Thousands of American and international companies are preparing for what is expected to be one of the fiercest legal battles in modern trade history, seeking to recover nearly $170 billion in tariffs paid to the U.S. government. This sweeping move follows a landmark Supreme Court decision that struck down a key tool used by former President Donald Trump to implement his protectionist trade policies, according to Bloomberg.
Background to the conflict: Limits of presidential power and emergency law
To understand the dimensions of this issue, one must consider the broader context of Washington's trade policy in recent years. The US administration has relied heavily on emergency powers to impose sweeping tariffs, under the banner of protecting domestic industry and national security. However, the Supreme Court ruling last Friday dealt a significant blow to this strategy. The court ruled that the president lacked the legal authority to impose those specific tariffs under the emergency powers he invoked, opening the door to complex legal questions about the fate of the revenues collected unlawfully.
Trump's reaction: A new escalation and a long-term battle
The US president did not remain silent in the face of this court ruling. In a press conference held after the decision was issued, Trump strongly criticized the court, stating that the judges "take months to write their opinions and don't even discuss the issue of recovering the funds." The president displayed clear defiance, saying, "We will finish this in the courts within the next five years," suggesting a legal strategy aimed at prolonging litigation to exhaust the opposing side.
Trump didn't stop at mere statements; he immediately announced new global tariffs of 10%, citing a different legal provision, in an attempt to circumvent the court ruling and maintain his protectionist policies. However, experts assert that this new measure will not stem the tide of lawsuits that companies intend to file to recover what they have already paid.
Alliance of those affected: From retail to heavy industries
The past few months have seen a flurry of activity from a wide range of companies to reorganize their legal affairs. The list of those affected includes giants in various sectors, from major retailers like Costco, which relies on imports to provide competitively priced goods, to large industrial companies like the American aluminum producer Alcoa, whose supply chains have been disrupted. The list also includes hundreds of small and medium-sized enterprises (SMEs) and local branches of foreign companies, reflecting the widespread impact of these tariffs.
Expected economic impacts locally and globally
The US administration's loss in this case is expected to have repercussions across the global economy. According to Bloomberg, the size and scope of any potential reimbursements would be unprecedented. If companies succeed in recovering these enormous sums, it could inject massive liquidity into the balance sheets of affected firms, potentially impacting consumer prices and inflation. On the other hand, this case places immense pressure on the US federal budget and establishes a legal precedent that limits future presidents' ability to use tariffs as a political tool without robust legislative backing.
