As the (Customs and Trade) World Turns: March 2026

We are navigating an unpredictable and fast-changing trade landscape and what we are reporting today may change by tomorrow (or in the next hour). However, our team is regularly issuing reports and alerts to help our clients and friends stay up to date. Sign up here for regular updates and to receive this newsletter each month. In addition, our Trump 2.0 Tariff Tracker can be found here and information regarding navigating the new tariffs can be found here.

This edition provides essential insights for sectors including international trade, national security, aluminum, steel, and copper industries, fashion and retail, automotive, life sciences, electronics, artificial intelligence, transportation, electric mobility, e-commerce, shipping and logistics, and compliance, as well as for in-house counsel, importers, and compliance professionals. 

As recent developments demonstrate, tariffs remain a central tool of the Trump Administration’s trade policy and domestic economic policy. Our team is closely monitoring the aftermath of the US Supreme Court ruling that the International Emergency Economic Powers Act (IEEPA) does not authorize the imposition of tariffs. As of March 10, the US Court of International Trade (CIT) has paused the implementation of immediate issuance of refunds for tariffs paid under the IEEPA while US Customs and Border Protection (CBP) builds up an adequate system to address these refunds. As discussed below, developments around a refund mechanism remain fluid.

In this March 2026 edition, we cover:

1. CBP considers automated refund process for unlawful IEEPA tariffs. 
2. The temporary 10% import surcharge imposed under Section 122 and the ongoing litigation challenging its legal basis. 
3. Five new general licenses for Venezuelan oil and gas transactions issued by OFAC.
4. Longer-term replacement tariffs being pursued through Section 301 and Section 232 investigations.
5. Record FCA recoveries reported in FY 2025, and heightened customs fraud enforcement signaled by the DOJ.
6. Class action lawsuits filed against companies alleged to have passed IEEPA tariff costs to customers.
7. Updated enforcement data released by CBP, with increased UFLPA detentions expected across high-risk industries.

1. Return to Sender: Developments in Getting IEEPA Tariffs Refunds

Following the Supreme Court’s decision in Learning Resources v. Trump, finding IEEPA tariffs unlawful, CBP is beginning to contemplate how to provide refunds to importers at the direction of the CIT. CBP ceased collecting IEEPA tariffs on February 24 pursuant to an executive order. The path(s) to obtaining refunds of IEEPA tariffs has yet to be finalized, but there have been important developments. 

On March 4, the CIT issued an order in Atmus Filtration, Inc. v. United States directing CBP to finalize tariffs (liquidate) on entries without regard to the IEEPA tariffs so that importers receive refunds. The order applied to all importers whose entries were subject to IEEPA tariffs. The CIT also instructed CBP to reliquidate entries for which liquidation was not yet final. However, on March 6, CBP filed a declaration detailing significant operational and technical barriers to immediate compliance with the CIT’s order but told the CIT that it was working on a process for refunds. Based on this declaration, the CIT has stayed the immediate enforcement of the order, and the government must provide a report by March 12 to the CIT describing the progress CBP has made towards the development of a process to issue refunds. 

Notably, CBP’s declaration indicates it is creating new functionality within the Automated Customs Environment (ACE) that would allow importers to file a declaration listing their IEEPA-affected entries. There would be a process to validate those amounts and then ACE would automatically recalculate duties and process refunds with interest on an aggregated basis. 

And the Fox Says… Although CBP has indicated a path forward for refunds, it remains unclear when the process will take effect, what the exact process will be, and if the process will be limited to certain importers who filed complaints. CBP has also signaled that it will review entries for enforcement issues, which could delay the refund process. We also expect the government to appeal the CIT’s order, and it is important for importers to remain proactive in developing internal refund processes and preserving their options for refunds. While the refund process continues to play out, importers should take the following proactive steps:

• File protests on liquidated entries before the 180-day deadline to protest expires. 

• Monitor liquidation dates and protest deadlines.

• Organize customs data so that it can be presented to CBP quickly, regardless of the refund mechanism. 

• Create an ACE account and register for electronic Automated Clearing House refunds with CBP.

• Given potential increased CBP scrutiny during the refund process, importers should review past imports for accuracy.

• Consider whether to file a complaint at the CIT. 

The International Trade team at AFS has extensive experience counseling clients on these matters, including avenues to preserve your rights to refunds. We will continue to monitor developments and provide updates as the refund process takes shape.

