CAPE is Coming: What Does it Mean for Tariff Refunds?
In a bulletin posted on Friday, April 10, CBP confirmed that CAPE—its new system for processing refund requests named Consolidated Administration and Processing of Entries—will go live on Monday, April 20, 2026. This marks an important turning point in the legal process for securing refunds for unlawful IEEPA tariff duties. CBP's announcement also gives some indication of the role that CAPE will—and will not—play in the refund process.
1. What is CAPE?
After Judge Eaton issued his order on March 4 directing CBP to issue refunds to all importers—not just those who have filed protests or lawsuits—the government told the court that its existing ACE system lacked the technical capacity to process the requests. Judge Eaton subsequently "suspended" his order while CBP built CAPE, which CBP has indicated it will complete by April 20.
According to an information notice issued by CBP, CAPE aims to provide a streamlined process for data submission. The core of the process is the "CAPE Declaration," a CSV-formatted file listing the entries for which the importer requests a refund. Importers (through their counsel) will submit their CAPE Declaration through the ACE portal. After the importer submits the CAPE Declaration, CBP will review each entry in the declaration and remove IEEPA duties for "valid" entry numbers.
2. CAPE's Limitations
CAPE is a technical tool to process refunds, and as a result it faces important limitations.
CBP’s announcements note the restrictions on the entries CAPE can process. For importers who submit claims pursuant to a court order and in accordance with appropriate statutory authority, CAPE will process “most entries that are either unliquidated or up to 80 days past the liquidation date.” That restriction reflects the limitations on CBP’s statutory authority. For unliquidated entries, the statutes permit—but do not require—CBP to liquidate without the IEEPA duties. For liquidated entries, Section 1501 strictly limits CBP’s authority by permitting CBP to reliquidate entries only within 90 days of liquidation. For entries past that 90-day window, CBP may not lawfully reliquidate without a protest, a court order, or both. In short: CAPE cannot legally process the tens of millions of entries that are beyond that window.
3. What Will CAPE's Role Be in the Refund Process?
The more fundamental question is which importers are entitled to use CAPE. Judge Eaton’s March 4/April 7 order purports to direct CBP to open CAPE to all importers. But the government has repeatedly stated that, in its view, only importers who sue in the CIT will receive refunds. CBP describes CAPE as a system to process “refund requests made pursuant to court order and in accordance with appropriate statutory authority by providing an electronic pathway to submit valid IEEPA duty refund claims.” For that reason, there is a good chance that the government will appeal the March 4/April 7 order. We expect the government to appeal before, or soon after, CAPE launches in order to clarify whether CBP must open the system to all importers. And for reasons explained in prior Grayhawk Law client alerts, it is likely that the government will prevail in that appeal.
The bottom line: If the government prevails on appeal, then the only importers eligible to use CAPE will be those who have successfully protested, sued in the CIT, or both.
We will continue monitoring developments closely, including the government's expected appeal. If you would like to discuss how these developments may affect your company’s entries or refund strategy, please feel free to reach out.
