News / Be ready to claim refunds if tariffs are ruled illegal, says Seko

© Inna Kot

Freight forwarders are bracing for the US Supreme Court’s decision on IEEPA tariffs, and are leveraging their tech stack to increase efficiency, should refunds be owed.

Seko Logistics told The Loadstar on the sidelines of the Manifest event in Las Vegas this week that the pending ruling represented a significant operational challenge, due to the uncertainty surrounding the outcome and the ripple effects it might create.

If the court rules IEEPA tariffs unconstitutional, importers could be entitled to substantial refunds, potentially triggering a surge in demand.

“We believe it’s likely the Supreme Court could side with the importers,” said Brian Bourke, chief commercial officer at Seko.

“If that’s the case, it could create a huge surge in demand by people looking to maybe beat the clock for whatever new tariff provisions are going to be coming down the line.”

But before any surge materialises, forwarders would face administrative complexity on a massive scale.

Unlike a straightforward rebate, any tariff refund process is expected to involve an administrative review, potentially overseen by the Court of International Trade. Importers may need to file protests or even lawsuits to recover duties, suggested Mr Bourke.

“It might also be possible for the customs broker to do it, or their  trade attorney, but that’s where it gets important – pick one, because you don’t want to have your broker and your lawyer filing these, because that will create more headaches and issues,” he advised.

He also added that calculating what would actually need to be repaid was far from simple.

“The IEEPA rate is not very cut and dry,” explained Mr Bourke. “Imagine doing that on 40,000 entries and figuring out what the value of just the IEEPA duty, especially when you’re also talking about 301 and 232 tariffs stacking on top.

“Parsing-out IEEPA reciprocal, IEEPA fentanyl, especially if it’s China, Canada, or Mexico; that’s the headache that’s about to happen, if tariffs are ruled unconstitutional.”

Jamie Andrade, Seko’s SVP of product management, revealed that the forwarder had invested in automated tools to identify impacted shipments and extract relevant duty data in advance of any ruling.

Ms Andrade explained that they want to be ready to help clients begin the refund process immediately.

“We want to be in the front of the line,” she said. “When that ruling comes down, we can have our first couple of clients already working on getting their money back, versus other people trying to figure out where to go and what to do.”

Ms Andrade suggested that Seko was one of a few forwarders working with customs directly and that the “majority of people are not prepared”.

“Everybody files customs entries through some sort of system, but most people are going to wait for the software provider to build a solution, or put the data fields in, or the type of drawback process into the system, for them to be able to try to do it through their own applications.”

“We don’t want to be in that bucket,” she explained.

There is currently no date when the Supreme Court ruling will be announced, but the earliest is 20 February, following the scheduled recess.