The US Supreme Court has dealt a serious blow to the White House's trade policy after ruling that President Donald Trump does not have the right to use the International Emergency Economic Powers Act of 1977 (IEEPA) to impose large-scale tariffs on imports, reports "Reuters".
The decision, which could have long-term consequences for the global economy, paves the way for the recovery of more than $175 billion in collected tariffs, according to calculations by economists from the Penn-Wharton Budget Model. The process of returning the funds, however, is just beginning and is expected to be slow and complex.
Since April, more than 1,800 cases related to tariff policy have been filed in the US Court of International Trade - a sharp jump from less than two dozen for all of 2024.
The plaintiffs include units of Japan's Toyota Group, the US retail chain Costco, tire manufacturer Goodyear Tire & Rubber, aluminum giant Alcoa, Kawasaki Motors and the Franco-Italian group EssilorLuxottica.
Lawyers expect a new wave of claims after a number of companies waited for the court's decision to avoid political tension.
Markets reacted positively
Shares of affected companies rose after the decision. Among the winners were European luxury brands LVMH and Hermes, as well as Italy's Moncler.
The hardest hit by the tariffs were companies in the consumer goods, automotive, manufacturing and apparel sectors, which rely on cheap production bases in China, Vietnam and India. The additional tariffs have increased the cost of importing finished goods and components and disrupted global supply chains. Companies must collect detailed data on imports and duties paid in different periods and regimes.
Some companies have already sold their rights to future refunds to outside investors for an advance payment of 25-30 cents on the dollar, waiving the remainder to the investors in the event of a final refund.
German logistics company DHL said it would use its technology systems to assist its customers with possible refunds.
Tariffs will not disappear completely
The Trump administration has already signaled that it will use other legal mechanisms to impose tariffs, including those related to national security and unfair trade practices.
The automotive sector, for example, will continue to be subject to 25% tariffs on vehicles from Mexico and Canada, imposed on national security grounds - a measure that does not fall under the scope of the repealed decision.
"Tariffs will not disappear. They will simply be placed under a different legal umbrella," international trade experts commented.
The question of whether companies will reduce prices for consumers remains open. Some businesses have already said they will seek refunds but do not expect prices to fall significantly, even if the legal proceedings are successful.
The German industry federation BDI called on the EU to ask the United States for clarity on the bilateral trade agreement after the U.S. Supreme Court overturned President Donald Trump's global tariffs, Reuters reported.
Wolfgang Niedermark, a member of the BDI board, called the decision a "strong signal for the rules-based trading order."
The BDI said it expected the U.S. administration to explore alternative ways to continue existing tariffs or introduce similar safeguards.