In a major legal setback for former US President Donald Trump, a federal trade court has blocked his proposed ‘Liberation Day’ import tariffs, ruling that he overstepped his constitutional powers.

The Court of International Trade in Manhattan found that the tariffs, targeting countries with trade surpluses, exceeded the authority granted to the presidency under the International Emergency Economic Powers Act (IEEPA).

Trump’s team claimed the tariffs were essential to national security and global trade negotiations, linking them even to de-escalation between India and Pakistan. However, the court emphasized that only Congress holds the power to regulate foreign commerce.

The decision followed lawsuits by small businesses and 13 US states. Trump’s administration has already filed an appeal.