By: Dr Avi Verma

At The IndoUS Tribune, we have long followed the evolving contest between executive ambition and constitutional restraint. Recently, that struggle reached a complex and pivotal moment. A lower court had ruled that former President Donald Trump’s sweeping global tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were unlawful—a decision that challenged the limits of executive power in trade policy. However, a federal appeals court has now temporarily stayed that ruling, allowing these tariffs to remain in place while the legal process continues. This development underscores the ongoing tension between judicial oversight and executive authority in U.S. trade policy.

The road to retaliatory tariffs: A trade war born of “emergency”

President Trump’s global tariff campaign originated from his declaration that America’s persistent trade deficits and related issues—such as fentanyl smuggling—constituted a national emergency. This enabled his administration to invoke IEEPA, a 1977 statute originally designed to confront immediate threats from hostile foreign actors, to justify broad import tariffs across numerous U.S. trading partners, including China, Canada, and Mexico. These “reciprocal tariffs” were central to Trump’s America First economic agenda.

However, the use of IEEPA for such sweeping economic measures drew sharp criticism from states, importers, economists, and constitutional scholars, who argued that the president had significantly overstepped his legal authority by sidestepping Congress in setting trade policy.

The court pushes back: Limits on presidential power

The initial ruling by a three-judge panel of the U.S. Court of International Trade declared that IEEPA does not grant the president “unbounded authority” to reshape trade policy unilaterally. The court emphasized that “an unlimited delegation of tariff authority would constitute an improper abdication of legislative power.” Critically, it concluded that the U.S. trade deficit does not meet the legal standard of an “unusual and extraordinary threat” required to invoke emergency powers under IEEPA.

The decision was a direct repudiation of the Trump administration’s argument that the president can act by any means necessary to pursue his agenda without meaningful judicial review. At the time, White House officials condemned the ruling as judicial overreach, asserting that “the political branches, not courts, make foreign and economic policy,” and pledging to use “every lever of executive power” to protect American interests.

Appeals court grants reprieve, tariffs remain

Yet, in a swift response, a federal appeals court granted the Trump administration’s request to temporarily suspend the lower court’s order. This stay means that for now, the tariffs imposed under IEEPA remain in force as the case proceeds through the courts, with the next hearing scheduled for early June.

This decision reflects judicial caution about second-guessing executive action in matters of foreign policy and economic strategy, reinforcing the administration’s position that courts should defer to elected branches. The reprieve also mitigates immediate market disruption and uncertainty for U.S. businesses navigating a complex global trade environment.

What now? Market relief, ongoing legal battles, and global uncertainty

Financial markets reacted positively to the appeals court’s stay, easing concerns over sudden tariff removals. Dow Jones, S&P 500, and Nasdaq futures edged higher, along with European and Asian stock indices, reflecting hopes for a more stable trade environment pending judicial clarity.

However, the legal questions remain unsettled. While the IEEPA-based tariffs are allowed to stand for now, tariffs imposed under other statutes, including Section 232 national security tariffs on steel, aluminum, and semiconductors, remain intact and unaffected by these rulings. The administration is also considering alternative legal authorities, such as Section 301 of the Trade Act and Section 338 of the Trade Act, to sustain or expand tariffs.

The ongoing litigation promises to reach the Supreme Court eventually, where a final determination on the scope of executive trade powers is widely anticipated.

A win for constitutional oversight—yet the fight continues

This legal saga is more than a trade story. It is a defining moment for American democracy and the balance of powers. The Trump administration’s position—that the executive branch should be free to act decisively and without judicial interference in matters of national interest—has met a judicial check, at least temporarily.

The courts have underscored that even when presidents are forceful or convinced of their cause, constitutional limits remain. In an era when “emergency” declarations risk becoming political tools, these rulings reassert a crucial boundary: executive power must operate within the framework of law and legislative oversight.

While the appeals court’s stay allows tariffs to continue, it does not resolve the deeper constitutional questions at stake. The outcome of this case will shape the future of U.S. trade policy, executive authority, and the role of courts in maintaining the delicate separation of powers.