Following the Supreme Court’s decision overturning the IEEPA tariffs, the Court of International Trade directed U.S. Customs and Border Protection (CBP) to issue refunds of IEEPA duties to importers that paid them. CBP has so far implemented only Phase 1 of its CAPE system, which is limited to certain unliquidated entries and entries within 80 days of liquidation.
In a May 26 update, CBP outlined several issues contributing to delays in processing refund claims.
Roughly one-third of claims failed initial file validation, primarily due to:
- Importer of record or filer mismatches on CAPE declarations
- Entry Number validations
- .CSV file not in alignment with the template published in the ACE portal
More than 3 million entries that passed file validation subsequently failed entry-level checks, most commonly because:
- The entry date falls outside CBP’s 90-day reliquidation authority
- The entry does not include a Chapter 99 Harmonized Tariff Schedule code used to assess IEEPA duties
- The entry was previously submitted in an earlier CAPE filing
CBP also noted that thousands of approved refunds have not yet been transmitted to the Treasury Department for payment, largely due to missing Automated Clearing House (ACH) banking details from the importer of record or its authorized CBP Form 4811 designee.
To date, approximately $85 billion in potential and certified IEEPA refunds have been submitted through CAPE, with about $20.6 billion certified and forwarded to the Treasury for disbursement.
Following a May 27 session between CBP and the Court of International Trade (CIT), Judge Richard Eaton issued an order expressing concern over “millions of informal entries where liquidation was simultaneous, or nearly simultaneous, with the time of entry and for which the liquidation is now final,” noting that “CBP has not presented a proposal as to how to address these entries.”
Judge Eaton ordered CBP to show cause why the court should not lift the suspension of its requirement for immediate compliance with the refund directive.
CBP must respond by June 4, and the CIT will hold a hearing on June 9, at which CBP Commissioner Rodney Scott has been directed to appear in person.