US court: Trump cannot use emergency law to impose most tariffs
A US federal court on Wednesday denied President Donald Trump the authority to impose sweeping tariffs on imports under an emergency law.
The US Court of International Trade, in a case filed by several businesses and 12 states across the country against the US government, including several Cabinet secretaries, ruled that the government's use of the emergency powers act was not consistent with the US constitution and therefore could not be used to impose the tariffs.
In a 49-page ruling, the court said the question it was dealing with is whether the president had the powers under the International Emergency Economic Powers Act of 1977 (IEEPA) "to impose unlimited tariffs on goods from nearly every country."
It said no.
"The court does not read IEEPA to confer such unbounded authority and sets aside the challenged tariffs imposed thereunder."
Widespread tariffs imposed by Trump have sparked market turmoil for weeks and moved several US economists to speculate that their effects might be to push the United States into a recession.
The ruling affects nearly all tariffs imposed by the Trump administration, including the punitive tariffs he introduced on what he referred to as "Liberation Day" in early April.
The decision represents a significant defeat for Trump, who is expected to appeal it.
The court noted that tariffs are the domain of Congress.
"The Constitution assigns Congress the exclusive powers to 'lay and collect Taxes, Duties, Imposts and Excises,'" and to "regulate Commerce with foreign Nations," the three federal judges wrote in their decision.
Trump has argued that trade deficits with other countries pose a national security risk, thereby constituting a national emergency.
In April, a dozen US states filed a lawsuit against the tariffs in the New York court. Ten of these states are governed by Democrats, while two are led by Republicans.
Trump seeks bilateral 'deals'
Trump has repeatedly emphasized his desire to negotiate bilateral agreements with individual countries, frequently shifting his approach. He claims this strategy allows him to secure "better deals" for the US, and he sees the punitive tariffs as a way to pressure partners into making concessions.
Most recently, the trade dispute between the US and Europe escalated further, when Trump unexpectedly threatened the EU with punitive tariffs of 50% starting on June 1. On Sunday, after speaking with European Commission President Ursula von der Leyen, he postponed the measure by just over a month. Both sides now aim to find a solution by July 9.
The EU has reserved the right to impose retaliatory tariffs in the event of an escalation.
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