Increased Section 232 Tariffs on Steel Imports from Turkey Struck Down

SEATTLE (Scrap Monster): A federal trade court in July struck down a presidential trade proclamation, somewhat limiting the president’s ability to impose tariffs under Section 232.

In March 2018, the Trump administration, by proclamation, imposed 25 percent tariffs on steel imports and 10 percent tariffs on aluminum imports using a Section 232 national security justification. In August 2018, President Trump issued another proclamation that increased the levy on steel imports from Turkey to 50 percent. A Turkish company, Transpacific Steel, challenged the increase.

The U.S. Court of International Trade on July 14 ruled that the presidential proclamation that doubled the tariffs on Turkey was issued “in violation of the animating statute and constitutional guarantees” and was, thus, “unlawful and void.”

The violation resulted from the proclamation being issued more than 90 days after the Commerce Department’s January 2018 submission of the report on its Section 232 investigation to the White House. Such presidential actions must, by law, be based on a formal report and set of findings and occur within 90 days of receipt of the report.

In this case, the court noted, the proclamation “mentions informal discussions between 
the President and the Secretary [of Commerce] regarding the changes to capacity utilization in the domestic steel industry after [the March 2018 proclamation] and how additional tariffs on steel products from Turkey would be ‘a significant step toward ensuring the viability of the domestic steel industry.’ … The President is not authorized to act under Section 232 based on any off-handed suggestion by the Secretary; the statute requires a formal investigation and report.”

The court added that, “Section 232 does not ban the President from addressing concerns by focusing on particular exports, but the decision to increase the tariffs on imported steel products from Turkey, and Turkey alone, without any justification is arbitrary and irrational.”

The ruling does not affect the administration’s overall imposition of Section 232 tariffs. In June, the U.S. Supreme Court refused to hear AIIS’s challenge to the tariffs, effectively ending the legal effort to have the levies struck down.

Courtesy: AIIS