Trump Tariffs: Can the US Be Punished for Breaking Trade Laws?
Since Donald Trump took office, he's threatened or imposed higher import duties on trade partners. Experts say the US president is violating existing trade agreements. How is he able to get away with it?
Legal Challenges and the WTO
New York University's Litigation Tracker lists legal challenges to the Trump administration's actions, but doesn't include trade actions.
Trade disputes fall under international law and are typically handled by the World Trade Organization (WTO) in Geneva, Switzerland.
WTO Dispute Settlement in Limbo
Jürgen Matthes from the Institute for the German Economy (IW) notes that Trump is breaking existing trade law with his tariffs, but doesn't seem concerned.
China, for instance, filed a WTO complaint after the US imposed an additional 10% levy on goods from China.
However, legal challenges before the WTO are currently stalled because the WTO's Appellate Body has been non-functional for years.
"Since the appellate body no longer exists, there will be no legally binding ruling against the US," said Matthes. "And even if there were one, under Trump, the US would probably not comply with it."
WTO 'unable to resolve its problems'
This situation is unsatisfactory for the 166 WTO members who joined to have binding rules in international trade.
How Trump Gets Away With It
Canada and Mexico view Trump's tariffs as a violation, especially since they are partners in the USMCA free trade agreement.
Kathleen Claussen, a law professor at Georgetown University, suggests the US government lawyers may have a workaround, using the International Emergency Economic Powers Act (IEEPA).
IEEPA allows the US president to intervene in international trade during a declared national emergency. Trump declared a national emergency due to the influx of migrants via the Mexican border and illegal drugs from Canada.Tariffs as Pawns
Claussen believes Trump uses tariffs as a weapon for trade negotiations, comparing them to discounts offered by mobile phone providers.
Canada and Mexico have experienced Trump's erratic use of tariff threats firsthand, with tariffs being imposed, postponed, and then reimposed.
IW expert Jürgen Matthes believes Trump uses uncertainty and constant threats to gain leverage for negotiations.Trump claims EU was formed ‘to screw the United States'
EU's Response
European nations, particularly Germany, are considering options if Trump imposes tariffs. The European Commission has announced countermeasures without providing details.
Matthes hopes for a deal, possibly through increased European purchases of US goods.
"A trade war harms everyone," he said, but added: "We also mustn't accept everything."