CIT Hits Pause on Immediate IEEPA Tariff Relief While CBP Builds Refund Process

On March 6, 2026, the U.S. Court of International Trade (CIT) amended its March 4 order in Atmus Filtration, Inc. v. United States, No. 26-01259, temporarily pausing immediate implementation of the court’s earlier directive requiring U.S. Customs and Border Protection (CBP) to stop applying IEEPA tariffs to unliquidated entries and to reliquidate certain entries that had already been liquidated. The amendment suspends those provisions while CBP develops an administrative process for issuing refunds.

The court’s amendment followed a closed conference with the parties, and a declaration submitted by Brandon Lord, Executive Director of CBP’s Trade Programs Directorate (the “Declaration”). In the Declaration, Mr. Lord outlined operational challenges associated with immediate compliance and proposed a framework for administering refunds through the Automated Commercial Environment (ACE), software used by CBP since 2003 to process customs entries.

Key Implications from the Government’s Declaration

The government’s Declaration outlines CBP’s anticipated approach to implementing a refund process for IEEPA tariffs. Although ACE system upgrades may be completed relatively soon, the broader administrative process—particularly the development of regulations and the submission and review of claims—may take significantly longer. The points below outline the principal operational and legal considerations for importers derived from the latest developments at CIT:

1. ACE implementation may take longer than 45 days. According to Mr. Lord’s Declaration, ACE upgrades that would enable CBP to administer a refund program may be operational in about 45 days, but the timeline is only an estimate and not a binding deadline. Moreover, even once operational, it may also take additional time before importers or their licensed customs broker may submit refund requests.
2. CBP may continue liquidating entries with IEEPA tariffs in the interim. Until the ACE upgrades are implemented, CBP is expected, for the time being, to continue liquidating entries with IEEPA tariffs applied even though the court has ordered otherwise. However, importers should not include IEEPA tariffs in their new entries.
3. The refund process itself could take years. Even after ACE upgrades becomes operational, the full refund process—including claim review and payment—could extend for years rather than months. Importers should therefore set realistic expectations with clients, investors, and other stakeholders who have an interest in the refund.
4. Regulatory guidance will likely be required before claims can be processed. Even if ACE becomes technically capable of processing refunds, CBP may need to issue implementing regulations to administer the program properly. These regulations could likely address eligibility criteria, claim procedures, third-party claimant criteria, and administrative rules governing the refund process.
5. Refund claims may involve strict procedural requirements. Claims could be subject to filing deadlines, documentation requirements, and potentially a sunset date by which all claims must be submitted. These requirements could present challenges for smaller importers or importers that are no longer active but still eligible for refunds.
6. Importers may be able to submit bulk request reassessment once the system is upgraded. The Declaration suggests that importers or their licensed customs broker may be able to enter bulk request rather than amending each entry.
7. Importers may need to calculate and substantiate the IEEPA portion of duties.
   Because IEEPA tariffs are not separately stated in entry documentation, ACE may not automatically identify the relevant duty amounts. Importers or their licensed customs brokers may therefore need to calculate and substantiate the IEEPA component when submitting refund claims. This could prove costly, particularly where refunds may ultimately be remitted to an importer’s customer or other third party.
8. Denials may trigger administrative protest procedures before judicial review. Once CBP implements its IEEPA refund process, a denial may be treated as an administrative action subject to the standard CBP protest procedures and timelines, unless CBP issues regulations providing otherwise.
9. The potential refund program may influence litigation strategy. Some commentators believe the prospect of a CBP-administered refund program may slow the filing of protective petitions at CIT because the Declaration suggests the proposed program could extend beyond the IEEPA refunds addressed in the Court’s March 4 order to cover all IEEPA refunds.
10. Importers should begin preparing operationally while awaiting CBP’s process. Importers should ensure that they have Automated Clearing House (ACH) payment capability established through ACE or Pay.gov so they can receive refund payments. They should also begin gathering entry documentation and supporting records needed to substantiate claims and consider establishing cost-sharing arrangements where refunds may need to be remitted to customers. As part of their preparation, importers should also consider assembling experienced legal, accounting, and licensed customs broker professionals early and budgeting for the potential costs associated with filing and pursuing protests.

