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PRIVILEGED AND CONFIDENTIAL: ATTORNEY-CLIENT COMMUNICATIONS
CTDA MEMBER UPDATE ON THE STATUS OF ADDITIONAL US TARIFFS PLACED ON IMPORTED PRODUCTS BY THE TRUMP ADMINISTRATION
1 – Yesterday evening, the US Court of International Trade (CIT) invalidated most of the additional global tariffs President Trump imposed on the vast majority of imported products earlier this Spring. The Court found that the President lacked his stated authority under the International Emergency Economic Powers Act (“IEEPA”) to impose these added tariffs;
2 – The CIT decision invalidates (a) the additional “base line” tariffs of 10 percent that apply to imports, including ceramic tile, from all countries (with a few listed product exceptions) and which are supplemental to the “ordinary” US tariffs; b) the 20 percent additional “fentanyl” tariffs on goods from China; and, c) the 25 percent added “fentanyl” tariffs on products from Canada and Mexico that do not qualify for duty-free status under the US/Mexico/Canada Free Trade Agreement (formerly NAFTA);
3 – The decision does not impact: (a) the additional 25 percent tariffs on imported steel, aluminum and derivative products containing them, (b) the Section 301 tariffs of 25 percent that have applied to virtually all products from China since 2018; and (c) the 25 percent tariffs on vehicles and certain automotive components. Each of these additional tariffs are imposed under other federal laws not addressed by the CIT case;
4 – The Administration has already appealed the CIT decision to the Court of Appeals for the Federal Circuit and has stated plans to file an emergency appeal with the US Supreme Court if the Appellate Court either upholds the decision or fails to respond quickly;
5 - If the CIT decision survives appellate review, it would undoubtedly result in the refund of these additional import duties paid by US importers. It must be stressed that US Customs will continue to collect these import duties as the CIT decision was just stayed this afternoon by the appellate court. If you are entering imported products into the US, you must continue to post the applicable additional duties until further notice;
6 – Should the Administration fail to overturn the CIT decision invalidating the IEEPA tariffs, it is very likely that the President will move to re-impose additional tariffs under any of three federal trade statutes other than IEEPA. If this occurs, it is likely that such tariffs would be only prospective from the date of their implementation and would not apply to any import entries filed prior to their effective date. This would enable importers to obtain refunds of the IEEPA tariffs from the date they were imposed until the effective date of the new tariffs.
If you have any questions, please contact CTDA Legal Counsel Robin Grover at (202) 302-1653. We will promptly alert you to any further developments regarding the tariff issues.
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