Important update regarding IEEPA Refunds

U.S. Customs and Border Protection (CBP) has been processing refunds of IEEPA tariffs following the Supreme Court’s February ruling that those tariffs were unlawfully imposed. Recent legal and administrative developments have introduced meaningful uncertainty around how much importers will recover, and when.

May 29 | DOJ Files Appeal

On May 29, the Department of Justice filed a notice of appeal challenging the Court of International Trade’s (CIT) universal injunction, which had directed CBP to issue IEEPA refunds broadly, including for "finally liquidated" entries (i.e., entries more than 90 days past liquidation). The government’s position is that CBP lacks the legal authority to refund duties on finally liquidated entries without an importer-specific court order. At the same time, CBP confirmed it will continue processing CAPE refunds for unliquidated and non-final entries. The Federal Circuit’s timeline to resolve the appeal is uncertain, legal analysts expect a resolution in weeks to months.

June 9 | CIT Hearing: Phase 2 and Phase 3 Clarified

At yesterday’s hearing, CBP provided its clearest picture yet of how the CAPE refund process will unfold beyond Phase 1. The key takeaways:

• Phase 2 will be specifically scoped to entries flagged for Reconciliation, a narrower category than many importers had anticipated, with a planned launch on June 29th.
• CBP made its first-ever mention of Phase 3, which appears to be the vehicle through which finally liquidated entries would eventually be addressed
• CBP indicated that refunds for finally liquidated entries may require importers to file suit at the CIT
• Phase 3 is advancing, with a planned launch at the end of July, though the government’s Federal Circuit appeal remains active

What This Means for Your Refund

While CBP has now acknowledged a path for finally liquidated entries through a future Phase 3, yesterday’s hearing makes clear that these refunds are not imminent. Layered on top of this, the DOJ’s appeal is still working its way through the Federal Circuit, if the government obtains a stay or prevails, even the announced Phase 3 pathway could be delayed.

For importers whose claims fall outside CAPE Phase 1, the realistic timeline to a refund is now measured in months at best, and potentially longer.

How Flexport Can Help

Given the uncertainty, Flexport has a solution. For claims greater than $500,000, our IEEPA Refund Buyout Program allows Flexport Capital, Flexport’s financing arm, to purchase your refund claim at a fixed percentage of face value and wire you the proceeds. You get certainty and liquidity today; we take on the legal and timing risk.

Get started below or reach out to tariffrefunds@flexport.com and our team of specialists will walk you through the process.

Flexport provides this advisory for informational purposes only. It does not constitute and may not be relied upon as legal advice; for legal advice, please consult your legal representative.