IEEPA Tariffs: US Federal Circuit Rules Trump Levies Illegal
Why in the news
A US federal appeals court has found that President Trump overstepped his powers by using an emergency-powers law to impose tariffs. The decision, delivered on 29 August 2025, matters for countries negotiating trade terms with Washington, including India.
Key facts
- The US Court of Appeals for the Federal Circuit decided by a 7-4 margin that the tariff announcements were unlawful.
- The ruling concerns the International Emergency Economic Powers Act (IEEPA) of 1977, which the court said does not allow unlimited tariffs.
- It backed the May 2025 finding of the US Court of International Trade that worldwide and retaliatory tariffs were unlawful.
- The order is stayed until October, so the tariffs stay in force while the Supreme Court is approached.
| Tariff authority | What it covers |
|---|---|
| Section 232 (Trade Expansion Act, 1962) | Steel, aluminium, automobiles, copper |
| Section 201 (Trade Act, 1974) | Solar panels |
| Section 301 | China, for unfair trade practices |
About IEEPA and the tariffs
IEEPA replaced the Trading with the Enemy Act of 1917. It lets a President declare a national emergency over foreign threats to national security, foreign policy or the economy.
In February 2025 the President announced 25% tariffs on Mexico and Canada, citing immigration and drug trafficking. In April 2025 he introduced a 10% baseline tariff plus reciprocal tariffs aimed at countries with trade surpluses.
Exam angle
- Remember the vote: 7-4 at the Federal Circuit, dated 29 August 2025.
- IEEPA was passed in 1977 and replaced the 1917 Trading with the Enemy Act.
- Section 232, 201 and 301 tariffs stay valid; the ruling hits only IEEPA-based duties.