U.S. Customs Agency Tells Judge It Cannot Comply with Tariff Refund Order
A United States Customs and Border Protection official informed a federal judge on Friday that the agency is unable to comply with a court order to halt processing import duties that include President Donald Trump's emergency levies, which were recently invalidated by the U.S. Supreme Court. The official stated that immediate compliance is not feasible due to systemic limitations.
Technical Limitations Cited
In an affidavit filed with the court, Brandon Lord, a CBP executive director, explained that the agency's current automated system processes hundreds of thousands of import entries weekly but cannot separate entries containing billions of dollars in tariffs collected under the International Emergency Economic Powers Act (IEEPA). Lord emphasized that CBP is "making all possible efforts" to develop an automated refund system that would be simpler and more efficient, potentially ready within 45 days.
"Currently, it is not possible for CBP to immediately prevent any additional entries from liquidating without IEEPA duties," Lord stated in the filing. He added that the agency faces an unprecedented volume of refunds, with existing administrative procedures and technology ill-suited for such a large-scale task, requiring manual work that would hinder trade enforcement missions.
Judicial Order and Response
The agency's response follows a Wednesday order from Judge Richard Eaton of the federal trade court in New York, who directed CBP to remove Trump's emergency tariffs from its backlog of importers' paperwork. Eaton suggested this would facilitate future refunds and questioned why the government hadn't acted sooner after the Supreme Court's ruling last month.
During a hearing, Eaton expressed skepticism about the Justice Department's claims that the refund process would be difficult, noting that CBP appeared to have all necessary data to issue refunds rapidly through its standard process, albeit on a much larger scale. He insisted the process should "not result in a mess" and that "every single cent of IEEPA duties that was imposed must be refunded."
Scale of the Issue
According to Lord's affidavit, CBP has identified approximately $166 billion in IEEPA duties collected from over 330,000 importers across 53 million individual entries. About 20.1 million entries remain unliquidated, complicating the refund process. The Supreme Court's 6-3 decision found that Trump unlawfully used IEEPA to impose reciprocal tariffs on imported goods, raising questions about when and how importers will receive refunds for nearly $170 billion in tariffs.
A hearing on the matter held Friday morning at the Court of International Trade in Manhattan was closed to the public. The case highlights ongoing challenges in implementing judicial mandates within large governmental systems, particularly when dealing with complex trade regulations and legacy technology infrastructure.
