EXECUTIVE SUMMARY

• IEEPA does not authorize the president to impose tariffs. In Learning Resources v. Trump and Trump v. V.O.S. Selections, the Supreme Court held that the International Emergency Economic Powers Act (IEEPA) does not authorize the president to impose tariffs. The court found that IEEPA’s authority to “regulate … importation” does not encompass the power to levy duties, which is an Article I taxing power reserved to Congress.

• What remains in place. Most IEEPA-only tariff programs are now void, but Section 232 and Section 301 tariffs are unaffected. The administration has announced it will pivot to Section 122 (temporary, time-limited surcharges) and expand use of Sections 232, 301, and 338 going forward.

• Refunds and litigation posture. The court did not dictate refund mechanics. The Court of International Trade (CIT) had stayed many cases; that stay will be lifted. To preserve rights, timely filing is critical while updated process guidance is pending.

• De minimis/small package ($800) shipments. The administration previously used IEEPA to suspend the de minimis tariff exemption for some imports, which was expanded to all imports by the president by executive order. The ruling may affect that suspension in the near term, but Congress has largely eliminated the de minimis tariffs exception effective July 1, 2027, which will supersede any IEEPA effect.

THE DECISION: CONGRESS CAN ONLY DELEGATE TARIFF AUTHORITY WHEN IT DOES SO EXPRESSLY

The Supreme Court clearly held that IEEPA does not confer upon the president authority to issue tariffs. While IEEPA authorizes the president to “investigate, … regulate, … prevent or prohibit … importation or exportation” of property in which a foreign national has an interest, the statute does not mention tariffs, duties, taxes, or any other term that would ordinarily signal a delegation of the authority to impose tariffs. The court underscored that when Congress intends to delegate tariff authority, it must do so expressly and with clear constraints on rates, duration, and required procedural steps. The court pointed to authorities such as Sections 232, 301, 201, 122, and 338 as examples of the kind of explicit language that IEEPA lacks.

The court then examined historical practice. It made note of the fact that for nearly 50 years since IEEPA’s enactment, presidents have consistently used the statute to address foreign property, impose sanctions, and regulate transactions, but never to impose tariffs. When the executive branch did impose tariffs in the past, it relied instead on the explicit tariff-delegating authorities such as Section 232 or Section 301. The majority argued that this long and unbroken interpretive practice confirmed that neither the executive branch nor Congress understood IEEPA as a source of tariff authority when it was passed or in the period since.

Finally, the court addressed jurisdictional questions. The court held that cases challenging payment of IEEPA tariffs fall squarely within the exclusive jurisdiction of the CIT.

WHICH TARIFFS ARE AFFECTED—AND WHICH ARE NOT

The Supreme Court’s ruling swept aside every tariff that depended solely on IEEPA, rendering them invalid. The most prominent casualty is the 10% global baseline tariff, which the administration had applied across nearly all imports; because this measure relied entirely on IEEPA, it cannot stand under the court’s reasoning. The same is true for the country-specific reciprocal tariffs, which imposed elevated rates on trading partners based on perceived imbalances and were likewise grounded in IEEPA authority. In addition, the court’s decision eliminates the fentanyl- and drug-trafficking-related tariffs targeting Canada, Mexico, and China, which had imposed duties of 25% to 35% on certain North American goods tied to the United States-Mexico-Canada Agreement (USMCA) origin rules and a 10% rate on all Chinese imports. Since each of these actions depended on IEEPA as their legal foundation, they fall with the court’s categorical determination that the statute provides no tariff authority at all.

Notably, however, the ruling did not disturb tariff regimes imposed under explicit tariff-delegating statutes. Section 232 national security tariffs, including those on steel, aluminum, autos, and other strategic goods, remain fully intact because Section 232 expressly authorizes presidential action to “adjust” imports based on national security findings. Likewise, the extensive duties imposed during the prior administration under Section 301, which target unfair trade practices (primarily Chinese imports), continue unaffected. These authorities stand on firmer statutory ground, with clear congressional delegation and detailed procedural requirements, and therefore lie outside the scope of the court’s IEEPA holding.

THE ADMINISTRATION'S "PLAN B": WHAT TO EXPECT NEXT 

The administration’s post-IEEPA strategy now centers on a rapid pivot to the alternative tariff authorities that Congress has expressly embedded in the Trade Act and Title 19. The first move came quickly with President Trump announcing plans to impose a 10% global tariff under Section 122 of the Trade Act of 1974, which permits temporary import surcharges of up to 15% for a period of up to 150 days when the United States faces a “large and serious” trade deficit. He subsequently announced on social media that he would instead implement a 15% tariff, exceeding the baseline tariff upon which much of the administration’s trade negotiations are based.

Because Section 122 authority is inherently time‑limited, this measure is best understood as a stopgap designed to preserve negotiating leverage while the administration initiates the more formal investigative processes required under Sections 301 and 232. The White House announced that the Section 122 tariff would go into effect on Feb. 24, 2026.

Next, Trump administration officials announced plans to impose additional tariffs based on their authority under Section 232 and Section 301. Section 232 allows the president to impose tariffs on imports that threaten national security after an investigation by the Department of Commerce. Section 301 is country-specific and enables the U.S. Trade Representative (USTR) to investigate unfair trade practices and impose retaliatory tariffs proportionate to the harm. These procedures, which involve fact-finding, public comment, and interagency review, are more time-consuming than IEEPA’s emergency framework, but once imposed, Section 232 and 301 measures rest on firm statutory ground and are more likely to survive legal challenges. The administration is expected to introduce or expand Section 232 and 301 investigations in the coming months.

