Piping up on tariff challenges

opinion

by Mike Stones

March 2, 2026

The current lull in tariff activity offers an opportunity for aircraft imports, according to our CJI Emergency Town Hall online.

“A three-pipe problem.” That was the smoking time fictional British sleuth Sherlock Holmes needed to solve particularly difficult criminal cases. The North American equivalent for Paul Jebely, partner and vice chair, international with law firm Sterlington is a large carton of Tim Hortons coffee.

The complex case before him during last week’s CJI Emergency Town Hall online meeting was how business aviation should respond to the challenge of President Trump’s changing tariff landscape. Joining the investigation was tariff guru Tobias Kleitman, president, TVPX.

Holmes needed about 50 minutes to smoke three pipes of tobacco while unravelling who did what to whom, with what weapon and when. Jebely and Kleitman had just over an hour to pick a path through the red tape of tariff rulings and potential refunds to reach clear conclusions about what to do now and in the future.

Both agreed recent Supreme Court ruling had created an opportunity for aircraft importers to bring aircraft into the US without tariffs and to claim refunds (eventually) on tariffs already paid. Last this month the court ruled that the International Emergency Economic Powers Act (IEEPA) does not give the president the right to impose tariffs – some of which applied to aircraft and aircraft parts. President Trump’s responded quickly with a plan to introduce a new global tariff of 10% – then increased to 15%. Latter a new 10% global tariff was imposed on all imports but crucially this does not apply to aircraft or aircraft parts.

‘A lot of Radio Gaga’

Jebely started by clarifying what the Supreme Court had (and had not) decided. “I’ve heard a lot of Radio Gaga out there from folks who aren’t necessarily qualified to talk US law, let alone US constitutional law,” he told the Town Hall. “The court has said you cannot do this [tariff regime] under this statue. It’s both closing a door and quietly pointing to the doors that may still stay open by what it’s not saying. So, it’s not banning tariffs or strong executive action in general. It is saying, look executive, not this way, not on this legal theory.”

Kleitman admitted to being “a little shell-shocked”, like many others, at the stunning turn of events. “IEEPA tariffs were deemed illegal and what we immediately got were Section 122 tariffs under a new executive order. But stunningly, in the annex, there is an exemption for all civil aircraft,” he said.

That opens a window for aircraft to be imported into the US for sale or pre-buy inspections, repair or modifications. But aircraft still need to be imported properly with importers securing a bond with fees owed to US Customs capped at the merchandise processing fee of 0.3464% of the value of the airplane or $651.50, whichever is less. “That’s great news for the industry and for owners who want to sell aircraft or upgrade them. We are going to see a lot of movement,” said Kleitman. But there’s still the potential for other tariffs to be introduced, he warned.

Picking up that theme, Jebely highlighted: “Trump talks about years of litigation [wrangling over the Supreme Court’s ruling]. A big ruling like this doesn’t end the game, it resets the board.” What is significant for transaction planning is that the court’s ruling eliminates any ambiguity about whether IEEPA tariffs could return in modified form – they cannot.

‘Take advantage’

So, from February 24th, the industry finds itself in a zero-tariff environment. “Take advantage,” advised Jebely.

Setting out the process for importing aircraft from Europe, Kleitman said: “If you’re coming over the North Atlantic, you’re probably going to go through Bangor, Maine. You need to get a customs broker, power of attorney and a customs bond. You need to get all the documentation in place, file the entry before you arrive.” The process can be completed quickly if everybody is engaged in the process – importers just have to prepare in advance, he added. (You don’t need to be a US resident or register the aircraft in the US before it’s imported).

Turning to the vexed question of refunds, both speakers urged patience. Importers cannot start the process of claiming a tariff refund by filing a protest until the entry has been “liquidated”. That happens 314 days after the date of import, after which importers have 180 days from that date to file their protest, said Kleitman from TVPX. Jebely’s advised: “To file the protest, start with a customs attorney and get good advice.” But don’t expect any repayments to be “in time for Christmas presents”.

Complex problems remain. One raised by Kleitman is that the fact that tariffs introduced under annex 122 are effective for only 150 days and then need to be extended by Congress. What then? Also, in May 2025, the US Department of Commerce’s Bureau of Industry and Security (BIS) started a section 232 investigation into imports of commercial aircraft, jet engines and aircraft parts.

Its aim is to decide if such imports threaten national security. If the bureau rules yes, the president can impose tariffs or other penalties. “If BIS ever concludes that civil aircraft or civil private aircraft imports do threaten national security, then the president’s power becomes extremely broad,” warned Jebely. There could be no cap on tariffs. Its report is due soon.

To complicate matters further, the US government commissioned a Section 301 investigation into unfair practices, which could recommend tariff sanctions against individual countries. Jebely’s advice is to: “Price [Annex] 122 [into aircraft transactions] in the very short term, track [Section] 301 like a hawk and treat [annex] 232 as a tail risk scenario you need to monitor but you can’t model.”

‘Professionalise those provisions’

During the current lull in tariff activity, Jebely urged aircraft importers and dealmakers to review contracts and ensure they are prepared to accommodate new tariff legislation. “Many players scrambled during IEEPA phase and we all patched contracts on the fly. This is the time to professionalise those provisions by using attorneys who know what they’re doing,” he said.

Make no mistake, the US administration is not retreating from tariffs. “It’s rebuilding the tariffs architecture on what it believes to be more legally durable foundations,” said Jebely from Sterlington. “The question is not whether replacement tariffs are coming – including for certain countries and certain aircraft. It is which products they are going to cover and whether aviation and aerospace continue to get carved out, or whether certain aircraft are no longer subject to being carved out. If I were a betting man, that’s what I would bet on.”

How long it will take to resolve these questions – particularly refund claims – remains unclear. What is clear is that before the answers emerge, Jebely will need more cartons of Tim Hortons coffee. (You can listen again to the Town Hall here – with a beverage of your choice).