Tariff Watch: Prepping for Canada Tariffs, CAPE Phase 3 Rollout, and the Post-De Minimis Reality
This week’s Tariff Watch examines preparations for Section 338 tariffs on Canada, the launch of CAPE Phase 3 for IEEPA refunds, de minimis developments, and other trade issues impacting importers and supply chain leaders.
Welcome to the latest edition of Tariff Watch, the weekly series from J.M. Rodgers that keeps importers, manufacturers, and supply chain leaders informed on the latest in US trade policies. July 2026 was jam-packed with tariff news week after week, and August shows no signs of letting up.
As we start the new month, the global trade community is grappling with new realities in the North American supply chain. For the first time in history, a US president has invoked Section 338 to impose tariffs with heavy 50% duties on Canada. At the same time, worldwide exporters are facing the realities of a US market without a de minimis exemption. Let’s take a look at this week’s news:
What’s New
- Phase 3 of the CAPE Portal is officially live: In late July, CBP launched Phase 3 of the Consolidated Administration and Processing of Entries (CAPE) portal. This highly anticipated module allows for IEEPA tariff refunds on finally liquidated entries. However, CBP has restricted Phase 3 access strictly to importers who have actively filed a protective lawsuit at the Court of International Trade (CIT).
- CBP reviews public comments on the de minimis suspension: The docket for public comments regarding Customs and Border Protection’s June 24 Interim Final Rules — which indefinitely suspended the $800 de minimis exemption for all modes of transport — closed on July 24. CBP is now reviewing feedback on the change before issuing final regulations governing the new postal entry and duty collection process.
Who’s Impacted
This week’s stories will have ripple effects across the entire supply chain:
- Importers of Canadian goods: As we reported last week, US President Donald Trump signed three proclamations targeting Canada on July 20. Any US business importing from Canada — especially within the automotive, dairy, and alcoholic beverage sectors — is facing imminent and substantial cost increases. The unprecedented 50% Section 338 tariffs take effect on August 19. These duties apply even if the goods are fully compliant with USMCA rules of origin.
- Importers seeking IEEPA refunds: Since the launch of CAPE Phase 3, proactive importers who filed suit at the CIT can now process refunds on their finally liquidated entries. However, it’s uncertain whether the courts or CBP will eventually give the same privilege to importers who failed to litigate early on.
- E-commerce and B2C retailers: The closure of the de minimis public comment period signals that the $800 exemption is gone for the foreseeable future. Retailers utilizing international mail must now fully comply with all formal and informal entry procedures and pay duties on previously exempt shipments — even if they enter the country through the postal network.
What We’re Seeing
A looming deadline and a new opportunity for refunds are keeping supply chain leaders especially busy. Here’s what we’re observing right now:
- A frantic sprint to beat the August 19 deadline: Section 338 requires a minimum 30-day window between announcing and implementing tariffs, which gave US importers of Canadian goods a little time to prepare for the impending duty increase. However, the time is flying by, and importers have just two weeks left to act. We’re seeing an enormous acceleration of cross-border freight as businesses attempt to clear Canadian inventory before the 50% duties hit on August 19.
- Deep dives into Section 338 product lists: Part of the prepping is determining which imports are actually subject to the Section 338 tariffs — and the scope is far broader than just the headline categories of motor vehicles, dairy, and alcohol. Trade compliance teams that have dug deep into Annex II of the July 20 presidential proclamations have discovered that everyday items like furniture, clothing, paper products, and hand tools are also subject to 50% duties.
- An overwhelming amount of Phase 3 CAPE filings: Internal teams and customs brokerages alike are working through significant backlogs of entries that can finally be liquidated, now that they can file for refunds in Phase 3 of the CAPE portal.
What We’re Monitoring
The J.M. Rodgers trade compliance team is still keeping a close watch on these ongoing stories:
- The potential expiration of the Jones Act waiver: A group of 52 US Representatives has formally urged the Trump administration to let the current Jones Act waiver expire as scheduled on August 16. A failure to renew the waiver will severely restrict the use of foreign-flagged vessels for domestic shipping, which could drive up domestic freight costs.
- Ongoing USMCA review tensions: We’re closely monitoring the formal USMCA joint review that launched on July 1 for any diplomatic fallout from the incoming Section 338 Canadian tariffs. These aggressive unilateral duties have the potential to create significant friction in the ongoing trilateral negotiations — particularly in talks about automotive rules of origin and labor enforcement.
- The transition from Section 122 to Section 301: The transition from the Section 122 global surcharge to the Section 301 forced labor tariffs creates the potential for administrative errors. We’re looking closely at new entries to verify how CBP is handling the changeover.
Sources
- Tariff Update: Refunds for Finally Liquidated Entries Under IEEPA, Snell & Wilmer
- Industry Groups Largely Back CBP’s De Minimis Suspension Rules, Inside Trade
- The Jones Act, the Waiver, and What’s Actually at Stake, Seafarers International Union