US Trade Court Rules Trump's Global Tariffs Illegal, But Impact May Be Limited
The U.S. Court of International Trade ruled that President Trump's provisional global tariffs, implemented in February, do not comply with the authorization basis of the 1974 Trade Act. However, the ruling only applies to the plaintiff companies, and its actual impact on other importers is expected to be limited.
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- 📰 Published: May 8, 2026 at 11:55
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Trump Tariff War Key News
Central News Agency
(New York, May 7, Comprehensive Foreign Report) The U.S. Court of International Trade today ruled that the provisional global tariffs implemented by President Trump in February this year do not comply with the authorization basis of the 1974 Trade Act. However, the ruling only prohibits the imposition of tariffs on the plaintiff companies and does not involve other importers, so the actual impact remains to be seen.
The New York Times pointed out that for Trump, who is preparing to visit China next week to discuss trade issues with Chinese leader Xi Jinping, this latest ruling is another major setback. Tariffs are expected to be an important topic on the Trump-Xi agenda, and this ruling will inevitably weaken Trump's bargaining chips.
In this 53-page ruling, a three-judge panel of the trade court, with a 2-1 vote, determined that the legal threshold for invoking Section 122 of the 1974 Trade Act to impose additional tariffs has not yet been met. The ruling cited legislative history, stating that Section 122 "documents a series of efforts to carefully limit the President's discretion in trade matters."
Jeffrey Schwab, litigation director for the Liberty Justice Center, a legal group representing the small businesses in this case, said: "Section 122 was passed in the context of a specific historical crisis, when the U.S.'s currency and gold reserves were being depleted, but this is not the case today."
The trade court today declared the global tariffs illegal, but the judges only explicitly prohibited the federal government from collecting these tariffs from the plaintiff small businesses. The actual impact may be limited, and the Trump administration is expected to appeal.
However, The Wall Street Journal believes that although the trade court did not issue a nationwide injunction, because the ruling has determined that the president overstepped his authority, other importers can choose to invoke this ruling to sue the court, forcing the federal government to find it difficult to maintain this tariff on more other importers.
Trump invoked Section 122 to impose provisional global tariffs on February 20 this year, after the Federal Supreme Court ruled that the president had no right to impose reciprocal tariffs under the International Emergency Economic Powers Act (IEEPA). Section 122 grants the government 150 days to implement tariffs of up to 15%, after which Congress intervenes. The Trump administration wanted to buy time to introduce a new tariff policy in July.
Reuters reported that the U.S. Court of International Trade ruled that all importers other than the plaintiffs must still pay this provisional tariff while the Trump administration appeals. This tariff is expected to expire in July.
The International Trade Court ruled that Trump's imposition of tariffs under Section 122 of the 1974 Trade Act was improper. However, one judge believed it was too early to declare the plaintiffs victorious.
The New York-based International Trade Court also rejected a request from 24 states to apply the ruling broadly, refusing to issue a blanket injunction that would apply this ruling to all importers; most of these states are Democratic-governed states. The trade court believed that, except for Washington State, most of the plaintiff state governments themselves were not importers and did not actually pay or were likely to pay tariffs related to Section 122.
Reuters also believes that although this ruling involves tariffs that will expire in about two months, it is another major setback for Trump's global tariff policy, and it comes just before he is scheduled to discuss trade tensions with Chinese President Xi Jinping next week.
Dave Townsend, a partner in Dorsey & Whitney's international trade team, said: "The U.S. government will undoubtedly appeal today's ruling, and it will be further heard by the Federal Circuit Court of Appeals and the Supreme Court." He stated that other importers are now also likely to ask the court to expand the scope of application.
Two small businesses—toy company Basic Fun! and spice importer Burlap & Barrel—argued that Trump's new tariff measures were an attempt to circumvent the Supreme Court's previous overturning of reciprocal tariffs.
Jay Foreman, CEO of Basic Fun!, said: "This ruling is an important victory for American businesses that rely on global manufacturing to provide safe and affordable goods. Illegal tariffs make it harder for companies like ours to compete and grow."
Former U.S. trade officials said the Trump administration is likely to appeal and may replace the provisional tariffs with permanent tariffs under other legal authorities later this year.
