There have been some major updates on the United States tariff front since the previous post on this topic went up. The biggest inflection point came from the highest court in the land, with the Supreme Court ruling in Learning Resources, Inc. v Trump that the International Emergency Economic Powers Act (IEEPA) does not authorize the president to impose tariffs, which is viewed as a tax power reserved for Congress.

Following that decision, U.S. Customs and Border Protection (CBP) launched the Consolidated Administration and Processing of Entries (CAPE) program, a process designed for refunding importers who paid those illegal tariffs.

For companies and consumers impacted by the tariffs, this should be great news. Much of it is; Learning Resources resulted in a repeal of the existing tariffs that have unblocked trade between the United States and other countries. But consumers, licensors, or other impacted parties expecting immediate cash compensation may be in for a rude awakening.

How the CAPE Process Works

CAPE is administrated solely through the electronic Automated Commercial Environment (ACE) Portal. ACE is CBP’s official web-based platform for international traders to track, manage, and report on their import/export activities, including handling things like cargo releases and compliance reports. Importantly, that includes export reporting, including payment and tracking of duties like tariffs.

The nature of tariff reports and tracking being native to the platform means processing reimbursements through it is easy, in theory. CBP has attempted to further streamline the process by limiting the initial salvo of reimbursement to unliquidated entries and entries within 80 days of liquidation (“liquidation” for this purpose is the official closing and finalization of an import entry by CBP, at which point the government’s determination of duties owed becomes final). This means that recent or unprocessed entries that are still “open” and readily available informationally.

Procedurally, CAPE works through the Importer of Record (IOR) submitting a “CAPE Declaration” through the ACE Portal. That declaration is a simple CSV file that lists the entries on which IEEPA tariffs were assessed. ACE then validates the entries, strips out the tariffs on the validated line items, and then re-runs the duty calculation and reimburses the importer of record on the difference.

As a whole, CAPE is meant to solve a scale problem. CBP collected tariffs across an enormous number of entries, so processing refunds one at a time would have taken years. The new system allows importers to submit batches of entries through a single filing so CBP can reopen and reprocess them together.

What are the Strings?

There are three main strings affected parties should be aware of: (1) obligation to file, (2) eligibility, and (3) downstream process where necessary.

Obligation to File

The first one is probably fairly obvious: The CAPE process is not automatic. If an IOR fails to file, or fails to file in time, they get no tariff relief. And as time passes and the process begins to offer relief to more categories of entries, collecting the information necessary to demand that relief may be more difficult.

Eligibility

The second string is less obvious: Who actually has the right to that refund?

CAPE is built on a foundation of United States customs law, without regard to the flow of money through a business relationship. Accordingly, the refund belongs to the importer of record listed on the entry. Only that party, or its authorized broker, can file the claim. CBP will send the money to that entity or to an account it designates, but that does not change who owns the claim in the first place.

For the video game industry, that distinction is not academic. Many supply chains in games are layered. Hardware companies rely on contract manufacturers. Publishers move physical goods through distributors, who may outsource import/export functions. Merchandising programs and collector’s editions may sit in separate entities. Even where the core business is digital, physical goods still move for events, promotions, and limited releases. On top of that, licensing and intercompany agreements routinely shift costs across borders.

In many of those arrangements, the party that ultimately absorbed the tariff cost into their margins as driven by the contract’s terms is not the IOR, but the IOR nonetheless is the party entitled to the refund. None of that changes just because the cost was passed along through a license, a royalty structure, or a pricing adjustment. Licensors and licensees tend to assume they can step in if they bore the economic burden, but CAPE does not recognize downstream cost allocation, which means the tariff refund may either lay in a grey area as far as who is entitled to it or create a legal dispute.

In practice, the contract may speak to this question. Distribution and licensing agreements sometimes address tariff refunds directly, and where they do, the importer may be obligated to pass the refund through. Alternatively, if the contract provides for a dynamic view of royalty arrangements with adjustments for chargebacks or refunds, remeasurement, or audit rights allowing for true-ups, arguably that structure contemplates the IOR passing through the applicable share of the tariff reimbursement to the other party.

In other cases, it comes down to leverage and business judgment. Some companies are voluntarily choosing to return funds to partners or customers to build goodwill and avoid potential legal disputes. Others are not, particularly where the contract is silent or they believe provides for a narrower view of the relevant calculation and when it is treated as final.

Downstream Processes

To date, of the 11 million applicable entries, only about 1.74 million refund requests had been filed as of April 29^th, 2026. The judge overseeing the process, Judge Eaton, relayed in a closed conference that applicants faced concerns with accessing the ACE Portal, struggling to reset and obtain usernames and passwords, failing to access training programs, and confusion with identifying the right importer for the required declaration. Others have reported long wait times to receive their refunds.

To ensure IORs receive the refund to which they are entitled, Judge Eaton recommended that IORs file protests with the CBP that IORs can simply withdraw if the refund is delivered satisfactorily so as to preserve their claim if they can’t file it timely on the ACE Portal. Whether that will result in a more cumbersome protest process as the CBP’s docket grows longer remains to be seen.

Downstream Processes

To date, of the 11 million applicable entries, only about 1.74 million refund requests had been filed as of April 29^th, 2026. The judge overseeing the process, Judge Eaton, relayed in a closed conference that applicants faced concerns with accessing the ACE Portal, struggling to reset and obtain usernames and passwords, failing to access training programs, and confusion with identifying the right importer for the required declaration. Others have reported long wait times to receive their refunds.

To ensure IORs receive the refund to which they are entitled, Judge Eaton recommended that IORs file protests with the CBP that IORs can simply withdraw if the refund is delivered satisfactorily so as to preserve their claim if they can’t file it timely on the ACE Portal. Whether that will result in a more cumbersome protest process as the CBP’s docket grows longer remains to be seen.

Conclusion

For companies in the game industry, the Supreme Court’s decision in Learning Resources and subsequent repeal of many of the Trump administration’s tariff represents an immediate easing of international trade on physical goods. But without the right contractual provisions in place, relief for already assessed tariffs may not trickle back through to developers, publishers, or licensors. Impacted parties should work closely with their legal and accounting teams to evaluate what entitlement they have, if any, and how to pursue it.