Executive Summary
On 20 February 2026, the United States Supreme Court ruled that tariffs imposed by President Donald Trump under the International Emergency Economic Powers Act (IEEPA) were unlawful. The ruling precipitated an immediate scramble among importers to recover an estimated US$175 billion in collected duties. For Singapore — one of Asia’s most trade-dependent economies and a significant transshipment hub — the decision carries layered implications: direct refund eligibility for Singapore-linked importers, downstream contractual disputes in global supply chains, and a strategic window in international tariff competitiveness.
This case study examines the core remedial question left unresolved by the Supreme Court ruling, Singapore’s specific legal and commercial exposure, and the policy responses available to Singapore’s government and business community.
- Background: The IEEPA Tariff Regime and Its Invalidation
1.1 Statutory Basis and Tariff Architecture
The IEEPA grants the President broad authority to regulate commerce during a declared national emergency. Beginning in 2025, the Trump administration invoked IEEPA to impose sweeping import tariffs characterised as an emergency trade measure. A baseline 10 per cent global tariff was initially announced under Section 122 of the Trade Act of 1974, subsequently raised to 15 per cent within 24 hours. Singapore-origin goods, along with those of virtually all US trading partners, fell within scope.
1.2 The Supreme Court Ruling
The Supreme Court’s 20 February 2026 decision held that the IEEPA tariffs exceeded the statutory authority conferred by Congress, rendering the duties constitutionally and administratively unlawful. Justice Brett Kavanaugh, writing separately, acknowledged that the refund process could become a multi-year ‘mess’ — a candid judicial admission of the administrative complexity the ruling would unleash.
The ruling did not specify the precise mechanism for refund distribution, delegating that determination to the Court of International Trade (CIT). This omission is the source of the principal remedial uncertainty now facing all affected importers, including those in Singapore’s trade ecosystem. - The Core Remedial Question
KEY ISSUE Does the Supreme Court’s ruling automatically extend to all importers as a class, or must each affected entity bring individual proceedings before the Court of International Trade?
The answer determines the practical accessibility of refunds for Singapore-linked businesses. Mark Ludwikowski of Clark Hill’s international trade practice has identified two structural possibilities:
Scenario Automatic Class-Wide Refund Individual Litigation Required
Mechanism CIT structures a universal remedy extending to all importers who paid IEEPA duties Each importer files separately; refund conditioned on active court or administrative challenge
Efficiency High — administratively coherent Low — replicates litigation across thousands of entities
Legal novelty High — unusual in US trade law precedent Low — consistent with standard protest procedures
Singapore importer exposure Lower — refund likely automatic if duties paid Higher — requires timely filing and legal representation in US courts
Timeline Potentially faster, subject to government compliance Multi-year; Trump has predicted five years of litigation
A further complication arises from the concept of ‘liquidation’ — the CBP’s finalisation of duty liability for a given import entry. Importers who did not file timely administrative protests before liquidation may find that their refund claims are procedurally foreclosed, regardless of the Supreme Court’s substantive holding. This is a critical issue for Singapore importers who absorbed IEEPA duties without preserving their legal options during the tariff period.
- Singapore’s Trade Exposure: A Structured Analysis
3.1 Macroeconomic Context
Singapore’s economy is among the world’s most trade-intensive, with total trade roughly three times GDP. The United States is consistently Singapore’s largest single-country trading partner in terms of bilateral investment and a top-three destination for exports. Singapore-linked firms — including subsidiaries of Singaporean multinationals, re-exporters, and transshipment intermediaries — were significant payers of IEEPA duties on US-bound shipments.
Singapore’s Ministry of Trade and Industry has confirmed it is actively seeking details on the refund procedures, signalling official awareness of the stakes. The MTI’s engagement reflects both direct fiscal interest and systemic concern about supply chain reconfiguration risks if refund timelines extend into years.
