What Is the International Emergency Economic Powers Act?

The International Emergency Economic Powers Act (IEEPA) is a U.S. law that lets the president regulate international economic activity during a declared national emergency.

Enacted in 1977, IEEPA lets the executive branch respond to unusual or extraordinary threats from outside the United States. These threats could affect national security, foreign policy, or the U.S. economy.

Under this authority, the president may impose a range of economic measures affecting international trade, including:

• Economic sanctions
• Restrictions on financial transactions
• Asset freezes
• Import and export restrictions
• Tariffs or other trade controls in certain circumstances

IEEPA is one of the strongest legal tools the executive branch can use.

It helps the executive branch respond to international crises, which can affect global commerce.

Which Agency Administers IEEPA Sanctions?

The U.S. Treasury Department usually carries out and enforces IEEPA actions. The Office of Foreign Assets Control (OFAC) does most of this work.

OFAC administers sanctions programs that restrict transactions with certain:

• Countries
• Individuals
• Companies
• Financial institutions

These programs may limit or prohibit U.S. businesses from engaging in trade or financial transactions with designated parties.

How IEEPA Can Affect Imports and Tariffs

IEEPA is best known for economic sanctions, but it can also affect global trade flows and tariff policy.

When the president declares a national emergency, the president can control imports or exports.

These controls can apply to a specific country, or a specific sector or entity. These restrictions may include:

• Blocking imports of specific goods
• Limiting financial transactions tied to trade
• Restricting supply chains linked to sanctioned parties
• Imposing additional trade barriers

For importers and exporters, IEEPA actions can significantly disrupt supply chains and create new compliance obligations.

IEEPA and Presidential Trade Authority

IEEPA grants the president broad authority to control economic transactions involving foreign countries during a national emergency.

However, the scope of this authority—particularly regarding tariffs—has been subject to legal scrutiny.

Federal courts may review trade measures taken under IEEPA. This includes the United States Court of International Trade. That court has jurisdiction over disputes involving customs and trade laws.

These cases can determine whether certain trade actions fall within the statutory authority granted under IEEPA.

How IEEPA Differs from Other U.S. Trade Laws

While IEEPA is sometimes discussed alongside other trade authorities, it serves a different purpose than traditional tariff statutes.

For example:

Because IEEPA ties to emergency powers rather than only trade policy, courts still debate its use for tariffs.

Why IEEPA Matters for Importers and Global Supply Chains

For companies engaged in international trade, IEEPA actions can quickly change the regulatory environment.

Potential impacts include:

• Sudden import restrictions affecting key suppliers
• Financial sanctions limiting international payments
• Compliance obligations related to sanctioned entities
• Supply chain disruptions involving restricted countries

Importers must stay alert when sourcing from regions or industries affected by sanctions or emergency trade measures.

Managing Compliance Risks Under IEEPA

Companies in global trade should use strong compliance procedures. These procedures help manage risks from sanctions and emergency trade restrictions.

Best practices include:

• Screening suppliers and partners against sanctions lists
• Monitoring updates from the Office of Foreign Assets Control
• Reviewing sourcing strategies in high-risk regions
• Working with experienced customs and trade compliance professionals

Proactive compliance can help businesses avoid costly penalties and supply chain disruptions.

Recent IEEPA Tariff Cases and Legal Challenges

In recent years, the International Emergency Economic Powers Act (IEEPA) has been central to major legal disputes. These disputes focus on the scope of presidential trade authority.

A series of court decisions ended with a 2026 ruling. It reshaped how policymakers may use IEEPA in trade policy.

Supreme Court Rules IEEPA Tariffs Unlawful

In February 2026, the U.S. Supreme Court ruled that tariffs under IEEPA were unlawful. The court said the law does not let the president impose broad import duties. The Court determined that the power to impose tariffs generally rests with Congress.

The ruling struck down broad tariffs on goods imported from many trading partners. It affected hundreds of thousands of importers across the United States.

This decision significantly clarified the limits of presidential emergency powers in the context of international trade.

Court of International Trade Orders Tariff Refunds

Following the Supreme Court’s decision, the U.S. Court of International Trade issued a major order.

It directed U.S. Customs and Border Protection to begin processing refunds.

These refunds cover tariffs collected under the invalidated IEEPA program.

Judge Richard Eaton ruled that:

• All unliquidated entries must be liquidated without IEEPA duties
• Entries that are liquidated but not yet final must be reliquidated without the tariffs

This effectively requires Customs to refund billions of dollars in previously collected duties.

Importantly, the court said the relief may cover all importers affected by the tariffs. Not limited to those who filed lawsuits.

Potential Refunds for Importers

Estimates suggest the federal government collected over $130 billion in IEEPA tariffs. Total refunds could reach $175 billion, depending on the refund process.

The refunds could be so large that regulators and businesses may need to review tens of millions of import entries. This makes the process complex for both groups.

Ongoing Legal and Policy Uncertainty

Although the courts invalidated the tariffs, several issues remain unresolved, including:

• Whether the government will appeal refund orders
• How quickly refunds will be processed by U.S. Customs and Border Protection
• Whether future administrations will attempt to use alternative statutes for emergency trade measures

In response to the court rulings, policymakers have explored other trade authorities.

They have considered using Section 122, which could allow temporary tariffs. It may also avoid the legal limits in the IEEPA cases.

Why This Matters for Importers

The IEEPA litigation highlights how trade policy decisions can rapidly change the duty landscape for importers.

Court rulings affecting tariff authority can result in:

• Retroactive duty refunds
• Changes to tariff programs
• New compliance requirements
• Supply chain disruptions

For businesses in global trade, it is vital to track IEEPA litigation and trade policy changes. This helps manage risk and predict potential cost impacts.

Staying Informed on Trade Policy Changes

Emergency trade authorities like IEEPA demonstrate how quickly international trade rules can change.

Businesses that depend on global supply chains should stay informed about:

• Sanctions developments
• Tariff policy changes
• Trade litigation affecting executive authority
• Regulatory updates impacting imports and exports

A strong logistics and customs compliance strategy can help companies adapt to evolving trade regulations.