U.S. Appeals Court Upholds Trump’s 10% Global Tariff

Court Finds Some Merit in Government's Arguments

U.S. President Donald Trump visiting Arlington National Cemetery. White House

In the legal battle surrounding U.S. President Donald Trump's "10% global tariff policy," the Federal Court of Appeals has sided with the Trump administration. Notably, the court stated that “the government is likely to succeed on the merits.” Based on this premise, the court ruled that preventing the government from collecting tariffs under the assumption that the tariffs are unlawful could result in significant losses for the current administration. As a result of this ruling, the tariffs can remain in place until the end of July.

On June 11 (local time), the U.S. Court of Appeals for the Federal Circuit decided to stay the enforcement of the U.S. Court of International Trade’s ruling, which had found the 10% global tariffs imposed by the Trump administration last February under Section 122 of the Trade Act to be unlawful. Consequently, the effect of last month’s ruling by the Court of International Trade (CIT) has been effectively suspended. The U.S. government can now maintain the current 10% tariff regime at least while the appeal is ongoing. The Court of Appeals had already issued a temporary stay of the lower court's ruling on May 12, immediately after the appeal was filed, and the period of that stay has now been extended.

In its decision, the appeals court pointed out the possibility of legal errors in the lower court's legal interpretation. The court also determined that suspending tariff collection could cause irreparable harm to the federal government. Particularly, the judges explicitly stated that the government's legal arguments are "likely to succeed on the merits."

This carries significance beyond a mere procedural decision. When deciding whether to grant a stay, courts typically consider the likelihood of the appellant’s success and the potential scale of harm. In this case, the fact that the court publicly acknowledged the persuasiveness of the government’s arguments is especially notable. The Wall Street Journal (WSJ) reported that “the appeals court suggested the trade court’s judgment may have been incorrect.” The court also noted that, if the tariffs are ultimately ruled unlawful, it would be possible to refund the collected tariffs, but if tariff collection were halted now and the government later prevailed, the resulting damage to the administration would be difficult to recover.

The “10% tariff” is a policy introduced by U.S. President Donald Trump after his reciprocal tariff policy was ruled unlawful. After the Supreme Court found the reciprocal tariffs imposed under the International Emergency Economic Powers Act (IEEPA) to be unlawful, President Trump invoked Section 122 of the Trade Act to impose a blanket 10% tariff on all imports worldwide. However, in a lawsuit brought by spice importer Burlap & Barrel, toy company Basic Fun, and the state of Washington, the Court of International Trade ruled on May 7 that the tariffs lacked sufficient legal basis and were therefore unlawful.

The key issue in the appeals process is the interpretation of Section 122 of the Trade Act. This provision allows the President to impose tariffs of up to 15% for a maximum of 150 days if he determines that there is a “fundamental balance of payments problem.” The Trump administration argues that the United States’ large trade deficit qualifies as a balance of payments problem. However, the plaintiffs counter that Section 122 was originally intended for emergencies such as currency or balance of payments crises, and cannot be applied to the United States’ chronic, decades-long trade deficit.

The Associated Press (AP) has assessed that this case is not only about the legality of the tariffs but also serves as an important test of the scope of the President’s trade authority. If the government wins on appeal, it could set a precedent allowing future presidents to impose extensive tariffs based on trade deficits without congressional approval. Conversely, if the government loses, the administration will have to rely on existing trade law frameworks such as Section 301 or Section 232 of the Trade Act.

Regardless of the outcome of this lawsuit, the current 10% global tariff is likely to expire on July 24. Section 122 of the Trade Act limits the President’s authority to impose emergency tariffs to a maximum of 150 days. Extension of this period would require congressional approval.

Before the tariffs imposed under Section 122 expire, the Trump administration is expected to complete its investigations into forced labor and overproduction under Section 301 of the Trade Act. On June 2, the Office of the United States Trade Representative (USTR) announced the results of its Section 301 investigation into forced labor and indicated plans to impose a 12.5% tariff on products from Korea. The USTR is also conducting an investigation into “overproduction” under Section 301, with Korea included among the target countries. On June 4, Jamieson Greer, USTR Chief of Staff, stated that the administration does not intend to impose tariffs beyond existing trade agreements. Under these trade agreements, tariffs on Korean exports to the United States are set at 15%.

This content was produced with the assistance of AI translation services.