Contributors: Tyler J. Kimberly, Mario A. Torrico, Lucas A. Rock, and Nancy A. Noonan

2. Section 122 Surcharge: Key Provisions, Exemptions, and the Legal Fight Ahead

On February 20, President Trump issued Proclamation 11012 under Section 122 of the Trade Act of 1974, imposing a 10% ad valorem temporary import surcharge effective February 24 through July 24 (the 150-day statutory maximum unless Congress extends it). The proclamation came the same day the Supreme Court held that the IE EPA does not authorize the president to impose tariffs.

What Is Section 122?

Section 122 authorizes temporary import surcharges (tariff) of up to 15% ad valorem for no more than 150 days to address “fundamental international payments problems,” including large balance-of-payments deficits, significant dollar depreciation, or international payments disequilibrium. The provision has never been invoked, and no court has interpreted its language. A group of democratic states have already challenged President Trump’s use of Section 122 to impose tariffs (see here). 

Proclamation 11012: Justification, Key Exceptions and Provisions

The proclamation cites a goods trade deficit that grew over 40% in five years to approximately $1.2 trillion as evidence of fundamental international payments problems.

Thirteen product categories detailed in Annexes I and II are exempted, including critical minerals, certain metals, energy products, certain natural resources and fertilizers, agricultural goods, pharmaceuticals, semiconductors and electronics, passenger vehicles, aerospace products, informational materials, articles already subject to Section 232 tariffs, United States-Mexico-Canada Agreement duty-free goods, and certain Dominican Republic-Central America Free Trade Agreement textile articles. The surcharge stacks on all other duties except Section 232 tariffs and is treated as a regular customs duty. 

Challenge to Section 122

On March 5, 24 states sued President Trump in the CIT, seeking a permanent injunction and refund of all Section 122 tariffs collected. The complaint alleges that no balance-of-payments crisis exists, the claimed crisis is pretext for unilateral presidential tariff action, and the broad exemptions are inconsistent with Section 122’s statutory language.

And the Fox Says… Importers should monitor CBP notices for Section 122 updates and review product classifications against the Annexes I and II exception lists to determine exclusion eligibility. As tariff rules continue to multiply and evolve, a proactive approach to customs compliance is essential to managing risk and controlling costs. 

Contributors: Denny Peixoto, Mario A. Torrico, and Antonio J. Rivera

3. OFAC Issues New General Licenses for Venezuelan Oil Transactions

In February, the Office of Foreign Assets Control (OFAC) released five general licenses (GLs) to the Venezuela Sanctions Program in quick succession authorizing certain activities related to the extraction and sale of Venezuelan-origin oil and gas. OFAC also issued several FAQs clarifying the effects of the GLs. We have briefly summarized the authorizations of the GLs below; however, companies must carefully consider the full text, including limitations and requirements, of each GL before entering into any potentially covered transaction. For example, most covered transactions cannot involve Cuban, Iranian, South Korean, or Russian persons, and many covered transactions require funds owed to PDVSA or a PdVSA entity to be paid into a funds identified by the US Department of the Treasury.

Venezuela GL 46A

GL 46A authorizes transactions ordinarily incident and necessary to an established US entity’s activities of lifting, export, reexport, sale, resale, supply, storage, marketing, purchase, delivery, transportation, or refining of Venezuelan-origin oil (e.g., arranging shipping and logistics services, chartering vessels, obtaining marine insurance and protection and indemnity coverage, and arranging port and terminal services). FAQ 1230 clarifies GL 46A also authorizes entities other than established US entities to be involved in transactions that are ordinarily incident and necessary to the activities listed above by an established US entity, and FAQ 1235 clarifies that downstream trading activities are also permitted. 

Venezuela GL 47

GL 47 authorizes activities ordinarily incident and necessary to exporation, re-exportation, sale, resale, supply, storage, marketing, delivery, or transportation of US-origin diluents to Venezuela (e.g., processing of payments, arranging shipping and logistic services, chartering vessels, obtaining marine insurance and protection, indemnity coverage, and arranging port and terminal services). 

Venezuela GL 48

GL 48 authorizes transactions ordinarily incident and necessary to the provision from the United States or by a US person of goods, technology, software, or services for the exploration, development, or production of oil or gas in Venezuela. 

Venezuela GL 49 

GL 49 authorizes all transactions that are related to the negotiation of and entry into contingent contracts for new investment in oil or gas sector operations in Venezuela, provided that the contract is made expressly contingent upon separate authorization from OFAC. 