Other authorities may also come into play, though each carries structural limitations. Section 338 of the Tariff Act of 1930 authorizes additional duties of up to 50% on countries that discriminate against U.S. commerce, but it has never been used to impose tariffs and requires an International Trade Commission investigation before the president can act. Section 201 (the global safeguard mechanism) permits temporary relief when domestic industries are seriously injured by import competition, but it too requires an ITC petition, investigation, and injury finding before duties or quotas may be imposed. These tools could supplement the administration’s tariff strategy, but they are not rapid-deployment authorities and historically have been invoked sparingly given their statutory thresholds and geopolitical implications.

Together, these moves reflect the administration’s plan for a coordinated transition away from IEEPA and toward other tariffs based on other statutory authorities. Using these other tariff authorities, the administration should be able to bring the average effective tariff rate to approximately the same levels they were at under the IEEPA-based tariffs.

REFUNDS, LITIGATION, AND THE ROLE OF THE CIT

Although the Supreme Court invalidated all tariffs imposed under IEEPA, the court refrained from outlining how those unlawfully collected duties should be returned. In practical terms, this means there is no court-mandated process for determining eligibility, calculating refund amounts, addressing pass-through issues within supply chains, or applying interest and offsets. Instead, organizations must now look to forthcoming Customs and Border Protection (CBP) and Treasury Department guidance, as well as case-management orders from the CIT, which will ultimately define the operational framework for refund claims.

In the meantime, the procedural posture of refund litigation has shifted dramatically. The CIT’s administrative stay, which had paused hundreds of IEEPA‑related refund cases pending the Supreme Court’s decision, will soon be lifted and reopen the door for both previously filed and newly filed claims to move forward. Many importers, anticipating this moment, had already filed protective actions to toll statutory deadlines, and the volume of pending matters means the CIT will likely rely on test cases to resolve threshold issues and then will consider consolidated proceedings to process the cases efficiently. But given the volume of cases and the amount of IEEPA tariffs paid, it could take a significant amount of time to evaluate and pay tariff refund claims.

Given this landscape, it is important for affected parties to file now to preserve their rights. The absence of a defined refund mechanism, combined with strict statutory time limits and the likelihood of robust government defenses, makes early action essential. Importers who promptly initiate CIT refund claims or strategically join existing lead cases will be best positioned as bellwether questions regarding eligibility, valuation, pass-through, interest, and offsets begin to take shape. In short, the organizations that move first may have the clearest path to recovery as the refund process evolves.

DE MINIMIS/SMALL PACKAGE ($800) SHIPMENTS

The court’s ruling also raises the question of how small packages (low value imports under $800) will be treated going forward. In 2025, the administration invoked IEEPA to suspend the “de minimis” rule, which ordinarily allows low‑value shipments to enter the United States duty‑free. By acting under IEEPA, the administration targeted specific trade flows, most notably small‑package imports from China, subjecting them to duties and fees that had never previously applied at this volume or scale. This marked a significant shift for e‑commerce platforms, express carriers and high‑volume shippers that rely heavily on the $800 threshold for predictable landed‑cost modeling.

The Supreme Court’s ruling did not directly address the legality of the de minimis suspension. However, because the administration’s action depended on IEEPA authority, the court’s reasoning may leave its suspension of the “de minimis rule” open to legal challenge. If IEEPA cannot support tariff‑like actions, including those that impose duties on small‑package shipments, the suspension of de minimis treatment under IEEPA may also lack a valid statutory basis. This may be a short-lived issue, however, because Congress has already moved to eliminate de minimis treatment more broadly, codifying its phase‑out in the One Big Beautiful Bill Act, which becomes effective July 1, 2027.

WHAT INDUSTRY ORGANIZATIONS CAN DO IN THE SHORT TERM

In the wake of the Supreme Court’s invalidation of all IEEPA‑based tariffs, industry organizations may consider filing suit in the CIT, taking appropriate administrative actions including any that the administration chooses to outline in the coming months, and paying close attention to the CBP’s liquidation of tariff entries. To support any claims for tariff relief, importing organizations should maintain complete and well‑organized import files to ensure they are prepared for both refund processing and potential audit scrutiny.

Because the administration has already begun shifting to alternative tariff tools, industry organizations should also prepare for the administration’s pivot to other statutory authorities. Organizations should be watchful for new announcements from the administration of potential Section 232 or 301 investigations. Organizations should consider participating in public comment periods and weighing in with the administration to provide information and feedback to policymakers who will be deciding on the scope and degree of additional tariffs.

With so much of the trade landscape now shifting, organizations should also revisit their contracts and compliance frameworks. Contract terms should be updated to include tariff‑change provisions, force majeure clauses and pricing adjustment mechanisms tied to statutory authorities such as Sections 232, 301 and 122 rather than IEEPA. Strengthening internal compliance, especially around origin documentation, valuation and tariff classification, will position organizations to withstand refund audits and to respond effectively as new investigations and tariff actions unfold.

For organizations that rely heavily on cross‑border e‑commerce, it is equally important to develop a small‑package strategy. With the de minimis exemption set to be eliminated as of July 1, 2027, companies should begin modeling how a post‑de minimis world will affect logistics costs, fulfillment strategies and landed‑cost calculations. Evaluating options such as shipment consolidation, foreign‑trade zones, and alternative routing models will be essential for maintaining competitiveness as the regulatory environment changes.

Finally, companies should remain vigilant by monitoring and documenting at every stage. This includes tracking forthcoming CBP and Treasury Department guidance on refund procedures, monitoring Commerce Department and USTR notices related to Section 232 and 301 investigations, and watching for ITC activity under Sections 201 and 338. Submitting timely data and comments will allow organizations not only to stay ahead of policy developments but to influence the outcomes that most directly affect their operations.