The Tariff War Continues

Last Friday, February 20, the Supreme Court of the United States invalidated, by a majority of 6-3, the tariffs imposed by President Trump under the International Emergency Economic Powers Act (IEEPA), considering that he exceeded the powers invoked to impose a large part of his taxes on the country's trading partners. The High Court confirms that tariffs are a type of tax that the Constitution requires the prior approval of Congress, and it is not legal in times of peace to create such broad new general levies, with the argument of a national economic emergency, restricting this instrument to traditional uses such as financial sanctions or blocking goods.

A way is therefore opened by which the affected operators will be able to request the refund of the tariffs paid on imports into the US since "the day of Liberation", on April 2, 2025, now declared illegal. Although the Court has not provided clear guidance on the retroactive consequences of its ruling, we recommend that operators analyse which tariffs of those satisfied are claimable and act quickly in the face of the very foreseeable saturation of the system.

The tariffs affected are the so-called "reciprocal tariffs" and the general tariffs that the Trump Administration imposed on almost all its trading partners, with a minimum rate of 10%. Tariffs on steel, aluminum, and other levies adopted under trade and safety laws other than the IEEPA are not affected and they are still in force.

It is not immediately clear whether the administration will set up a standardized reimbursement process or whether companies will be required to file a claim with the Court of International Trade. Initially those claims for reimbursement are estimated at about $240 billion.

On the other hand, the Ruling does not prevent Trump from resorting to other legal frameworks as he has already done, specifically the provisions on national security or retaliatory measures against unfair trade practices (section 122 of the Trade Act of 1974) as he announced immediately and which have come into force in February 24. Since this day, Trump will apply a temporary surcharge of 10% on imports for a maximum of 150 days, without the need to request prior authorization from Congress as long as he finds arguments to prove the existence of fundamental problems with international payments. The threat of a 15% tariff, instead of 10%, has not yet materialized, but the White House is working on a proposed way to increase the rate.

This measure will expire on July 24, 2026, unless Congress approves an extension. This new measure will not affect 0% tariffs under the free trade agreement with Mexico and Canada.

Faced with this new framework of legal uncertainty, the European Union demands, as the largest trading partner of the US, that they comply with their commitment established in the Joint Declaration signed in July 2025, affirming that “a deal is a deal”. However, no measures aimed at counteracting the combined impact of the Supreme Court's ruling and the new global tariffs have been approved at this time.

At Cuatrecasas' Customs Law Group, we are at your disposal to assist you in clarifying whether refunds can be requested, and to accompany you throughout the claim procedure through American law firms specializing in customs law.

For more information, please contact our specialists through the Knowledge and Innovation Area.