3.2 Categories of Affected Entities
Entity Type Nature of Exposure Refund Eligibility
Singapore-based direct exporters to US Paid IEEPA duties as importer of record or through US buyer agreements Potentially eligible if named importer
Singapore re-exporters / transshipment hubs Goods passed through Singapore; IEEPA duties applied at US entry point Depends on contractual duty allocation and importer-of-record status
Singapore subsidiaries of MNCs Parent company may be US importer of record; refund flows to parent, not Singapore entity Indirect; governed by intra-group transfer pricing and cost allocation
Singapore firms in US supply chains (non-importer) Bore cost of passed-along tariffs through price adjustments No direct eligibility; litigation risk as secondary claimants
3.3 The Pass-Through Problem
Among the most legally and commercially complex dimensions of Singapore’s exposure is the pass-through problem. Many Singapore-based suppliers adjusted contract prices or absorbed cost increases when IEEPA duties were imposed by their US buyer counterparts. Because the US government will pay refunds only to the importer of record — not to downstream commercial parties or end consumers — Singapore firms that bore the economic burden of the tariffs without being the legal importer may receive no direct refund.
COMMERCIAL RISK Singapore suppliers who negotiated lower contract prices to offset IEEPA costs, or who absorbed cost increases from US buyers who subsequently passed duties on, may face secondary litigation attempting to recover those funds — with uncertain prospects.
Lawyers in the United States are already anticipating a wave of litigation from downstream firms pursuing unjust enrichment, breach of contract, or commercial adjustment claims. Singapore firms should assess their contractual position carefully to determine both their exposure to such claims and their own grounds for recovery.
- Strategic and Policy Implications for Singapore
4.1 Competitive Tariff Position
The Supreme Court ruling narrows the tariff gap between Singapore and other regional competitors — a consideration that Singapore’s Ministry of Trade and Industry has already flagged. During the IEEPA regime, Singapore’s pre-existing free trade agreement framework provided a relative advantage. Post-ruling, this advantage is partially eroded as IEEPA-penalised competitors now also access refunds. However, Singapore retains structural advantages in logistics infrastructure, legal certainty, and treaty network depth that partially offset this recalibration.
4.2 The Geopolitical Litigation Dimension
President Trump’s own prediction of five years of refund litigation is not merely a political statement — it functions as a strategic deterrent. If the US government resists or delays CBP refund procedures, the cost of recovering duties may approach or exceed the refund amount for smaller Singapore firms. This asymmetry favours larger operators with US legal infrastructure and disfavours SMEs. Singapore’s government may consider facilitating collective action mechanisms or diplomatic channels to press for expedited refund procedures.
4.3 Precedent for Emergency Trade Powers
The ruling establishes an important precedent constraining executive emergency trade powers in the United States. For Singapore, whose trade policy operates under the assumption of rule-of-law predictability from major partners, the case reinforces the value of bilateral and multilateral treaty frameworks over executive-declared emergency regimes. The episode strengthens Singapore’s longstanding advocacy for rules-based international trade governance. - Recommendations
For Singapore-Based Businesses
Affected firms should undertake an immediate audit of IEEPA duty payments made from 2025 through the ruling date, identifying all transactions where a Singapore entity or a counterpart it has a contractual relationship with served as importer of record. Legal counsel with US customs expertise should be engaged to assess protest status, liquidation deadlines, and the implications of the CIT’s forthcoming remedial order.
Firms that passed IEEPA costs through commercial contracts should review whether those contracts contain price adjustment, most-favoured-nation, or duty drawback clauses that could be activated by the refund ruling. Proactive engagement with US counterparts is preferable to reactive litigation.
For the Singapore Government
MTI and Enterprise Singapore should establish a coordinated information channel to advise affected Singapore firms on US refund procedures as the CIT structures its remedial order. Singapore’s diplomatic mission in Washington should engage with CBP and the Office of the US Trade Representative to press for expedited, administratively coherent refund procedures — particularly the class-wide remedy option, which best serves Singapore’s SME base.
At the multilateral level, Singapore should use this episode to advance WTO and regional advocacy for binding constraints on emergency trade power invocations, complementing its existing FTA architecture. - Conclusion
The IEEPA tariff refund litigation presents Singapore with a layered set of challenges and opportunities. The core legal question — whether the Supreme Court’s ruling automatically extends to all importers or requires individual action — will determine the accessibility and timeline of refunds for Singapore-linked businesses. The pass-through problem creates additional commercial complexity for firms that absorbed tariff costs without being importers of record.
Singapore’s macroeconomic trade intensity amplifies both the stakes and the urgency of its response. A proactive legal, commercial, and diplomatic posture — pursued on multiple fronts simultaneously — is the most prudent course of action for both the government and the private sector.