A Midyear Road Map for U.S. Trade Policy and Enforcement

So let's get into it.

For our first topic, the current tariff landscape, we'll be discussing the status of the global tariff under Section 122, refunds of the IEEPA tariffs following the Supreme Court's ruling on their illegality, and sector-specific tariffs under Section 232.

So what are our thoughts?

To put this in context, this all goes back to the Supreme Court's decision in February, which struck down the tariffs that were put in place under the International Emergency Economic Powers Act.

And since that decision, the Trump administration has been looking for a way to recreate the IEEPA tariffs with alternative tariffs under different statutory authority.

And the Section 122 tariffs are the first step in that process.

Now, if you remember, the Section 122 tariffs also came into force in February, so we had the Supreme Court decision that morning.

The Section 122 tariffs were put in place that afternoon.

And the Section 122 tariffs covered largely the same goods as the IEEPA tariffs, so that is most goods from all trading partners.

Two important limitations to flag on Section 122.

The first is that there's a rate limitation.

So unlike IEEPA, under Section 122, the tariff rate can only go up to 15%.

It's at 10% now, but it can only go up to 15%.

The second limitation is a timing limitation, and this is also very important because these Section 122 tariffs will expire on July 24th.

And on that July 24th date, we expect the administration to replace the 122 tariffs with new tariffs under Section 301, which is an issue we'll be discussing a little bit later.

And on the IEEPA tariff refund front, as Pat mentioned, after the Supreme Court struck down the IEEPA tariffs back in February of 2026, there's been really extensive litigation at the Court of International Trade, as well as movement at Customs and Border Protection, CBP, to help effectuate refunds to the hundreds of thousands of importers that paid nearly $200 billion in IEEPA tariffs.

Currently, there are two avenues by which importers of record are able to pursue refunds.

One at Customs, directly from Customs.

There are different phases that Customs has laid out for importers to seek refunds and file for those.

However, those only cover about 60% of the refunds available.

The other avenue that the Department of Justice insists that importers of record must take is by pursuing the refunds in an active litigation at the Court of International Trade.

There are currently over 4,000 lawsuits by importers of record and a pending class action of importers who are actually seeking to get full recovery by filing those lawsuits at the CIT, or Court of International Trade.

Just recently, there was a big update at that court posture whereby the Department of Justice actually appealed to the Federal Circuit, arguing that unless importers of record do file at the CIT, they will not be entitled to full relief.

And so what we're seeing here is importers of record having to take sort of the dual tracks to actually effectuate or receive a full refund.

We have the Department of Justice arguing against full refunds unless that litigation is initiated.