U.S. Customs and Border Protection headquarters in Washington, May 10, 2023.
Bloomberg | Bloomberg | Getty Images
U.S. Customs and Border Protection told a U.S. Court of International Trade judge on Friday that it is not currently able to comply with his order to begin refunding about $166 billion collected in reciprocal tariffs imposed last year by President Donald Trump.
CBP, in a court filing, cited its existing technology, processes and manpower requirements as the reasons it could not immediately comply with the conditions of Judge Richard Eaton’s order on the so-called IEEPA tariffs. The Supreme Court recently ruled those duties are illegal.
But CBP also suggested in the new filing that it could begin issuing refunds by late April after revamping its technology.
Brandon Lord, executive director of the trade programs directorate at CBP’s Office of Trade, in the filing said that as of Wednesday, more than 330,000 importers have made a total of over 53 million
entries “in which they have deposited or paid duties imposed pursuant to the International Emergency Economic Powers Act.”
Trump had invoked that act to slap reciprocal tariffs in various amounts on imported products from most of the world’s countries, without authorization from Congress.
The filing came as Eaton was set to hold a hearing Friday on the refund issue at the Court of International Trade in New York.
Eaton has been designated as the only CIT judge who will hear lawsuits from importers seeking refunds on Trump’s tariffs in light of the Supreme Court’s 6-3 ruling invalidating them on Feb. 20, in the case known as Learning Resources, Inc. v. Trump.
CBP in the filing said it “is confident that it can develop and implement” new functionality in its Automated Commercial Environment — the system for tracking imported merchandise — “that will streamline and consolidate refunds and interest payments on an importer basis,” instead of issuing more than 54 million separate refunds.
“CBP is making all possible efforts to have this new ACE functionality ready for use in 45 days,” the agency said. “This new process will require minimal submission from importers.”
The agency said it estimates that changing the ACE system “will save CBP over 4 million hours” of work by employees.
Eaton on Wednesday ordered CBP to calculate the cost of bringing in shipments into the United States without assessing a tariff, and told the agency to make refunds to importers who had paid the IEEPA tariffs, with interest.
“Customs knows how to do this,” Eaton said during a court hearing on Wednesday. “They do it every day. They liquidate entries and make refunds.”
The Trump administration could appeal Eaton’s order to the U.S. Court of Appeals for the Federal Circuit, which could further delay the issuance of refunds to importers.
Many importers have sued the Trump administration seeking refunds of tariffs they have paid since last year that were deemed illegal.
Eaton’s order on the refunds was issued in a lawsuit filed by one of those importers, Atmus Filtration, but it applies to every duty that was paid in connection with the IEEPA tariffs. Atmus Filtration, which is based in Nashville, Tennessee, makes filters, coolant and chemical products.
In the filing Wednesday by CBP’s Lord, the agency indicated that its existing technology was making it impossible to immediately comply with Eaton’s order.
“In light of the Court’s March 5, 2026 amended order, CBP is now facing an unprecedented volume of refunds. Its existing administrative procedures and technology are not well suited to a task of this scale and will require manual work that will prevent personnel from fully carrying out the agency’s trade enforcement mission,” the filing said.
“Personnel would be redirected from responsibilities that serve to mitigate imminent threats to national security and economic security,” the agency said.