• On 20 February 2026, the U.S. Supreme Court struck down tariffs imposed under the IEEPA, including those targeting goods from China, Mexico and Canada and the broader reciprocal tariffs; however, the ruling did not address whether previously paid duties will be refunded, leaving importers awaiting further guidance or litigation.
• Although IEEPA is no longer available as a tariff tool, the Administration can pivot to alternative statutory authorities — including Section 122 (short-term tariffs up to 15 percent), Section 232 (national security-based commodity tariffs), Section 301 (unfair trade practice investigations), and Section 338 (broad discretionary tariffs up to 50 percent) — each with differing procedural requirements.
• The decision signals a shift back to more structured, congressionally authorised trade mechanisms rather than an end to tariff action, meaning supply chain resilience remains critical through sourcing diversification, duty-management strategies, logistics optimisation, and enhanced customs analytics.

The U.S. Supreme Court issued a major decision striking down tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The decision invalidates both sets of IEEPA-based tariffs challenged in the case: tariffs on goods from China, Mexico, and Canada to stop the flow of fentanyl and the reciprocal tariffs applied broadly to goods from around the world.

What the ruling leaves out, however, is just as important. The decision makes no mention of issuing refunds for tariffs already paid. Importers and trade professionals are now in a holding pattern, waiting for Customs or future litigation to determine whether billions of dollars in duties may ultimately be recoverable.

Potential tariff options the Administration may use next

Even as IEEPA is now off limits as a basis for tariffs, the decision does not eliminate the government’s ability to rely on other authorities for imposing tariffs. Immediately after the ruling, the Administration indicated it will pivot to some of those options. Below, we examine the types of tariff authority the Administration may turn to and offer practical guidance to help importers navigate what comes next.

Section 122: Short-term tariffs with rapid implementation

Section 122 of the Trade Act of 1974 allows the president to impose short-term, country-specific tariffs of up to 15% for 150 days without congressional approval. Although Section 122 has never been used to impose tariffs, its structural simplicity and relatively low procedural threshold make it an appealing alternative. It may also be notable that many of the reciprocal tariffs imposed under IEEPA clustered around the same 15% level permitted under Section 122.

Section 232: Tariffs on specific commodities

These tariffs require a Commerce Department investigation and a national security finding, but the authority remains active and fully operable. This Administration has shown a willingness to use 232 when the policy objective is broad or strategically significant, and nothing in the Court’s ruling limits that option. While the process may be slower, shippers should prepare for the possibility of additional Section 232 tariffs.

Section 301: Targeted tariffs addressing unfair trade practices

Rather than targeting national security concerns, these give the U.S. Trade Representative broad discretion to investigate longstanding issues such as technology transfer, intellectual property, market access, and other disputes. Section 301 was the Administration’s preferred tariff tool during its first term, serving as the basis for the extensive duties placed on Chinese goods beginning in 2018. It could once again become a vehicle for imposing targeted duties, should the Administration choose to maintain pressure on specific trading partners.

Section 338: Broad authority with few procedural constraints

This alternative hasn’t been used since before 1950. It allows the president to impose tariffs of up to 50% on countries found to be engaging in discriminatory or unreasonable practices that disadvantage U.S. commerce. Unlike Sections 232 or 301, Section 338 requires no prior investigation, has no statutory end date, and allows the president to act by proclamation upon the necessary findings, with the U.S. International Trade Commission serving only an advisory role.

What this means for supply chains and business resilience

Taken together, these authorities ensure that the end of IEEPA-based tariffs does not mean the end of tariff actions. Instead, the decision represents a rebalancing—moving the country back toward the more procedurally defined and congressionally authorized pathways that have historically governed U.S. trade policy. Trade-dependent businesses should anticipate continued tariff activity, but under statutes with clearer rules, more predictable timelines, and established administrative processes.

For importers, the fundamentals of resilience remain unchanged. Companies should continue evaluating cost-reduction and risk-mitigation strategies that reduce exposure and increase flexibility, including:

• Diversifying sourcing across regions to reduce reliance on any single country or tariff regime.
• Leveraging foreign trade zones and duty-deferral programs to improve cash flow and manage duty exposure.
• Optimizing transportation and warehousing networks to reduce total landed cost and improve agility.
• Using tariff and customs analytics tools to help navigate the potential refund process effectively. Tools such as our U.S. Tariff Impact Analysis, ACE Import Intelligence, and U.S. Customs Analytics provide data-driven visibility into duty exposure and customs activity, helping importers to make informed decisions quickly.

For now, the Supreme Court’s decision closes one chapter and opens several others. The invalidation of the IEEPA tariffs resolves a long-running legal debate about the outer limits of emergency economic powers, but it also sets the stage for new questions about refunds, compliance, and the future tools the Administration may use to pursue its trade objectives. The one certainty is that this ruling will reshape the tariff landscape and the mechanics of presidential trade authority for years to come.

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