The U.S. Court of International Trade has halted former President Donald Trump’s “Liberation Day” tariffs, ruling they exceed executive authority under the IEEPA, delivering a major blow to his trade agenda.
A Landmark Decision Shakes U.S. Trade Policy
In a pivotal ruling on May 29, 2025, the United States Court of International Trade struck down former President Donald Trump tariffs sweeping “Liberation Day” , declaring them unlawful. The decision, rooted in the International Emergency Economic Powers Act (IEEPA), underscores that the President cannot impose broad tariffs without Congressional approval unless tied to a clear national emergency. This landmark verdict not only disrupts Trump’s trade strategy but also reinforces judicial oversight over executive actions.
Why Were Trump Tariffs Blocked?
Trump declared a national emergency in January 2025, imposing 25% tariffs on Mexico and Canada to combat fentanyl trafficking. On April 2, he introduced 10% global tariffs, citing “foreign trade imbalances” as an economic threat. These “Liberation Day” Trump Tariffs , enacted under the IEEPA, bypassed public comment and Congressional consultation, prompting legal challenges from trade partners and domestic stakeholders.
The three-judge panel ruled that the IEEPA does not grant the President unlimited authority to impose tariffs. The court found that the tariffs on Mexico and Canada were punitive rather than directly addressing the stated emergency. Similarly, the global tariffs were deemed “ultra vires” (beyond legal authority) as they lacked a clear link to national security or foreign policy threats.
A federal judge stated in the ruling: “The IEEPA does not permit sweeping economic measures simply because a national emergency is declared. Tariffs must be proportionate to the identified threat.”
🚨 U.S. Court blocks Trump’s “Liberation Day” tariffs, ruling they overstep IEEPA authority. 25% on Mexico/Canada, 10% global tariffs deemed unlawful. Dow Futures jump 1.7%! Major blow to Trump’s trade plans—appeal filed. What’s next for U.S. trade? 🇺🇸📉 #TradePolicy pic.twitter.com/igPIyBGbCo
— USA UPDATES (@usaupdatessite) May 29, 2025Economic and Market Reactions to the Ruling
The decision sent immediate ripples through global markets. Dow Futures rose 1.7% within hours, reflecting investor confidence in reduced trade tensions. The U.S. dollar strengthened, while Asian markets, including Japan’s Nikkei and South Korea’s KOSPI, saw gains of 1.2% and 1.4%, respectively, as reported by Bloomberg.
However, not all Trump-era tariffs are affected. Measures on steel, aluminum, and automobiles, as well as potential future tariffs on pharmaceuticals and semiconductors, remain intact, as they rely on separate legal frameworks. Tariffs from Trump’s first term (2017–2021) targeting China also continue unchanged.
Global Responses and Trade Negotiation Impacts
Foreign governments expressed mixed reactions. China’s Foreign Ministry reiterated that “trade wars have no winners,” while Australia called the tariffs “unjustified and harmful.” The UK’s trade secretary noted that the ruling is “only the first step in a complex legal process,” according to Reuters.
The decision complicates ongoing trade talks. Negotiations with India and Japan face uncertainty, as the White House’s leverage is weakened. Upcoming U.S.-EU discussions at the G7 Summit in June 2025 may require a strategic overhaul, with EU officials signaling a need for clarity on U.S. trade policy, per a statement from the European Commission.
Expert Analysis: Legal and Economic Implications
Trade law expert Dr. Emily Carter, a professor at Georgetown University, told usaupdates.site: “This ruling reaffirms that executive power has limits, even in emergencies. The court’s decision protects the balance of power and ensures tariffs align with legal intent.”
Economically, the ruling could stabilize U.S. trade relations but leaves the administration’s broader agenda in flux. “The White House now faces a choice: appeal and double down or pivot to targeted, legally sound measures,” said Michael Lee, a trade policy analyst at the Brookings Institution.
What’s Next for Trump Tariffs?
The court has given the administration 10 days to revise its tariff framework, setting the stage for a high-stakes legal and political battle. The White House has already filed an appeal, with a spokesperson stating, “Unelected judges cannot dictate how we protect our nation.” Analysts predict the administration may seek Congressional support or shift focus to sector-specific tariffs to maintain its trade agenda.
This ruling highlights the judiciary’s critical role in upholding checks and balances. As the U.S. navigates a volatile global trade landscape, the outcome of this legal saga will shape economic policy and international relations for years to come.
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About the Author
Suraj is a seasoned news writer specializing in U.S. politics and trade policy. With a background in journalism and a passion for delivering accurate, engaging stories, he covers breaking news with clarity and depth. Learn more about our team on our About Us page.
