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Javier Pastor
Senior WriterComputer scientist turned tech journalist. I've written about almost everything related to technology, but I specialize in hardware, operating systems and cryptocurrencies. I like writing about tech so much that I do it both for Xataka and Incognitosis, my personal blog.
Alba Mora
WriterAn established tech journalist, I entered the world of consumer tech by chance in 2018. In my writing and translating career, I've also covered a diverse range of topics, including entertainment, travel, science, and the economy.
On Wednesday, the Court of International Trade ruled that President Donald Trump doesn’t have the authority to impose the so-called reciprocal tariffs he announced worldwide. The implications of this decision are significant.
Tariff chaos. Trump initiated a global trade war during his presidential campaign. After his return to the White House, he started implementing tariffs on almost every country. These import taxes sparked a reciprocal escalation of tariffs between the U.S. and China, creating immediate repercussions for the global economy. As a result, Trump eventually postponed and eased levies in anticipation of future negotiations.
Illegal tariffs. Trump imposed new tariff policies under the International Emergency Economic Powers Act (IEEPA), an emergency law enacted in 1977. However, there was substantial opposition to his actions. A coalition of companies and several Democratic states filed lawsuits against the president to challenge the tariffs. The Court of International Trade has now declared the use of this law illegal.
The controversial IEEPA. Trump used IEEPA to justify his actions. This law allows the president to regulate international trade after declaring a national emergency in response to an unusual or extraordinary threat to the country. However, the recent federal court ruling said that “the court does not read IEEPA to confer such unbounded authority” and effectively overturned the “challenged tariffs” imposed under this act.
The Trump administration’s appeal. Senior officials in the Trump administration have already initiated an appeal, which will move the case to a federal court of appeals. The case might ultimately reach the Supreme Court, where Republican judges outnumber Democratic ones. This could potentially give Trump an advantage in the final ruling.
Tariffs overturned. The ruling hasn’t declared all tariffs illegal. Among those that have been thrown out are the 25% tariffs on imports from Canada and Mexico, as well as the 20% tariffs on Chinese goods. The federal court says Trump can’t enforce his reciprocal tariffs either. These levies impacted nearly every country worldwide, although the president reduced them to 10% after a temporary 90-day pause.
“The challenged Tariff Orders will be vacated and their operation permanently enjoined. There is no question here of narrowly tailored relief; if the challenged Tariff Orders are unlawful as to Plaintiffs, they are unlawful to all.”
Tariffs still in effect. Tariffs imposed under a different legal authority, known as Section 232, haven’t been affected by the recent ruling and will continue to be in effect. This includes imports of cars, steel, and aluminum.
What happens next? Although the ruling is effective immediately, the federal trade court explains in a separate resolution that a 10-day period will be granted for administrative orders. Time will tell how the U.S. and other countries will respond.
Image | Bermix Studio
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