Reuters
Oil-rig supply ships, St John's, Newfoundland [Source: Reuters]
President Donald Trump has pushed into new trade law territory with an emergency sanctions law to justify punishing 25% tariffs on Canadian and Mexican imports and an extra 10% duty on Chinese goods to curb fentanyl and illegal immigration into the U.S.
Trade and legal experts said the 1977 International Emergency Economic Powers Act (IEEPA) is untested for imposing import tariffs and Trump’s action will likely face swift court challenges that could set important precedents.
As widely expected, Trump declared a national emergency under IEEPA on Saturday, citing the “extraordinary threat” from fentanyl and illegal immigration. The law gives the president broad powers to impose economic and financial sanctions in times of crisis, including against Russia over its war in Ukraine.
IEEPA gave Trump, in the second week of his second term in the White House, the fastest path to imposing tariffs, as trade laws he used in his first four years for duties on steel, aluminium and Chinese goods would have required months-long investigations and public consultations.
Courts upheld Nixon’s action, but Jennifer Hillman, a trade law professor at Georgetown University and former World Trade Organization appellate judge, said Trump’s action may not fit the emergency.
The Nixon ruling and reporting requirement language in the IEEPA statute suggest that there needs to be a causal connection between the emergency – fentanyl and migrants – and the remedy: universal tariffs on Canada, Mexico and China.
