Thought Leadership
A clearBorder watching brief
TLDRThe U.S. Supreme Court has ruled that President Trump exceeded his authority under the International Emergency Economic Powers Act in imposing sweeping global tariffs. The decision nullifies the broad, country-specific tariffs targeting China, Canada, Mexico, and other trade partners; potentially opening the door to refunds of billions of dollars in duties. In response, Trump invoked the never-before-used Section 122 of the Trade Act of 1974, imposing a temporary 10% global tariff for 150 days, with plans to increase to 15%.
Last updated: 5th May 2026
The original IEEPA tariff regime marked one of the most expansive assertions of executive trade authority in modern U.S. history.
Controversially wielding the International Emergency Economic Powers Act, the Trump administration imposed sweeping “reciprocal” tariffs across dozens of countries. Legal challenges followed swiftly. States, small businesses, and major importers all argued that IEEPA granted no explicit authority to levy tariffs, and that Congress had not delegated such broad taxing power to the executive branch.
In a landmark ruling, SCOTUS has agreed: striking down the tariff architecture, and delivering a sharp rebuke to the administration’s interpretation of “emergency powers”. The decision upends the legal basis of the tariff regime and forces an immediate policy recalibration for Washington.
How did we get here?
Until now, the Trump administration has depended upon IEEPA to apply tariffs and broad duties linked to perceived trade imbalances. The Supreme Court’s 6-3 decision marks a major check on that authority, with Chief Justice Roberts noting that Congress had not granted an open-ended power to levy import taxes.
Exporters, again, now face heightened uncertainty: tariffs may be reintroduced under different statutes, timing and rates are fluid, and potential stacking with existing MFN (Most Favored Nation) or trade deal tariffs could disrupt global supply chains.
The new 10% global tariff entered into force on 24th February under Section 122 of the Trade Act of 1974. The statute permits duties of up to 15% for a maximum of 150 days – implying an expiry window in late July 2026, unless extended or replaced by alternative measures. The White House has indicated that rates could rise from 10 to 15%, while parallel Section 232 and 301 investigations remain available as policy tools.
For cross-border traders, the notion of tariff stability is a distant memory. In this latest chapter of an ongoing saga, a temporary floor has been set – but further, sector-specific tariffs or statutory pivots remain highly plausible.
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The context
Key watchpoints
IEEPA tariffs ruled unlawful; potential refund exposure runs into tens of billions of dollars.
Section 122 invoked for the first time to impose temporary global tariffs (10%, potentially rising to 15%).
Parallel tariff authorities (Sections 232 and 301) remain available to the administration.
Refund mechanisms and litigation timelines through the Court of International Trade.
Potential increase from 10% to 15% within the 150-day window.
Stacking risk with existing MFN or sectoral tariffs.
Expansion of derivative tariffs (e.g., metals content in finished goods).
Diplomatic retaliation or renegotiation signals.
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UK exports to the US nosedive after protracted shocks and uncertainty
4th May 2026
UK goods exports to the US (excluding precious metals) have fallen by £1.5bn – or 24.7% – since President Trump’s “liberation day” tariffs, according to ONS data. This means the UK is now running a trade deficit with its largest trading partner.
Although Trump has removed tariffs on Scotch whisky “in honour” of King Charles, the wider export picture remains highly pressurised. Commentators have described a “triple squeeze” for exporters: higher trading costs from tariffs, higher employment costs and taxes, and input price pressures.
→ The trade lens: policy reversals, selective exemptions, and ongoing tariff threats mean exporters are operating without a stable baseline. For UK firms, the challenge is planning for an environment where neither pricing nor market access can be forecast with any degree of confidence.
EU vehicle tariffs set to rise to 25% as Section 122 volatility spreads
1st May 2026
President Trump has said tariffs on EU cars and trucks entering the US will rise to 25% from next week, accusing the EU of non-compliance with last year’s trade deal. Brussels has rejected the move, with Bernd Lange arguing that the US has repeatedly breached the agreement, including through tariffs on products containing steel and aluminium. The announcement places automotive supply chains back at the centre of US–EU trade friction. Shares in Ford, Stellantis, and General Motors all fell after the announcement, reflecting investor concern over input costs, sourcing decisions, and retaliatory risk.
→ The trade lens: rather than stabilising after the IEEPA ruling, the tariff environment is mutating. Firms should expect continued statutory pivots, sector-specific measures, and pressure on production-location decisions.
Tariff refund portal opens as importers line up for repayments
20th April 2026
The refund system for companies seeking repayment of tariffs collected under the IEEPA regime has opened. Over 330,000 importers paid the disputed duties, across 53 million shipments, with total potential refunds estimated in excess of $165bn.
Court filings suggest that – by 9 April – 56,497 importers had completed the steps needed for electronic refunds, representing $127bn of eligible duties. The administration has indicated approved claims may take 60–90 days to pay, though technical and procedural issues could slow reimbursement.
