Appeals court strikes down Trump’s tariff power in major decision

President Trump’s tariffs have been thrown into legal limbo.

The U.S. Court of Appeals for the Federal Circuit, in a 7-4 ruling late Friday, said Mr. Trump overstepped when he invoked the International Emergency Economic Powers Act, or IEEPA, to set nation-by-nation tariffs on trading partners around the globe.

However, the court paused the effect of its ruling until Oct. 14, giving Mr. Trump time to appeal to the Supreme Court.

The ruling stemmed from a lawsuit that small, import-reliant businesses filed against Mr. Trump over his “Liberation Day” tariffs on dozens of nations. They said he usurped powers typically reserved for Congress by declaring a national emergency and claiming the right to impose tariffs on any country.

“It seems unlikely that Congress intended, in enacting IEEPA, to depart from its past practice and grant the President unlimited authority to impose tariffs. The statute neither mentions tariffs — or any of its synonyms — nor has procedural safeguards that contain clear limits on the President’s power to impose tariffs,” the court said in its ruling.

The decision could upend months of work by Mr. Trump to reset global trade relations.

“This was weaponized partisan injustice at its worst, politicians in black robes,” White House economic adviser Peter Navarro said on Fox News’ “Sunday Morning Futures.”

However, Mr. Navarro said he is confident that the dissenting opinion provides a “very clear road map to how the Supreme Court can certainly rule in our favor.”

The White House recently finalized tariffs from 15% to 41% on dozens of countries. Levies have been raised to their highest levels in more than a century.

Mr. Trump solidified the 10% blanket tariff on all imports and is implementing the 15% rate he negotiated with the European Union, Japan and South Korea.

The administration had warned that an adverse ruling would undermine the president and ongoing negotiations, although the court ruled that Mr. Trump had overstepped.

On Friday, the White House said it would prevail on appeal.

“President Trump lawfully exercised the tariff powers granted to him by Congress to defend our national and economic security from foreign threats,” White House spokesman Kush Desai said. “The president’s tariffs remain in effect, and we look forward to ultimate victory on this matter.”

Mr. Trump said the ruling, if allowed to stand, would “destroy” America.

“It would be a total disaster for the Country. It would make us financially weak, and we have to be strong,” he posted on Truth Social. “The U.S.A. will no longer tolerate enormous Trade Deficits and unfair Tariffs and Non-Tariff Trade Barriers imposed by other Countries, friend or foe, that undermine our Manufacturers, Farmers, and everyone else.”

Mr. Trump emphasized that his tariffs remain in effect, pending appeal.

The ruling does not eliminate Mr. Trump’s ability to impose tariffs on nations. He could seek other statutes to authorize them or have Republican allies in Congress approve them through legislation.

The decision also does not impact sector-specific tariffs on products such as steel, cars and aluminum, which were issued through a mechanism designed to protect national security.

The ruling affects nation-based tariffs imposed on individual countries, including major trading partners such as China, Mexico and Canada.

Outside groups hailed the ruling as a vital check on presidential power.

“The court of appeals rightly affirmed that IEEPA does not give the president unilateral authority to rewrite the country’s tariff regime. Any other decision would have raised insurmountable constitutional problems,” said Oliver Dunford, a lawyer at the Pacific Legal Foundation, a public interest law firm that supported the lawsuit.