March 12 (Reuters) - The U.S. government's work to build a four-part system to refund $166 billion in illegal tariff collections with interest is between 40% and 80% complete, according to a court filing on Thursday.

Brandon Lord, an official with U.S. Customs and Border Protection, said in a court filing the agency is developing an online claim portal for importers and brokers to submit refund requests. 

Once submitted, the claims will go through processing, review and refunding, according to the filing. Lord said in a filing last week the system could be operating as soon as mid-April.

Lord's filing at the U.S. Court of International Trade was made to comply with an order issued last week by Judge Richard Eaton as part of his directive to refund tariff payments.

Most U.S. tariffs were struck down by the Supreme Court in February, dealing a blow to President Donald Trump's central economic policy. However, the Supreme Court did not provide guidance on refunding the tariff payments that had been collected from importers since February 2024.

Many large importers such as FedEx sued CBP to protect their right to a refund, which Trump said could take up to five years. Many smaller importers feared the cost of the refund process would outweigh the benefits of trying to get reimbursed.

Eaton last week ordered CBP to begin processing refunds using its existing system, but the agency instead proposed a new process that would be ready to accept refund applications as soon as next month and would not require importers to sue.

Lord said in Thursday's filing the least developed part of the system was the mass processing portion, which was 40% complete, while the most developed portion was the review portion, which was 80% complete.  

CBP did not say how quickly refunds would be paid. More than 330,000 importers paid the tariffs on 53 million shipments and only around 21,000 were registered with its system to receive a refund, according to a court filing last week.

Refunds will only be issued to importers who paid them. Consumer groups and lawmakers have urged companies to pass along the refunds to consumers, although there is no obligation to do so.

FedEx and Costco have been sued by customers for refunds and FedEx has said it will reimburse customers, while Costco said it will use the refunds to lower prices.

After the Supreme Court struck down the tariffs, Trump ordered new 10% tariffs under a decades-old authority meant to address a balance-of-payments emergency.

States and private businesses have sued to challenge those tariffs, which they argue were also illegally imposed.

In addition, the Trump administration has started investigating unfair trade practices of major trading partners, a step toward imposing tariffs under a law that has withstood legal challenges.