The global trading system plunged into uncertainty after a ruling by the U.S. Supreme Court, which declared tariffs imposed by the Donald Trump administration under the IEEPA Act to be illegal. In response, the president announced the introduction of a new, 15 percent global tariff, based on balance of payments protection provisions. The European Commission is demanding explanations, India has suspended trade negotiations, while tech giants are counting on billions in refunds for previously paid duties.

Supreme Court Ruling

The recognition of IEEPA tariffs as illegal opens the way for corporations to claim refunds of billions in overpaid customs duties.

New Global Tariff

Donald Trump introduces a 15 percent tariff based on balance of payments protection, circumventing the court ruling.

European Union Resistance

Brussels demands explanations and is preparing a 'trade bazooka' in response to American protectionism.

Russia's Export Crisis

Declining oil production and the need to offer huge discounts are draining the Kremlin's war budget.

The American judiciary has dealt a serious blow to the White House's trade policy. The Supreme Court ruled that tariffs imposed under the IEEPA Act were unlawful because their nature corresponds to taxes, for which Congress has the exclusive right to legislate. The ruling caused immediate euphoria on stock exchanges, particularly among tech companies like Apple or Alphabet. These companies can now seek refunds of billions of dollars in paid tariffs, although experts warn that this process will not be automatic and will require separate proceedings before customs courts. President Donald Trump responded to the ruling by escalating tensions, announcing a new, temporary 15 percent import surcharge. He used Article 122 of the Trade Act of 1974, which allows for the introduction of a temporary import surcharge for up to 150 days to counteract the country's balance of payments problems, with a maximum statutory rate of up to 15 percent. Although the new levy is intended to be broad in scope, the administration signaled possible exemptions for partners under the USMCA agreement. The European Union reacted to these reports with great concern, emphasizing that the current legal uncertainty undermines fair and predictable transatlantic relations. Article 122 of the Trade Act of 1974 has rarely been used in American diplomatic practice, being a relic of the era of currency crises and attempts to stabilize the dollar in the Bretton Woods system. Simultaneously, the dispute over European defense autonomy ambitions is escalating. Washington sharply criticized the EU's proposal for preferential treatment of the domestic defense industry, threatening retaliatory actions. Meanwhile, economic data indicates Russia's worsening situation in the oil market. In the fourth year of the invasion of Ukraine, Russia's oil production was reported to be around 9.1 million barrels per day (depending on definition and period), and Urals-type crude is sometimes sold with discounts reaching about 20 dollars relative to Brent oil, which limits revenues to the Kremlin's budget.

„The Supreme Court's decision is a direct attack on our national security and economic sovereignty, but we will not let these radical judges stop us from protected American jobs.” — President of the United States, author of the new tariff policy

Mentioned People

  • Donald Trump — President of the United States, author of the new tariff policy
  • Christine Lagarde — ECB President warning against disruption of trade balance
  • Friedrich Merz — German Chancellor announcing coordination of EU actions towards the USA