Ryan Majerus, a former senior official at the U.S. Department of Commerce and now an attorney at King & Spalding, said: "The U.S. government will appeal this ruling, but will continue to collect most of the Section 122 10% tariffs until July 24, when they may be replaced by permanent Section 301 tariffs." (Compilers: Hsu Jui-cheng, Chen Yi-wei) 1150508
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Central News Agency
(New York, May 7, Comprehensive Foreign Report) The U.S. Court of International Trade today ruled that the provisional global tariffs implemented by President Trump in February this year do not comply with the authorization basis of the 1974 Trade Act. However, the ruling only prohibits the imposition of tariffs on the plaintiff companies and does not involve other importers, so the actual impact remains to be seen.
The New York Times pointed out that for Trump, who is preparing to visit China next week to discuss trade issues with Chinese leader Xi Jinping, this latest ruling is another major setback. Tariffs are expected to be an important topic on the Trump-Xi agenda, and this ruling will inevitably weaken Trump's bargaining chips.
In this 53-page ruling, a three-judge panel of the trade court, with a 2-1 vote, determined that the legal threshold for invoking Section 122 of the 1974 Trade Act to impose additional tariffs has not yet been met. The ruling cited legislative history, stating that Section 122 "documents a series of efforts to carefully limit the President's discretion in trade matters."
Jeffrey Schwab, litigation director for the Liberty Justice Center, a legal group representing the small businesses in this case, said: "Section 122 was passed in the context of a specific historical crisis, when the U.S.'s currency and gold reserves were being depleted, but this is not the case today."
The trade court today declared the global tariffs illegal, but the judges only explicitly prohibited the federal government from collecting these tariffs from the plaintiff small businesses. The actual impact may be limited, and the Trump administration is expected to appeal.
However, The Wall Street Journal believes that although the trade court did not issue a nationwide injunction, because the ruling has determined that the president overstepped his authority, other importers can choose to invoke this ruling to sue the court, forcing the federal government to find it difficult to maintain this tariff on more other importers.
Trump invoked Section 122 to impose provisional global tariffs on February 20 this year, after the Federal Supreme Court ruled that the president had no right to impose reciprocal tariffs under the International Emergency Economic Powers Act (IEEPA). Section 122 grants the government 150 days to implement tariffs of up to 15%, after which Congress intervenes. The Trump administration wanted to buy time to introduce a new tariff policy in July.
Reuters reported that the U.S. Court of International Trade ruled that all importers other than the plaintiffs must still pay this provisional tariff while the Trump administration appeals. This tariff is expected to expire in July.
The International Trade Court ruled that Trump's imposition of tariffs under Section 122 of the 1974 Trade Act was improper. However, one judge believed it was too early to declare the plaintiffs victorious.
The New York-based International Trade Court also rejected a request from 24 states to apply the ruling broadly, refusing to issue a blanket injunction that would apply this ruling to all importers; most of these states are Democratic-governed states. The trade court believed that, except for Washington State, most of the plaintiff state governments themselves were not importers and did not actually pay or were likely to pay tariffs related to Section 122.
Reuters also believes that although this ruling involves tariffs that will expire in about two months, it is another major setback for Trump's global tariff policy, and it comes just before he is scheduled to discuss trade tensions with Chinese President Xi Jinping next week.
Dave Townsend, a partner in Dorsey & Whitney's international trade team, said: "The U.S. government will undoubtedly appeal today's ruling, and it will be further heard by the Federal Circuit Court of Appeals and the Supreme Court." He stated that other importers are now also likely to ask the court to expand the scope of application.
Two small businesses—toy company Basic Fun! and spice importer Burlap & Barrel—argued that Trump's new tariff measures were an attempt to circumvent the Supreme Court's previous overturning of reciprocal tariffs.
Jay Foreman, CEO of Basic Fun!, said: "This ruling is an important victory for American businesses that rely on global manufacturing to provide safe and affordable goods. Illegal tariffs make it harder for companies like ours to compete and grow."
Former U.S. trade officials said the Trump administration is likely to appeal and may replace the provisional tariffs with permanent tariffs under other legal authorities later this year.
Ryan Majerus, a former senior official at the U.S. Department of Commerce and now an attorney at King & Spalding, said: "The U.S. government will appeal this ruling, but will continue to collect most of the Section 122 10% tariffs until July 24, when they may be replaced by permanent Section 301 tariffs." (Compilers: Hsu Jui-cheng, Chen Yi-wei) 1150508
Choose to stand with facts, every sponsorship you make is a force to protect press freedom.
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The text, images, and videos on this website may not be reproduced, publicly broadcast, or publicly transmitted and used without authorization.