They could end tomorrow. The law behind them has never been tested in court, and one has already been struck down this year. Here is what that would actually do to your business — and why the answer is not simply “good news.”
We are publishing this before anything happens, because the week it happens is the week nobody has time to think. If you read one section, read the one about your inventory. That is the part that hurts.
Almost every business we talk to has quietly assumed this blows over. That is a reasonable hope and a terrible plan, but it is worth understanding exactly how it might end, because the different endings have very different consequences for you.
Why this is genuinely uncertain
Section 338 of the Tariff Act of 1930 sat unused for more than ninety years before this year. One trade lawyer described it to reporters as “literally a blank canvas because it’s never been litigated.” That cuts both ways: nobody can tell you it is safe, and nobody can tell you it will fall.
What we do know is that the administration’s previous approach did fall. In February 2026 the Supreme Court rejected an attempt to impose broad tariffs on nearly all countries under a 1977 national security law. A specialised trade court then rejected the replacement measures, though collection continued while appeals ran. Section 338 is the third instrument tried, and it is the first one nobody has ever argued about in front of a judge.
The arguments lawyers expect to see
- That it was superseded. Newer trade statutes — the 1962 Trade Expansion Act, the 1974 Trade Act — came with procedural safeguards. The argument is that Congress replaced Section 338 rather than leaving it lying around.
- That the arithmetic was never done. The statute is framed around offsetting specific discrimination. Critics say no calculation of actual harm was produced.
- That the scope does not match the grievance. The measures reach Canadian goods with no connection to the disputes cited — hockey sticks and cement among them.
- That the discrimination is not discrimination. Canada’s dairy protections apply to many trading partners, not the United States specifically.
As of late August 2026, no lawsuit had actually been filed against these particular measures. One public-interest litigation group was reported to be looking for plaintiffs and finding few takers — which tells you something about how exposed importers feel about putting their name on a case.
And the statute permits modification, which means the measures can be narrowed, widened or retargeted by the same mechanism that created them, without any court involved at all.
Four ways this ends
A deal
Negotiations restart and both sides stand down, probably in stages and probably with something traded away. Slowest to arrive, gentlest on your business, because you would see it coming.
A court
A ruling strikes the measures down. This is the abrupt one, it arrives with no notice, and refunds of duty already collected become a live question rather than a certainty.
A rename
The measures are re-issued under different authority with a different name and largely the same effect. Nothing improves; every article written about “Section 338” simply stops being useful.
Nothing
They stay, everyone adjusts, and in three years this is simply how trade works. Historically the most common outcome for tariffs, and the one worth planning against.
The part that hurts: your inventory
Say the duties end on a Tuesday. On Wednesday your competitor places an order at the new, lower cost. Three weeks later they are selling stock that cost them 50% less than the stock sitting in your warehouse.
You now have two bad options: hold your prices and lose the sale, or match them and eat the difference on everything you are holding. The more you stockpiled to get ahead of the tariff, the worse this is.
This is the single most under-discussed risk in the entire episode, and it is the direct cost of the advice everybody gave in August, which was to buy ahead.
The practical mitigation is unglamorous: know your inventory position by cost layer, keep it lean enough to turn quickly, and negotiate price-protection terms with suppliers now — a clause that credits you if their price falls within a set window is normal in volatile categories and costs nothing to ask for.
The other five things that would change
| What | What actually happens |
|---|---|
| Duty you already paid | Refunds are possible but never automatic and rarely fast. They depend on the terms of the ruling or the order, and on you being able to produce entry records. Keep every customs document from this period, even if you never expect to use it. |
| Your tariff surcharge | If you added a line item to invoices, read your own wording. Many surcharges do not say when they end, and customers will ask on day one. Decide the answer before you are asked. |
| Contracts with escalation clauses | Most were written to move prices up. Check whether yours move back down, and on whose initiative. A clause that only ratchets one way is a dispute waiting to happen. |
| Suppliers you switched to | If you moved to a Canadian or non-US supplier and signed a term, you may not be free to switch back — and it is worth asking whether you should. Supply security has a value that does not appear on the invoice. |
| Canada’s counter-tariffs | A separate decision by a separate government. They would probably come off too, but not necessarily at the same time, which could leave your inputs taxed while your competitors’ exports are free. |
What is worth doing either way
This is the useful test for any tariff decision you are making right now: would I still be glad I did this if the tariffs vanished next month?
Yes — do these
Knowing your true costs by input. Being able to reprice quickly. Finding a second supplier. Opening a market that does not depend on one country. Fixing the website. Automating the admin. None of these get worse if the tariffs end.
Careful — these are bets
Deep stockpiling. Long contracts locked at today’s inflated prices. Capital spending justified solely by the duty. Permanently repricing your product upward. Each of these is fine if the tariffs persist and painful if they do not.
Almost everything in the first column is what the New Markets Review is for, and that is deliberate. We would rather sell you work that is right in every scenario than work that depends on guessing this one correctly.
Questions people ask
Will the Section 338 tariffs be struck down?
Nobody knows. The statute has never been litigated, no case had been filed against these measures as of late August 2026, and the same administration’s earlier tariffs were rejected by the Supreme Court in February 2026 under a different law. Treat it as genuinely open rather than likely either way.
Would I get my money back?
Possibly, and not quickly. Refunds depend on the terms of whatever ends the measures. The only thing fully within your control is keeping complete customs records so a claim is possible at all.
Should I wait it out?
Talks between Ottawa and Washington have broken down and no relief is expected in the near term. Waiting is a position, not a plan, and it is the one option that leaves you no better off in any of the four scenarios above.
If it ends, is my stockpile worthless?
Not worthless, but potentially uncompetitive. You would be selling goods bought at a tariffed cost against goods bought without one. Ask suppliers for price protection now, while you still have a reason to.
Do Canada’s counter-tariffs end at the same time?
Not necessarily. They are a separate decision by the Canadian government and could be lifted earlier, later, or partially.
Find out what you would actually be exposed to → · What the tariffs cover · Where else in the world would buy this?
InfiniteUp is a four-person software studio in Nanaimo, BC. 40+ apps shipped, 60,000+ installs, 117 countries. See our work.
Legal analysis summarized from public reporting on prospective challenges to the Section 338 measures; this is not legal advice and we are not lawyers. If refund eligibility matters to your business, speak to trade counsel and keep your customs records regardless. Last reviewed 10 September 2026.