US Trade Court Strikes Down Trump's Latest Tariffs as EU Faces Increased Threat

On Thursday, the US Court of International Trade delivered a significant blow to former President Donald Trump's latest trade ambitions, ruling against his imposition of a sweeping set of global tariffs. The court declared that the tariffs, enacted on February 24, were unjustified under a 1970s trade law. This ruling favored small businesses that had challenged the tariffs, resulting in a 2-1 decision by the judges involved, with one noting that it was premature to declare victory for the plaintiffs. The small businesses argued that Trump's tariffs were an effort to bypass a crucial US Supreme Court decision, which had previously struck down the tariffs imposed by the Republican leader in 2025 through the International Emergency Economic Powers Act. In his initial order, Trump had invoked Section 122 of the Trade Act of 1974, allowing duties for a limited period of 150 days to address serious balance of payments deficits or prevent a significant depreciation of the US dollar. However, the latest court ruling determined that this legal framework was not suitable for the specific types of trade deficits that Trump had cited. In a related development, Trump announced on the same day a new ultimatum to the European Union (EU), demanding that they fulfill trade deal commitments by July 4. If these commitments are not met, he threatened to raise tariffs on EU goods, particularly automobiles, from an agreed rate of 15% to a significant 25%. Trump referenced a 'great call' with European Commission President Ursula von der Leyen during which they also discussed the pressing issue of Iran potentially acquiring nuclear capabilities. This latest threat follows an unexpected tariff announcement the previous Friday, where Trump disclosed plans to increase tariffs on EU vehicles due to what he claimed was non-compliance with the terms of a deal agreed upon last July in Scotland. According to that agreement, the EU had committed to reducing tariffs on US industrial goods to zero and offering duty-free quotas on certain American agricultural and seafood products. However, progress in legislative approval has been sluggish within the European Parliament, prompting Trump’s frustration and subsequent threats. As the geopolitical landscape remains tumultuous and trade negotiations continue, the implications of these rulings and threats resonate beyond just US-EU relations, affecting global trade dynamics and the business climate for small enterprises at home. With tariffs being a contentious topic, the trade court's decision may signal a shift in how similar future policies are challenged and implemented. Related Sources: • Source 1 • Source 2