By Matthias Inverardi, Emma Rumney, Christoph Steitz and Elisa Anzolin
DUSSELDORF/LONDON/MILAN, March 6 (Reuters) – Since the U.S. Supreme Court knocked down some of President Donald Trump’s key tariffs, European firms have been talking with U.S. clients, seeking legal advice on refunds and using a loophole to amend documents for already imported goods.
Conversations with a dozen European firms from electronics makers to consumer brands showed how companies are striving to adapt to whipsaw changes in U.S. trade tariffs amid a long-running standoff under Trump.
After the U.S. top court quashed Trump’s so-called “liberation day” tariffs in February, he imposed a new 10% blanket levy that could rise to 15%, generating new global uncertainty about the trade deals struck last year and what rates importers actually faced.
“The Supreme Court ruling has said one thing… The White House is saying something else,” Italian drinks maker Campari’s CEO Simon Hunt told Reuters, adding that there were also different signals coming from customs and trade courts.
“If there’s an opportunity to recover (tariff payments), then clearly, like every other company, we’ll look at it. But at this stage, we’re just going to wait and see.”
The U.S. government collected more than $130 billion in tariff payments – now deemed illegal – which had been central to Trump’s trade policy. In its ruling, the Supreme Court did not provide guidance on issuing refunds, however, leaving it unclear how importers will get their money back.
On Friday, the U.S. Court of International Trade will meet with government lawyers to hammer out a reimbursement process. Government lawyers have said it would require manual reviews of tens of millions of payments.
PROCESS TO AMEND IMPORT PAPERS OFFERS POTENTIAL ROUTE
German electric fan maker ebm-papst’s U.S. unit is looking at its legal options for refunds, including amending import papers under a process called post-summary correction (PSC), allowed for some 300 days after a good enters the United States.
That could in theory lower the applicable tariff rate and lead to an automatic refund, consultants said. But some industry sources said they weren’t optimistic about a payout and feared U.S. authorities may jam up the process.
“This option is being used. Where legally permissible and appropriate,” an ebm-papst spokesperson told Reuters.
The German firm, which has sales of more than 2 billion euros ($2.36 billion) and employs around 13,500 staff, has fielded calls from U.S. clients over possible refunds and said its tariff impact was in the “double-digit” million euro range.
Its discussions with customers in the United States illustrate another complexity to the refund process: as the importer of record – the legal entity responsible for bringing goods into a country – only it can claim a refund.
Companies which are not the importer of record but may have paid duties as part of a contractual agreement with the importer, will have to seek a reimbursement via those suppliers or distributors – a complexity which could lead to legal disputes between business partners.
“There are still no binding guidelines from U.S. authorities and many details remain unclear. This includes, for example, whether the mutually agreed EU-U.S. agreement is still valid,” the ebm-papst spokesperson said.
“The tariff damage is considerable.”
‘CHANGING PAPERWORK’ COULD TRIGGER REFUNDS
Nicolas Urien, head of global trade advisory at consultancy Customs Support Group, said firms were “changing paperwork” in a process that allows importers to amend an entry before the U.S. customs body has finalised the duty assessment.
This only worked for “unliquidated” imports, but it could offer companies a more direct way to seek refunds than going through the courts, where costs are putting off many smaller firms.
“A PSC may be used for unliquidated entries – where duties have been paid but not yet finalised – to remove tariffs that are no longer legally valid,” Urien said. “Some companies have already initiated this process.”
The Financial Times reported on Friday, citing sources, however, that some U.S. firms were getting refund requests knocked back. A U.S. trade court judge on Wednesday ordered the government to begin paying the refunds.
A U.S. executive at a small European alcohol firm said it was looking into how to claim refunds and taking advice from industry bodies and logistics partners. It had also looked at the post-summary correction route.
The firm could launch a lawsuit. It plans for now, though, to wait for the U.S. to outline the refund process more clearly, with any payout seen as something of an unexpected bonus.
It would be like “finding loose change down the back of the sofa”, the executive said.
($1 = 0.8462 euros)
(Reporting by Matthias Inverardi and Tom Kaeckenhoff in Duesseldorf, Christoph Steitz and Patricia Weiss in Frankfurt, Emma Rumney in London, Stine Jacobsen in Copenhagen, Maria Rugamer in Gdansk and Gilles Guillaume in Paris; Writing by Adam Jourdan; Editing by Josephine Mason and Hugh Lawson)
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