Customs and Border Protection (CBP) will launch a new capability within its electronic system of record for imports to streamline the processing of refunds for President Donald Trump’s recently invalidated International Emergency Economic Powers Act (IEEPA) tariffs.
The agency on Thursday provided an update to the Court of International Trade (CIT) outlining the tool, which will live within its Automated Commercial Environment (ACE). Dubbed the Consolidated Administration and Processing of Entries (CAPE), it will help to calculate and issue refunds of ad valorem IEEPA duties.
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CAPE will include four integrated components—a claim portal, mass processing, review and liquidation (or reliquidation, when appropriate) and refunds. Importers and customs brokers will submit claims through the portal using Comma-Separated Values (CSV) files, which contain a list of the entry summaries. The system will then assess and validate those entries and take out IEEPA harmonized tariff schedule (HTS) numbers before recalculating the appropriate duty rates and processing any necessary liquidation or reliquidation of funds. Refunds will then be issued to designated bank accounts.
According to Brandon Lord, executive director of the Trade Programs Directorate at CBP, as of this week, the different elements of CAPE are in varying stages of buildout. The agency anticipates that development will take place in phases, beginning with basic functionality before the platform sees more mature tools added for complicated scenarios.
CBP currently estimates that its development of the claim portal component is 70 percent complete, while the development of the mass processing component is 40 percent complete. Development of the review and liquidation and reliquidation component is 80 percent complete, while development of the Refund component is 60 percent complete.
The update comes a week after a federal appeals court denied the Trump administration’s request to delay refunds on IEEPA tariffs, and the CIT ruled that customs must begin the process of doling them out. The judge in the case said CBP should use standard procedures to issue refunds and importers that paid IEEPA tariffs should not have to file lawsuits in order to guarantee that they’re paid out.
“Customs knows how to do this,” CIT Judge Richard K. Eaton said while delivering the ruling. “They do it every day. They liquidate entries and make refunds.”
But according to Lord, processing $166 billion in refunds quickly and efficiently is a tall and “unprecedented” order. The executive director said last week that the agency’s existing administrative procedures and technology “are not well-suited to a task of this scale,” and the volume of labor will pull personnel away from trade enforcement activities.
Augmenting CBP’s system will take a month and a half, Lord said, as it needs to consolidate both refunds and interest owed. As of March 4, there were more than 53 million entries related to IEEPA tariffs to sort through. “CBP is making all possible efforts to have this new ACE functionality ready for use in 45 days,” he added.
During the first phase of the CAPE deployment, Lord wrote that the system will have the capacity to process most formal and informal entries on which IEEPA tariffs were paid, excluding unliquidated entries that are subject to antidumping or countervailing duties as well as those with liquidation statuses that are suspended, extended or under review, among others.
“CBP will provide detailed guidance to users regarding the scope and functionality of each phase of development as it is implemented,” Lord wrote.
