When are Exchange Server Toolbox rules applied to e-mail?

Question / Problem

Are the rules of the Exchange Server Toolbox evaluated before the Exchange Server bounces an email because the recipient does not exist?

Answer / Solution

Yes, the Exchange Server Toolbox becomes active immediately after SMTP reception and processes all incoming (received) rules, regardless of the existence of the recipient. However, the incoming (accepted) rules are not processed until the Exchange Server has accepted the email and therefore wouldn't be triggered.