→ The trade lens: importers face document collation, claim sequencing, cash-flow timing, and possible reimbursement questions. Where tariff costs were passed on through higher prices, refunds could create a second-stage commercial issue: whether the reimbursement should sit with the importer, customer, distributor, or end buyer.
The dust settles on Section 301 as a successor regime
13th March 2026
With the Supreme Court having curtailed IEEPA authority and Section 122 limited to 150 days, the administration is repositioning Section 301 as its primary tariff instrument. Unlike Section 122, 301 investigations can yield open-ended remedies and are not capped at 15%. Several targeted economies already concluded bilateral “reciprocal tariff” understandings with Washington in 2025, raising questions about legal coexistence and diplomatic durability.
→ The trade lens: The expiry of Section 122 in July will likely signal not a de-escalation, but a transition. Firms should model for tariff persistence lasting well beyond summer 2026 – especially in manufacturing-intensive sectors.
USTR launches Section 301 investigations against 16 major trade partners
12th March 2026
The resultant inquiry is on an accelerated timetable, with hearings beginning 5 May. Many commentators have been quick to note, the move appears designed to replace directly the temporary Section 122 global tariffs before their 27 July expiry.
→ The trade lens: This marks a decisive pivot from “emergency tariffs” to a more durable unilateralism. Section 301 carries few practical judicial constraints, raising the probability of longer-lasting, sector-targeted retaliation.
Aston Martin cuts 20% of workforce as tariff pressure bites
25th February 2026
The luxury carmaker has confirmed it will cut around 20% of its global workforce (approximately 600 roles) after net losses widened 52% in 2025 to £493.2m. Long associated with engineering pedigree and prestige, the Gaydon-based manufacturer cited U.S. tariffs under President Trump as “extremely disruptive,” alongside subdued demand in China.
With roughly 3,000 employees, the majority UK-based, cuts are expected to deliver £40m in annual savings. Capital expenditure has also been trimmed to £1.7bn, with electric vehicle investment delayed.
→ The trade lens: For a heritage British exporter trading on quality and reputation, the link is striking. Tariff volatility in its largest export market spells margin compression, investment deferral, and domestic job losses.
Note that another renowned British automotive manufacturer – Jaguar Land Rover – also encountered dangerous headwinds recently; in that case, owing to >a cyber attack that halted operations worldwide. Clearly, even the world’s largest and most widely-respected cross-border firms are not immune to trade shocks.
U.S. partners weigh responses
24th February 2026
The UK, EU, India, and other trade partners are evaluating exposure to the new Section 122 tariff. European and UK exporters emphasise a need for clarity; some warn of retaliatory measures if U.S. tariffs override negotiated trade agreements.
Analysts (including friend-of-clearBorder Sam Lowe, of The Financial Times) caution that this uncertainty may slow investment, disrupt inventory planning, and affect pricing strategy.
→ The trade lens: Boardrooms must integrate diplomatic signals into commercial risk models. Proactive engagement and scenario planning are key to mitigating short-term shocks.
Legal uncertainty and market disquietude: implementation begins
24th February 2026
Section 122 tariffs officially take effect today. However, some elements (including reporting and classification) remain inconsistent. Some sectors, such as semiconductors and steel derivatives, could see additional levies in coming weeks. Litigation, including from firms like FedEx and groups representing U.S. importers, has begun – potentially highlighting potential recovery pathways, but only adding to administrative complexity.
→ The trade lens: Expect short-term volatility in U.S. imports. Firms should track exemptions, update customs compliance procedures, and prepare for potential stacking with existing MFN (Most Favored Nation) tariffs.
Trump imposes 10% temporary global tariffs under Section 122
22nd February 2026
Following the landmark SCOTUS decision, Trump has signed a proclamation under Section 122, setting a 10% tariff on (the vast majority of) imports, effective for 150 days.
Exemptions apply to select minerals, fertilisers, agricultural products, and certain electronics. The White House indicates that rates could rise as high as 15%, creating an uncertain forecast for the compliance environment. North American trade partners under USMCA retain protections, but the global landscape is unsettled.
→ The trade lens: Companies must reassess supply chains, pricing, and contracts. Contingency planning is critical as tariff levels and scope may shift rapidly.
SCOTUS ruling cans Trump IEEPA tariffs
20th February 2026
The U.S. Supreme Court has struck down the Trump administration’s sweeping IEEPA tariffs, citing lack of congressional authority.
Country-specific and global duties on China, Canada, Mexico, and others are now legally void, potentially entitling importers to billions in refunds. President Trump has signaled he will pivot to Section 122 of the Trade Act to maintain temporary tariffs of 10-15%.
→ The trade lens: As expected, this creates immediate uncertainty. Refunds may take years, and new statutory tools mean short-term duty levels are volatile.
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