President Donald Trump may have lost his chance to impose new tariffs on imported vehicles and car parts after taking no action on November 14, a self-imposed deadline, according to trade law experts who spoke to Reuters.
The US government issued a Section 232 probe on imported vehicles in May 2018 and six months ago President Trump threatened to tax them with a 25 percent duty as a negotiating tool on trade talks with the EU and Japan.
However, Trump did nothing on November 14, the deadline established by the act to take action, and that might put an end in his ability to impose any tariffs on imported cars due to the Trade Expansion Act of 1962, Section 232, which lays out how a US President can tax specific imports if they are deemed a threat to national security.
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The 1962 act is clear about the time limits a US President has for setting new import duties to protect US national security.
“I don’t see the law as giving the president any options other than take action against imports or determine to take no action and the case is closed,” said Jennifer Hillman, a Georgetown University law professor and a former World Trade Organization judge.
Trump has forfeited his authority to impose Section 232 tariffs by not acting by the deadline, added Clark Packard, trade policy counsel with libertarian advocacy group RStreet.org.
Add to that the decision of the Court of International Trade published last Monday, saying that Trump ran out of time on a Section 232 probe of steel imports, when he tried to double the tariffs on Turkish steel in August 2018.
“Although the statute grants the President great discretion in deciding what action to take, it cabins the President’s power both substantively, by requiring the action to eliminate threats to national security caused by imports, and procedurally, by setting the time in which to act,” wrote judges Claire Kelly and Jane Restani in the decision.
When asked for a comment, a White House official only said that U.S. Trade Representative Robert Lighthizer “has updated the President on the progress of trade negotiations to address concerns related to the threatened impairment of national security with respect to imported automobiles and certain automobile parts.”
However, President Trump has the power to use other statutes to impose tariffs, including the International Emergency Economic Powers Act, which is used for sanctions and to battle terrorism financing.
The IEEPA “does not have much of an investigatory prerequisite to it, so it is something the president could do quickly,”Hillman, a senior fellow at the Council on Foreign Relations, said. “Ditto for the Trading with the Enemy Act, and he seems predisposed to deem the EU as an ‘enemy,’ at least with respect to autos trade.”