Venezuela GL 50A 

GL 50A authorizes all transactions related to any oil or gas sector operations in Venezuela of specified entities, including several large non-US entities, or their subsidiaries. These entities are currently limited to BP PLC, Chevron Corporation, Eni S.p.A., Établissements Maurel & Prom SA, Repsol S.A., and Shell PLC. 

And the Fox Says… While certain GLs have overlapping authorizations, a company must carefully consider which, if any, GLs it qualifies for. Finally, each general license contains important requirements that must be carefully considered and complied with before engaging in the relevant transactions. These requirements include, for example, record keeping requirements, requirements that US persons or established US entities be a party to the transaction, and that monetary payments to blocked persons be made into the Foreign Government Deposit Funds or any other account as instructed by the Department of Treasury. 

Contributors: Maya S. Cohen and Matthew Tuchband

4. From IEEPA to What’s Next: Understanding the Possible Replacements for IEEPA Tariffs

Following the Supreme Court’s decision in Learning Resources, Inc. v. Trump, the Administration revoked all IEEPA tariffs and imposed a temporary 10% global tariff under Section 122 of the Trade Act of 1974. President Trump indicated his intention to raise the Section 122 tariffs to 15%, but this has not yet taken place. Section 122 tariffs are capped at 15% and limited to 150 days (unless Congress acts to extend). The Administration appears to be using this window to develop longer-term replacements under two key authorities: Section 301 and Section 232.

Section 301: Under Section 301, the US Trade Representative (USTR) may investigate whether a foreign country is violating trade agreements or unjustifiably burdening US commerce. An affirmative finding allows the USTR or the president to impose remedial tariffs on a country-wide basis. Section 301 does not cap tariff amounts or product scope, and there is no mandatory sunset period. Additionally, the USTR may reinstate previously terminated Section 301 actions. Following Learning Resources, the USTR announced it will initiate several Section 301 investigations covering “most major trading partners” on an accelerated timeline, addressing topics from industrial excess capacity to pharmaceutical pricing.

Section 232: Under Section 232, the US Department of Commerce may investigate whether imports threaten national security and recommend tariffs or import quotas. Unlike Section 301 (which targets countries), Section 232 targets specific products. Reports indicate Commerce may initiate new Section 232 investigations targeting products such as large-scale batteries, industrial chemicals, and telecommunications equipment. Existing Section 232 tariffs on steel, aluminum, and copper, among other commodities, range from 10% to 200%.

And the Fox Says… The current Section 122 tariff seems to be a temporary fix set to expire in July. Companies should monitor forthcoming Section 301 and Section 232 investigations, as these will determine the rate and scope of tariffs that replace the IEEPA regime. Companies impacted by potential investigations should consider filing comments on the investigations.

Contributors: Tyler J. Kimberly, Andrew McArthur, and Antonio J. Rivera

5. Trade Fraud Enforcement Intensifies After Record-High Year of Settlements and Judgments Under the FCA

The US Department of Justice’s (DOJ) enforcement of the False Claims Act (FCA), which surged in 2025, is expected to continue to increase in 2026. Total recoveries under the FCA in FY 2025 totaled $6.8 billion, the highest single year total in the statute’s history. In a keynote address at the Federal Bar Association’s FCA conference in February, Brenna Jenny, deputy assistant attorney general for the Commercial Litigation Branch, noted that 2025 saw a record number of qui tam complaints alleging customs fraud, and she expects a sustained increase in settlements in the future.

More recently, Cody Herche, who heads the joint DOJ-US Department of Homeland Security Trade Fraud Task Force (TFTF), highlighted major trends in FCA enforcement during the Inaugural Forum on Trade Investigations, Enforcement & Litigation held on February 23 in Arlington, Virginia. First, settlements have grown larger on average, with the recent Ceratizit settlement (see here for our prior alert) settlement reaching $54 million. Second, the pace of settlements has accelerated. Most trade-related FCA cases have been resolved without significant litigation, something Herche attributed to advanced analytics that give the government greater visibility into trade data.

Herche also emphasized an uptick in criminal prosecutions related to trade fraud and a growing focus on individual accountability, noting that companies act through individuals. He pointed to criminal statutes available to the TFTF, including 19 U.S.C. §§ 521, 541, and 545, and referenced the case of MGI International, LLC and two subsidiaries to illustrate the increased scrutiny on individuals. Beyond those four trends, Herche discussed the TFTF’s use of data from the Automated Commercial Environment to identify anomalies and behavioral shifts that may signal evasion. He offered the example of changes in the declared Harmonized Tariff Schedule of the United States code of imported goods that are inconsistent with logistics patterns, which might suggest a false statement.

