President Donald Trump has entered unprecedented territory in trade policy by utilizing emergency sanctions to impose penalties on Canadian and Mexican imports, as well as implementing an additional 10% tariff on Chinese goods to address issues related to fentanyl and illegal immigration in the U.S.
Legal and trade experts have pointed out that the 1977 International Emergency Economic Powers Act (IEEPA) has not been previously tested for imposing import tariffs, and Trump's actions are expected to encounter rapid legal challenges that could establish significant precedents.
In line with expectations, Trump invoked a national emergency under IEEPA on Saturday, citing an "extraordinary threat" posed by fentanyl and illegal immigration. This law grants the president broad authority to impose economic and financial sanctions during crises, such as those imposed against Russia due to its actions in Ukraine.
With IEEPA providing the quickest route for imposing tariffs, Trump bypassed lengthy investigations and public consultations, a process that would have been necessary for tariffs on steel, aluminum, and Chinese goods in his first term.
Regarding the legal implications, Tim Brightbill, co-chair of the international trade practice at the law firm Wiley Rein, mentioned, "The courts typically uphold the president's emergency measures, especially those related to national security." However, the novelty lies in whether tariffs fall under this remit as IEEPA has historically been used for sanctions, Brightbill noted.
William Reinsch, a trade expert at the Center for Strategic and International Studies, highlighted that challenging the tariffs might be an uphill battle due to the judiciary's reluctance to question presidential authority during emergencies, stating, "Judges are unlikely to dispute the president's definition of an emergency."
Although there are parallels to President Nixon's similar use of emergency powers, trade law expert Jennifer Hillman from Georgetown University expressed skepticism about Trump's justification for tariffs, particularly as they are not specifically targeted at the root causes of the emergency.
Amidst these debates, suggestions have been made for greater congressional oversight of IEEPA to prevent potential misuse by future administrations. At the forefront of this discussion is U.S. Senator Tim Kaine, who advocates for limiting IEEPA's application to tariffs and emphasizes the need for thoughtful trade policies that benefit American consumers.