U.S. Courts Weigh In On Legality Of Trump IEEPA Administration Tariffs

The end of last week brought a lot of upheaval when it came to Trump administration tariff policy. First, in a unanimous opinion issued on Wednesday, May 28, the U.S. Court of International Trade (USCIT), which hears disputes involving international trade and customs laws, struck down the tariffs President Donald Trump had issued under the International Emergency Economic Powers Act (IEEPA).

The ruling did not affect any of the Section 232 tariffs the Trump administration had imposed, including those on industrial metals and automobiles. Indeed, the tariffs at issue are the:

• 10 percent baseline tariffs announced on April 2;
• The reciprocal tariffs totaling between 20 percent and 50 percent on approximately 65 trading partners with which the U.S. runs trade deficits (see the latest Connecting the Dots story on these penalties and the 10 percent tariffs at this link); and
• The 25 percent fentanyl IEEPA tariffs on products from Canada and Mexico and the 20 percent fentanyl IEEPA tariff on products from China. (See the Connecting the Dots story on these penalties at this link.)

The three-judge panel found the IEEPA “does not authorize the President to impose unbounded tariffs” and the administration exceeded its authority in imposing the “reciprocal” and fentanyl IEEPA tariffs.

Less than 18 hours later, D.C. District Court Judge Rudolph Contreras issued a similar ruling that argued the IEEPA “does not authorize the President to impose” tariffs. Judge Contreras, who also called the tariffs “unlawful,” stayed his order for 14 days “so the parties may seek review in the Court of Appeals.”

The USCIT had given U.S. Customs and Border Patrol 10 days to implement its ruling, but that time was not necessary. That is because on the afternoon of May 29, the U.S. Court of Appeals for the Federal Circuit in Washington, D.C. stayed the USCIT’s ruling, which means the Trump administration can once more impose the tariffs. The appeals court set a briefing schedule that requires the two parties in the case to outline their arguments by June 9. At that point, the court will decide whether to grant a longer injunction.

This case is widely expected to eventually be heard by the Supreme Court.

In the meantime, as the BBC reported, the White House vowed to press ahead. Trade adviser Peter Navarro told reporters, “You can assume that even if we lose [in court], we will do it [tariffs] another way.” According to BBC, options include invoking Section 301 of the Trade Act of 1974, or 1930 Section 338 of the 1930 Trade Act, which allows the president to impose tariffs of up to 50 percent on imports from countries that “discriminate” against the United States.