On May 28, 2025, the United States Court of International Trade ruled that former President Donald Trump exceeded his authority by imposing broad tariffs under the International Emergency Economic Powers Act (IEEPA). The court determined that the IEEPA does not grant the president the power to unilaterally impose such sweeping import taxes, effectively blocking the enforcement of these tariffs.

The ruling arose from consolidated lawsuits filed by the Liberty Justice Center, representing five small businesses, and a coalition of twelve states led by Oregon Attorney General Dan Rayfield. The plaintiffs argued that the tariffs imposed significant financial burdens and that the president lacked the constitutional authority to implement them without congressional approval.

The three-judge panel, comprising judges appointed by Presidents Trump, Reagan, and Obama, issued a unanimous decision stating that the IEEPA does not authorize the president to impose tariffs unilaterally. The ruling emphasized that the power to regulate foreign commerce resides with Congress, reinforcing the constitutional separation of powers.

The five small businesses involved—VOS Selections, FishUSA, MicroKits, Terry Precision Cycling, and Genova Pipe—faced significant operational and financial hardships due to the tariffs, including increased costs, supply chain disruptions, and pricing uncertainties. These companies highlighted the detrimental impact on American manufacturing, jobs, and competitiveness. Business leaders stressed that the unpredictable nature of the tariffs hindered planning and growth.

The court's ruling underscores the constitutional principle that trade powers reside with Congress. The IEEPA, enacted in 1977, grants the president authority to deal with unusual and extraordinary threats to national security, foreign policy, or the economy. However, the court determined that this authority does not extend to imposing tariffs without congressional approval.

Historically, the IEEPA has been used to impose sanctions and regulate economic transactions during national emergencies. However, it has not been used to impose broad tariffs on imports. The court's decision aligns with previous rulings that emphasize the need for a clear connection between the declared emergency and the measures imposed.

Despite the court's ruling, legal analysts suggest that the president may still have several legal avenues to pursue trade policies. These include:

• Section 122 of the Trade Act of 1974: Allows the president to impose up to 15% tariffs for a limited six-month period without needing formal processes.

• Section 301 of the Trade Act of 1974: Enables tariffs after investigations into unfair trade practices.

• Section 232 of the Trade Expansion Act of 1962: Allows tariffs based on national security grounds.

• Section 338 of the Tariff Act of 1930: Permits duties up to 50% on imports from nations that discriminate against U.S. commerce.

The Trump administration has announced plans to appeal the decision, indicating that the case may ultimately be decided by the Supreme Court. Critics argue that the tariffs raised consumer prices and disrupted supply chains, while supporters contend they were necessary to address trade imbalances and protect domestic industries.

This ruling reaffirms the constitutional allocation of trade authority to Congress and may have significant implications for the future of U.S. trade policy and the balance of power between the executive and legislative branches.