Trump tariffs to remain in effect - appeals court overturns stay
A federal appeals court temporarily reinstated President Donald Trump's broadest tariffs on Thursday, a day after a U.S. trade court ruled that Trump had exceeded his authority in imposing the duties and ordered an immediate halt to them.
The United States Court of Appeals for the Federal Circuit in Washington said it was staying the lower court's decision to hear the government's appeal and ordered the plaintiffs in the cases to respond by June 5 and the administration by June 9.
Wednesday's surprise ruling by the U.S. Court of International Trade had threatened to derail or at least delay Trump's so-called Liberation Day tariffs on imports from most U.S. trading partners and additional tariffs on goods from Canada, Mexico and China. The latter was linked to his accusation that the three countries were facilitating the flow of fentanyl into the U.S.
The three-judge panel of the trade court ruled that the Constitution gives Congress, not the president, the power to impose taxes and tariffs, and that the president had exceeded his authority by invoking the International Emergency Economic Powers Act, a law intended to address threats during national emergencies.
Senior Trump administration officials had said they were not discouraged by the trade court's ruling, saying they expected to either win on appeal or use other presidential powers to ensure the tariffs go into effect.
Trump has used the threat to impose hefty tariffs on goods from almost every other country in the world as leverage in international trade talks, a strategy that the trade court ruling would overturn. The trade court ruling did not interfere with any negotiations with major trading partners that are scheduled in the coming days, the Trump administration said.
Trump himself wrote in a statement shared on social media that he hoped the US Supreme Court would "overturn this terrible and country-threatening decision" of the trade court, while sharply criticizing the judicial branch of government as anti-American.
Many of the U.S.'s trading partners offered cautious responses. The British government said the trade court's decision was an internal matter for the U.S. administration and noted that it was "only the first stage of legal proceedings." Both Germany and the European Commission, the European Union's executive arm, said they could not comment on the ruling.
Canadian Prime Minister Mark Carney said the trade court's finding was "consistent with Canada's early position" that Trump's tariffs were illegal.
Financial markets, which have been reeling in response to unexpected changes in Trump's chaotic trade war, reacted with cautious optimism to the trade court's decision, although gains in stocks on Thursday were largely limited by expectations that the court's ruling would face a potentially lengthy appeals process.
Indeed, analysts said widespread uncertainty remained about the future of Trump's tariffs, which have cost companies more than $34 billion in lost sales and higher costs, according to a Reuters analysis.
Some sector-specific tariffs, such as on steel, aluminum and auto imports, were imposed by Trump under separate authority for national security reasons and were not affected by the ruling. The Liberty Justice Center, the nonprofit group representing five small businesses that sued over the tariffs, said the appeals court's temporary stay was a procedural step.
Jeffrey Schwab, senior counsel for the center, said the appeals court would ultimately side with small businesses that faced irreparable harm from "the loss of critical suppliers and customers, forced and costly changes to established supply chains and, most seriously, a direct threat to the very survival of these businesses."
A separate federal court earlier Thursday also found that Trump exceeded his authority by using the International Emergency Economic Powers Act for what he called reciprocal tariffs of at least 10% on goods from most U.S. trading partners and for separate taxes of 25% on goods from Canada, Mexico and China related to fentanyl.
However, that decision was much narrower, and the relief order barring the fees applied only to the toy company that brought the case. The administration has appealed that decision as well.
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