On Friday, the United States Supreme Court ruled by a 6-3 majority in Learning Resources, Inc v. Trump that the International Emergency Economic Powers Act (IEEPA) does not give the US president the authority to impose tariffs without congressional approval.
The decision immediately dismantled the legal basis that had allowed the White House to roll out wide-ranging duties on goods from across the world.
Within hours of the ruling, US President Donald Trump-led White House unveiled a different approach that relies on multiple sections of US trade law, including Sections 122, 301 and 232, as well as other lesser-known tools.
Together, these provisions allow the Trump administration to impose tariffs under specific legal conditions rather than broad emergency powers.
What is Section 122?
Section 122 of the Trade Act of 1974 had never been used before the current administration turned to it as a substitute for the invalidated emergency tariffs.
This provision allows the US president to impose import surcharges of up to 15 per cent or introduce quotas when the United States faces what the statute describes as a “large and serious” balance of payments problem.
The authority applies to imports from all countries or selected nations and does not require a formal investigation before action is taken.
Under this authority, Trump
imposed a 10 per cent duty on global imports for a period of up to 150 days. Because the provision contains a built-in time limit, the tariffs will automatically expire unless Congress votes to extend them beyond the 150-day window.
The administration has described Section 122 as a stopgap measure rather than a permanent solution. Trump said the temporary duties would give his team time to pursue other legal avenues that could sustain or expand tariff levels over the longer term.
“We have alternatives, great alternatives,” Trump said. “Could be more money. We’ll take in more money and we’ll be a lot stronger for it,” he said when asked about the administration’s options following the Supreme Court ruling.
While legal challenges to the Section 122 tariffs are expected, analysts have pointed out that the time-limited nature of the measure could make it difficult for courts to rule on the policy before the duties expire.
What is Section 301?
While Section 122 allows broad action across global imports, Section 301 of the Trade Act of 1974 is designed to address specific trade practices by individual countries.
The statute empowers the US Trade Representative (USTR) to investigate foreign government actions that are considered unjustifiable, unreasonable, or discriminatory and that burden US commerce.
If such practices are confirmed, the president can impose retaliatory measures, including tariffs, without a predetermined expiration date.
Following the Supreme Court ruling, Trump directed the US Trade Representative to begin several new country-specific investigations under Section 301.
The executive order instructed the office to examine “certain unreasonable and discriminatory acts, policies and practices that burden or restrict US commerce,” although it did not name the countries that would be targeted in these new probes.
The USTR already has open investigations involving China and Brazil. Officials have indicated that other major trading partners, including Vietnam and Canada, could also face scrutiny under Section 301.
These investigations typically take many months to complete, and in some cases can extend beyond a year.
However, once concluded, they provide a legal foundation for tariffs that is more durable than emergency measures, because they are based on documented findings of unfair trade practices.
What is Section 232?
Section 232 of the Trade Expansion Act of 1962 provides a separate legal foundation for import restrictions based on national security concerns.
Under this provision, the US Commerce Department is authorised to investigate whether certain imports threaten to impair national security. If such a finding is made, the president can adjust imports through tariffs, quotas, or other measures.
Tariffs imposed under Section 232 on steel and aluminium remain in effect following the Supreme Court ruling, as the decision did not address this statute.
Officials are examining whether industries such as semiconductors, copper, and critical minerals could qualify for protection under Section 232.
Expanding the definition of national security to include these sectors would allow the administration to impose or maintain tariffs on products considered vital to the domestic supply chain and defence-related manufacturing.
Section 232 differs from Section 301 in that it focuses on the strategic importance of domestic industries rather than the conduct of foreign governments.
What are other Sections & options available to Trump?
Section 338
Section 338 of the Tariff Act of 1930 has emerged as one of the most significant alternative authorities being discussed within the administration.
Often described by legal advisers as a powerful reciprocity mechanism, the provision allows the president to impose additional duties of up to 50 per cent on imports from countries that discriminate against US commerce.
Unlike Section 301, which requires a detailed investigation into unfair practices, Section 338 focuses more narrowly on whether a foreign country treats US goods less favourably than domestic products or imports from other nations.
