week of February 27, 2026

February 27, 2026

Where Things Stand: Tariffs, Refunds, Liquidations, Protests and Litigation After the Supreme Court Ruling

The Supreme Court’s recent decision invalidating IEEPA-based tariffs has understandably created confusion. Between shifting tariff authority, refund uncertainty, protest deadlines, and discussion of litigation, many importers are asking the same question: What should we be doing right now?

This update provides a structured explanation of where things stand.

What the Supreme Court Decided

The Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs. As a result, tariffs imposed under IEEPA lack statutory authority.

The decision does not eliminate tariffs generally. It addresses only IEEPA. Other trade statutes remain available to the Administration.

What Tariffs Apply Now

As of February 26, 2026, the Section 122 tariff rate is 10%.*

Tariff rates and related trade measures remain fluid and subject to change. Information in this article reflects conditions as of its stated date and may be revised as developments occur. Overall, tariff authority has shifted — it has not disappeared.

*Watch for: The Administration has publicly announced an intention to raise the Section 122 rate to 15% (announced February 21, 2026). That increase has not yet taken effect but may be implemented. Members should monitor developments.

What Happens to Previously Paid IEEPA Tariffs?

While the authority under which those tariffs were imposed has been invalidated, the Court did not establish a refund process.

Refund timing and mechanics remain unsettled. Refunds may proceed administratively through U.S. Customs and Border Protection (CBP), may require protests, or may ultimately involve litigation. Proposed Congressional legislation would mandate refunds, but it is not currently law.

Many observers believe refunds should ultimately be required, but the procedural path is still developing.

The Key Concept: Liquidation

Before discussing protests or court action, one term must be clearly understood: liquidation.

Liquidation is the date when CBP finalizes an entry and legally fixes the duty amount. Once an entry is liquidated, the 180-day protest window begins.

Liquidation status can be confirmed through CBP’s Automated Commercial Environment (ACE). Importers or their customs brokers can review ACE to determine whether an entry has been liquidated and the exact liquidation date.

The protest period runs 180 days from the liquidation date — not from the entry date and not from the date the tariff first took effect.

If an entry has not yet liquidated, the protest clock has not started.

When Is a Protest Needed?

If an entry has liquidated, the importer has 180 days from the liquidation date to file a protest with CBP. A protest is an administrative filing — not litigation — and it preserves refund rights.

In the current context, a protest would typically assert that duties were assessed under IEEPA authority that the Supreme Court has declared invalid, and therefore the rate of duty applied at liquidation was legally incorrect.

If CBP grants the protest, the entry would be adjusted consistent with that decision, which may include the refund of duties paid. If CBP denies the protest, the importer may then consider filing an action in the Court of International Trade.

If the 180-day protest window passes without a protest being filed, the administrative remedy is generally closed.

When Is Court Action Required?

Court action in the U.S. Court of International Trade (CIT) generally becomes relevant when administrative remedies are unavailable or have been denied — typically after a protest has been denied or when the protest window has expired.

Filing in the CIT is not a political act. It is the designated judicial forum for resolving customs disputes when administrative options have been exhausted.

Why Are Some Companies Filing in Court Now?

Some importers have filed actions in the Court of International Trade before liquidation or protest. In many cases, these filings represent broader legal challenges to tariff authority or precautionary steps to preserve standing and reduce procedural uncertainty.

That approach may be appropriate for companies with significant exposure or specific litigation strategies. For most importers, however, the statutory trigger for refund action remains liquidation, and the 180-day protest window runs from that date.

Each company should evaluate its own entry status, liquidation timing, and risk tolerance before determining whether early litigation is warranted.

Where We Stand Today

IEEPA tariffs have been invalidated. A 10% Section 122 tariff has been announced. Refund mechanics remain unresolved. Liquidation status — as reflected in ACE — determines whether a protest window has opened. Litigation is conditional, not automatic.

The prudent course for most importers is to confirm liquidation dates, preserve protest rights where necessary, and monitor CBP guidance as the refund process develops.

Addendum – Toy Association Refund Guidance

The Toy Association has authorized the Hobby Industry Coalition to share its summary of recommended steps for importers seeking refunds of IEEPA tariffs. This document reflects guidance as of February 25, 2026 and is provided as a resource for members.

Summary of Steps for Seeking Refunds of IEEPA Tariffs (as of February 25, 2026)

2-26-26-The_Toy_Association_-_Summary_of_Steps_for_Seeking_Refunds_of_IEEPA_Tariffs.pdf

HIC appreciates the Toy Association’s willingness to make this resource available to our members.

To continue receiving real-time updates on tariffs and other important policy and regulatory matters from additional informed sources, members are invited to consider joining the Toy Association.

Legal Notice

This update is provided for informational purposes only and reflects information believed to be accurate as of its publication date. It does not constitute legal, customs, financial, or business advice. Tariff rates, regulatory interpretations, and related litigation developments remain subject to change. Members should consult qualified customs counsel regarding their specific entries, liquidation status, protest deadlines, potential refund options, and any decisions relating to litigation or protective filings.