Michail Risvas, 30 March 2026 8 mins read
On 20 February 2026, the US Supreme Court held in Learning Resources Inc et al v Trump et al that the International Emergency Economic Powers Act 1977 (IEEPA) does not authorise the President to impose tariffs, as he had done on ‘Liberation Day’. Although the decision of the Supreme Court appeared to provide a check on the President’s powers, its practical consequences were bound to be limited. However, the judges’ reasoning raises much wider questions about their skeptical perspective on international trade law.
As correctly recognised by commentators as well as Justice Kavanaugh’s dissent, ‘the decision might not substantially constrain a President’s ability to order tariffs going forward’, given that numerous other federal statutes authorize the President to impose tariffs and might justify most (if not all) of the tariffs at issue in this case.’ Indeed, immediately following the ruling, the Trump Administration imposed a 10 per cent tariff under the Trade Act 1974 (s122) and initiated investigations into unfair trade practices by foreign countries under Section 301, thereby underscoring the limited practical impact of excluding IEEPA as a legal basis. Given the limited practical effect of the Supreme Court judgment on international trade, it is worth examining the symbolic significance of the decision for international trade law.
The IEEPA gives the President broad authority to regulate and block a wide range of international transactions in response to national emergencies:
‘investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States.’ (emphasis added)
All six judges of the majority rejected the President’s reading of the IEEPA under ordinary principles of statutory construction that IEEPA’s grant of authority to ‘regulate… importation’ of property during a declared national emergency is broad enough to include the power to impose tariffs (that is duties on imports). Three of them, Justices Kagan, Sotomayor, and Jackson, – all appointed by democrat presidents – also relied on the ‘Major Questions Doctrine’ to bolster their conclusion. Under the doctrine, Congress must speak clearly if it wishes to assign to the Executive Branch decisions of vast economic and political significance.
The three dissenting judges, Justices Thomas, Alito, and Kavanaugh, who are amongst the most conservative members of the Supreme Court, held that the IEEPA included and delegated the power to impose tariffs.
The focus here will be on the disagreement between the majority and minority on whether IEEPA’s regulation of imports (or ‘importation’ in the Act) includes the power to impose tariffs from an international economic law perspective. However, the present analysis is not concerned with the issue of whether the Supreme Court was in fact required to consider international law. The conditions under which US courts engage with international law are limited (note, for example the Charming Betsy canon) and reflect a jurisprudence that ties the internalisation of international law to Congressional intent – in contrast the more expansive approach of the Court of Justice of the European Union (De Búrca (2015) at p. 1005).
An International Economic Law perspective on trade and tariffs in the Supreme Court decision
As a matter of international trade law, there are two important points in the majority’s reasoning. First, for the majority the concept of ‘regulation’ does not include tariffs, and this was not only a matter of statutory interpretation and Congressional practice but also a matter of common understanding. For example, Justice Kagan held that ‘the meaning of “regulate,” both in common parlance and as Congress uses the word, does not encompass taxing.’ By contrast, Justice Kavanaugh in his dissent emphasised ‘the dictionary definitions and the traditional understanding of tariffs as a tool to regulate foreign imports.’
Second and interrelated, Justice Roberts (who wrote the opinion of the Court) interprets tariffs as ‘very clear[ly]… a branch of the taxing power,’ ‘different in kind, not degree’ from regulatory tools, and thus outside the spectrum of authorities to ‘regulate’ trade. Again, Justice Kavanaugh disagreed characterising tariffs as a lesser form of trade regulation. He explains that
‘[t]he plaintiffs and the Court acknowledge that IEEPA authorizes the President to impose quotas or embargoes on foreign imports—meaning that a President could completely block some or all imports. But they say that IEEPA does not authorize the President to employ the lesser power of tariffs, which simply condition imports on a payment. As they interpret the statute, the President could, for example, block all imports from China but cannot order even a $1 tariff on goods imported from China.’
These disagreements reflect a deeper divergence between domestic constitutional law and what the imperative of the separation of powers requires. Notably, it is the majority’s reasoning that has been subject to criticism under doctrinal domestic law. For instance, Chad Squitieri has argued that ‘[t]o ignore that the power to regulate importation has traditionally included the power to impose tariffs, and to instead shift attention to whether the statute delegates a separate taxation power, is to miss the point.’ That point is that tariffs can and do regulate, quite regardless of whether they also raise revenue.
For present purposes, the focus is on how the Supreme Court majority’s understanding of tariffs sits uneasily with established WTO law and practice and, more broadly, international economic law doctrine. First, from an international economic law perspective, tariffs fall within the scope of trade ‘regulation.’ For example, Article XXIV of the General Agreement on Tariffs and Trade (GATT) (both in the 1947 and the 1994 versions) refers to ‘tariffs or other regulations of commerce” and “duties or other regulations of commerce’ (emphasis added). This language makes clear that tariffs are not conceived as external to ‘regulation’ but rather as one of its central expressions.
Second, in the context of the WTO, tariffs not only constitute the paradigmatic but also the preferred regulatory tool in matters of international trade, as opposed to more restrictive regulatory measures such as quantitative restrictions which are prohibited. A WTO Panel in Turkey – Textiles emphasized that ‘[t]he prohibition against quantitative restrictions is a reflection that tariffs are GATT’s border protection “of choice”. Quantitative restrictions impose absolute limits on imports, while tariffs do not’ [9.63].
Quoting this the Appellate Body in India – Additional Import Duties also held that ‘tariffs are legitimate instruments to accomplish certain trade policy or other objectives such as to generate fiscal revenue. Indeed, under the GATT 1994, they are the preferred trade policy instrument, whereas quantitative restrictions are in principle prohibited’ [159] (emphasis added).
Accordingly, the majority’s sharp conceptual separation between taxation and regulation does not align with the functional and doctrinal approach adopted in WTO law, where tariffs operate simultaneously as fiscal instruments and as central tools of trade regulation.
This raises the question why the progressive justices (in addition to three conservative judges), rather than the ‘conservative’ dissent, arrived at a position that is so antithetical to established WTO law and practice. One possible explanation is that the majority’s primary concern was to impose limits on the President’s powers as a matter of domestic constitutional law, even if this came at the expense of alignment with international economic law. Yet, the longstanding US opposition to the WTO Appellate Body – across the administrations of Presidents Obama, Trump, and Biden, and ultimately leading to its paralysis – also provides useful background explanation.
The judgment’s silence on contemporary international trade law and practice
In a decision that spans approximately 170 pages and examines the historical evolution of early modern English law and 18th and 19th century US practice, one might reasonably have expected some engagement with contemporary international trade law and practice. Even a brief acknowledgment of how tariffs are conceptualised in international trade law would have provided a more contextually grounded account of the regulatory landscape within which such measures operate.
The merits of the Supreme Court’s decision will remain contested from both constitutional and policy perspectives. However, irrespective of whether the Court was formally required to engage with international or WTO law, its complete silence on these frameworks is likely to reinforce the perception that scepticism toward international law and multilateral institutions, such as the WTO, is – within the United States – systemic rather than contingent, and not confined to any particular administration or ideological orientation.