Companies line up for refunds

US SUPREME COURT RULING ON TRUMP TARIFFS

- AP/REUTERS

THE SUPREME COURT struck down President Donald Trump's biggest and boldest tariffs.

But the justices left a $133 billion question unanswered: What's going to happen to the money the government has already collected in import taxes now declared unlawful? Companies have been lining up for refunds. But the way forward could prove chaotic.

When the smoke clears, trade lawyers say, importers are likely to get money back — eventually. "It's going to be a bumpy ride for awhile," said trade lawyer Joyce Adetutu, a partner at the Vinson & Elkins law firm.

Each importer might have to sue in the Court of International Trade to get a refund, and it is not clear that a class action could be formed to cover the broad range of companies that paid tariffs, legal experts said. Importers have two years to sue to claim a refund, under US trade law.

For nearly all goods subject to tariffs, an importer posts a bond with the Customs and Border Protection agency and pays an estimated tariff on the merchandise to bring it into the United States. The government makes a final determination of the tariffs on those goods, a process known as liquidation, which usually happens 314 days after entry of the goods.

Excess payments are refunded or the importer must cover the shortfall.

The refund process is likely to be hashed out by a mix of the US Customs and Border Protection agency, the specialised Court of International Trade in New York and other lower courts, according to a note to clients by lawyers at the legal firm Clark Hill.

"The amount of money is substantial,’ Adetutu said. "The courts are going to have a hard time. Importers are going to have a hard time."