Trump's tariff defense under WTO rules could face legal challenges
Investing.com -- The Trump administration's decision to impose tariffs on civil aircraft parts may face legal challenges under international trade rules, according to Bank of America (NYSE:BAC) (BofA) analysts.
At the center of the issue is whether the U.S. tariffs override obligations under the World Trade Organization (WTO) Agreement on Trade in Civil Aircraft (ATCA), which has mandated the elimination of tariffs on civil aircraft and related components since 1980.
The U.S. could seek cover under Article XXI of the General Agreement on Tariffs and Trade, which allows exemptions from WTO commitments on grounds of 'essential' security interests.
While the WTO has historically interpreted 'essential' to mean a state of war, the U.S. has long argued that the term is 'self-determining,' giving each country discretion in defining its national security.
However, the legal foundation for the tariffs remains uncertain. The Trump administration invoked the International Emergency Economic Powers Act (IEEPA) as a justification, but BofA analysts highlight that 'IEEPA isn't a tariff legal authority,' and that 'many in the legal community think these tariffs could fail when litigated in court.'
The aerospace industry is already feeling the impact of the recent trade tariffs. Howmet Aerospace (NYSE:HWM_p), a key player in the sector, has issued a force majeure notice to its customers, a legal clause that permits contract obligations to be suspended when unforeseen and uncontrollable events occur.
The company said it would work with customers, 'including discussing your interest in alleviating the impact of the Tariff Executive Order on Howmet.'
This marks the first instance of a commercial aerospace supplier taking such action since the introduction of the tariffs.
'We would expect other suppliers to follow as Howmet is widely respected as a disciplined and well-run supplier,' BofA analysts said.
Suppliers may find themselves compelled to negotiate pricing concessions with customers to manage the financial burden of the increased costs due to the tariffs.
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Politico
9 minutes ago
- Politico
What Trump Doesn't Understand About Putin
Russian leader Vladimir Putin looks increasingly cornered. The Ukrainians just staged a stunning drone attack on strategic bombers in far-flung Russian air bases. Putin's battered troops are struggling to gain significant territory in Ukraine, and the frontline has barely shifted in two years. His economy is a mixed bag, with inflation slowing growth and other danger signs flashing. President Donald Trump, who has long admired Putin's brash leadership style, is now questioning the Russian leader's sanity and urging him to 'STOP!' his attacks on Ukraine. And U.S. lawmakers are mulling a heavy new sanctions and tariffs package aimed at Moscow — the type one senator describes as 'bone-crushing.' Given all these challenges, why won't Putin abandon his goal of conquering Ukraine? I have been asking former U.S. officials versions of this question in recent days. Finally, I realized it's the wrong question — and the wrong way to think about this whole war. Putin will never abandon his ambition of conquering Ukraine, and convincing him to do so shouldn't be the aim of Ukraine's global supporters. Instead, the goal should be to make it impossible for Putin to fulfill that ambition. In simpler terms: You can't make Putin walk away from Ukraine; you have to put Ukraine out of his reach. Trump and some of his top aides do not seem to understand this about Putin. They've sent mixed signals about their views of Russia's strongman, with Trump acting as if the carrots of economic deals and Truth Social posts can sway him. With new sanctions on the table, many Russia watchers hope Trump will seize the moment to show Putin that even if he can't control his ambitions, he can make it too painful for Putin to achieve them. But those same analysts warned that new sanctions alone won't make Putin back down. Neither will continued military aid to Ukraine, nor tough-talking posts on social media. Showing Putin that he absolutely cannot subsume Ukraine will require all these tactics and more. It will also require patience. 'That's why you do these missions, like Ukraine taking out some of their strategic bombers. That hurts. It's expensive,' said Andrea Kendall-Taylor, a former U.S. intelligence official. 