Earlier this year, the Trump Administration invoked the International Emergency Economic Powers Act (IEEPA), a 1977 emergency statute, to impose sweeping import tariffs on various US-trade partners. These unprecedented IEEPA tariffs sparked immediate legal challenges by affected businesses and states, which argued the President overstepped authority. Lower courts have so far agreed.

The Supreme Court must now decide whether Congress, via IEEPA, delegated tariff-setting power to the executive during emergencies. Several justices across the ideological spectrum appeared skeptical during oral arguments that IEEPA authorizes these tariffs, questioning if allowing such power would upend the Constitution’s balance (Congress’s commerce and taxing powers vs. executive emergency powers). The Court’s decision will either rein in presidential trade powers or affirm the office’s broad emergency tariff authority.

For businesses engaged in international trade, the impending ruling has practical stakes. Companies should prepare by staying informed, keeping abreast of the Supreme Court’s proceedings and anticipating a decision in the coming months, as an adverse ruling for the administration could come swiftly given the case’s fast-tracked schedule. Additionally, businesses should consult advisors, engaging trade counsel or customs brokers to navigate these uncertainties. Legal advisors can assist in tracking tariff payments, filing refund claims, and adapting compliance strategies; they can also help companies advocate for relief, for example, ensuring any refund process is handled fairly. Preparing now with professional guidance will position businesses to act quickly once the Court’s decision is announced.

The Supreme Court’s pending decision on the Trump-era IEEPA tariffs is poised to clarify the limits of presidential power in trade emergencies. Regardless of the outcome, companies should remain vigilant and proactive, protecting their interests through the courts and administrative processes, and staying flexible to adjust to whatever new trade landscape emerges.

By taking preparatory steps now, businesses can better weather the changes that this landmark decision may bring.

Questions?

Please contact the authors Aimee J. Jachym and Marcus C. Hoekstra or another member of our corporate international practice.