The first phase of US Customs & Border Protection’s (“CBP”) Consolidated Administration and Processing of Entries (“CAPE”) refund system went live on April 20, 2026. This initial phase is limited to certain unliquidated entries and certain entries within 80 days of liquidation, and CBP is forecasting a 60-90 day refund period. Other refunds will commence at a later, unspecified time.
As the tariff landscape shifts focus to the refund process, companies across the supply chain are beginning to face reimbursement demands from customers seeking recovery/reimbursement of IEEPA tariff costs. The overall request is based on an assumption that, though the IEEPA tariffs were paid by the importer, the cost of the tariffs was either expressly or implicitly passed on to the customer through higher prices. Since these additional costs are now being refunded by CBP, certain customers are requesting that the importer agree to reimburse the applicable portion of the IEEPA refunds. Indeed, at least five class action lawsuits have been filed against companies such as FedEx, Nintendo, COSTCO, and Temu seeking recovery of the increased costs paid by customers as a result of the IEEPA tariffs, among other remedies.
Whether prompted by specific customer demands, coordinated efforts, or internal concern, businesses need to be prepared to respond to these requests in a strategic, consistent, and legally sound manner.
Understanding the Exposure
The scope of potential exposure depends on several factors, including a company’s position in the supply chain—whether it is the importer of record or a supplier or intermediary bearing the tariff cost—and the volume of counterparties likely to submit reimbursement requests. Companies should evaluate how tariff-related costs were passed through to customers and how those increases were communicated and documented.
Key Contractual Considerations
A thorough review of the governing contracts and purchase orders is essential. Companies should assess whether their agreements with customers contain provisions that bear on the allocation of tariff risk and the viability of reimbursement claims, including:
- Pass-through and tariff allocation language that expressly addresses responsibility for tariff costs;
- Indemnification or reimbursement provisions that could create a contractual basis for recovery by the customer;
- “No refunds,” “final pricing,” or “entire agreement” provisions that may limit or defeat reimbursement claims; and
- Termination for convenience rights, expiring contract terms, or unrelated commercial disputes that could create leverage—or risk—in negotiations.
Defining the Right Resolution Strategy
There is no one-size-fits-all answer to a tariff reimbursement demand. Companies should think carefully about what success looks like for them and consider the full range of potential outcomes, which may include:
- Declining refunds where the contractual and factual basis supports doing so;
- Negotiating a commercial resolution, such as partial reimbursement, credits or rebates toward future purchases, price adjustments, or application of reimbursement amounts against other outstanding balances or claims; and
- Pursuing a hybrid approach that minimizes precedent risk while preserving key customer relationships.
Companies should also consider consistency across customers and whether tailored, account-by-account outcomes or a standardized approach is more appropriate—particularly given the risk that relief granted to one customer may invite copycat claims from others.
Leveraging Settlements to Strengthen the Contractual Framework
Reimbursement negotiations also present an opportunity to strengthen a company’s contractual position going forward. In connection with a proposed settlement, companies may seek amendments to customer contracts, such as adding express tariff-allocation language, adjusting pricing terms, or modifying sourcing and product-mix arrangements. A well-crafted settlement agreement should include a release of claims and be structured to protect the company in any future disputes.
The Time to Act Is Now
The wave of tariff reimbursement demands is not a distant possibility—in many cases it is already underway.
Companies that wait to develop a strategy until demands arrive risk being caught flat-footed, responding inconsistently, and setting unfavorable precedents that ripple across their customer base. Instead, companies should think proactively, by assessing potentially triggered relationships, planning negotiation objectives, and developing a playbook that enable companies to respond swiftly and strategically as requests come in. Given the potential volume and complexity of refund demands, having a well-defined framework in place before the pressure mounts is essential. It is important to equip sales, account management, and other customer-facing teams with standard talking points and response protocols for handling informal reimbursement inquiries before they escalate.
Mayer Brown’s International Trade and Corporate groups have deep experience advising clients on these issues. We have assembled a team of trade and commercial lawyers here at Mayer Brown to assist clients through this next stage of the IEEPA process, and stand ready to help you prepare, plan, and execute a tailored response strategy.
Visit us at mayerbrown.com
Mayer Brown is a global services provider comprising associated legal practices that are separate entities, including Mayer Brown LLP (Illinois, USA), Mayer Brown International LLP (England & Wales), Mayer Brown (a Hong Kong partnership) and Tauil & Chequer Advogados (a Brazilian law partnership) and non-legal service providers, which provide consultancy services (collectively, the "Mayer Brown Practices"). The Mayer Brown Practices are established in various jurisdictions and may be a legal person or a partnership. PK Wong & Nair LLC ("PKWN") is the constituent Singapore law practice of our licensed joint law venture in Singapore, Mayer Brown PK Wong & Nair Pte. Ltd. Details of the individual Mayer Brown Practices and PKWN can be found in the Legal Notices section of our website. "Mayer Brown" and the Mayer Brown logo are the trademarks of Mayer Brown.
© Copyright 2026. The Mayer Brown Practices. All rights reserved.
This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.
[View Source]
