A US federal trade court has ruled against President Donald Trump’s latest 10% global tariffs, delivering a legal setback to one of his key trade policy measures and raising questions over the administration’s authority to impose broad import duties without Congress.The ruling by the US Court of International Trade came in a 2–1 decision on Thursday. It found that the tariffs imposed earlier this year were not justified under a 1974 trade law and were therefore ‘invalid’ and ‘unauthorized by law,’ Reuters reported. Trump had announced that he would be signing an executive order imposing 10% global tariffs in February, which applied broadly across imports. The measures were introduced shortly after the US Supreme Court struck down earlier, more aggressive tariff actions by the administration, ruling that they exceeded presidential authority under emergency economic powers.At the time, Trump had invoked Section 122 of the Trade Act of 1974. This provision allows temporary tariffs for up to 150 days in cases involving serious balance of payments deficits or risks linked to currency stability. The administration argued that the United States was facing a major trade imbalance, citing a $1.2 trillion goods trade deficit and a current account deficit of about 4 percent of GDP.However, the court rejected this justification. The majority judges said the type of trade deficit cited by the administration did not meet the legal threshold required under the law. They ruled that the government had overstepped the authority granted by Congress and that the tariffs could not stand under the statute used to impose them.The case was brought by small businesses that rely heavily on global supply chains. They argued that the tariffs were designed to bypass the earlier Supreme Court ruling, which had already limited the administration’s ability to impose broad trade penalties under emergency powers.One of the plaintiffs, Jay Foreman, chief executive of toy manufacturer Basic Fun said the ruling would help bring stability to businesses that depend on international manufacturing.“This decision is an important win for American companies that rely on global manufacturing to deliver safe and affordable products. Unlawful tariffs make it harder for businesses like ours to compete and grow,” Foreman said. He added that the decision provides clarity for companies managing international supply chains, which had been under pressure since the tariffs were introduced.The Trump administration had defended the policy, arguing that the United States was facing a structural trade imbalance that required urgent action. Officials said the tariffs were necessary to protect domestic industries and reduce dependence on imports.One judge on the three-member panel dissented. The judge said the law provided broader discretion to the president on trade matters and suggested that the challenge was premature.The ruling is expected to be appealed. If the administration moves forward, the case will first go to the US Court of Appeals for the Federal Circuit in Washington and could eventually reach the Supreme Court again.This decision adds to a series of legal challenges faced by Trump’s tariff strategy. In February, the Supreme Court had already struck down earlier versions of his global tariffs, ruling that emergency economic powers do not give the president unlimited authority to impose import taxes.
