Jaguar Freight | The Impact of U.S Trade Policy and Expectations for Transatlantic Trade Post-IEEPA Tariffs

It’s an understatement to say it’s been a chaotic year for global trade. For much of 2025 and early 2026, supply chain professionals, importers, and multinational companies have been operating in an environment defined by policy shifts, unclear exemptions, and significant cost volatility. Against that backdrop, the U.S. Supreme Court’s February 20 decision on the legality of the IEEPA tariffs was widely anticipated as a turning point, with many on both sides of the Atlantic Ocean hoping for clarity and finality.

Instead, we received something more complex. The court struck down the IEEPA duties, which comprised the majority of the Trump administration’s tariff strategy. Within hours, the administration responded by invoking Section 122 authority to impose a 10 percent tariff that broadly approximates the prior IEEPA duties.

For importers, particularly those engaged in high volumes of EU and U.S. trade, the ruling and the immediate policy response confirmed both the good and the bad. First, the bad is that tariffs remain a central negotiating lever in U.S. trade policy. Second, while uncertainty persists, a positive is that we may now have visibility into the upper limit of what duties will be charged.

For an industry starved for certainty, it’s hard to know which matters most right now.

The Supreme Court Decision and the Section 122 Response

The February 20 ruling determined that the IEEPA-based duties were unlawful and ordered them lifted. That decision effectively dismantled the legal framework for most of the tariffs implemented over the past year. The aforementioned Section 122 tariffs, whose legality is already being questioned, are intended as temporary measures and automatically expire after 150 days unless Congress votes to extend them. That provision introduces yet another timeline and another layer of uncertainty into planning. Importers must now account not only for cost, but also for the likelihood of an extension or replacement.

Adding to the frustration for importers, carriers, and U.S. consumers is that at the time of writing, there is no formal guidance on whether previously paid IEEPA duties will be refunded. For many companies, billions of dollars in duties remain in limbo. The practical advice for impacted companies is to engage your customs brokers now. Ensure documentation is complete and be prepared to act quickly when/ if a refund process is announced.

There is also a widely held expectation that the path of least resistance for the administration to maintain the tariff levels may be a transition from Section 122 to Section

301 tariffs. Section 301 tariffs account for many of the Trump duties still in effect, offering a more ‘durable’ legal footing that can be structured to closely mirror the IEEPA duties.

The Total Cost Impact

Helpful at this point is that the actual cost impacts of the tariffs have become clearer. When effective tariff rates surged in 2025, the average effective rate jumped from 2.2 percent in January to 10.91 percent by October, roughly a fourfold increase. Chinese exports faced effective rates of 37.4 percent during that period, while steel and aluminum products reached 41.1 percent. New tariffs generated $148.3 billion in revenue in the first ten months of 2025 alone.

The Section 122 rate, at 10 percent, broadly aligns with importers’ prior costs. That suggests the most extreme upward pressure on costs has already been felt. While tariffs remain politically fluid, the hope is that we are not facing an immediate increase beyond what supply chains have already been paying.

This matters because predictability, even at the current elevated cost levels, is more manageable than continuous upward shocks. Supply chains can price in known constraints, but it’s much harder to efficiently plan around daily changes.

From a macro perspective, one estimate suggests that the net global impact averages around 1 percent. For EU and U.S. traders, the aggregate numbers may understate what’s happening company by company. Diversified importers are likely to see less impact, whereas a specialized manufacturer reliant on a smaller number of inputs may face greater costs.

Winners, Losers, and Lessons Learned

The effects of tariff policy are uneven in other ways, too.

Organizations leveraging technology and analytics, diversified supplier networks, and strong supply chain coordination are navigating the disruption most effectively. For them, tariffs became another input variable in a complex cost equation. Companies with visibility across suppliers, transportation partners, and their own operations can treat volatility as a scenario-planning exercise rather than a crisis.

By contrast, companies with limited supply chain visibility or highly concentrated sourcing struggled. For them, the chaos exposed structural weaknesses that had long been tolerated in a low-duty environment.

For EU-focused importers, an additional layer of uncertainty now exists. Following the Supreme Court ruling, EU lawmakers signaled they may freeze the U.S. trade deal pending

review, potentially leading to a transatlantic trade reset. If negotiations stall or there’s retaliation, importers operating across the Atlantic could face revised rules of origin, new compliance standards, or sector-specific countermeasures.

The Path Forward for Supply Chain Professionals

In 2026, the mandate for supply chain leaders is clear.

First, maintain and deepen supplier diversification initiatives. The events of the past year have validated the need for multi-regional sourcing models. Even if tariffs stabilize, geopolitical risk persists.

Second, invest in digital tools and partnerships that enable real-time cost modeling and scenario analysis. When tariff regimes can shift within weeks, so can sourcing, supply chain lead times, and transportation costs. Decisions need to be made quickly, but they also need to work in the long term.

Third, prepare for downstream pricing and cost allocation adjustments. While much of the tariff burden has been absorbed by companies in different ways as a short-term solution, the costs will settle into the appropriate expense buckets that will soon be reflected in different manufacturing costs, shipping rates, and consumer prices.

And for EU and U.S. companies in particular, scenario planning should now incorporate the possibility of a renegotiated or paused transatlantic trade deal. A complete reset is not inevitable, but it is plausible.

Conclusion

The Supreme Court ruling did not deliver the clarity many hoped for. Instead, one legal framework has been replaced with another, and a new timeline was created. Yet amid the uncertainty, there is a measure of stability.

Trade policy will remain political with tariffs serving as a negotiating tool. Thankfully, however, the industry is not reacting blindly. With real data, resilient processes, and diversified partner networks, EU and U.S. companies are better positioned to remain proactive and strategic as long as market uncertainty persists.

Compliments of Jaguar Freight – a member of the EACCNY