On February 20, 2026, the US Supreme Court issued its decision in Learning Resources, Inc. v. Trump and Trump v. V.O.S. Selections, Inc., ruling that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs. The Court invalidated both the “Reciprocal Tariffs” introduced in April 2025 and the earlier “Trafficking and Immigration Tariffs,” representing one of the most consequential judicial interventions in modern US trade policy.
Although the ruling arises from US constitutional law, its commercial effects extend globally. Companies involved in Thailand-US trade, including Thai exporters, regional manufacturers, and US importers sourcing goods from Thailand, may now face significant questions regarding tariff refunds, contractual cost allocation, and ongoing supply arrangements.
This alert summarizes the Court’s decision, identifies the tariffs affected, examines the emerging refund landscape, and outlines practical considerations for businesses connected to Thailand-US trade flows.
The Supreme Court Decision
The Supreme Court held that the authority to impose tariffs rests with Congress, not the President. Because they constitute a form of taxation under Article I, Section 8 of the US Constitution, they may be imposed only where Congress has clearly delegated that power.
The Court found that the IEEPA authorises the President to regulate economic transactions during national emergencies but does not permit the imposition of tariffs. Although the statute allows regulation of imports and exports, it contains no reference to duties or taxation, which the Court viewed as decisive.
Relying in part on the “major questions doctrine,” the Court emphasized that Congress does not delegate powers of major economic significance through ambiguous statutory language. The absence of historical precedent, particularly as no prior administration had used IEEPA to impose tariffs, further supported the conclusion that the executive branch exceeded its authority.
Which Tariffs Are Affected?
The Supreme Court’s decision invalidates all tariffs imposed under the IEEPA. These tariffs fell into two principal categories:
- Trafficking and Immigration Tariffs: The Trump administration introduced these in early 2025 declaring fentanyl trafficking and migration-related concerns to constitute a national emergency. These measures imposed additional duties, generally ranging from approximately 10% to 25%, on a broad range of imported goods from multiple trading partners. The tariffs applied across numerous product categories rather than targeting specific industries, meaning many ordinary commercial imports were affected.
- Reciprocal Tariffs: Implemented in April 2025, these imposed baseline tariffs of at least 10% on imports from nearly all US trading partners, with higher rates applied to certain countries. These tariffs were justified on the basis that persistent trade deficits represented an economic emergency requiring immediate executive action. Because the measures applied globally, goods manufactured in ASEAN, including Thailand, frequently became subject to the tariffs when imported into the United States, regardless of whether Thailand itself was a political focus of the policy.
The Court’s ruling eliminates both categories of IEEPA-based tariffs.
Importantly, the decision does not affect tariffs imposed under other trade authorities expressly delegated by Congress. Duties introduced under statutes, such as Section 232 of the Trade Expansion Act of 1962 (national security tariffs), Section 301 of the Trade Act of 1974 (trade practice remedies), and other established trade mechanisms remain in force.
Consequently, while IEEPA tariffs have been invalidated, many product-specific tariffs, including duties affecting steel, aluminium, technology products, and other industrial goods commonly exported through regional supply chains, continue to apply.
The Administration’s Response
Following the Supreme Court’s decision, the US administration moved quickly to replace the invalidated IEEPA tariffs using alternative statutory authorities.
Most notably, a new global tariff was introduced under Section 122 of the Trade Act of 1974, which permits the President to impose temporary import surcharges to address balance-of-payments concerns. Unlike the IEEPA tariffs, Section 122 measures are expressly limited in duration and may remain in effect for no more than 150 days without congressional approval, suggesting that they may function primarily as an interim measure.
The administration has also indicated that additional tariffs may be pursued through established trade mechanisms, including accelerated Section 301 investigations targeting allegedly unfair trade practices and expanded reliance on Section 232 national security tariffs, as well as other trade remedy authorities available under US law.
Accordingly, although the IEEPA tariffs have been invalidated, businesses should expect continued tariff activity and ongoing uncertainty in the US trade environment.
Will Tariff Refunds be Issued?
The Supreme Court’s decision begs the questions of whether and how refunds will be issued for tariffs already paid.
The Court did not order automatic reimbursement or establish a refund mechanism. Instead, the case was remanded to the US Court of International Trade (CIT) to determine the appropriate form of relief. As a result, companies should not assume that tariff payments will be returned automatically.
Several potential paths to recovery may emerge. Refunds could be processed administratively by US Customs and Border Protection (CBP), ordered through litigation before the CIT, or implemented through a combination of administrative procedures and court supervision. The ultimate approach will depend on forthcoming agency guidance and the outcome of ongoing proceedings.
The financial stakes are substantial. Economists estimate that IEEPA tariffs generated more than USD 175 billion in revenue, making any refund process one of the largest trade reimbursement exercises in US history. Although many companies had already filed legal challenges prior to the ruling, additional claims are expected as affected businesses assess their eligibility.
In most cases, the party entitled to seek refunds will be the US importer of record, which formally paid duties at the border. However, tariff costs were frequently allocated across supply chains through pricing adjustments, cost-sharing clauses, or commercial negotiations. Consequently, Thai exporters and regional manufacturers may have indirect financial exposure or contractual interests linked to potential refund proceedings.
Implications for Thailand-US Trade
The decision carries several immediate commercial implications for businesses involved in Thailand-US trade flows. Companies may wish to reassess supply agreements and commercial arrangements that address tariff pass-through, pricing adjustments, and reimbursement obligations, particularly where tariff costs were shared between importers and exporters.
As a legal matter, refund claims will generally be controlled by the US importer of record, which formally paid the duties. However, Thai exporters and regional manufacturers may retain economic interests in potential recoveries where contractual arrangements allocated tariff burdens across the supply chain.
Timing considerations are also likely to prove significant. Customs liquidation deadlines, protest requirements, and other procedural rules may affect eligibility for refunds, making early assessment important while the refund framework continues to develop.
Finally, although the IEEPA tariffs have been invalidated, replacement tariffs introduced under alternative statutory authorities may continue to affect pricing, sourcing strategies, and long-term supply chain planning involving Thailand.
Recommended Steps for Affected Businesses
In light of the continuing uncertainty surrounding the refund process, companies participating in Thailand-US trade, including Thai manufacturers, regional exporters, and US importers sourcing goods from Thailand, should consider undertaking an early assessment of their potential exposure and recovery rights.
Businesses may wish to preserve comprehensive documentation relating to entries subject to IEEPA duties, including customs entry records, proof of tariff payments, and commercial agreements addressing how tariff costs were allocated between counterparties.
Identifying the US importer of record will be particularly important, as that entity will generally possess standing to pursue refund claims under US customs law. Thai exporters, while not typically direct claimants, may nonetheless have economic interests tied to refund outcomes where pricing adjustments, reimbursement provisions, or cost-sharing arrangements were implemented during the period the tariffs were in force.
Companies should also closely monitor guidance expected from US Customs and Border Protection, the Department of Justice, and the US Department of the Treasury regarding the administrative handling of refunds. Depending on how the process develops, affected importers may need to evaluate litigation before the US Court of International Trade to preserve or enforce recovery rights.
Finally, businesses operating cross-border supply chains involving Thailand should review existing supply agreements and pricing structures in light of both potential tariff reimbursements and the continued risk of replacement tariffs imposed under alternative US trade authorities.
We will continue to monitor developments relating to refund procedures, judicial proceedings, and replacement tariff measures.
Businesses seeking to assess potential tariff refund eligibility, evaluate contractual exposure, or coordinate cross-border legal strategy involving Thailand and the United States may contact Silk Legal for further information or assistance.
