Court fight leaves some tariff refunds in limbo

Washington — Importers seeking refunds of duties collected by the Trump administration under the International Emergency Economic Powers Act face renewed uncertainty after U.S. Customs and Border Protection indicated that a key upcoming phase of its refund program will be limited to companies actively pursuing litigation.

The disclosure came during a June 10 hearing before the U.S. Court of International Trade, where CBP Executive Assistant Commissioner Susan Thomas outlined the agency’s plans for the next phase of refunds tied to tariffs that courts have ruled were unlawfully imposed under IEEPA.

According to trade law firm Mowry & Grimson, CBP expects to launch “Phase 3” of its Customs Automated Processing Environment refund program by the end of July. The phase is expected to cover entries not addressed in earlier refund rounds, including finally liquidated entries, drawback claims, entries with open protests and other special situations.

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According to reporting from Politico, Thomas told the court that the Phase 3 refund window would initially be available only to importers with pending appeals before the Court of International Trade because the government has appealed a prior court order directing CBP to issue refunds to all importers.

Under the agency’s current plan, importers that did not participate in litigation would not gain access to Phase 3 until the appeal is resolved or another court order directs CBP to process refunds more broadly.

The issue emerged during a hearing convened by Judge Richard Eaton, who questioned government officials about the status of refunds and the administration’s decision to appeal an earlier ruling requiring nationwide relief.

The dispute is part of a broader legal battle over tariffs imposed under IEEPA. Courts have ruled that the administration exceeded its authority in imposing certain duties, setting off a complex refund process that could ultimately affect billions of dollars paid by importers.

Phase 2 of the refund program, which covers reconciliation entries, is expected to be completed by the end of June. Phase 3 would address a range of more complicated entry types that were not eligible for earlier refund rounds.

Separately, Mowry & Grimson warned clients that scammers have begun targeting importers seeking tariff refunds. According to the firm, at least one importer received an email appearing to come from CBP that included company-specific information and supplier names before directing recipients to click a link or call a phone number regarding refunds.

The firm said the information likely was gathered from publicly available trade databases and urged importers to verify any communications related to tariff refunds before responding.

CBP has also posted a list of best practices for importers to protect themselves from potential scams related to refunds.