Background

A recent appeals court decision highlights continuing questions about the president’s authority to modify Section 232 import tariffs. The decision reversed a lower court ruling and handed a win to the federal government, but the importer plaintiff may seek further review.

In March 2018 President Trump issued proclamation 9705 imposing an additional 25 percent tariff on imports of steel articles from all countries, including Turkey. The president then issued in August 2018 proclamation 9772 increasing this tariff to 50 percent for steel from Turkey. An importer of such goods filed suit, alleging that the latter proclamation was illegal because it lacks a nexus to national security, did not follow mandated statutory procedures, and singled out importers of Turkish steel products.

Under amendments to Section 232 of the Trade Expansion Act of 1962 made by Congress in 1988, if the president receives a report from the Department of Commerce that imports of a particular product are threatening national security he/she shall determine within 90 days (1) whether he/she concurs and, if so, (2) the nature and duration of the action needed to adjust those imports so they will no longer pose such a threat. The law also states that the president shall implement any such action within 15 days of that determination.

However, two of the three justices of the Court of Appeals for the Federal Circuit cited a Supreme Court decision in noting that Section 232’s direction that the president “shall” act within a certain timeframe does not limit his/her ability to act after that deadline. They also said Section 232 permits the president to announce not just a discrete responsive action but a continuing course of action whose initial implementing steps may be modified if deemed necessary (e.g., by adding import tariffs or restrictions). They therefore concluded that proclamation 9772 was merely a further implementation of the plan announced in proclamation 9705.

A dissenting justice disagreed on both points. He asserted that in its 1988 amendments to Section 232 Congress, frustrated by the executive branch’s historical practice of perpetually modifying earlier actions, removed language allowing such behavior and instead set specific deadlines related to Section 232 actions, including by using the words “no later than.” He also rejected that idea that a presidential action under Section 232 may include a plan of action, pointing out among other things that (1) the requirement for the president to determine the duration of an action “has no teeth if an ‘action’ may include an open-ended series of actions that may be endlessly modified,” and (2) the requirement for the president to notify Congress within 30 days of the reasons for an action “is useless to Congress if the statute permits the President to adopt a continuing plan of action that may be changed later.”

The majority noted that its decision does not address other circumstances that would present other issues about presidential authority to adjust initially taken Section 232 actions without securing a new report with a new threat finding from the DOC.

For more information on strategies to mitigate the impact of the Section 232 tariffs, please contact Mark Segrist or Mark Tallo.

Copyright © 2021 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

ST&R: International Trade Law & Policy

Since 1977, we have set the standard for international trade lawyers and consultants, providing comprehensive and effective customs, import and export services to clients worldwide.

View Our Services 

Close

Cookie Consent

We use cookies on our website. By continuing to use our website, you agree to the Privacy Policy and Terms of Use.