The news
CBP will open the third phase of its IEEPA tariff refund portal on Oct. 6, the agency told the Court of International Trade in a sworn declaration. This phase covers entries that are already finally liquidated, which means CBP has already made its final calculation of the duty owed on them.
The phase is open only to importers that sued at the trade court, and only if they gave CBP a valid importer of record number by July 30. As a result, an importer that holds closed entries but never sued still has no way to claim them through the portal.
The rest of the program has moved much faster, and as of Sept. 11 CBP had accepted about $134.7 billion in refunds, which includes duties plus interest, across 27.2 million entries. Of that total, it had certified about $122 billion and sent it to Treasury for payment.
Know more
The portal has opened in three steps, each adding a new group of entries.
Phase 1: opened April 20, and by June 5 CBP had accepted $94.9 billion and sent about $24 billion to Treasury.
Phase 2: opened June 29 and added about $28.7 billion of reconciliation entries, which are the ones importers adjust after the goods have cleared.
Phase 3: opens Oct. 6 for finally liquidated entries, and only for plaintiffs.
Payments picked up over the summer, as refunds sent to Treasury rose from about $24 billion in early June to $106.6 billion by Aug. 21, and then to $122 billion by Sept. 11.
Even so, some of the accepted money is stuck for reasons that have nothing to do with the courts. CBP’s filing counts 20,184 refunds, worth about $1.3 billion, that are held only because the importer has no bank details on file with the agency. That count is about double the figure CBP reported earlier in the summer, and another 6.1 million entries failed CBP's checks.
How it works
A closed entry is harder to refund than an open one because of a time limit. CBP can reopen a finalized entry on its own for 90 days after it closes, but after that it needs a court order to do so.
Phase 3 is reserved for plaintiffs because the court has already ordered CBP to reopen their entries, which gives the agency the authority to refund them. The same 90-day limit is also one of the main reasons entries failed CBP's checks in the earlier phases. The other common reasons were a missing Chapter 99 tariff line, which is the code CBP uses to charge the IEEPA duty, and entries that had already been claimed on an earlier filing.
The counter
For importers that did not sue, Oct. 6 changes nothing yet. A motion to extend relief to them as a class was argued before Judge Richard Eaton on Aug. 19, but he has not ruled. The government argues the motion came too late.
The government is also asking the Federal Circuit whether the trade court can order refunds for anyone who did not sue. In that appeal it has argued that it can keep about $30 billion or more in contested refunds on closed entries. A ruling in its favor could therefore narrow Phase 3 before much of it is paid.
Individual claims, however, can move far more slowly than the totals suggest. Helen of Troy, the housewares maker, had received $1.8 million of a $9.2 million Phase 1 claim by its latest quarter, according to its finance chief. Another $71 million of its Phase 2 claims was still pending at that point.
Meanwhile, the program covers only the IEEPA duties that the Supreme Court struck down in February. Section 232 and Section 301 duties are still being collected, and they cannot be refunded through the portal. CBP's own refund page still describes only Phases 1 and 2.
What’s next
The government owes the court a progress report by 5 p.m. on Oct. 6, the same day Phase 3 opens, and a closed settlement conference follows the next day. After that, the class ruling is the real test. If Judge Eaton certifies the class, importers that never sued will get a path to their closed entries. If he does not, Phase 3 will remain open only to plaintiffs.
