CBP’s $1 Billion De Minimis Announcement and the Procedural Refund Problem

Informal Entries, Section 321, and Why “Refunds Later” Is a Procedural Assumption

U.S. Customs and Border Protection recently announced that it has collected more than $1 billion in duties following the suspension of duty-free de minimis treatment under Section 321. The announcement highlights the scale and speed with which duties are now being collected on low-value imports that previously entered the United States duty-free.

What the announcement does not address is a narrower procedural question: how, and for whom, those duties could be refunded if the Supreme Court ultimately concludes that the International Emergency Economic Powers Act (IEEPA) does not authorize the tariffs being collected. That question matters because recent court decisions declining to halt liquidation rest on the assumption that refunds remain available later through ordinary customs procedures.

That assumption fits formal entries. It fits informal entries far less comfortably.

Where the $1 Billion Came From

The $1 billion figure appears to arise largely from shipments that previously qualified for Section 321 treatment and that, once duty-free entry was suspended, were processed as dutiable informal entries. Shipments valued at $800 or less did not suddenly become formal entries. They instead fell into the informal entry framework applicable to imports valued at $2,500 or less, subject to established exceptions.

That procedural classification matters. Informal entries are designed for rapid clearance and simplified processing, not for delayed liquidation or extended post-entry review.

Liquidation for Informal Entries

For formal entries, liquidation commonly occurs close to a year later. That delayed liquidation event triggers the familiar 180-day protest period.

Informal entries operate differently. As a general matter, liquidation for informal entries occurs at or near the time of release, consistent with the regulatory definition of liquidation in 19 CFR § 159.1.

The consequence is straightforward. For informal entries, the 180-day protest period generally begins running immediately, rather than months later. The protest framework in 19 CFR Part 174 still applies, but the clock starts much sooner.

The Compressed Protest Window

Under 19 CFR § 174.12(e), a protest must be filed within 180 days after liquidation. For informal entries that liquidate at or near release, that means the opportunity to challenge duty assessment and preserve refund rights can expire quickly, often before an importer has reason to expect that the legal basis for the duties might later be overturned.

This timing difference is not a technicality. It defines whether an administrative refund pathway exists at all.

The Mismatch with Current Litigation Assumptions

In recent IEEPA tariff cases, courts have declined to enjoin liquidation on the theory that monetary harm is not irreparable where statutory refund mechanisms remain available. That reasoning assumes a procedural model in which liquidation has not yet occurred and the protest window remains open while higher courts resolve the underlying legal question.

That assumption does not translate well to informal entries.

The $1B in duties that CBP announced comes largely from informal entries that previously entered duty-free under Section 321. Because these entries liquidate at or near the day of entry, the ordinary 180-day protest period may already have expired for many of these shipments by the time the Supreme Court issues a ruling on the legality of IEEPA tariffs.

The very features that made de minimis and informal entry attractive for trade facilitation also compress, and in some cases eliminate, the procedural window that courts assume will remain available for refunds later.

Are There Alternative Refund Mechanisms?

Outside of litigation at the Court of International Trade, U.S. customs law offers few alternatives to a timely protest followed by reliquidation. Post-summary corrections are unavailable to informal entries. Clerical-error reliquidation provisions do not apply to disputes over legal authority. CBP has no general equitable authority to refund duties absent a protestable decision. No administrative refund program has been announced for IEEPA-based tariffs, and no waiver of protest deadlines has been issued.

As a result, missing the protest window is typically fatal to an administrative refund claim.

Where the Refund Assumption Breaks Down

CBP’s announcement underscores how quickly duties can be collected when low-value shipments are moved into the informal entry framework. It also highlights a less discussed reality: the procedural safeguards courts rely on when they say refunds will be available later are unevenly distributed across entry types.

For formal entries, those safeguards are familiar. For informal entries and former Section 321 shipments, they are compressed, fragile, and in some cases already exhausted. As attention remains focused on whether IEEPA tariffs stand or fall, it is worth recognizing that the most difficult refund questions may arise not from large formal entries, but from millions of low-value shipments that liquidated quietly and long before the legal debate reached its conclusion.

Contact us today if your company relies on informal or de minimis entry procedures and needs help evaluating how liquidation timing, protest windows, and entry type may affect refund exposure. O’Meara & Associates provides technical analysis and planning support to help companies understand these procedural risks and prepare internally. We do not file protests or represent importers before CBP, but we work alongside brokers and legal counsel to ensure decisions are grounded in a clear understanding of customs procedure.