Please see the following notice from Sidley Austin LLP regarding the strike down of IEEPA tariffs.
Supreme Court Strikes Down the Use of IEEPA to Impose Tariffs
Further to the below, we wanted to provide our updated thoughts on today’s Supreme Court decision and what companies should be thinking about going forward.
First, the Supreme Court decision affirmed the Federal Circuit decision, which had affirmed, in part, the Court of International Trade decision. The judgment entered by the CIT declared that the IEEPA tariffs are “invalid as contrary to law[.]” The Supreme Court did not attempt to limit its decision by only applying it prospectively. As a result, we believe that the decisions create a refund opportunity for importers.
Second, we do not know how the refund process will work just yet. We are willing to bet, however, that it will not be automatic or immediate. Instead, we still believe that our “belt and suspenders” approach makes the most sense. Importers should be gathering the information necessary to pursue refunds through the existing U.S. Customs and Border Protection administrative process (e.g., downloading import reports from ACE) and be filing protests on liquidated entries. We expect that CBP will be issuing its views on how importers should proceed (e.g., we expect CBP to discourage importers from filing post-summary corrections). Importers should also consider whether filing your own court case at the CIT makes sense. While the benefits afforded by having your own case on file may be less than they were now that the Supreme Court has issued its decision (due to the CIT’s jurisdictional limitations), it may still worth pursuing for many importers. We would be happy to discuss these issues with you further.
Third, we do not expect that tariffs are going away. Stated differently, while the Supreme Court has struck down the use of IEEPA to impose tariffs, there are other statutes available to the President. Accordingly, we expect that the administration will impose tariffs at comparable levels under other statutes as early as today. We are not expecting any gap.
Fourth, we do not believe that the Supreme Court’s decision will have any impact on the trade agreements the administration has negotiated with other countries. Again, we expect that other countries recognize that there are other statutes the Trump administration can use to impose comparable tariffs and will not be willing to upset the deals that have been negotiated.
Finally, companies need to be considering the commercial implications of today’s ruling. Companies that have raised prices or passed on tariff surcharges to customers will need to explain how any tariff refunds will be shared; similarly, companies that paid increased prices or tariff surcharges to suppliers will want to know when/how its suppliers intend to share the refunds. We have helped many clients develop talking points to help control the narrative around these issues (rather than try to respond to a flood of individual inquiries).
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