'Can we impose enough costs that he eventually says, 'I cannot do this indefinitely?'' I'm not the first person to posit that Putin will never change his belief that Ukraine belongs to Russia. Putin's own writings make clear that he's convinced Kyiv must be under Russia's thumb if Moscow wants to achieve new heights on the global stage. Former Secretary of State Antony Blinken suggested Putin's view is 'theological.' One analyst has argued that the West's best strategy on the war may require waiting until Putin dies. A White House official, in response to a request for comment from the administration, told me Trump 'has always been tough on Putin.' The official, whom was granted anonymity to discuss sensitive diplomatic issues, added: 'This president's foreign policy is unique in that he can be tough on our adversaries, but he is simultaneously able to look anyone in the eye to try to deliver peace.' But many of Trump's words and actions indicate that he has limited appreciation for how hard-core Putin is about pursuing Ukraine. During the campaign, Trump declared numerous times that he could end the war in his first 24 hours back in office — a claim that he now says was in jest but which nonetheless cast Putin as easy to persuade. In the months since, the president has seemed bewildered that Putin isn't easing up on Ukraine. Trump recently said, with a tone of surprise, that the Russian leader has gone 'absolutely CRAZY.' Trump also seems frustrated with Putin's lack of seriousness in ceasefire talks. The tough talk from Trump is striking given his past efforts to win Putin over. But his methods are not always consistent. Trump came across as passive in a social media post Wednesday after speaking to Putin, saying the Russian made it clear he'd have to retaliate against the Ukraine drone strikes. 'It was a good conversation, but not a conversation that will lead to immediate Peace,' Trump wrote, not saying if he'd urged Putin to avoid escalation. Comments and moves by others in the administration also suggest a lack of clarity about the Kremlin boss, who first invaded Ukraine more than a decade ago. Vice President JD Vance's dismissal of Ukrainian concerns that Putin will not uphold a peace deal — most famously in that awkward Oval Office meeting in February with Ukrainian President Volodymyr Zelenskyy — indicates that he doesn't fully grasp the depth of Putin's desires. It also likely boosted Russian confidence that its efforts to drive wedges between Washington and its allies, including Ukraine and the European Union, are working. Secretary of State Marco Rubio's assertion that the United States may simply walk away from trying to resolve the crisis didn't exactly help Kyiv, either. It suggests the U.S. lacks patience and that the Russians should forge ahead in seeking a decisive edge in the war. And if there's one thing Putin believes he has on his side, it's time. What exactly is Putin's breaking point, or the point at which he'll give up on taking over Ukraine? 'This kind of stuff — it's very hard to quantify. It's the psychology of one man,' Eddie Fishman, a former State Department official who dealt with Russia sanctions, told me. Some of these Russia specialists said Putin is likely aware of the concept of 'TACO Trump' — the 'Trump Always Chickens Out' notion that's swept Wall Street and other realms. Trump's policy inconsistency and his frequent backtracking, such as on tariffs, may suggest to Putin that the U.S. president will try to drive a hard bargain but ultimately cave, giving Moscow wiggle room. The sanctions bill is a test of sorts for Trump and whether he truly understands Putin's mindset. It has garnered support from the majority of U.S. senators and includes harsh provisions aimed at choking off Russia's last major source of income: its energy exports. The legislation would impose 500 percent tariffs on countries that continue buying Russian oil, gas, uranium and other materials. It's questionable whether the 500 percent figure will survive talks between the White House and Capitol Hill. The tariffs would land on major U.S. trading partners in Europe, China and India and wreak havoc on the global economy. Still, whatever version of the bill survives could deal a major blow to Russia. If Trump signs the bill, the Kremlin should worry because it will mean he's not afraid to escalate things with Moscow. But if he signs the bill and then delays, waives or otherwise doesn't enforce the sanctions and tariffs involved, Putin will believe Trump is backing down yet again and that he can take advantage of the American leader's capriciousness. If Trump also fails to take other meaningful steps to help Ukraine, especially on the military aid front, it could further boost Putin's confidence that he and his troops can ultimately overpower Kyiv. Of course, the Kremlin chief could still agree to peace talks — he already has, in a way, though he tends to send powerless