CBP’s Proposed Process.

Mr. Lord’s Declaration states that CBP anticipates that the process will involve the following steps:

1. The importer files a declaration in ACE that includes a list of entries on which IEEPA duties were paid.
2. ACE runs a series of validations on each entry within the declaration and automatically re-calculates the duty owed without the IEEPA tariffs (with applicable interest).
3. CBP verifies the declaration and processes refunds as soon as practicable.
4. ACE automatically finalizes (liquidates or reliquidates) the entries.
5. ACE automatically aggregates the refunds with interest by importer and liquidation date.
6. CBP certifies the refunds.
7. The Department of the Treasury issues IEEPA refunds electronically.

In the Declaration, Mr. Lord indicates that CBP expects to have a process functionally ready in ACE within approximately 45 days; however, the Declaration outlines several important caveats. Operational, legal, and technical constraints may require adjustments, and CBP may also need to issue regulations to administer the refunds. While CBP intends for the proposed process to be significantly simpler and more efficient than ACE’s current functionality for submitting individual Post Summary Corrections (PSCs), the process will not be automatic. Importers or their licensed customs brokers will likely need to submit a declaration through ACE. CBP intends to provide specific guidance on how to claim IEEPA refunds once the new system is implemented in ACE. Even after implementation, the Declaration cautions that issuing all the refunds could take years.

Regulatory Action May Be Required for CBP to Implement CIT Decision.

The Declaration indicates that CBP may need to enact new regulations to fully implement CIT’s order, similar to when the Harbor Maintenance Fee (HMF) was struck down in 1998. CBP regulations are issued through the rulemaking process under the Administrative Procedure Act (APA), which typically involves proposing a rule in the Federal Register, allowing public notice and comment, and then issuing a final rule.

In certain circumstances, the process can be expedited. The APA’s “good cause” exemption allows agencies to bypass notice-and-comment requirements when they are impracticable, unnecessary, or contrary to the public interest. CBP may also issue an interim final rule that takes effect immediately while accepting comments afterward, or a direct final rule for noncontroversial changes. Normally, a final rule becomes effective 60 to 90 days after publication, although the full rulemaking process often takes two to three years.

Moreover, after Loper Bright ended Chevron deference, CBP must rely on clear statutory authority to support its actions. Because IEEPA does not provide explicit statutory guidance for issuing refunds, CBP’s implementation may require additional regulatory action. As a result, although ACE may be functionally capable of processing IEEPA refunds within about 45 days, regulatory or procedural delays could extend the timeline.

ACH Enrollment Needed for CBP Refunds.

One of CBP’s biggest challenges in issuing IEEPA refunds is that a significant number of importers and customs brokers have not enrolled to receive ACH electronic payments. Regardless of how the IEEPA refund process unfolds, this is a step that importers and licensed customs brokers can take now to help expedite payments.

As part of the Modernizing Payments to and From America’s Bank Account initiative, beginning February 6, 2026, all U.S. Treasury payments, including CBP refunds, must be made by electronic funds transfer (EFT).[1] According to the Declaration, CBP has been unable to process and issue refunds to approximately 2,897 importers covering about 7,700 refund transactions due to missing ACH enrollment.

Customs brokers and importers with ACE access through the Automated Broker Interface (ABI) may submit EFT/ACH information through the “ACH Refund Authorization” tab. Users with inactive ACE Trade accounts must reactivate them to enroll in ACH refunds, while void ACE account holders must contact the CBP Bonds team. Entities without an ACE Portal account must enroll through Pay.gov to receive refunds.

Businesses or individuals without an ACE account or SSN/EIN/TIN may still receive refunds, but CBP cannot issue payments to unidentified parties. These entities must obtain an EIN or TIN from the IRS or request a CBP-assigned importer number using CBP Form 5106.[2]

Importers must ensure any designated third parties complete the ACH Refund application and that designation information remains current. Paper checks will be issued only in limited circumstances where electronic payment is impracticable due to hardship, lack of infrastructure, national security or emergency conditions, or similar operational exceptions.[3]

Lessons from the Harbor Maintenance Fee Refund Process that may Apply to IEEPA Refunds.

