U.S. Customs and Border Protection is on track to launch Phase 2 of its tariff refund program starting June 29, according to recent court statements.

  • The U.S. Supreme Court ruled February 20 that the International Emergency Economic Powers Act (a statute from the 1970s) does not grant President Donald Trump authority to issue global tariffs.

But while the agency’s phased rollout is moving forward, the administration continues to challenge the court’s order to refund all IEEPA tariffs paid, regardless of entry status. Thus, important questions remain about which entries will qualify, when refunds will be paid and whether some importers may need to rely on litigation to recover duties.

Phase 1 Cleared Billions In Refunds For Simpler Entries

CBP launched Phase 1 of its Consolidated Administration and Processing of Entries system, known as CAPE, on April 20 to process IEEPA refunds as ordered by the U.S. Court of International Trade.

This first phase of the refund process was limited to unliquidated entries and entries that were within 80 days of liquidation. CBP also allowed certain entries with a status of suspended, under review or extended, as well as warehouse entries and withdrawals. Overall, Phase 1 accounts for almost two-thirds of all potential entries.

By June 9, CBP announced significant progress with the refund process:

  • More than 16 million entries have been processed in Phase 1.
  • More than $22 billion in refunds have been completed and sent to the Treasury Department for disbursement.
  • CBP expects to reach more than $60 billion in approved refunds by July 1.


Currently, entries for more than $95 billion in potential and certified refunds have been accepted for processing, but CBP estimates that U.S. importers paid as much as $166 billion in IEEPA duties across more than 53 million entries.

ICYMI: CBP Issues Over $20B In IEEPA Refunds In First Month

Phases 2 And 3 Are Expected To Resolve More Complicated Entries

Phase 2, scheduled to launch on June 29, is expected to broaden CAPE’s capabilities for entries marked for reconciliation due to later adjustments to value, classification, origin or other import data. CBP estimates that Phase 2 will cover roughly $28.7 billion in refunds.

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At a June 9 hearing before the Court of International Trade, Susan Thomas, executive assistant commissioner for CBP’s Office of Trade, indicated that Phase 3 is expected by the end of July. This phase will focus on the most complex cases, including liquidated entries and entries with an action still pending in court.

With the rollout of Phase 3, about 95% of all entries should be eligible for refunds, Thomas said. She estimated that finally liquidated entries account for roughly $11.4 billion, or 6.9%, of the total payments made for IEEPA duties last year.

RELATED: PPAI Research: The Tariff Effects, From Refunds To End Buyers And Operations

Legal Challenges Continue

CBP has continued to argue that it cannot issue refunds for finally liquidated entries in every case without a court order, particularly where the importer has not filed its own case at the Court of International Trade.

That position is tied to the federal government’s appeal of the court’s refund orders. The administration has challenged the scope of relief, arguing that broad refund orders should not automatically extend to importers that were not parties to the original case. During the same June 9 hearing, Claudia Burke, counsel for the United States, suggested that the court could simply create a list of importers who filed suit so that CBP could then issue refunds to those companies.

These challenges create a mixed picture: On one hand, refunds are still underway, and the timeline for Phase 2 and Phase 3 gives importers a better sense of when additional refund categories may become available. On the other hand, the appeal and the uncertainty around finally liquidated entries mean that the scope of expected refunds may change again before the Phase 3 rollout at the end of July – when the administration is widely expected to impose a new round of global tariffs.

ICYMI: Trump Administration Plans New Tariffs On Imports From 60 Countries

For now, companies with finally liquidated entries should pay especially close attention to the appeal and consult their trade counsel or customs brokers. Next steps may depend on the status of the entries, the amount at stake and whether an importer already has a case pending.

PPAI will continue to monitor these developments and provide updates. Subscribe to PPAI Newslink to have these delivered straight to your inbox twice a week.