U.S. appeals court rules most Trump tariffs illegal

A U.S. appeals court ruled on Friday that most of U.S. President Donald Trump's tariffs are illegal, undercutting Trump's use of the levies as a key international economic policy tool.

The U.S. Court of Appeals for the Federal Circuit on Friday upheld an earlier ruling by the Court of International Trade that Trump wrongfully invoked an emergency law to issue the tariffs. However, the appellate judges sent the case back to the lower court to determine whether it applied to everyone affected by the tariffs or just the parties involved in the case, Bloomberg reported Friday.

The court allowed the tariffs to remain in place through October 14 to give the Trump administration a chance to file an appeal with the U.S. Supreme Court.

The Treasury, the U.S. Trade Representative's office and the Commerce Department had no immediate response to the ruling.

Trump has made tariffs a pillar of U.S. foreign policy in his second term, using them to exert political pressure and renegotiate trade deals with countries that export goods to the United States. The tariffs have given the Trump administration leverage to extract economic concessions from trading partners but have also increased volatility in financial markets.

The decision from the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., addressed the legality of what Trump calls "reciprocal" tariffs imposed as part of his trade war in April, as well as a separate set of tariffs imposed in February against China, Canada and Mexico.

Trump justified both sets of tariffs – as well as more recent tariffs – under the International Emergency Economic Powers Act (IEEPA), which gives the president the power to address "unusual and extraordinary" threats during national emergencies.

A lower federal trade court in late May rejected that stance and struck down Trump's IEEPA-based tariffs, including his worldwide "reciprocal" tariffs unveiled in early April. But the Federal Circuit quickly paused that ruling while Trump's appeal played out, according to CNBC.

The challengers welcomed the court's decision on Friday. "This ruling protects American businesses and consumers from the uncertainty and harm these unlawful tariffs have caused," said Jeffrey Schwab, director of litigation for the Liberty Justice Center, the Wall Street Journal reported Friday.

(With input from agencies)