US Court of International Trade upholds Section 232 tariffs

Monday, 25 March 2019 00:32:38 (GMT+3)   |   San Diego

The US Court of International Trade today rejected a lawsuit aimed at revoking the Section 232 tariffs against imported steel and aluminum. The lawsuit was initiated by the American Institute for International Steel (AIIS), and aimed to determine whether the current implementation of Section 232 violates the constitutional separation of powers.

The three-judge panel ruled against the AIIS, noting a precedent case before the Supreme Court in 1976 (Fed. Energy Admin. v. Algonquin SNG Inc.). The panel said that it did not have standing to question the president’s reasons for imposing the tariffs, only to determine whether the tariffs violate the constitution.

“Identifying the line between regulation of trade in furtherance of national security and an impermissible encroachment into the role of Congress could be elusive in some cases because judicial review would allow neither an inquiry into the President’s motives nor a review of his fact-finding,” the panel said.

However, one of the judges offered a “dubitante” opinion, which occurs when a judge is unsatisfied with some aspect of the decision but it is not enough to record an open dissent. Judge Katzmann said that his colleagues, relying largely on a 1976 Supreme Court decision, concluded that the statute passes constitutional muster. However, Katzmann said “while acknowledging the binding force of that decision, with the benefit of the fullness of time and the clarifying understanding borne of recent actions, I have grave doubts.”

Katzmann concluded that “What we have come to learn is that section 232, however, provides virtually unbridled discretion to the President with respect to the power over trade that is reserved by the Constitution to Congress.  Nor does the statute require congressional approval of any presidential actions that fall within its scope. In short, it is difficult to escape the conclusion that the statute has permitted the transfer of power to the President in violation of the separation of powers.”

In a statement, the AIIS said it plans to appeal the decision, relying on that dubitante opinion. “We are heartened that the Court of International Trade (CIT) recognized that section 232, in the court’s words, ‘seem[s] to invite the President to regulate commerce by way of means reserved for Congress.  Unfortunately, the court also found that a 1976 Supreme Court decision foreclosed closer review of the merits of our constitutional claim by the CIT itself. But we remain convinced that, as one of the judges wrote today in a separate opinion, ‘it is difficult to escape the conclusion that the statute has permitted the transfer of power to the President in violation of the separation of powers.’ We are appealing immediately in order to continue making that argument.”

The American Iron and Steel Institute (AISI), which filed an amicus brief in the case in favor of the tariffs, also issued a statement. “We have consistently maintained that Congress acted within its constitutional authority when it authorized the president to take action to adjust imports, when the Secretary of Commerce has determined that such imports threaten to impair the national security.  We are pleased that the CIT has agreed.”

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