In a landmark ruling with broad implications for U.S. trade policy, a federal court has struck down President Donald Trump’s sweeping global tariffs, delivering a significant blow to one of the signature economic policies of his post-presidency political platform.

The Court of International Trade in New York ruled that the Trump administration overstepped its authority by using emergency powers to impose broad import duties on nearly every trading partner worldwide. The three-judge panel concluded that the International Emergency Economic Powers Act (IEEPA) — a 1977 statute the administration cited to justify the tariffs — does not grant the president unilateral power to set trade policy on such a scale.

In its opinion, the court reaffirmed that the U.S. Constitution reserves the authority to regulate international commerce exclusively for Congress, and that this balance of power could not be bypassed by invoking economic emergencies.

The case stemmed from two separate lawsuits: one brought by the nonpartisan Liberty Justice Center on behalf of small import-dependent businesses, and another by a coalition of twelve U.S. states led by New York Attorney General Letitia James.

James praised the ruling, calling it “a win for the rule of law and economic fairness.” She added, “The law is clear: no president has the power to single-handedly raise taxes whenever they like.”

The challenged tariffs were part of what Trump branded his “Liberation Day” trade policy—an aggressive tariff regime unveiled on April 2 that levied a baseline 10% tariff on most countries and imposed steeper, retaliatory duties on key trading partners including the European Union, the United Kingdom, Canada, Mexico, and China.

The court also invalidated a separate set of tariffs targeting imports from China, Mexico, and Canada, which the Trump administration had claimed were necessary to stem the flow of drugs and illegal immigration. However, tariffs imposed on specific goods such as steel, aluminum, and automobiles—enacted under different statutes—were not addressed in this ruling.

The White House, through Deputy Press Secretary Kush Desai, criticized the decision. “It is not for unelected judges to decide how to properly address a national emergency,” he said. While Trump has yet to personally comment, the administration is seeking a stay of the ruling as it prepares to appeal.

The court granted the White House a 10-day window to begin halting the affected tariffs. However, analysts note that some of the duties had already been suspended or scaled back amid backlash from international allies and global market instability.

Financial markets responded positively to the ruling. U.S. and Asian stocks rose in early Thursday trading, while European markets opened flat, reflecting cautious optimism.

Though the case could ultimately reach the Supreme Court, legal experts say the ruling significantly narrows the president’s ability to unilaterally impose trade barriers without congressional approval.

Still, the Trump administration may pursue alternative legal pathways to revive its tariff agenda. Analysts at Goldman Sachs noted that under existing trade laws, the president could still impose temporary tariffs—up to 15% for 150 days—if framed around concerns like trade imbalances or national security.

There is also speculation that Trump could invoke a little-used provision of the 1930 Tariff Act allowing up to 50% duties on imports from nations deemed to be “discriminating” against the United States—though such a move would likely invite further legal scrutiny.

Trump’s global tariff strategy was originally pitched as a way to revive American manufacturing, protect domestic jobs, and force trading partners to renegotiate allegedly unfair trade deals. But the policy quickly triggered global trade tensions, market volatility, and sharp criticism from U.S. businesses and allies.