And the Fox Says… The continued pace of new suits and the DOJ’s on-all-fronts approach to trade enforcement and the FCA signal that tariff evasion remains in regulators’ crosshairs. Importers should conduct regular internal audits of their classification practices, valuation methodologies, and country-of-origin determinations. Importers should also evaluate their supply chains to assess the risks and vulnerabilities, especially vertically integrated supply chains. 

Contributors: Collin M. Douglas, Mario A. Torrico, Jackson David Toof, and Nadia Patel

6. After the Ruling: IEEPA Tariff Refunds and What They Could Mean for Importers

As we discussed in the first article, on February 20, the Supreme Court held that tariffs imposed under the IEEPA exceeded presidential authority and were unlawful. The ruling opened the door for importers to seek refunds from the government for billions of dollars in IEEPA duties paid. It has also triggered a waive of class action lawsuits targeting companies that passed various tariff-related costs on to customers. 

In response to the Supreme Court’s decision, as of early March, at least five class actions have been filed in federal courts across the country. These cases fall into two categories. The first involves logistic providers accused of billing customers itemized fees tied directly to IEEPA duties, along with additional secondary fees related to the unlawful duties. The second category of suits targets consumer brands that raised retail prices to offset tariff costs, even where those increases were not separately itemized as surcharges. The plaintiffs allege that, in light of the Supreme Court’s ruling, companies that retain tariff-related charges are unjustly enriched at consumers’ expense. 

A common theme across the complaints is the use of companies’ own public statements as evidence that tariff costs were deliberately shifted to customers. The litigation also highlights a key divergence in companies’ strategic response to the Supreme Court’s IEEPA decision. That is, some companies have signaled a willingness to return tariff refunds to customers, while others have remained silent. 

And the Fox Says… Companies that imposed surcharges or raised prices in connection with IEEPA tariffs should carefully review their contracts, public statements, and pricing records to assess potential exposure. As refund litigation proceeds, businesses should evaluate whether and how tariff-related costs were passed to consumers and consider whether a refund commitment or other risk-mitigation strategy is appropriate. 

Contributors: Andrew McArthur, Lucas A. Rock, and Antonio J. Rivera

7. CBP Released Updated UFLPA Enforcement Statistics – What’s New and What Companies Should Know

CBP has released updated enforcement statistics under the Uyghur Forced Labor Prevention Act (UFLPA), giving businesses clearer visibility into how shipments are being evaluated for forced‑labor risks. The 2026 update includes more detailed shipment‑level reporting, improved transparency, and new analytic tools, which together signal intensifying enforcement. 

The CBP dashboard shows that in FY 2025 (October 2024-September 2025), 22,398 shipments underwent UFLPA review, with 11,355 released, and 10,225 denied, yielding a 50% approval ratio. Electronics, as well as the automotive and aerospace sectors, are among the top industries experiencing intensified UFLPA enforcement actions. China, Laos, Malaysia, India, Thailand, and Vietnam remain the leading countries facing the highest number of UFLPA reviews by value. In the first quarter of FY 2026 (October 2025 through December 2025), CBP has released approximately $38 million in shipments, while denying about $2 million in shipments. Another $31.69 million worth of shipments are pending review.

What’s New

• More shipments flagged: CBP now counts each product line as its own “shipment,” increasing the number of enforcement actions recorded. 

• Better risk visibility: Importers can now analyze enforcement activity by industry, country of origin, and 4-digit HTS category. The details help importing companies identify supply‑chain vulnerabilities at a more granular level. 

What This Means for Your Business

• Expect more detention and document requests as CBP sharpens its data tools.

• Companies must be prepared with robust traceability records demonstrating that goods are not linked to Xinjiang or to entities on the UFLPA Entity List.

As the Fox Says… Importers should continue to assess their supply chain for any forced labor exposure. Importers should also review the updated statistics dashboard to identify products that CBP is prioritizing for enforcement. Reach out to the AFS UFLPA task force for support in assessing risk, preparing documentation, or navigating any CBP enforcement action. In case you missed it, our 2026 Guide for Global Business can be found here.

Contributors: Yun Gao, Lucas A. Rock, and Angela M. Santos