through and whether recovery may be possible. Our tariff specialists have summarized the ruling and offered actions for business owners.

Details on the Court decision

Judge Eaton of the CIT directed CBP to remove IEEPA tariffs from two categories of entries.

For unliquidated entries, CBP must liquidate them without IEEPA duties and return any tariffs already paid. For entries that have already been liquidated but remain within the protest period, CBP must reliquidate them and remove the IEEPA duties.

The order applies nationwide, affecting all importers rather than only the company involved in the case. Judge Eaton also indicated that he may oversee future cases related to IEEPA refunds.

DOJ pause request denied

During the hearing, the Department of Justice asked the court to pause the order while the government pursues an appeal.

Judge Eaton denied the request and ordered the government to return to court on March 6 to explain how refunds will be implemented and to address the issue of entries that are already fully liquidated.

He emphasized the need for an organized process and stated that the court wants to avoid thousands of individual refund disputes.

Remaining questions

Although the ruling establishes a path for refunds, several important questions remain.

It is still unclear how CBP will handle entries that are already final and outside the protest period. The court has asked the government to address this issue in upcoming proceedings.

There is also uncertainty around how importers should identify qualifying entries and how quickly CBP will implement a refund process.

“The ruling is welcome news for business owners, but it now invites a host of questions,” said Charlie Clevenger, UHY Principal and leader of Tariff Support. “There are many layers to this, not only would the importer of record stand to benefit, but there may be opportunities for their customers and suppliers who were indirectly impacted.”

Indirect tariff exposure implications

The ruling may also trickle down to companies that were not the importer of record but still absorbed tariff costs.

Manufacturers, distributors, and retailers often paid higher prices to suppliers who passed along IEEPA duties through the cost of goods. While these companies may not be able to claim refunds directly from CBP, they may benefit if importers of record recover duties and pass the savings through.

Businesses that experienced tariff-related price increases may want to review supplier agreements and pricing structures to determine how duties were allocated.

What businesses should do now

Companies that paid or absorbed IEEPA tariffs should begin reviewing their import records and documentation.

This includes identifying entries that remain unliquidated or within the protest window, confirming duty payments, and organizing supporting documentation in case CBP issues refund guidance.

Because the refund process is still developing, businesses should work with their tax or trade advisor to review their position and prepare for further guidance from the court and CBP.

If your business directly paid or indirectly absorbed IEEPA tariffs, OR if your business directly or indirectly passed price increases onto customers for IEEPA tariffs, you should also review your agreements with those customers and assess your exposure. Contact our tariff specialists today to evaluate potential refund opportunities and prepare for the next steps in the process in either case.

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