The United States Supreme Court held that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs; international importers that paid IEEPA tariffs should prepare to pursue refunds through Post‑Summary Corrections (for unliquidated entries), timely Customs and Border Protection (CBP) Protests (for liquidated entries), and, where appropriate, protective Court of International Trade filings to preserve rights.
Tariff Case Background
The Supreme Court decided on February 20, 2026, that IEEPA does not confer tariff‑imposing authority on the President. The Court emphasized that when Congress delegates tariff power, it does so explicitly and with clear constraints—features absent from IEEPA—rejecting the Government’s broader reading and remanding/affirming the consolidated challenges accordingly. Meaning, IEEPA‑based tariffs are unlawful, and importers have credible pathways to seek refunds for duties collected under these tariffs.
Companies that imported goods subject to the IEEPA tariffs—including broad product sets and lanes affected in 2025—are in scope. The decision addresses presidential authority under IEEPA (a U.S. statute), but its effects are felt by global traders shipping into the U.S.; the record shows the challenged program included wide‑ranging base and escalated rates, sometimes applied “notwithstanding any extant trade agreements,” underscoring potential refund magnitude for cross‑border supply chains.
Operational Impact
Signficiantly, refunds are not automatic. Businesses should expect administrative steps before money returns. For unliquidated entries, importers can use Post‑Summary Corrections (PSC) via ACE/ABI to correct rates; for liquidated entries, importers must file timely Protests within 180 days of liquidation; because CBP’s ability to re‑liquidate outside protests is limited, many importers should consider protective filings in the U.S. Court of International Trade (CIT) to preserve rights, speed relief, and secure injunctions preventing liquidation while refund mechanisms are clarified.
Policy Actions for Affected Companies
- Establish a “tariff recovery” workstream (Legal–Customs–Finance–IT) with an owner accountable for PSCs, Protests, and CIT strategy; maintain a master calendar keyed to 180‑day Protest deadlines and expected liquidation dates.
- Appoint a steering committee (Legal, Customs, Finance) to direct recovery efforts and approve litigation posture.
- Create CFO‑level dashboards forecasting refund principal and statutory interest (19 U.S.C. § 1505(b)).
- IT Department: Extract duty data fields (entry number/date, HTS, origin, duty amount/type) from ACE/ABI and internal ERP; create a claims register keyed to PSC/Protest/CIT statuses.
- For unliquidated entries: Prepare PSC packages via ACE/ABI; entries typically liquidate within about 314 days, so move before liquidation to maximize PSC use.
- For liquidated entries: Draft standard Protest language citing the Supreme Court’s holding and unlawful collection; lodge within 180 days post‑liquidation.
- Consider protective CIT filings to preserve jurisdiction, enjoin liquidation, and (where needed) pursue accelerated Protest dispositions (19 C.F.R. § 174.22) to get to court faster.
- Build a document set for each claim: CF 7501 Entry Summary, bills of lading, commercial invoices, packing slips, entry numbers/dates, classification, origin, duty type/amount; keep local copies, not just in ACE, to guard against portal changes.
Key Takeaways
The Court held that IEEPA’s authority to “regulate…importation” does not include power to impose tariffs; Congress has historically delegated tariff authority explicitly with constraints, and IEEPA lacks such signals. Portions of the Supreme Court decision discuss separation‑of‑powers concerns and the “major questions” line of cases in evaluating the Government’s asserted delegation. Rationale highlights congressional practice (explicit “duty” language, caps, and procedural preconditions in other trade statutes) and notes the breadth of unreviewable emergency declarations if IEEPA were read to include tariffs.
- Supreme Court: IEEPA does not authorize presidential tariffs; explicit, constrained delegations are required.
- Refunds are not automatic—importers must act via PSCs (unliquidated), Protests (liquidated), and possibly protective CIT filings.
- Protest deadline: 180 days from liquidation; PSCs must precede liquidation; typical liquidation occurs in about 314 days.
- CBP self‑reliquidation is narrowly time‑limited (90 days) absent a court order.
- Interest may be available on refunds per statute referenced by the memo.
Disclaimer: This material is provided for informational purposes only. It is not intended to constitute legal advice, nor does it create a client-lawyer relationship between Galloway and any recipient. Recipients should consult with counsel before taking any action based on the information contained within this material. This material may be considered attorney advertising in some jurisdictions.
