US court rules Trump exceeded authority with broad tariffs; implications for global trade, allies, and American businesses

WASHINGTON, Aug 30 — A US appeals court on Friday ruled that many of President Donald Trump’s sweeping tariffs, which have disrupted global trade, were unlawful — but allowed them to remain in place temporarily, giving him time to appeal to the Supreme Court.

In a 7-4 decision, the US Court of Appeals for the Federal Circuit upheld a lower court’s finding that Trump had overstepped his authority by using emergency economic powers to impose broad-based tariffs.

However, the court permitted the duties to stay in effect until mid-October. Responding on his Truth Social platform, Trump blasted the ruling, declaring that “the United States of America will win in the end” and vowing to fight the decision at the Supreme Court.

The ruling deals a setback to the president, who has relied heavily on tariffs as a key policy tool. It also raises concerns about trade agreements struck with allies such as the European Union and casts uncertainty over billions of dollars in tariff revenue if the Supreme Court does not side with him.

The case does not cover Trump’s sector-specific tariffs on steel, aluminum, autos and other imports.

Since retaking office in January, Trump has invoked the International Emergency Economic Powers Act (IEEPA) to impose “reciprocal” tariffs on nearly all US trading partners, setting a 10 per cent baseline and higher rates for dozens of economies. He also cited similar emergency powers to levy separate duties on Mexico, Canada and China in response to drug trafficking.

The Court of International Trade ruled in May that Trump had exceeded his authority with the across-the-board tariffs, blocking most of them, though the appeals court later froze that decision pending review.

Friday’s ruling noted that while the president holds significant powers under IEEPA during national emergencies, those powers “do not explicitly include the authority to impose tariffs, duties, or taxes.” It concluded that Trump’s “reciprocal” tariffs and duties tied to drug trafficking “are not authorized.”

Just hours before the ruling was issued, Trump administration officials warned that striking down the tariffs would undermine US foreign policy and national security. Commerce Secretary Howard Lutnick cautioned such a decision could “threaten broader US strategic interests,” spark retaliation, and unravel trade deals, while Treasury Secretary Scott Bessent said suspending the tariffs risked “dangerous diplomatic embarrassment.”

Several lawsuits remain ongoing against Trump’s use of emergency powers to impose duties. Should the tariffs ultimately be invalidated, businesses may seek reimbursement of the billions already collected. — AFP