Why did the US Court of International Trade block Trump’s tariffs?

The US Court of International Trade ruled that President Trump exceeded his authority under the International Emergency Economic Powers Act (IEEPA) when imposing global tariffs. The court concluded that Congress had not authorized him to impose such tariffs, particularly in response to migration and drug smuggling threats.

What is the significance of the Court of Appeals' decision in this case?

The US Court of Appeals for the Federal Circuit temporarily paused the decision of the Court of International Trade, meaning that the tariffs will remain in effect while the appeal process continues. This decision keeps the tariffs active until further rulings are made.

How does this ruling affect tariffs on Mexico, Canada, and China?

The ruling affects the tariffs imposed by the Trump Administration in response to migration and drug smuggling, including those on Mexico, Canada, and China. These tariffs are temporarily paused, pending the outcome of the appeal.

Will the tariffs on steel, aluminum, and automobiles be impacted by these decisions?

No, the ruling does not affect sector-specific tariffs on steel, aluminum, and automobiles. Those tariffs are part of a separate legal case and are not involved in the current dispute over IEEPA-based tariffs.

What legal cases are involved in challenging Trump’s tariffs?

The legal challenges to Trump’s tariffs are brought by small businesses in the case V.O.S. v. United States and a coalition of US state governments in Oregon v. United States. The two cases were consolidated by the Court of International Trade for its ruling.

How should businesses respond to these developments in US trade policy?

Businesses should monitor the progress of the legal challenges to understand how tariffs may change in the future. Due to the rapidly evolving nature of tariff policies, companies should stay prepared to adjust to new or modified tariff structures.

Federal Court Blocks Trump's Tariffs; Court of Appeals Pauses Ruling

In two days, the US Court of International Trade and the US Court of Appeals for the Federal Circuit decided on the legality of the Trump Administration's imposition of tariffs under the International Emergency Economic Powers Act (IEEPA).

While one decision underscored that President Trump had exceeded his authority, the other halted that decision from taking effect until the appeal is decided.

Background of the Dispute and Implications of the Decisions

On May 28, 2025, the US Court of International Trade (CIT) announced its decision, determining that President Trump had acted beyond his authority and that Congress had not authorized him to impose tariffs under the IEEPA.

Moreover, CIT concluded that Trump did not have the authority to impose unrestricted global tariffs, blocking the 10% global rate and the higher per-country tariff rates currently subject to a 90-day pause, as well as tariffs on Mexico, Canada, and China in response to migration and drug smuggling. The CIT added that tariffs do not deal with the threats of migration and drug smuggling.

The day after this decision, the US Court of Appeals for the Federal Circuit (CAFC) issued an administrative stay to block the enforcement of the decision made by the CIT, and temporarily reinstated specific tariffs. The administrative stay will remain in effect until the Trump Administration appeals against the CIT's decision.

Therefore, the long-term implications for US trade policy remain unclear as the legal challenge over the IEEPA tariffs moves through the appeals process. Nevertheless, other tariffs, those implemented before the 2025 Inauguration Day, are part of a separate case still pending before the CAFC, and sector-specific tariffs imposed on steel, aluminum, and automobiles are not affected by these rulings.

Conclusion

These claims against the Trump Administration were brought in two separate cases by the impacted small businesses, V.O.S. v. United States, and a coalition of US state governments, Oregon v. United States. The CIT merged and made a single consolidated decision, which is now being challenged through an appeal.

Considering that the State of California independently filed a lawsuit in Federal Court challenging President Trump's authority to enact tariffs unilaterally, businesses should emphasize monitoring the outcome of these cases. Additionally, due to the rapid changes in tariff policies, companies should be ready to adapt to changes in tariff structures.

Source: EY - Federal Court blocks Trump Administration IEEPA tariffs, EY - Court of International Trade rules tariffs under International Emergency Economic Powers Act unlawful; appeals court temporarily reinstates tariffs as case proceeds, VATabout