UPDATE ON SECTION 122 TARIFFS

MAY 10TH, 2026

Background:
Section 122 of the Trade Act of 1974 allows the President to impose temporary tariffs (up to 15%) to address major U.S. balance-of-payments issues.

Key Dates:
February 24, 2026 – 10% global Section 122 tariffs went into effect
July 24, 2026 – Current scheduled expiration date unless extended by Congress

• Court Rejects Section 122 Tariff Authority

  On 5/7/26 The U.S. Court of International Trade ruled against the administration’s use of Section 122 tariffs in a 2–1 decision, finding that Section 122 was not an appropriate mechanism for addressing the trade deficits cited in the February order.

• Parallels to Prior IEEPA Tariff Challenges

  These tariffs were implemented after the Supreme Court invalidated the earlier IEEPA-based tariffs, and this situation appears to be following a similar path with growing legal challenges and potential refund implications for importers.

• Ongoing Uncertainty and Expected Appeal

  The ruling adds another layer of uncertainty to the administration’s evolving tariff strategy, and an appeal is widely expected.