April 4, 2026 — The U.S. trade industry has reached a landmark milestone: Following the U.S. Supreme Court's ruling that tariffs imposed by the president under the International Emergency Economic Powers Act (IEEPA) were illegal, U.S. Customs and Border Protection (CBP) is accelerating the development of corresponding refund procedures. This means the illegal tariffs imposed on goods from China, Canada, Mexico and other countries are set to be refunded on a massive scale, with total refund claims reaching as high as $166 billion, marking the largest tariff refund operation in U.S. history.
Landmark Ruling: Clarifying Separation of Powers, Emergency Tariffs Ruled Illegal
The turning point came on February 20, when the Supreme Court issued a historic decision: in a 6-3 vote, the court ruled that the IEEPA does not grant the president the unilateral authority to impose tariffs.
Enacted in 1977, this law was originally designed to respond to national security emergencies, allowing the president to freeze assets and restrict specific transactions in the face of extraordinary threats — but it has never been used to levy tariffs. Chief Justice John Roberts, writing for the majority, explicitly stated that the power to tax is a core authority explicitly granted to Congress under the U.S. Constitution, and the executive branch cannot bypass Congress to unilaterally impose tariffs under the guise of a "national emergency":
"The words 'regulate' and 'import' cannot bear the weight of such an expansion of power."
This ruling directly invalidated a series of tariffs imposed by the Trump administration in its second term under the IEEPA, including the so-called "fentanyl tariffs" on Chinese goods, and "immigration tariffs" targeting Mexico and Canada. These tariffs, implemented since February 2025, have collected a total of $166 billion in duties over the past year, covering more than 330,000 importers and up to 53 million customs entry records.
Refund Process Accelerates: Exclusive System to Launch April 20, Refunds Processed in 45 Days
After the ruling took effect, CBP immediately launched the development of a refund mechanism. According to the latest updates, CBP is building a dedicated system called the Consolidated Administration and Processing of Entries (CAPE), deployed within the Customs Automated Commercial Environment (ACE) portal. This exclusive refund system will officially launch on April 20, to process the largest-ever batch of refund applications.
CBP disclosed that the system will enable "one-click filing and automatic calculation": importers or their licensed customs brokers only need to upload a list of corresponding entry summaries, and the system will automatically remove the illegal IEEPA tariff codes, recalculate the duties, and finally complete the refund via Automated Clearing House (ACH) electronic transfer. The entire process is expected to be completed within 45 days, saving more than 4 million manual work hours compared to traditional manual processing.
However, uncertainties remain: CBP stated that the first phase of the refund system will only cover entry summaries that have not yet completed duty liquidation, as well as records within 80 days after liquidation. For older entry records that have already exceeded the traditional 180-day protest deadline, it remains unclear whether they are eligible for refunds, or whether importers need to file formal lawsuits through the Court of International Trade to apply. The industry is waiting for follow-up system updates and policy clarifications.
The Radiation Technology Association (RadTech) also shared the latest updates with its member companies, reminding relevant importers to complete their ACE system account registration and update their bank refund information as soon as possible to avoid missing the refund window, while closely following CBP's subsequent policy updates.
Trade Landscape Largely Unchanged: Section 232, 301 Tariffs to Remain
It is worth noting that this ruling only targets tariffs imposed under the IEEPA; other additional tariffs based on different laws will continue to remain in the U.S. trade landscape for now.
CBP explicitly stated that Section 232 steel and aluminum tariffs under the Trade Expansion Act of 1962, and Section 301 intellectual property-related tariffs under the Trade Act of 1974, are measures authorized by different laws, and are not affected by this Supreme Court ruling, and will continue to be collected normally. This means that the previously highly watched Section 301 tariffs on Chinese goods will not be affected by this refund wave for the time being.
Earlier, organizations including PCI and the American Chemistry Council (ACD) have followed up with reports and responses. ACD welcomed the ruling, stating that it not only opens the door for importers to recover illegally collected duties, but also re-clarifies the boundaries of separation of powers, preventing the executive branch from arbitrarily disrupting global trade order with "emergency powers".
Currently, the entire industry is in a stage of waiting and preparation. More and more importers are sorting out their entry records, preparing to submit refund applications as soon as the system goes online on April 20, to recover the illegally collected funds.
source: Supreme Court Tariff Ruling May Trigger Refund Opportunities | PCI Magazine
