If my supplier paid the IEEPA duty under DDP, do they get the CAPE refund?

No. CBP refunds the importer of record (IOR) on the entry — that is the party named on the CBP-7501, regardless of who funded the duty payment commercially. Under DDP, the foreign supplier typically funds the duty but is not the IOR; the IOR is still your U.S. company (or your nominated U.S. IOR). The refund flows to the IOR's ACH refund account. Whether you pass that money back to your supplier is a contractual question between you and them, not a CBP question.

We are the IOR but our supplier wants the refund — can we redirect CBP to pay them?

No. CBP issues the refund to the IOR's ACH refund account on file. There is no facility to redirect the refund to a foreign party at the CBP level. Any pass-through to your supplier has to happen through your normal commercial settlement (credit note, wire transfer, offset against future invoices). Document the arrangement in writing before the refund lands.

Our DDP supplier is now claiming the refund money — what's our legal position?

This is a contract question, not a customs question. Read your purchase orders, supply agreements, and Incoterms version (typically Incoterms 2020 DDP). The default Incoterms text does not address subsequent duty refunds. Most importers' position is that the duty cost was a component of the agreed landed price they paid the supplier, so the refund stays with the importer. Some suppliers argue the duty was a pass-through cost and should refund to them. Resolve via written agreement or with trade counsel — do not promise the money before legal review.

Should we change our Incoterms going forward to avoid this problem?

Many importers are reviewing DDP arrangements specifically because of refund-routing ambiguity. Switching to DAP or CPT shifts duty payment responsibility back to the importer, which removes the pass-through ambiguity entirely. The trade-off is cash-flow exposure: your importer absorbs the duty payment instead of the supplier financing it. Discuss with your CFO and trade counsel before changing standard terms across your supplier base.

Does the foreign supplier need to do anything for us to file CAPE on a DDP entry?

Generally no. CAPE filing operates off your CBP-7501 entry summary data, which the IOR or the IOR's broker has direct access to. The foreign supplier does not need to be involved in the filing. The only practical issue is recordkeeping: if your DDP supplier handled all the customs paperwork through their nominated broker, you may need to coordinate to obtain the entry summaries and broker assistance for CAPE filing.

DDP Imports and IEEPA Refunds: Who Actually Gets the Money?

DDP-shipped entries create a question that does not come up for normal IOR-funded imports: when your supplier paid the IEEPA duty as part of the all-in landed price, does the CAPE refund belong to you or to them?

The customs answer is clear. The contract answer is messier.

The CBP Position

CBP refunds the importer of record. That is the party named on box 12 of the CBP-7501 entry summary. Refunds are disbursed via ACH to the refund account associated with the IOR. There is no mechanism in CAPE to direct payment to a third party — and certainly not to a foreign entity that is not the IOR.

So if your U.S. company is the IOR (which is the normal case even under DDP — the foreign supplier nominates a U.S. IOR or uses your IRS number to file the entry), the refund flows to you. The fact that the supplier financed the duty payment commercially is not visible to CBP.

How DDP Funded the Duty in the First Place

Under Incoterms 2020 DDP (Delivered Duty Paid), the seller is responsible for clearing the goods through customs and paying all import duties. Operationally, that usually means:

The supplier nominates a U.S. customs broker.
The supplier provides the broker with funds (or a credit account) to pay duties.
The CBP-7501 names the U.S. importer of record — often the U.S. consignee, sometimes a Foreign Trade Zone operator, sometimes a third-party IOR service.
The duty is paid in the IOR’s name to CBP, but funded by the supplier.

The “supplier paid the duty” reality is therefore a commercial reality, not a CBP reality. CBP sees only the IOR.

The Refund Routing

When CAPE Phase 1 issues a refund:

It goes to the IOR named on the entry.
It is paid via ACH to the refund account on file with CBP.
It is paid as a single consolidated amount per IOR + liquidation date combination.

The IOR receives the money. What happens next is a commercial question.

The Three Common Commercial Outcomes

Outcome 1 — IOR keeps the refund. Many importers’ position is that they paid the all-in landed price as a single commercial number. The duty was a component of that price. Now that the duty has been refunded, the refund belongs to the party that paid the price — them. This is the most common position when the original duty cost was not separately invoiced or itemized.

Outcome 2 — IOR passes the refund to the supplier. When the supplier separately invoiced the duty as a pass-through item (common in some industries), the contract typically supports the supplier’s claim to the refund. The importer receives the ACH credit, then issues a credit note, wire transfer, or invoice offset to the supplier.

Outcome 3 — Disputed. When the contract is ambiguous, both parties argue. This is happening now, in 2026, across many importer-supplier relationships. The dollar amounts are large enough — 25% of merchandise value, sometimes hundreds of thousands of dollars per supplier — that disputes are escalating to legal counsel.

What to Do Now

Before the refund lands:

Pull every DDP entry from the affected window. Identify which CAPE refunds you expect to receive and the dollar amounts.
Check your purchase orders, supply agreements, and any duty-handling addenda for explicit language on refunds, rebates, or duty adjustments.
If the contract is silent, get a written position from your supplier in writing — before the refund lands. A clarifying side letter or amendment is much easier to negotiate when neither party has the cash.
Coordinate with your trade counsel on how to handle disputes if the supplier claims the money.

Going forward:

Review whether DDP is the right Incoterm for your supplier base. The refund-routing ambiguity is one of several reasons importers are reconsidering DDP after the IEEPA experience.
If you keep DDP, add explicit refund-handling language to your standard terms.
If you switch to DAP or CPT, plan for the cash-flow impact of paying duties yourself.

Common Mistakes

Mistake — Promising the supplier the refund before reading the contract. Once you commit in writing, the supplier will hold you to it. Read first, commit later.

Mistake — Letting the broker discuss refund routing with the supplier. Brokers handle entry filing, not commercial settlement. Refund disputes belong with you and your trade counsel, not your broker.

Mistake — Assuming the foreign supplier can collect from CBP directly. They cannot. Even if you both agree the supplier should get the money, CBP still pays the IOR. The supplier collects from you, not from CBP.

Mistake — Ignoring DDP refund routing because the dollar amount per entry is small. Aggregate across a year of entries from one supplier and the dollar amounts are often material. Don’t make this decision entry-by-entry.

Where This Connects

For the broader filing process, see the 7-step CAPE filing guide. For decisions about which entries belong in CAPE versus protest versus CIT, see CAPE, protest, or CIT. For foreign IORs specifically, see the foreign importers of record CAPE refund checklist.

If you’d like help mapping your DDP entries and refund routing, request a free assessment.

CAPE Portal Guide is not a law firm, customs broker, or government agency. Refund-routing disputes between importers and suppliers are commercial contract matters and should be handled with qualified trade counsel.