FedEx, DHL, and UPS are starting to pass on tariff refunds worth billions of dollars to customers under a US government program, reported Yahoo Finance. The refunds stem from duties ruled illegal under the International Emergency Powers Act of 1977.

FedEx stated that it has received US$800 million in refunds, which will be distributed to customers beginning in August. Chief Customer Officer Brie Carere confirmed the plan during an earnings call. DHL mentioned that funds are already being returned, although it did not disclose the amount.

UPS Chief Executive Carol Tomé indicated that her company could receive $5 billion in refunds overall, with $500 million applied for immediately under phase one of the program. She emphasized that UPS acts as a pass-through, remitting money directly to customers once received.

Phase two of the government's CAPE program begins on June 29, with phase three expected by the end of July. These expansions will make more tariffs eligible for refunds, depending on when they were paid since President Donald Trump imposed blanket duties 14 months ago.

Other companies are also facing pressure to return funds. Costco has been sued by customers and pledged to repay money 'in some form,' while Walmart announced price cuts on 7,200 products. At stake is an estimated $166 billion in tariffs.

The refund process comes amid continued trade uncertainty. Many firms face 10 percent global tariffs under Section 122 of the Trade Act of 1974, which are under legal challenge. FedEx Chief Executive Raj Subramaniam stated that shifting global trade policy remains a significant headwind.