Life After IEEPA: The Tariffs That Replaced the Tariffs

The Supreme Court struck down the IEEPA tariffs on February 20, 2026. Four days later a 10 percent global surcharge took effect under a different statute. That is the shape of the last six months, and it is the answer to the question importers keep asking about tariffs after the IEEPA ruling — the duties did not go away, they got re-founded on authorities that Congress wrote with locks on them.

Each lock has cost the administration something. Section 122 came with a 150-day fuse and burned out on July 24. The Court of International Trade held the surcharge unlawful in May before it expired on its own. What replaced it on July 24 is a Section 301 action reaching 60 economies at rates between 10 and 12.5 percent, built on a forced-labor theory and a public comment record — which is a slower, narrower, better-defended instrument than the one the Supreme Court took away. Congress priced this authority when it delegated it, and the executive is now paying the price.

What Replaced the IEEPA Tariffs?

But start with what survived. The Section 232 national-security tariffs on steel, aluminum, autos, and the rest were never at issue, and neither were the existing Section 301 duties on Chinese goods. Learning Resources voided one category: the tariffs proclaimed under the International Emergency Economic Powers Act, which is to say the fentanyl-related duties, the reciprocal tariff regime, and the Brazil action.

The replacement arrived immediately. The President proclaimed a 10 percent global surcharge under Section 122 of the Trade Act of 1974, 19 U.S.C. section 2132, on the day the opinion issued, effective February 24, 2026. Section 122 lets the President impose import surcharges of up to 15 percent to address “large and serious United States balance-of-payments deficits.” It also caps the duration at 150 days unless Congress extends it, which Congress did not.

And that cap did more work than the litigation did.

Why Did the Section 122 Surcharge Last Only 150 Days?

Because the statute says so, and because nobody on Capitol Hill moved to change it. The surcharge sunset by operation of law at 12:01 a.m. on July 24, 2026.

And the CIT got there first on the merits. On May 7, 2026, a divided three-judge panel held the proclamation invalid, reasoning that “balance-of-payments deficits” carries a defined meaning drawn from the liquidity and official-settlements measures Congress had in view in 1974, and that the proclamation’s reliance on trade deficits and current account deficits didn’t satisfy it. Judge Stanceu dissented, arguing that Congress had deliberately declined to freeze the term to any particular metric. The Federal Circuit granted a stay on May 12, so the surcharge kept being collected. Then the clock ran out anyway.

Which leaves a merits ruling on a statute nobody is currently using and an appeal that may or may not be worth deciding. The doctrinal question — whether a 1974 economic term of art binds a 2026 proclamation — is live and will matter the next time an administration reaches for Section 122. The dollars mostly aren’t.

Are the New Section 301 Forced-Labor Tariffs Vulnerable?

The successor regime took effect the moment the Section 122 surcharge expired, with a narrow grace period for goods in final transit. The U.S. Trade Representative determined that 60 governments had failed to enforce prohibitions on the importation of goods made with forced labor, and that the failure burdens U.S. commerce unreasonably — a Section 301(b) theory rather than the more familiar Section 301 route against a foreign government’s own trade practices.

And the rate structure rewards close reading. Seventeen economies, including Canada, Mexico, India, and the United Kingdom, draw a flat 10 percent additive rate. Goods from the European Union and Taiwan draw whatever gets them to 10 percent net of the MFN rate. Japan, South Korea, and Switzerland land at 12.5 percent net of MFN. Everyone else — China, Brazil, Vietnam, Russia among them — takes 12.5 percent on top of the existing rate, which for many Chinese goods means 37.5 percent all in. Tariff-rate quotas apply to certain textiles from Bangladesh, Cambodia, Indonesia, and Malaysia. Exemptions cover pharmaceuticals, certain chemicals, agricultural commodities, some seafood and forest products, and goods qualifying under an existing free trade agreement.

The obvious challenge writes itself. And USTR handed the challengers their timeline — it opened an investigation, gathered comments from more than 2,100 companies and individuals, adjusted exemptions, and issued a determination covering nearly every trading partner, finishing the day the prior authority expired. Importers will argue the outcome was decided before the record was built.

But that argument runs uphill, and importers planning around it should understand why. Section 301 names the power it grants. It sets out who investigates, what they must find, and what they may do about it. It has survived four decades of challenges. The Supreme Court’s objection in Learning Resources was that IEEPA contains none of the guardrails Congress attaches when it delegates tariff authority — and Section 301 is the statute the Court was describing when it made that point. Attacking the application is a different and harder project than attacking the authority. Whether a comment record was meaningfully considered is reviewed on an abuse-of-discretion posture that has rarely favored the challenger.

What Should Importers Be Doing Now?

Two tracks, and they run on different clocks.

The backward-looking track is the refund. Customs and Border Protection collected roughly $166 billion in IEEPA duties across more than 53 million entry summaries, and recovering a share of it depends on whether an entry was liquidated and when, on a CBP claims system still being built out, and on a class certification motion argued in the CIT on August 19. The limitations period for a section 1581(i) action is two years from accrual, and the prevailing view puts the earliest deadlines around February 2027. Our companion piece on IEEPA tariff refunds and the Court of International Trade walks through the mechanics. The short version: pull the entry data now, and file to preserve.

And the forward-looking track is classification and origin, which has quietly become the exercise worth more money. IEEPA duties applied country-wide at a flat rate, which made tariff engineering close to pointless. The Section 301 action does not work that way. It carries product exemptions, tariff-rate quotas, FTA carve-outs, and rates that differ by trading partner and stack differently against the MFN rate. A misclassified HTSUS subheading or an unexamined origin determination is now worth real money in either direction — and the penalty exposure under 19 U.S.C. section 1592 for getting it wrong on purpose is a separate problem that supply chain teams tend to discover late.

Anyone who restructured a supply chain around the reciprocal tariff schedule in 2025 is now operating under a rate table that shares almost none of its assumptions. Sourcing decisions made when Vietnam and Mexico sat at similar rates deserve a fresh look, because they don’t anymore.

Congress wrote the tariff statutes with caps, clocks, findings requirements, and hearing obligations, and for fifty years that draftsmanship looked like surplusage. It isn’t. Every authority the administration has reached for since February has bitten back on one of those terms — Section 122 on its definition and its 150-day fuse, Section 301 on its investigation and comment requirements. The rates on tariffs after the IEEPA ruling are lower and the ground under them is firmer, and importers who spend the fall on entry data and classification rather than on litigation news will be the ones positioned when the next authority gets tested. Freeman Law advises importers and multinational businesses on cross-border tax and trade exposure and on the refund and controversy litigation that follows it.

This article is for general informational purposes only and is not legal or tax advice. Reading it does not create an attorney-client relationship with Freeman Law. The law is fact-specific and subject to change, and you should consult qualified counsel about your particular situation.