Section 122's 10% global surcharge died exactly the way our tariff-authority guide said it would: not through a policy reversal, but because its statutory clock ran out. At 12:01 a.m. ET on July 24, the 150-day surcharge that began February 24 expired by operation of law. But if you were hoping that meant a quieter week for your landed costs, it didn't — a much broader replacement took effect in the same hour.
The clock ran out right on schedule — but not without a fight
Section 122 was already the second tariff mechanism this administration had leaned on in 2026. The first, a set of tariffs imposed under IEEPA emergency powers, was struck down by the Supreme Court on February 20 in a 6-3 decision applying the "major questions doctrine" — the Court held that a power this sweeping needed explicit authorization from Congress, not an emergency-powers workaround. Section 122 became the bridge measure that followed four days later.
The bridge itself didn't have a clean run. The Court of International Trade struck down the Section 122 surcharge on May 7 in a divided 2-1 ruling, finding the proclamation didn't identify a "balance-of-payments deficit" the way Congress meant the term in 1974. But that ruling's relief was narrow by design — the court granted an injunction only to the three named plaintiffs in that case, not to importers generally, after finding only they had shown the concrete injury needed for standing. The government appealed, and the Federal Circuit issued a stay on May 12, so CBP kept collecting the surcharge on every other importer's entries straight through to its natural July 24 expiration. If you paid the surcharge during that window and you weren't a plaintiff in that case, don't assume a refund is coming automatically — the appeal doesn't resolve that for you, and the working guidance from trade counsel is to file your own protest and keep your entry documentation rather than wait on someone else's litigation.
What replaced it: Section 301 forced-labor tariffs on 60 economies
USTR opened 60 parallel Section 301 investigations on March 12, covering 59 countries plus the EU, examining each economy's enforcement of forced-labor import prohibitions. Its report and proposed action published June 2, the comment docket closed July 6, and public hearings ran three days at the US International Trade Commission starting July 7. USTR's final Federal Register notice implementing the tariffs published July 23, effective 12:01 a.m. ET on July 24 — the same hour Section 122 expired — and covers all 60 investigated economies.
The final rate structure has four tiers, and the country you source from determines which one applies. Seventeen economies that have a forced-labor import ban on the books, committed to one through a trade agreement, or run a partial regime — including Canada, Mexico, India, Indonesia, and the UK — get a flat 10%. The EU and Taiwan get a 10%-net-of-MFN rate, meaning the Section 301 duty tops up whatever they already pay to 10% combined (zero additional duty if their MFN rate already clears that bar). Japan, South Korea, and Switzerland get the same net-of-MFN treatment but topped up to 12.5%. Everyone else USTR investigated — including China — pays a flat 12.5%. Several countries' final tier differs from what USTR proposed back in June, after the comment period and hearings — a proposed rate in a Federal Register notice is a starting point, not your final number, until that comment window closes.
This is the practical lesson from watching Section 122 and Section 301 collide this week: a temporary tariff expiring is not the same as tariff exposure going away. Check what's filling the gap before you adjust pricing or sourcing on the assumption of relief.
The exclusions and grace period that actually matter to you
Two details in the final notice are worth checking against your own HTS codes before you assume the new rate applies to everything you import:
Product exclusions across roughly 2,120 tariff codes. The notice exempts anything already carrying a Section 232 duty (no double-stacking), civil-aircraft-use goods, pharmaceutical products, Chapter 98 entries, USMCA-compliant goods from Canada and Mexico, CAFTA-DR-qualifying textiles, humanitarian donations, informational materials, and accompanied baggage, plus a general carve-out for raw materials or products where the tariff would cause a genuine domestic supply problem. On top of that, USTR is standing up duty-free tariff-rate quotas for Bangladesh, Cambodia, Indonesia, and Malaysia tied to how much US cotton and textile input each country buys — the standard 10% rate applies to those four until the quota mechanism is actually running.
A short grace window, already closing. Goods loaded onto a vessel before 12:01 a.m. ET July 24 and entered for consumption before 12:01 a.m. ET July 28 are exempt from the new duties under the transition provision. That window is measured in days, not weeks — if you have shipments in transit, this is the first thing to confirm with your broker, not the last.
What to check this week
Map every HTS code and country of origin you import against your country's rate tier and against the exclusion list — the same product can land in a different bucket depending on which country it ships from. Confirm bill-of-lading and vessel-load dates against the July 24–28 grace window for anything currently in transit. And don't assume an internal compliance program buys you a lower rate: the final notice assesses these duties by country and product, not by importer conduct, so a clean supply-chain audit doesn't create a safe harbor here the way it might under other trade-enforcement regimes.
One more date worth diarizing while you're in this file: a separate, unrelated Section 232 action puts a 100% duty on certain patented pharmaceuticals and active pharmaceutical ingredients starting July 31 (September 29 for a second group of companies) — generics are excluded entirely, and the EU/Japan/South Korea/Switzerland/Liechtenstein get a reduced 15% rate, the UK 10%. Relevant if pharma inputs are anywhere in your supply chain; see our guide to the three tariff authorities for how Section 232 differs from the Section 301 action described here.
Related reading on this site
For the underlying framework behind everything above, start with Section 232 vs. Section 301 vs. Section 122, and check the tag archives for tariffs and guides for the latest as rates and exclusions get revised.
This summary is drawn from USTR's own Federal Register notices and press releases (initiation, proposed action, and July 23 final action), cross-checked against trade-law-firm analysis, current as of July 25, 2026 — not legal or customs advice. Rate tiers, exclusions, and quota mechanics can still be corrected or clarified by USTR after publication — confirm your specific entries and HTS classifications with a licensed customs broker before relying on any figure above.