Jaguar Freight | Tariff Update: Judge Rules Against Tariffs, But Duties Remain In Place

IMPORTANT TARIFF UPDATE

A federal appeals court has ruled that President Donald Trump exceeded his authority when imposing specific tariffs earlier this year. The decision struck down the so-called “Liberation Day” duties but left them in effect until at least mid-October while the case moves to the Supreme Court.

At issue are tariffs announced on April 2 that applied a baseline 10 percent duty on most imports and additional rates as high as 50 percent on goods from countries with trade surpluses, including China, Canada, and Mexico. Tariffs imposed under other authorities, such as those targeting steel, aluminum, and automobiles on national security grounds, are unaffected by the decision.

The court concluded that Trump’s broad use of the law to impose tariffs on nearly all trading partners went beyond his authority. The decision upheld an earlier ruling from the Court of International Trade.

Notably, the revenue from the contested tariffs has been significant. By July, they had generated an estimated $159 billion for the U.S. Treasury. If the ruling stands, importers could seek refunds. The duties will continue to be collected in the meantime.

Actions can importers take right now:

As mentioned, the administration plans to appeal. For this and other reasons, the stay may remain in place beyond October 14. The administration may also pursue new measures, including Congressional approval, all of which will take considerable time. There will be many more bold headlines on the subject forthcoming, so remember that it’s all just rhetoric until actual legal rulings have been made.

We also recommend that companies protect themselves by ensuring quotes and contracts include a short tariff-contingency clause that references the October 14 enforcement window and any potential Supreme Court stay, while clearly outlining refund and rebill mechanisms.

At the same time, a smart approach for some companies will be to run dual landed-cost scenarios for any upcoming 4th quarter orders. Modelling costs both with and without IEEPA-based tariff lines, while keeping Section 232 items fixed across both models, will help budget best- and worst-case cost scenarios.

Finally, take the time to flag SKUs with mixed legal exposure by identifying which product lines are subject to IEEPA-based rates versus Section 232 or other authorities, and ensure these distinctions are accounted for in cost calculations so they can be passed appropriately through in customer quotes/ COGS models.

The bottom line is that, for now, the outcome leaves U.S. businesses and trading partners uncertain about whether a cornerstone element of Trump’s trade policy will remain, and with little additional clarity on how supply chains will be impacted for the remainder of 2025.

Jaguar Freight will provide additional updates as new information becomes available.

Sincerely,

The Team at Jaguar Freight

Compliments of Jaguar Freight – a member of the EACCNY