The Trump administration claimed a temporary victory on Thursday for one of its embattled tariff policies.
A Washington, D.C.-based U.S. Court of Appeals for the Federal Circuit decided that the government can continue to collect the 10 percent duties on international imports that were levied under Section 122 of the Trade Act of 1974 while an appeal of the Court of International Trade’s (CIT) ruling—which invalidated the tariffs—is heard in full.
Set to expire July 24, the Section 122 tariffs were imposed days after President Donald Trump’s International Emergency Economic Powers Act (IEEPA) were deemed unlawful by the Supreme Court. At the time, the administration justified the duties by saying that America’s trade imbalance with global trade partners amounts to a balance-of-payments issue, which the law addresses.
The CIT did not agree. In early May, the New York-based trade court (which first heard the IEEPA tariff case that eventually advanced to the Supreme Court last year) handed down a 2-1 decision that while Section 122 authorizes the president to impose tariffs, the power is limited to conditions that were not met in this case.
Section 122, which has never been employed to impose tariffs by a sitting president, allows the Commander in Chief to levy duties up to 15 percent for 150 days. Congressional approval is required to keep them in place for longer than that.
The administration quickly initiated an appeal of the decision. It has now been vindicated; the block on the duties was stayed. The appeals court said the administration could suffer irreparable harm, including disruptions to America’s trade policy, if the duties were not allowed to be collected while the appeal process plays out. It also tipped its hat in favor of the government, saying that its case was “likely to succeed on the merits.’’
