Time to Secure IEEPA Refunds! CBP CAPE Tool Launches April 20

Importers now have a path to reclaim tariffs they never should have paid.

On April 10, US Customs and Border Protection (CBP) released eagerly awaited guidance on its new Consolidated Administration and Processing of Entries (CAPE) tool, a streamlined portal for obtaining refunds of duties paid under the International Emergency Economic Powers Act (IEEPA).

Mark April 20 on Your Calendars

Phase 1 of CAPE is scheduled to launch within the Automated Commercial Environment (ACE) for certain standard entries that are unliquidated or are within 80 days of liquidation. This refund process follows the US Supreme Court’s February 20 decision holding that President Trump lacked legal authority to impose IEEPA tariffs.

Importers are encouraged to review the scope of Phase 1 (i.e., which entries are eligible for refunds), understand the requirements for submitting claims, including certification and entry date criteria, and prepare to troubleshoot any issues that arise. This alert provides an overview of the CAPE program, instructions to submit a refund claim, and additional considerations regarding the process.

Overview of CAPE

CAPE is designed to consolidate refunds of IEEPA duties and interest paid, rather than processing refunds on an entry-by-entry basis. CBP plans to implement CAPE through a phased development approach, adding more functionality in subsequent phases for more complicated entry scenarios (e.g., flagged for reconciliation or subject to drawback claims or protest).

Phase 1 is limited to certain entries that are:

Unliquidated.
Within 80 days after liquidation. The 80-day threshold is designed to allow sufficient time for CBP to process and reliquidate entries by the 90th day, meeting the agency’s legal timeframe for voluntary reliquidation pursuant to 19 U.S.C. § 1501.

How to File a CAPE Declaration - Information to Submit in ACE

Importers of Record (IORs) and authorized customs brokers (that filed the entry summaries on the IOR’s behalf) may file a CAPE Declaration by uploading a .CSV file with the list of entry numbers for which a refund of IEEPA duties is requested in ACE. We are clarifying with CBP whether authorized attorneys with importer’s ACE access can also submit refund declarations for their clients.

Only the entry numbers eligible for IEEPA refunds must be submitted via .CSV file. Each individual CAPE Declaration has a limit of 9,999 entries, but IORs and brokers can file multiple CAPE Declarations.

Once a CAPE Declaration is validated and accepted, ACE will update the appropriate entry summary lines by removing the IEEPA Harmonized Tariff Schedule Chapter 99 provision and the corresponding IEEPA duties, resulting in an updated version of the entry. Following CBP review, entries will be liquidated or reliquidated and refunds will be issued on a consolidated basis.

Certification Requirement

By filing a CAPE Declaration, the filer must acknowledge and certify: “I certify that I am legally authorized to make this filing, and that in doing so I have complied with all applicable laws, regulations, and instructions.”

Because the CAPE process begins with a declaration that broadly certifies compliance with all applicable laws, regulations, and instructions, importers should carefully consider which entries to include, as claims may be reviewed by CBP in processing the refunds.

Entries Excluded From Phase 1

Certain types of more complicated entries will not be accepted by CBP in CAPE Phase 1 and will be addressed in subsequent phases:

Entries flagged for reconciliation, as well as Entry Type 09 (Reconciliation Summary).
Entries covered by an open protest.
Entries not filed in ACE, and entries without a liquidation status in ACE.
Entries subject to Antidumping/Countervailing Duties for which the US Department of Commerce has issued liquidation instructions that are pending liquidation pursuant to 19 U.S.C. § 1504(d).
Entries for which liquidation is final (i.e., 90 days after liquidation).
Entry Types: Duty Deferral (08), Recon (09), TIB (23), or Drawback (47).

How Refunds Will Be Issued

All refunds will be paid electronically via Automated Clearing House (ACH). To receive a refund, the importer must apply for ACH Refund through their ACE account. Refunds will not be issued until the bank information is provided to CBP.

The importer or the party designated through either CBP Form 4811 (Special Address Notification) or on the ACE Portal account, and on the entry summary, will be eligible to receive refunds.

Timeline for Refunds

CBP has indicated that valid IEEPA refunds will generally be issued within 60 to 90 days following acceptance of the CAPE Declaration, unless a compliance concern requires further CBP review. However, entries that are extended, suspended, or under review, as well as warehouse entries, will maintain their liquidation status, with validated refunds issued at liquidation.

Other Key Considerations

The new CAPE guidance offers importers and the trade community more information about the IEEPA refund process, but several uncertainties remain. For example, it is still unclear how certain rejected claims can be corrected. Importers should also be aware that new ACE implementations can have various programming errors that may take time to resolve. While April 20 is the target date for the rollout of Phase 1, there is no guarantee that the CAPE system will be functional on that date and it is unclear when the refund process for entries excluded from Phase 2 will be rolled out. Moreover, the government still has time to appeal the US Court of International Trade’s decision ordering refunds, and any appeal would likely hold up the refund process.

Additionally, importers and brokers need to be diligent in ensuring the accuracy of the data submitted to CBP to avoid delays in refunds. Once a CAPE Declaration has been filed and accepted, it cannot be amended. CBP may also review the accuracy of the underlying entries.

If additional eligible entries are identified after filing, a new CAPE Declaration can be filed for those entries. Each entry may only be submitted on one accepted CAPE Declaration; entries previously submitted will receive a rejection error if included on a subsequent declaration.

Importers should also consider that some suppliers and customers that have shared in the cost of the IEEPA tariffs may also seek to recover a share of the tariffs paid.

How to Prepare for Refunds and Preserve Your Rights to Refunds

To prepare for the refund process, we advise importers to take the following steps:

Ensure that your company has an ACE importer account. This requires a US address. It is taking upwards of a month to apply for a new account. We are assisting companies with troubleshooting the application process.
Set up ACH bank information for refunds. This requires a US bank account. If you do not have a US bank account, identify and arrange for an alternative payee.
Compile a list of entries that are eligible for IEEPA refunds under Phase 1 and prepare to submit in the format required by CBP.
Continue to track entries that will be eligible for refunds under subsequent phases.
Review entries carefully before filing for accuracy (e.g., ensure no duplicative entries).
Ensure that there are no other compliance concerns with entries (e.g., origin, tariff classification, value), as that could trigger additional review by CBP.
Continue to protest entries that are nearing the 180-day protest deadline, as the timeline for subsequent phases of the refund process is uncertain.
Determine how refunds may impact obligations to other stakeholders.

Our team is assisting companies with all the above steps. For more information, please contact the authors of this alert or your ArentFox Schiff relationship attorney.