While Ottawa is welcoming a U.S. federal court decision that would block President Donald Trump’s fentanyl-related tariffs against Canada, experts say local businesses are “not out of the woods” yet.
On Wednesday, a decision by the U.S. Court of International Trade said Trump does not have the authority to wield tariffs on nearly every country through the use of the International Economic Emergency Powers Act of 1977 — a national security statute that gives the president authority to control economic transactions after declaring an emergency.
The Trump administration filed a notice of appeal soon after the ruling came down from a three-judge panel.
Toronto lawyer Sean Stephenson of Dentons, whose practice focuses on international trade and sanctions, cautions that “nothing changes overnight” with this ruling, especially given the appeal process that awaits.
Even if the ruling is eventually upheld, he says Trump could potentially try to use a number of alternative levers at his disposal to reimpose tariffs against Canada and other countries that were ruled unconstitutional under the emergency justification.
Business groups in Canada also say they don’t feel the ruling brings any new certainty in the immediate term, with the Canadian Chamber of Commerce adding that “ultimately, the end of this trade war with the U.S. will not come through the courts” but rather through a new negotiated agreement.
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