Supreme Court overturns IEEPA tariffs
Supreme Court overturns IEEPA tariffs
Trump immediately introduces alternative import duties of 10%
On 20 February 2026, the US Supreme Court put an end to the Trump administration's controversial IEEPA tariffs. Almost immediately, new levies were introduced on a different legal basis.
Brief overview of the situation:
1. No authority under IEEPA
The Court ruled that the President could not impose import duties based on the International Emergency Economic Powers Act (IEEPA). As a result, the so‑called “fentanyl tariffs” on China, Canada and Mexico and “reciprocal tariffs” were declared invalid.
Tariffs supported by other legal bases – such as Section 232 (steel and aluminium) and Section 301 of the Trade Act of 1974 (China) – remain in force.
2. New 10% levy via Section 122 of the Trade Act of 1974
In response, on 24 February 2026 the government introduced a 10% global import surcharge based on Section 122 of the 1974 Trade Act. This provision allows temporary measures in the event of fundamental international balance of payments problems.
The measure applies for a maximum of 150 days (until 24 July 2026), unless Congress approves an extension. Certain goods – such as critical minerals, pharmaceuticals, specific electronics, and USMCA goods from Canada and Mexico – are exempt.
3. What about refunds?
On 6 March 2026, the Court of International Trade approved the request by CBP (U.S. Customs and Border Protection) to develop an orderly administrative process for refund applications via the agency’s ACE system. This means that a new functionality will be added to the ACE system for the calculation and payment of the ad valorem duties wrongly paid that were imposed under the IEEPA.
This new ACE functionality is called Consolidated Administration and Processing of Entries (CAPE) and will consist of four integrated components:
- Claim Portal;
- Mass Processing;
- Review and Liquidation/Reliquidation; en
- Refund.
We are closely monitoring the development of this platform and will update this article as soon as further information becomes available.
4. Prepare for a possible refund
Since it is not yet clear how a potential refund procedure will unfold, thorough preparation is essential.
We recommend verifying whether your ACE (Automated Commercial Environment) account is active and mapping your import history. This will give you a clear overview of which shipments fall under the invalidated IEEPA tariffs and will allow you to act quickly once a refund process begins.
The specific ACE report to review is the Entry Summary Details Report (ES‑003), which can be exported to an Excel spreadsheet.
To identify the IEEPA rates, the column containing the HTSUS code (Harmonized Tariff Schedule of the United States) must be filtered to select codes 9903.01.XX and 9903.02.XX, and then further filtered at the eight-digit level by country.
If you do not yet have access to your ACE account, we would be happy to assist you with registration and further setup. We can also put you in touch with our customs colleagues at BDO US for further support.