underlings to the sessions in his place. Those motions seem to be about buying time with Trump, a self-styled dealmaking expert who is eager for a compromise. Even if Putin agrees to a sustained ceasefire or other type of pause in the fighting, Russia analysts I spoke to believe he'll use the downtime to regroup and eventually make another move against Kyiv. One Trump tactic unlikely to work on Putin is promising him economic deals, should he come to terms with Ukraine. To be fair, Putin himself has raised this prospect in a bid to get sanctions relief from Trump, who largely sees the world through a business lens. The reality is that the Russian economy has been transformed since the February 2022 full-scale invasion of Ukraine. It is now heavily fueled by the war itself. There are signs that this cannot go on forever, but it has continued longer than many Western officials and analysts predicted. Putin is also likely aware that even if Trump were to lift all U.S. sanctions on Russia, American businesses are unlikely to jump into the Russian market anytime soon. There are too many risks, including the possibility that a future U.S. president could reimpose the sanctions. Besides, European sanctions are likely to remain in place. 'Given sanctions and export controls that need to be lifted, not to mention the reputational risk and the operating environment in Russia, it's hard to see that Western companies would be rushing to go back to that market,' Randi Levinas, a former chief operating officer of the now-dissolved U.S.-Russia Business Council, told me. Putin is in a corner. But while everyone is watching him, he's still got his eye on Ukraine — all of Ukraine.
New York Times
13 minutes ago
- New York Times
Trump Administration Live Updates: President Bans Citizens of 12 Countries From Entering U.S.
In recent years, people in Myanmar have endured a military coup, civil war, enforced conscription, aerial bombardment and a devastating earthquake. A new hardship landed Thursday morning, as President Trump ordered a sweeping travel ban that included the citizens of Myanmar. The action is an effort to stop immigration from nations that Mr. Trump deemed to have a 'large-scale presence of terrorists,' among other concerns. The travel ban, announced by the president on Wednesday night in Washington, is set to take effect on Monday. It applies to the people of Afghanistan, Myanmar, Chad, the Republic of Congo, Equatorial Guinea, Eritrea, Haiti, Iran, Libya, Somalia, Sudan and Yemen. Many of these countries have been wracked by conflict, while others are ruled by repressive regimes. In both cases, Mr. Trump's proclamation closes the door on those hoping to flee to the United States to build new lives. Citizens of seven other countries — Burundi, Cuba, Laos, Sierra Leone, Togo, Turkmenistan and Venezuela — will be barred from entering the United States on tourist and student visas. They also will not be able to settle permanently in the U.S. Image In Yangon, Myanmar, in March. Credit... Sai Aung Main/Agence France-Presse — Getty Images 'We will not allow people to enter our country who wish to do us harm,' Mr. Trump said in a message on social media. 'As soon as I woke up, bad news was already waiting for me,' said Ko Min Nwe, a 35-year-old accountant in Myanmar who last month won a U.S. immigration lottery that put him on the path for a green card next year. 'Being a Myanmar citizen means that wherever we go, we face discrimination and now, even this rare stroke of luck feels like it's been stolen from me.' Mr. Trump said that his new travel restrictions also apply to countries that do not have proper ways to vet travelers to the United States, that have a track record of citizens who overstay their American visas and that have not easily accepted back their nationals. But the restrictions overwhelmingly target nations with vulnerable populations eager for sanctuary in the U.S. 'This policy is not about national security — it is about sowing division and vilifying communities that are seeking safety and opportunity in the United States,' said Abby Maxman, the president of Oxfam America, the charity dedicated to fighting global inequality and poverty. The ban provides for certain exceptions. For instance, Afghans can still apply for special visas designed to safeguard those who worked for the U.S. government or military as translators and other assistants before the American withdrawal in 2021. Legal permanent residents of the United States are exempt from the order. So are athletes and their entourages visiting for major sporting events. Adoptions from the restricted nations will be allowed. Image Afghan women receiving food aid in Kabul last month. Credit... Wakil Kohsar/Agence France-Presse — Getty Images During his first term, Mr. Trump imposed a series of travel bans on mostly Muslim-majority nations, some of which were countered by the courts. Former President Joseph R. Biden Jr. revoked the immigration restrictions when he took office, calling them 'a stain on our national conscience.' Hashmat, an Afghan journalist, said he had been granted a visa to go to the United States, after enduring a month in a Taliban prison for his reporting. He is now in hiding. The new travel ban, which appears to apply to the type of visa he received, has left him with no hope, said Mr. Hashmat, who goes by only one name. 