Cross Border Trade Updates

U.S. Trade Policy and Tariff Actions

• ‍U.S. Supreme Court strikes down IEEPA tariffs: On 20 February, the Supreme Court ruled that the tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were not authorized. The decision sets the precedent that IEEPA does not give the President authority to impose tariffs as a measure of “regulating imports.” The White House subsequently issued an executive order Ending Certain Tariff Actions lifting tariffs imposed under IEEPA. Additionally, on 22 February, U.S. Customs and Border Protection issued CSMS # 67834313 - Ending Collection of International Emergency Economic Powers Act Duties, which removes the following IEEPA-related tariff provisions effective 24 February 2026:

• ‍Only IEEPA tariffs invalidated:  The Supreme Court’s decision does not impact any other tariff actions that the Trump Administration has implemented, such as any Section 232 or Section 301 tariffs and their current investigations.
• No clarity yet on scope or process for IEEPA refunds: The SCOTUS decision did not directly address the scope and implementation of tariff refunds. The SCOTUS ruling also reaffirmed that the Court of International Trade (CIT) has “exclusive jurisdiction” on tariff challenges against the Government. It is anticipated that CIT will manage all refund litigation. ‍
• Trump Administration implements Section 122 global tariffs: On the same day, following the Supreme Court decision regarding IEEPA tariffs, the Trump Administration issued a Presidential Proclamation implementing a “global” ad valorem tariff of 10% under Section 122 of the Trade Act of 1974. Section 122 tariffs are effective 24 February although CBP has not released CSMS guidance on the implementation. President Trump later announced through Truth Social that the rate would be revised up to 15%, though this is not yet reflected in a proclamation or executive order. Section 122 tariffs are limited to a 15% ceiling and have a 150-day expiration date and can be extended through Congressional approval. Further, some members of the GOP have indicated an interest in codifying IEEPA tariffs, but most Hill watchers believe there is no appetite for such a move by Congress in support of tariffs in advance of mid-terms.
• Food processing and packaging machinery of 8422 and 8438 will be subject to the new Section 122 tariffs effective 24 February. There are select exemptions for some products as outlined in Annex I and Annex II of the proclamation, including USMCA-compliant products.

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Trade Policy Actions by Other Countries

• ‍European Parliament Pauses implementation of US-EU trade deal: On 23 February, reports indicate Bernd Lange, the chair of EU Parliament’s committee on international trade (INTA), would pause the vote scheduled to implement certain aspects of the US-EU trade deal. Further reporting noted the EU Commission needed more clarity on the trade deal before deciding on next steps. If the EU agrees to implement the agreement as is, imports of U.S.-manufactured food packaging and processing machinery into the EU would decrease from 1.7% to duty-free.‍
• Status of U.S. bilaterial negotiations and discussions: Please see the chart below for the latest on how certain countries are engaging with the United States in effort to reduce additional tariffs and conclude bilateral deals. These may change in the coming days in reaction to the Supreme Court ruling.

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