On October 6 CBP Opens the Door to Refunding Finally Liquidated IEEPA Tariffs to Importers – but Only to Those Who Have Filed a CIT Case First

Importers with finally liquidated entries who have received a court order for International Emergency Economic Powers Act (“IEEPA”) duty refunds will be able to start filing for those refunds beginning tomorrow, October 6, 2026. US Customs and Border Protection (“CBP”) declared on September 15 of this year that Phase 3 of CAPE—the Consolidated Administration and Processing of Entries system—will be operational on that date. 

CAPE is CBP’s framework for processing IEEPA tariff refunds following the Supreme Court’s 6-3 ruling invalidating those tariffs. The refund process has been rolled out in three phases:

• Phase 1 launched on April 20 and covered unliquidated entries and entries that liquidated within 80 days, where CBP could act administratively.
• Phase 2 launched on April 20 and covered entries that were flagged for reconciliation (before a reconciliation entry is filed).
• Phase 3 will apply to entries that are finally liquidated and can only be refunded through a court-ordered reliquidation.

Liquidation is CBP’s formal process of finalizing the duties owed on an entry. CBP has the statutory authority to reliquidate within 90 days of liquidation. After that, the entries are considered “finally liquidated.”

CBP has taken the position that an importer must have secured an order from the US Court of International Trade (“CIT”) directing CBP to reliquidate those finally liquidated entries. Without such an order, CBP continues to assert that it cannot issue refunds for finally liquidated entries. 

CBP’s position that only importers of record with an IEEPA tariff refund case pending before the CIT may participate in Phase 3 of the CAPE is subject to ongoing litigation. The federal government has appealed a CIT order universally requiring CBP to refund IEEPA duties on finally liquidated entries. The government argues that the CIT lacked authority to order refunds for importers that did not file suit, relying on the Supreme Court’s recent limits on universal injunctions in Trump v. CASA, Inc.

Filing a lawsuit is the quickest and easiest path to recovery of the IEEPA tariffs on finally liquidated entries. The CIT has assigned all IEEPA cases to Senior Judge Richard Eaton, who is automatically entering orders in each and every case requiring reliquidation of the entries without regard to the IEEPA tariffs. Our experience with filing these suits is that the CIT has been entering individual reliquidation orders within a few weeks of filing. After such an order is entered, the importer then will be able to submit a refund claim for the finally liquidated entries via CAPE Phase 3. Importers can feel confident in receiving final relief from this process, as the federal government has represented to the courts that it will not appeal those reliquidation orders.

When CBP deploys Phase 3 on October 6, it will cover entries that are liquidated more than 80 days after filing only if filed by plaintiffs who have received a CIT reliquidation order. If you have not filed an individual CIT case, you are not eligible for Phase 3.  Accordingly, filing an individual lawsuit at the CIT is currently the quickest—and only effective—way to obtain tariff refunds for finally liquidated entries.

Although protests are typically the normal process for correcting and seeking refunds on entries that have liquidated within 180 days, we have seen that CBP has been suspending protests involving IEEPA tariffs. CBP apparently wants importers to file their own cases directly at the CIT and use CAPE to recover IEEPA tariffs; CBP apparently does not want to address IEEPA tariffs through the protest process.

However, individual lawsuits ultimately might not be necessary, if the CIT’s universal relief order is upheld or one or both of two potential class actions currently pending before the CIT is successful. When the two class actions were argued in August, Judge Eaton was skeptical of the government’s opposition to class certification but also seriously grappled with whether the class actions could result in relief in the form of universal refunds.

Importers should seriously consider whether now is the time to file a suit or whether they will wait and see how those cases play out. If the universal refund order is stricken down and the class actions are unsuccessful, statute of limitations and other jurisdictional deadlines for certain entries will start factoring in and could preclude filing of such suits in the future. The normal statute of limitations deadlines would be two years from when the tariffs took effect (starting with the IEEPA tariffs on China and Hong Kong in February 2025), although they are tolled while the class actions are pending.

If you are an importer who is interested in assistance with recovering IEEPA tariffs or filing a CIT case, please contact your Butzel attorney or Butzel’s International Trade, Tariffs, and Customs Specialty Team, which includes multiple CIT-admitted attorneys. We have assisted numerous clients with obtaining CAPE refunds and implemented a unique rapid-response process to quickly and efficiently accomplish prepare and file IEEPA recovery cases at the CIT. We have already filed such cases on behalf of dozens of importers. We are available to discuss in more detail at your convenience.

Catherine M. Karol
313.225.5308
karol@butzel.com

Jennifer M. Smith-Veluz
202.454.2885
smithveluz@butzel.com

Mitchell Zajac
313.225.7059
zajac@butzel.com