Trump’s tariffs in limbo after trade courts cite presidential overreach

The US Court for International Trade (CIT) said President Donald Trump lacks the authority to levy sweeping tariffs on virtually all nations, a ruling that would block the duties he announced in early April on the administration’s so-called “liberation day.”

In the May 28 decision by a three-judge panel, the CIT also called for a halt to tariffs imposed in early February on Mexico, Canada and China. Trump had declared those tariffs were necessary to force the three countries to address a national emergency involving the trafficking of illicit drugs such as fentanyl at the US southern and northern borders.

But the CIT ruling was swiftly put on hold. On May 29, the US Court of Appeals for the Federal Circuit granted a same-day motion by the US Department of Justice for an immediate administrative stay that keeps the tariff measures in effect while the trade court’s decision is under appeal.

Trump had instituted the tariffs by executive order under the International Emergency Economic Powers Act of 1977 (IEEPA), which gives the president limited latitude to levy tariffs without congressional approval to deal with an “unusual and extraordinary threat” for which a national emergency has been declared. The duties also cannot be implemented for any other purpose. Though the initial tariffs were aimed at the smuggling of illegal drugs, the Liberation Day tariffs were put in place to remedy persistent annual US goods trade deficits, which the Trump administration claimed represent a national emergency.

However, the CIT determined that the worldwide and reciprocal tariffs levied exceed the powers granted to the president under the IEEPA and that the trafficking-related tariffs don’t directly address the threat for which they were instituted.

In the decision, the court ruled on two cases: one brought by five small businesses and another brought by 12 states (Arizona, Colorado, Connecticut, Delaware, Illinois, Maine, Minnesota, Nevada, New Mexico, New York and Vermont).