Enterprise Risk: Why US Tariffs Are Now a Board-Level Governance Issue
Rapid changes to US tariff policy have transformed what were once transactional import decisions into issues with enterprise-wide implications. The reliance on tariffs has had bipartisan support across Administrations, and the risks are not going away.
For boards and senior financial leadership, tariffs now intersect with risk management, internal controls, disclosure considerations, and long-term strategic planning. Getting this right requires sustained attention — these are not decisions that can be rushed, particularly where regulatory interpretation and enforcement remain unsettled.
On the morning of April 2, our team recorded a 5Q5A podcast discussing the enterprise-wide risks that tariffs now present to US importers. Just hours later, President Trump issued the Section 232 proclamation on steel, aluminum, and copper — the most consequential change to the Section 232 tariff regime since the 50% tariffs were first implemented in 2018.
That discussion captured a critical moment: our team was analyzing the valuation ambiguities in the existing Section 232 framework — issues that would be directly addressed by the proclamation issued that afternoon — as companies were separately and simultaneously grappling with anticipated millions of dollars in IEEPA refunds. The risk themes we identified are the same issues regularly raised in board-level discussions with clients across industries.
Tariff Regime Complexity: The proliferation of more than a dozen tariff regimes since February 2025, each with distinct rules governing classification, valuation, and country of origin, and the resulting interpretation risk — each regime demanding its own careful analysis.
Duty and Penalty Exposure: Potential exposure to back duties and civil penalties ranging from two to eight times the loss of revenue to the government (or more), with CBP’s five-year statute of limitations applying separately to each import entry. Demonstrating “reasonable care” — through legal counsel, applicable standards review, and contemporaneous documentation — significantly mitigates this exposure and can serve as a competitive advantage.
Disclosure and Reputational Considerations: The possibility that tariff‑related risks or enforcement activity may implicate securities disclosure obligations and affect relationships with investors, customers, and suppliers.
Refund‑Related Developments: The availability of potential refunds for IEEPA tariffs paid since February 2025 following a US Supreme Court decision, including administrative timing considerations related to the CBP’s Consolidated Administration and Processing of Entries (CAPE) refund module.
Section 232 Developments: The April 2 proclamation on steel, aluminum, and copper significantly reshaped the Section 232 tariff regime, introducing new rate structures with tariffs up to 50%, de minimis weight thresholds for exemptions and other complex rules. Valuation ambiguities related to pre-proclamation entries — including the absence of detailed agency guidance and related litigation — remain a source of retroactive exposure.
Forward‑Looking Trade Policy Events: The upcoming July joint review of the United States–Mexico–Canada Agreement (USMCA) and the potential relevance of existing USMCA claims in that context.
Governance and Oversight Structure: The current environment demands cross‑functional coordination — spanning finance, engineering, supply chain, and legal — because no single division owns this risk. Board-level visibility into this coordination is increasingly essential.
Companies that invest the time to understand their tariff exposure will make sound strategic decisions; those that rush will compound their risk. For more information, please contact the ArentFox Schiff Customs & Import Compliance team.
