U.S. Court of International Trade (CIT) Rejects Trump IEEPA Tariffs

According to GMF Market Commentary, on May 28, 2025, the U.S. Court of International Trade ruled that Trump does not have the authority to unilaterally impose tariffs under the IEEPA, thus the court prohibited the enforcement of Trump's Executive Order 14257 issued on April 2, meaning the "Liberation Day Tariff" is suspended.

The ruling emphasized that tariffs need to be "uniform" nationwide, so if the tariff order is illegal for the plaintiff, it is illegal for all entities, having a nationwide effect.

In summary, if the ruling is strictly enforced, all tariffs based on the IEEPA will be canceled. This includes reciprocal tariffs of 10% or higher for all countries, and the fentanyl tariffs against China, but does not involve the "232 tariffs" on steel, aluminum, and automobiles.

GMF Market Commentary analyzes that theoretically, U.S. Customs, responsible for collecting tariffs, needs to unconditionally comply with the ruling, meaning stopping the collection of tariffs. After the ruling is issued, the court will formally notify the U.S. government (including the Treasury and CBP) to stop enforcing the tariff order.

Typically, CBP will update its operational guidelines within hours to days (possibly by issuing an "emergency notice" or "operational memorandum") to stop collecting the relevant tariffs. The actual cessation of collection may require 1-3 days of administrative processing time.

However, in practice, the Trump administration may take two approaches to bypass the court ruling: one is to appeal to the circuit court and apply for a stay to continue collecting tariffs until the appeal decision is made; the other is to invoke other laws to continue the IEEPA tariffs.