A federal court ruled Wednesday that an emergency law does not provide President Trump with unilateral authority to impose tariffs on nearly every country, blocking a series of tariff announcements dating back to February that have rattled financial markets.
The three-judge panel on the U.S. Court of International Trade unanimously ruled Congress did not delegate “unbounded” tariff authority to the president in the International Emergency Economic Powers Act of 1977 (IEEPA), the linchpin of Trump’s legal defense.
“An unlimited delegation of tariff authority would constitute an improper abdication of legislative power to another branch of government,” the court wrote in its unsigned opinion.
“Regardless of whether the court views the President’s actions through the nondelegation doctrine, through the major questions doctrine, or simply with separation of powers in mind, any interpretation of IEEPA that delegates unlimited tariff authority is unconstitutional,” the opinion continued.
“The IEEPA authorizes the president to impose necessary economic sanctions during an emergency to combat an “unusual and extraordinary threat.”
Trump has attempted to invoke the law to impose widespread tariffs by citing trade deficits and the threat posed by international drug cartels.
Wednesday’s ruling blocks Trump’s April 2 “Liberation Day” tariffs and a series of orders dating back as early as Feb. 1, when the president announced he was imposing tariffs on Canada, Mexico and China. Many of the tariffs have been adjusted or delayed as stocks fell and Treasury yields rose.
The three-judge panel comprised Judge Timothy Reif, a Trump appointee; Judge Jane Restani, an appointee of former President Reagan; and Judge Gary Katzmann, an appointee of former President Obama.
The decision came in response to two separate lawsuits, part of a broader wave of litigation challenging Trump’s tariffs.
One filed by a group of small businesses specifically focused on Trump’s “Liberation Day” announcement, but the other brought by a group of Democratic state attorneys general, led by Oregon, challenged a broader set of tariffs.
Before ruling that the IEEPA does not authorize Trump’s tariffs, the court rejected the administration’s threshold arguments, including that the president’s orders are a political question not subject to the courts’ review.
“This reliance on the political question doctrine is misplaced,” the unanimous panel wrote.
This story was updated at 7:40 p.m.
