US Appeals Court Keeps '10% Global Tariff' in Effect During Appeal

The "10% global tariff" imposed by U.S. President Donald Trump to replace reciprocal tariffs previously ruled illegal by a court is expected to remain in effect until its scheduled expiration in late July.

On June 11 (local time), the U.S. Court of Appeals for the Federal Circuit decided to stay the enforcement of a ruling by the U.S. Court of International Trade, which had declared the 10% global tariff imposed by the Trump administration in February under Section 122 of the Trade Act to be unlawful.

The appellate court had previously issued a temporary stay on the lower court's ruling on May 12, shortly after the appeal was filed. Following further review, the court has now extended this stay until a final decision is reached in the appellate proceedings.

The appellate court explained its decision by noting that there is a possibility of legal error in the lower court's interpretation regarding the balance of payments deficit, and that the federal government could suffer irreparable harm if the stay were not granted.

The effect of this stay is limited to the two importers that originally filed the lawsuit—spice importer Burlap & Barrel and toy importer Basic Fun—as well as the State of Washington.

While the lower court ruled that the 10% global tariff was illegal, it did not issue an order applying the ban on tariff collection universally beyond the plaintiffs.

Previously, after the U.S. Supreme Court ruled in February that the imposition of reciprocal tariffs based on the International Emergency Economic Powers Act (IEEPA) was illegal, President Trump imposed a 10% global tariff on all countries under Section 122 of the Trade Act.

However, the U.S. Court of International Trade ruled on May 7 that these tariffs were in violation of the law and therefore invalid.

The court subsequently issued an injunction prohibiting the application of the 10% global tariff to the importers and the State of Washington that had filed the suit.

Section 122 of the Trade Act, which the Trump administration used as the basis for the 10% global tariff, grants the President the authority to impose tariffs for up to 150 days to address large and serious balance of payments deficits.

The 10% global tariff was originally imposed as a temporary measure, effective only for 150 days until late July.

The Trump administration plans to fill the gap left by the reciprocal tariffs by introducing new tariffs following an investigation under Section 301 of the Trade Act during this period.

Previously, the Office of the United States Trade Representative (USTR) announced the results of its Section 301 investigation into forced labor on June 2, signaling a 12.5% tariff on South Korea.
※ Please note: This article was translated by AI and may contain errors.