This narrower test could allow the administration to act more quickly in cases where discriminatory treatment can be demonstrated without the need for lengthy inquiries.
Legal advisers have indicated that Section 338 is likely to become a central instrument for advancing the administration’s reciprocal trade agenda.
Because the authority was explicitly granted by Congress in the 1930s, it was not affected by the Supreme Court’s ruling on emergency powers.
The potential use of Section 338 highlights the Trump administration’s shift toward leveraging older, often dormant trade laws that grant the executive branch specific powers to overcome judicial hurdles.
Section 201
Section 201 of the Trade Act of 1974 provides another pathway for imposing temporary import restrictions, but it operates differently from country-specific tools like Section 301.
Often referred to as a safeguard mechanism, Section 201 allows the president to impose tariffs or quotas when a surge of imports, regardless of origin, is found to be a substantial cause of serious injury to a US industry.
The administration is currently using Section 201 to impose measures on solar cells, solar modules, and large residential washing machines. These actions are based on findings that increased imports of these products have harmed domestic manufacturers.
Safeguard measures under Section 201 are temporary and are subject to review, typically lasting for several years rather than indefinitely.
By using Section 201, the White House can target product categories without singling out specific countries, thereby framing the measures as responses to market conditions rather than bilateral trade disputes.
Anti-dumping & countervailing duties
In addition to the statutes that grant the president direct authority to impose tariffs, the administration is relying heavily on trade remedies administered by the US Department of Commerce and the International Trade Commission (ITC).
These include anti-dumping duties, which target goods sold in the US market at less than fair value, and countervailing duties, which address products subsidised by foreign governments.
As of February 19, the US Commerce Department issued final results on countervailing duty reviews concerning South Korean steel plate. At the same time, new investigations were initiated into citric acid and citrate salts from Canada and India.
These proceedings can result in duties that exceed standard tariff rates, sometimes reaching levels far higher than 90 per cent, depending on the extent of dumping or subsidisation found.
Unlike broad tariff measures imposed by presidential proclamation, anti-dumping and countervailing duty cases are highly technical and involve detailed administrative processes.
Foreign firms often find these cases difficult to contest successfully because of the complex methods used to calculate dumping margins and subsidy rates.
Section 337
Section 337 of the Tariff Act of 1930 offers a different form of trade restriction by focusing on intellectual property violations and unfair methods of competition.
Rather than imposing tariffs, this provision allows the International Trade Commission to issue exclusion orders that prevent certain products from entering the US market altogether.
The administration is encouraging US technology firms to file more Section 337 complaints, particularly against Chinese electric vehicle manufacturers and companies producing software-integrated hardware.
If the ITC finds that imported products infringe US patents, trademarks, or other intellectual property rights, it can issue a general exclusion order that bars those goods from entering the country.
Section 406
Section 406 provides a specialised safeguard mechanism that applies specifically to imports from Communist countries. Similar in structure to Section 201, this provision allows action when imports from such countries cause market disruption in the United States.
The threshold for demonstrating disruption under Section 406 can be easier to meet than the standard required to establish a national security threat under Section 232.
While Section 301 remains the broader tool for addressing trade practices involving China, Section 406 is being discussed as a faster-track option for certain industrial categories.
Officials have pointed to sectors such as textiles and low-end manufacturing as potential candidates for action under this provision, where import surges from Communist countries could be more readily framed as market disruption.
The Supreme Court’s decision in Learning Resources, Inc. v. Trump did not dismantle the administration’s reliance on tariffs as a central trade policy instrument.
Instead, it just forced a reconfiguration of the legal architecture underpinning those measures. Broad emergency declarations under the International Emergency Economic Powers Act have been replaced by a patchwork of statutory tools.
Section 122 provides short-term coverage through a temporary global surcharge, while Sections 301 and 232 offer pathways to longer-lasting tariffs grounded in findings of unfair trade practices or national security concerns.
Sections 338 and 201 offer the potential to expand the administration’s ability to impose duties or quotas based on discrimination against US goods or harmful import surges, respectively.
Trade remedies such as anti-dumping and countervailing duties, along with Section 337 exclusion orders and the potential use of Section 406, provide more options in the Trump policy toolkit.
With inputs from agencies
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