A U.S. federal court has blocked President Donald Trump's sweeping "Liberation Day" tariffs, ruling that he exceeded his authority by imposing them under emergency powers. The Court of International Trade determined that the 1977 International Emergency Economic Powers Act (IEEPA) does not grant the president the authority to unilaterally impose tariffs, as trade deficits do not constitute the "unusual and extraordinary threat" required by the act.
The court's decision mandates that Trump rescind the tariffs within 10 days, reaffirming that only Congress has the constitutional power to regulate commerce with foreign nations. This ruling is a significant setback for Trump's protectionist trade policies, which had led to market instability and global criticism.
The case, V.O.S. Selections, Inc. v. Trump, was brought forward by small business owners who argued that the tariffs caused economic harm and were implemented without proper congressional authorization. Legal scholars have hailed the decision as a reaffirmation of constitutional checks and balances.
In response to the ruling, the Trump administration has filed a notice of appeal, potentially escalating the case to the Supreme Court. A White House spokesperson defended the tariffs, stating that trade deficits pose a national emergency affecting American communities and industries.
Financial markets reacted positively to the court's decision, with Asian shares and U.S. futures experiencing significant gains. Japan's Nikkei 225 rose by 1.5%, South Korea’s Kospi increased by 1.4%, and the U.S. dollar strengthened against the yen.
Sources: Reuters, Business Insider, The Times
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