Mr. Lord’s Declaration cites as an example United States Shoe Corp. v. United States (1998), the case that invalidated the HMF on exports and provides a close analog to a large-scale tariff refund program facing IEEPA tariffs. [4] Like in Learning Resources, the case began at CIT, the Supreme Court found the measure partially unconstitutional, and Customs (then under the U.S. Treasury) had to establish a refund process from scratch to meet the court’s refund order.

After the March 31, 1998 decision, Treasury and Customs stopped collecting the export HMF and formally removed the requirement by July 31, 1998. [5] Refunds were initially limited to claims before CIT. But in 2000, eligibility was expanded, allowing any party that had paid export HMF to seek refunds for the entire collection period (April 1, 1987–April 25, 1998). [6] Customs faced significant challenges administering refunds because the HMF statute did not provide a refund mechanism.

Customs Refund Procedures For HMF

It took until 2001 for Customs to issue interim and final rules establishing a formal refund procedure, including implementing a deadline for claims.[7] The rules—codified at 19 C.F.R. § 24.24(e)(4)(iv)—outlined:

• the method for requesting refunds
• documentation requirements
• payment report and certification procedures
• revisions to previously filed reports
• procedures for third party claimants
• the availability of protest procedures for denied claims

Exporters (or their agents) were required to submit a written refund request, typically accompanied by proof of payment. The request had to identify the quarters for which refunds were sought and include the exporter’s name, address, EIN, relevant agent information, and a designated contact person.

Protest Rights and Judicial Review

The Federal Circuit’s decision in Swisher International, Inc. clarified the availability of protest procedures. The court held that the denial of an HMF refund could be protested under 19 U.S.C. § 1514 to the extend the dispute concerned a decision by Customs regarding charges or exactions, which were deemed merged into liquidation, as opposed to the legality of the HMF.[8]

The court also recognized that Customs could establish administrative refund procedures for the convenience of the parties. Therefore, following the decision, Customs issued guidance establishing additional timelines and criteria. These changes stated that if a refund request was not approved through the initial or revised Report/Certification, the claimant had 120 days to submit supporting documentation and 90 days thereafter to file a protest.

Practical Lessons for Future IEEPA Tariff Refund Claims

The HMF refund process ultimately proved to be lengthy and administratively complex. Customs later enacted a regulatory sunset provision requiring claims to be filed by December 31, 2001. Although the Treasury Department and Customs had refunded approximately $730 million by late 2000, refunds continued to be processed as late as 2004 because of the significant time required to review and administer the remaining claims.

Although ACE is more advanced today, the HMF process offers useful insight into how large-scale customs refund programs, such as the proposed IEEPA refund program, may develop. Perhaps the most salient takeaway from the HMF refund program is that large-scale refund efforts can become procedurally complex and time-consuming even after the underlying legal issues have been resolved. Accordingly, importers and potential claimants should set realistic expectations and begin preparing now in anticipation of CBP’s forthcoming refund process.

[1] See 19 C.F.R. §§ 24.36, 141.61, 159.6, 174.13 31, C.F.R. Part 208, Executive Order 14247 and 91 Fed. Reg. 21 (Jan. 2, 2026). (EFT is usually made via ACH)

[2] See 19 C.F.R. 24.5 (Completed and signed CBP Form 5106 should be emailed to the appropriate Center of Excellence and Expertise (Center). The email subject line should include “New 5106 Add” or “5106 Update,” along with the team assignment for the account. If the importer has not been assigned to a Center, the appropriate Center should be selected based on the tariff number with the highest import value.)

[3] See 31 C.F.R. § 208.4

[4] See United States v. U.S. Shoe Corp., 523 U.S. 360 (1998)

[5] 63 Fed. Reg. 40822 (July 31, 1998).

[6] See Swisher Int’l, Inc. v. United States, 205 F.3d 1358 (Fed. Cir. 2000)

[7] See generally, 66 Fed. Reg. 16854 (March 28, 2001) (interim regulation), 66 Fed. Reg. 21806 (April 27, 2001) (correction of interim regulation) 66 Fed. Reg. 34813 (July 2, 2001) (final rule), and 67 Fed. Reg. 31,948 (May 13, 2002) (amendment to final rule).

[8] See also, 19 C.F.R. Part 174

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