Tariff dispute: US trade court puts a damper on Trump

A commercial court has declared the tariffs imposed by US President Donald Trump to be largely unlawful and thus temporarily halted the US government's tariff policy. The U.S. Court of International Trade in New York ruled on Wednesday (Case No. 25-cv-00066 et al) that the U.S. President cannot impose such far-reaching tariffs on the basis of the emergency law used for this purpose.

The court has thus at least temporarily lifted many of the tariffs imposed by the US government on the import of goods from other countries – including China, Canada and Mexico –. They may now no longer be levied. A number of US states and smaller US companies affected by the import tariffs had filed suit.

Car tariffs remain in place

Tariffs on cars, steel and aluminum are not affected by the ruling. Trump had issued these on the basis of other laws. In addition, the US President has the right to temporarily impose tariffs on goods from countries with which the USA has a high trade deficit.

For his far-reaching tariff policy, Trump had declared the US trade deficit to be a national emergency and relied on emergency powers under the International Emergency Economic Powers Act of 1977 (IEEPA). The court had to examine whether this law authorizes the US president to "impose unlimited tariffs on goods from almost any country in the world".

"The Court does not find that IEEPA confers such unlimited authority and vacates the challenged tariffs imposed on that basis," the ruling issued on Wednesday states. The US government immediately announced an appeal against the ruling. It initially remained unclear whether the tariffs would now be suspended. It cannot be ruled out that the White House will be successful in its appeal.

German government: "No comment"

Reactions on this side of the Atlantic were correspondingly restrained. A spokesperson for the Federal Ministry of Economics did not wish to comment on the ongoing legal proceedings in the USA when asked by dpa. "We continue to hope that a good solution can be reached for both sides in the negotiations between the EU Commission and the US government."

The EU Commission also did not wish to comment on the ruling. It is currently negotiating a possible deal with the US government on the mutual lifting of tariffs and other trade restrictions. Trump recently threatened the EU with punitive tariffs of 50 percent.

Trump's tariffs have caused irritation worldwide. They were seen as a one-sided escalation of international trade conflicts and put considerable pressure on the financial markets. The European Union and China in particular are at the center of Trump's trade policy measures. The US government recently reached an agreement with China to reduce tariffs.

(vbr)