Federal court strikes down Trump's new 10% global tariffs
The president's economic policy once again received a judicial drubbing following the Supreme Court ruling that struck down the original levies.
Donald Trump fastens list of tariffs during Liberation Day.
The U.S. Court of International Trade once again delivered a stinging setback to the Trump administration's economic policy, ruling against the 10% global tariff imposed by the Donald Trump administration. The three-judge panel found that its application cannot be justified under a 1970s law invoked for its implementation.
The court ruled by 2 votes to 1 that Trump exceeded his powers by invoking section 122 of the Trade Act of 1974 to impose the new levy without having congressional approval to do so.
An incorrect application of the Trade Act of 1974
The trade court also held that Trump implemented the rule incorrectly by failing to identify what specific type of economic crisis it seeks to address, something the law requires, and thus did not follow the specific balance-of-payments measures foreseen when the law was written five decades ago.
"The President enjoys no inherent authority to impose tariffs during peacetime. This case turns on the meaning of Section 122 and whether the President asserted the existence of the conditions required by the statute in order to lawfully proclaim the import surcharges. … The President’s Proclamation fails to assert that those required conditions have been satisfied."
Ruling only affects plaintiffs
A further judicial blow to Trump, who imposed this new temporary levy in February after the Supreme Court struck down a significant portion of his reciprocal tariffs. According to the administration, the 10% tariff was intended to address balance of payments deficits.
The Court of International Trade on Thursday ordered the defendants to implement its ruling within five days, as well as ordered reimbursements to the importers who filed the lawsuit. While the ruling, which can be appealed, is limited for the time being to the plaintiffs, it sets a legal precedent allowing other companies to challenge the surcharges as well.
The levy will be in effect until the end of July, unless Congress extends it, while the White House seeks more durable mechanisms to rebuild its trade agenda.
The Trump Administration is seeking new formulas to maintain the tariffs
To that end, U.S. authorities have opened investigations into dozens of trading partners over concerns related to forced labor and overcapacity, which could lead to new tariffs.
Trump's sectoral tariffs on products such as steel, aluminum and automobiles are unaffected by the Supreme Court's backward-looking decision.
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