1930 law, 50% tariff and new lawsuit: Trump faces new challenge over Canadian tariffs | Today’s news
A major U.S. food importer has filed a lawsuit against President Donald Trump’s 50% tariffs on certain Canadian products, arguing that the administration lacks the legal authority to impose tariffs under a little-known provision of the 1930 Trade Act.
Gellert Global Group filed the lawsuit on Tuesday, asking the U.S. Court of International Trade to declare the tariffs illegal and stop their enforcement and collection. The company has also asked for a refund of the duty with interest, which it claims was illegally collected.
The legal challenge comes after trade talks between Washington and Ottawa broke down earlier this year, leading the US to impose tariffs on billions of dollars worth of Canadian goods and prompting retaliation from Canada.
Why is an American food importer challenging Trump’s 50% Canadian tariffs?
In its lawsuit, Gellert Global Group described the tariffs as “the latest attempt by the Trump administration to exercise, through a law that was never designed for that purpose, the tariff authority that the Constitution grants to Congress.”
The company says Trump lacked the authority to invoke Section 338 of the Tariff Act of 1930 to impose tariffs on Canadian products.
The provision, part of the Smoot-Hawley Tariff Act of 1930, is a rarely used legal mechanism that the administration relied on to impose the 50% tariffs. The tariffs went into effect in August.
The suit asks the trade court to rule that the tariffs are illegal and stop their enforcement and collection. It also demands a refund of duties already paid along with interest.
The case adds to the legal challenges facing Trump’s tariff policy, with businesses challenging the administration’s authority to impose tariffs under various provisions of US law.
Which Canadian products face Trump’s 50% tariffs?
The US tariffs cover billions of dollars worth of Canadian goods, including hockey sticks. The administration subsequently added products such as cheese, motorboats and aluminum goods to its list of targeted imports.
Certain products, including road salt and cement, were exempted from duty. Trump also moved to ban the import of various Canadian alcoholic and dairy products.
The measures prompted retaliation from Ottawa and intensified trade disputes between the neighboring countries.
Although the tariffs have affected a relatively small share of total bilateral trade, the dispute has strained relations between the US and Canada, two of each other’s most important trading partners.
Trump’s repeated proposals to make Canada the 51st US state have added to diplomatic tensions.
How does the lawsuit fit into Trump’s broader tariff fight?
Since returning to the White House last year, Trump has imposed broad tariffs on US trading partners, including allies and competitors, separately targeting industries such as steel and autos.
His tariff policy faced legal scrutiny over the extent of the president’s authority to impose tariffs without congressional approval.
In February, the U.S. Supreme Court struck down Trump’s country-by-country tariffs, prompting a wave of requests from companies for refunds. However, the sectoral tariffs remained in place.
After the ruling, the administration turned to other legal mechanisms to rebuild its tariff regime. However, the Supreme Court decision limited Trump’s ability to quickly impose new tariffs on trading partners.
The latest lawsuit focuses specifically on the administration’s use of Section 338 of the Tariff Act of 1930 for Canadian tariffs.
The court’s ruling could determine whether the disputed tariffs can remain in place and whether Gellert Global Group is entitled to a refund. Other businesses that have paid the tariffs may also be watching the proceedings for their potential consequences.
Read also | Trump thanks ‘legendary’ friend Musk for promising SpaceX stock to kids
