Key Notes:
- On May 28, the U.S. Court of International Trade (CIT) permanently enjoined tariffs imposed by President Donald Trump under the International Emergency Economic Powers Act (IEEPA), finding that he exceeded statutory and constitutional authority by imposing broad tariffs on imports from China, Canada, Mexico, and other countries.
- The CIT held that IEEPA does not grant the president unlimited tariff authority, emphasizing that “the Constitution assigns Congress the exclusive powers to ‘lay and collect Taxes, Duties, Imposts and Excises,’ and to ‘regulate Commerce with foreign Nations’” and that “any interpretation of IEEPA that delegates unlimited tariff authority is unconstitutional.”
- The CIT found the so-called “Trafficking Tariffs” unlawful because they did not “deal with” the specific threats identified in the Executive Orders (EOs) but instead sought to create leverage over foreign governments – a purpose not authorized by IEEPA.
- The CIT found that the so-called “Worldwide and Retaliatory Tariffs” fail because they exceed any authority granted to the president by IEEPA to regulate importation through tariffs.
- The U.S. government appealed the decision, and the U.S. Court of Appeals for the Federal Circuit (CAFC) temporarily stayed the CIT’s ruling on May 29, allowing the tariffs to remain in effect while the appeal is considered.
- The CIT’s decision does not impact existing Section 301 tariffs on China or Section 232 tariffs on steel, aluminum, autos, and related products; these remain in full effect.
- Until further notice, importers should continue to pay all applicable tariffs, maintain detailed records, and monitor for further developments, as the legal status of the IEEPA-based tariffs remains subject to ongoing appellate review.