On February 20, the Supreme Court (“SCOTUS”) determined, in a 6 to 3 decision that the International Emergency Economic Powers Act (“IEEPA”) does not authorize the President to impose tariffs.
From our initial understanding, SCOTUS however has deferred the decision back to the Court of International Trade (“CIT”) on whether refunds for duties paid by U.S. importers will be provided. Meaning, the question of whether companies will receive tariff refunds remains outstanding.
| The White House later issued several executive actions to eliminate, maintain, and reimpose global tariff measures. These include: 1) An Executive Order (“EO”) formally terminating all IEEPA tariff actions. Respective agencies are ordered to take immediate steps to effectuate the termination of the collection of all current IEEPA tariffs. 2) A Proclamation imposing a 10% tariff on imports from all countries, except certain specified products, under Section 122 of the Trade Act of 1974 (19 U.S.C. 2132). An accompanying Fact Sheet can be found HERE. Starting Tuesday, February 24 at 12:01 AM EST, for 150 days (until 12:01 AM EST on July 24), the U.S. will charge a temporary import surcharge of 10% (on top of of normal MFN duties) on products from all countries, unless included in the list of exemptions detailed in Annex I and Annex II of the proclamation. These include: -USMCA-qualifying products; -CAFTA-DR qualifying textile and apparel products; -Products and parts of products subject to current or future Section 232 actions (note that the 10% WILL apply to the portion of the product that is not subject to Section 232 tariffs); and -Certain agricultural, aerospace, electronics, natural resources not available domestically, pharmaceuticals, vehicles (automobiles, trucks, buses, etc.), critical minerals, and information materials, donations, and accompanied baggage. In-Transit: The 10% tariff will not apply to products loaded onto a vessel at the port of loading and in transit on the final mode of transit prior to entry into U.S. before 12:01 AM EST on February 24 and that are entered for consumption, or withdrawn from warehouse for consumption, before 12:01 AM EST on February 28. U.S. FTZs: Impacted products must be admitted under “privileged foreign status” unless eligible for domestic status. 3) An EO continuing the global elimination of duty-free entry for low-value goods under Section 321 de minimis – see HERE. |