Trump’s 25% Tariff on Steel Imports Survives Statutory Challenge

US importers failed to show that the decision by former president Donald Trump to impose a 25% tariff on steel imports in the name of national security violated the Trade Expansion Act, the Federal Circuit said Thursday.

Under the statute, if the secretary of commerce determines that an article is being imported into the US in such quantities or circumstances that they threaten national security, and the president agrees with that conclusion, the president may “determine the nature and duration of the action” needed to adjust the imports so they will no longer be a threat.

In 2018, the secretary of commerce concluded that excessive steel imports were a threat to national security and the president agreed. Trump then imposed an 25% tariff on imports from all countries except Canada and Mexico . He later extended exclusions to certain other countries.

USP Holdings Inc. and other US steel importers, who said they’d each paid between $500,000 and $35 million on the tariff, said that it violated the statute because it didn’t address an imminent threat and because the president didn’t include a termination date in his proclamation and thus didn’t set the “duration” for the measure.

After concluding that the secretary’s threat determination was the reviewable action, the opinion by Judge Timothy B. Dyk said that the statute “imposes no imminence requirement.”

The factors the statute requires the secretary and president to focus on when assessing the threat the imports have on national security don’t include imminence but rather focus instead on the long term health of and adverse effects on the relevant domestic industry, the US Court of Appeals for the Federal Circuit said. The identification of such factors is inconsistent with the notion that the threat must be imminent, it said.

As for USP’s duration argument, the court said that the statute gives the president authority to adopt and carry out a plan of action that allows adjustments of specific measures.

“If the President has authority to undertake a plan of action that includes adjusting tariffs over time, then the President must also have authority to undertake a plan of action that includes imposing a tariff indefinitely and removing it at a later time once the President determines that it is no longer necessary,” the court said.

Judge Haldane Robert Mayer joined the opinion.

Judge Raymond T. Chen joined all but one footnote of the opinion on the basis of circuit precedent. But he said that precedent likely runs afoul of US Supreme Court case law.

Lewis Leibowitz of Washington, D.C., represented the plaintiffs. The Justice Department represented the government.

The case is USP Holdings Inc. v. United States, 2022 BL 199398, Fed. Cir., No. 2021-1726, 6/9/22.