US President Donald Trump has faced another significant legal blow regarding his trade policies, while the US Court of International Trade has ruled that the 10% tariff imposed by the Trump administration is illegal. This follows a previous ruling by the Supreme Court which had already declared Trump's tariffs unconstitutional. However, the court has currently stayed the tariff only for two private importers and the state of Washington.
Judicial Ruling and Specific Exemptions
According to a report by the Associated Press, a three-judge panel at the Court of International Trade in New York delivered a 2-1 decision ruling that the 10% tariffs were illegal following a lawsuit brought by small businesses. The court stated that Trump violated the authority granted to the President by Congress under the law. ” The court's decision specifically orders the cessation of tariff collection from Washington state and two companies: the spice company Burlap & Barrel and the toy company Basic Fun.
Context of the 10% Global Tariff
The dispute centers on the temporary 10% global tariff imposed by the Donald Trump administration in February, after the Supreme Court overturned the large double-digit tariffs imposed on almost every country last year. The new tariffs introduced in February were implemented under Section 122 of the Trade Act of 1974 and are scheduled to expire on July 24. While the court ruled in favor of the three entities, it refused to accept the proposal to stop tariffs for the remaining 24 importers involved in the case. Currently, only these three importers have been granted an exemption.
Previous Supreme Court Intervention
Earlier, the US Supreme Court had declared the tariff rates arbitrarily imposed by President Trump as illegal, which led to the creation of the 10% tariff plan. The Supreme Court's historic decision was reached with a 6-3 majority. At that time, the court noted that Trump was the first president to cite a 1970s emergency law to impose tariffs on more than 100 countries. Also, it was noted that he used the threat of tariffs to secure trade deals with several nations, while the court declared the action unconstitutional, pointing out that the word ‘tariff’ isn't mentioned anywhere in that specific law.
Key Highlights
The ruling marks a significant moment in the ongoing legal challenges against the administration's trade enforcement strategies. The case highlights the limitations of presidential power regarding trade laws established by Congress.