'I devoted 14 years of my life working with respected media outlets to promote democracy, freedom of speech and global values — values I believed the U.S. shared,' he said. 'Today, I suffer because of those very values.' Some of the countries affected by Mr. Trump's latest travel order reacted quickly, vowing to tackle problems. Somalia, according to Mr. Trump's proclamation, was targeted because it lacks a central authority that can properly screen travelers and it is a 'terrorist safe haven.' 'Somalia values its longstanding relationship with the United States and stands ready to engage in dialogue to address the concerns raised,' Dahir Hassan Abdi, the Somali ambassador to the U.S., said in a statement. Myanmar erupted into full-blown civil war four years ago, following a military coup that ousted an elected government. Criminal networks in the country's poorly governed borderlands have filled war chests and flooded the world with synthetic drugs, cyberscams and dubiously sourced minerals. Still, there is scant evidence that Myanmar is exporting terrorism, much less to the United States. Most immigrants from Myanmar arrived in the United States as refugees escaping persecution. Waves of immigration to the United States by Myanmar nationals have followed moments of political turmoil, such as crackdowns on democracy movements in 1988 and 2007. More recently, more than 3.5 million people in Myanmar, out of a population of about 55 million, have been uprooted from their homes because of the civil war. Millions more have sought shelter abroad, mostly in neighboring Thailand and Bangladesh. Image A refugee from the Mae La camp in Myanmar after being transferred to a hospital in Thailand in February. Credit... Athit Perawongmetha/Reuters Starting last July, a resettlement initiative brought Myanmar refugees living in camps in Thailand to the United States. But that program has effectively stopped since Mr. Trump's second inauguration. American aid for Myanmar refugees in Thailand and Bangladesh has been slashed, too; without access to medical care, babies and elderly patients have died, doctors say. From 2005 to 2015, about 100,000 refugees from camps in Thailand were resettled overseas, mostly in the United States, according to the U.N. refugee agency. Myanmar is now a fractured nation. Most of the heartland of the country is controlled by the military junta, while ethnic armed groups and pro-democracy forces have carved out territory in the vast outer areas. Airstrikes by the Myanmar military have destroyed hundreds of villages. Thousands of people have been imprisoned and tortured for daring to oppose the military junta and call for democracy. Since the coup in 2021, the United States has imposed sanctions on top junta officials and the business cronies who prop them up. But some critics say Washington's actions don't have enough bite. Ma Mya Thiri Lwin, 24, was accepted at a college in Minnesota to study computer science beginning in August. As part of a large student-led boycott of government institutions, she had not attended university in Myanmar. Now, she said, her dreams of one day working in Silicon Valley have withered. 'It feels like Myanmar is cursed,' she said, learning that Mr. Trump's travel ban included her homeland. 'Even the U.S., which claims to be a stronghold of human rights, has turned a blind eye to people like us who are poor, oppressed and at risk.' Safiullah Padshah and Mike Ives contributed reporting.
Bloomberg
33 minutes ago
- Bloomberg
Trump's Administration Has Asked Ally Serbia to Accept Deportees
President Donald Trump's administration is pushing Serbia and other Balkan nations to take in migrants deported from the US, according to people familiar with the matter. The requests to countries in the region are ongoing and part of a broader strategy to find foreign governments willing to receive migrants sent from the US, including some who originally entered under Biden-era protections, according to the people, who requested anonymity because the talks were private.
