New twist: The halt is stopped in Trump's tariff battle

USA

The tariff chaos will continue – at least for a while longer

Joachim Kerpner

Updated 12.59 | Publishcd 12.49

On Wednesday, a court stopped Trump's tariffs and the world breathed a sigh of relief.

Barely a day later, the halt was paused.

The Trump administration must be given time to sharpen its counter-arguments, a higher court ruled.

Quick version

• The US Court of International Trade stopped Donald Trump's tariffs, because he was considered to have abused his power when he introduced them.
• The Trump administration appealed the decision and a high court paused the halt yesterday, Thursday. The tariffs are in effect while the Trump camp develops its legal counter-arguments.
• The battle over the tariffs is expected to reach all the way to the US Supreme Court, where it can be decided whether Trump's use of an economic crisis law from 1977 was legal.

Donald Trump's threat of high tariffs against a long list of countries has created chaos in the world economy.

On Wednesday, American time, the US Court of International Trade ruled that the American president had abused the law he referred to when he introduced the tariffs. The court found that Trump did not have "unlimited power" to fight a global trade war, according to  The New York Times.  The tariffs were thus declared illegal.

The decision meant that the Trump administration must withdraw most of the tariffs within ten days.

The law that Trump referred to - an economic crisis act from 1977 - gives the president the right to act against imminent threats. When Trump made his tariff decisions, he has referred partly to the fact that fentanyl smuggling from abroad constitutes a crisis situation, partly to the fact that the US trade deficit must be addressed urgently.

Donald Trump's tariffs have created chaos in the world economy. Photo: Manuel Balce Ceneta / AP

After Wednesday's court ruling, senior US government officials went public and declared that the tariffs would not be lifted. In addition, the Trump camp filed an appeal with a higher court, asking it to pause the court's decision so that the presidential administration has time to develop its arguments that the tariffs are legal.

The higher court ruled on Thursday on just such a pause, which means that while the Trump administration sharpens its arguments, the tariffs can remain in place.

The battle over whether the tariffs are valid or not is expected to go all the way to the US Supreme Court, according to The New York Times.

If the legal battle ends with Trump's use of the almost 50-year-old economic crisis law being deemed illegal, it still does not necessarily mean that the president is prohibited from imposing tariffs.

There are a handful of other laws that he can refer to to impose tariffs. But those laws require a longer process that could take "a couple of months" to implement, unlike the quick presidential orders made possible by invoking the emergency law.