Section 122 Tariffs Ruled Unlawful: Why Refunds Are Far From Guaranteed

Most importers are making the same mistake right now: assuming the court ruling automatically means tariff relief is coming. It doesn’t.

The Court of International Trade just ruled Trump’s Section 122 global tariffs unlawful, marking the second major legal defeat for these broad-based tariff actions in a matter of months. But that does NOT mean importers should expect an immediate stop to collections — or automatic refunds.

What are the Section 122 tariffs in question?

Section 122 of the Trade Act of 1974 gives the president limited emergency authority to impose temporary tariffs or import restrictions — up to 15% for 150 days — without a formal trade investigation if there are concerns about large trade deficits or pressure on the U.S. dollar. The Trump administration attempted to use this authority as a faster, broader mechanism to impose global tariffs across imports, bypassing the longer processes typically required under Sections 301 or 232 after the IEEPA tariffs were struck down earlier this year.

What’s changing legally is actually less important than what’s happening operationally.

We’re seeing companies assume customs entries will simply “correct themselves” after these rulings. In reality, CBP processes, liquidation timelines, protests, and refund eligibility are where the real battle starts. In many cases, importers who did not actively preserve their rights could still miss recovery opportunities entirely — even if the underlying tariff authority gets struck down.

And this is where the process breaks. The legal headlines move faster than customs administration. Appeals are likely. Collections may continue during litigation. Refund mechanisms may differ depending on whether entries are liquidated, whether importers were parties to the case, and whether claims were properly preserved. That gap between court decisions and operational execution is where companies lose money.

The importers most exposed are those that treated these tariffs as temporary noise and failed to build a recovery strategy into their customs processes.

The least exposed? Companies that tracked affected entries early, maintained documentation discipline, and treated tariff exposure like a working capital issue — not just a trade compliance issue.

Because at this stage, this is fundamentally a cash flow story. For some importers, there could eventually be meaningful duty recovery opportunities. For others, the administrative path to recovering those funds may become so fragmented, delayed, or legally narrow that the refund is theoretical more than practical.

The bigger issue is the instability itself. Businesses can price around tariffs. What they cannot efficiently manage is constant legal reversal, shifting authorities, overlapping tariff mechanisms, and uncertainty around whether duties paid today will still exist six months from now.

And make no mistake — even with this ruling, the administration is already signaling alternative tariff pathways through Sections 301 and 232. So anyone treating this as “the end of the tariff era” is reading the room wrong.

Please reach out if you would like to discuss how this situation is impacting your supply chain.