Landmark Ruling: Court Blocks Trump's Global Tariffs, Reinforces Congressional Trade Authority
On May 28, 2025, the U.S. Court of International Trade (USCIT) delivered a landmark ruling, declaring former President Donald Trump's sweeping "Liberation Day" tariffs illegal. The court determined that Trump had overstepped his authority under the International Emergency Economic Powers Act (IEEPA) by imposing broad-based import duties without proper justification.
🧾 Background: The "Liberation Day" Tariffs
In April 2025, President Trump announced the "Liberation Day" tariffs, aiming to impose a 10% baseline tariff on most imports and higher tariffs on goods from countries with significant trade surpluses, such as China and the European Union. The administration justified these measures under the IEEPA, citing economic threats like trade deficits and non-reciprocal trade practices as national emergencies.
⚖️ The Court's Decision
The USCIT, in a unanimous decision by a three-judge panel, ruled that the tariffs exceeded the authority granted to the President under the IEEPA. The court found that the economic conditions cited did not constitute an "unusual and extraordinary threat" as required by the Act. Furthermore, the court emphasized that the IEEPA does not grant the President unlimited tariff powers and that such broad delegation of authority would violate the Constitution's separation of powers unless Congress provides clear, limiting guidelines.
🧑⚖️ Legal Precedents and Implications
The ruling stems from consolidated cases, including V.O.S. Selections, Inc. v. United States and Oregon v. Department of Homeland Security. The plaintiffs, comprising small businesses and several states, argued that the tariffs disrupted supply chains and increased consumer costs. The court's decision underscores the limits of executive power in trade policy, reaffirming that tariff authority resides with Congress.
📉 Economic and Political Repercussions
The invalidation of the tariffs has significant economic implications. Markets reacted positively to the ruling, with U.S. and international stock indices rising and a modest gain in the dollar. However, the decision introduces uncertainty for U.S. businesses reliant on imports and complicates ongoing trade negotiations.
🏛️ Next Steps: Appeal and Legislative Responses
The Trump administration has announced plans to appeal the decision, potentially bringing the case before the Supreme Court. In parallel, Congress is considering the Trade Review Act, a bipartisan bill aimed at reclaiming congressional authority over trade matters and ensuring that future tariffs undergo legislative scrutiny.