Will Trump's 'New Weapons' be Trade Law Sections 232 and 301?
The U.S. Supreme Court's ruling against Trump's trade tariffs prompts him to consider alternative trade laws as leverage for negotiations.
Following a recent U.S. Supreme Court ruling that invalidated former President Trump's inter-tariff policies, Trump is now eyeing Trade Law Section 301 and Section 232 as potential alternatives. Both laws, while having a complex activation process and a limited scope, offer the advantage of lacking upper limits on tariff rates and allowing flexible adjustments once activated, making them powerful tools for Trump's negotiation tactics. Section 301, in particular, empowers the U.S. Trade Representative to investigate and respond to 'unreasonable or discriminatory' trade practices by foreign governments, theoretically permitting the imposition of extraordinarily high tariffs if necessary.
However, activating these laws is not straightforward. The procedures require several steps, including public notice of investigation, a 30-day public comment period, a 60-day consultation with the affected country, and holding public hearings. This process can typically take from six months to over a year. If the administration attempts to shorten this timeline unilaterally, it may face legal challenges under the Administrative Procedure Act. For example, in 2018, the Trump administration faced lawsuits from over 3,500 U.S. importers who argued that the administration had not adequately considered opposing comments during the public review process regarding tariffs on Chinese imports. While the International Trade Court recognized procedural errors, it ordered a reevaluation rather than voiding the tariffs altogether.
Despite the complexities, once tariffs are imposed, the U.S. Trade Representative can adjust them relatively freely. The ongoing legal battles surrounding previous tariff measures underscore the contentious nature of trade policies. Trump's reliance on these legal frameworks signals a continued strategy of using tariffs as leverage in international trade negotiations, potentially affecting U.S. relations with countries such as China, which have been significant players in global trade markets.