Editor’s Note
On February 20, 2026, the U.S. Supreme Court ruled 6-3 that former President Donald Trump’s broad tariffs on imports were illegal, finding he overstepped his authority by using emergency powers without congressional approval.
The Supreme Court of the United States ruled by a 6-3 majority that the sweeping tariffs imposed by President Donald Trump on imports from nearly all of America’s trading partners were illegal. The court found that Trump had overstepped his authority by invoking the 1977 International Emergency Economic Powers Act (IEEPA) to impose tariffs without congressional approval. Chief Justice John Roberts, who wrote the majority opinion, clarified that the IEEPA does not grant the president the authority to levy tariffs. Roberts stated clearly that the court’s task was solely to determine whether the power to regulate imports granted to the president by the IEEPA includes the power to impose tariffs, and he unequivocally answered no.
This ruling upholds lower court decisions, particularly those from the Court of International Trade in May 2025 and the Court of Appeals in August 2025, which had already reached the same conclusion. Notably, this decision does not follow typical ideological lines. In addition to the three liberal justices, Trump-appointed justices Amy Coney Barrett and Neil Gorsuch also supported the majority opinion. Justices Clarence Thomas, Samuel Alito, and Brett Kavanaugh dissented.
The Supreme Court’s decision affects all tariffs imposed under the IEEPA. This specifically includes the so-called Liberation Day tariffs of April 2, 2025, under which Trump imposed a ten percent base tariff on nearly all goods imported into the US and set significantly higher country-specific tariffs for many nations. For the EU, the original Liberation Day tariff rate was 20 percent. Additionally, tariffs imposed against Canada, Mexico, and China over fentanyl and smuggling, as well as other country-specific IEEPA surcharges, will be affected.
However, tariffs imposed on other legal bases remain unaffected. Section 232 tariffs on steel and aluminum, which were increased to 50 percent in June 2025, remain fully in force. Similarly, the 25 percent auto tariffs imposed under Section 232 of the Trade Expansion Act also remain. Industry-specific tariffs on copper and wood products under Section 232 are also unaffected by this ruling. However, according to the Yale Budget Lab, the tariffs now declared illegal under IEEPA constituted the majority of the entire tariff regime established during 2025.
The European Union and the United States agreed on a trade deal on July 27, 2025, during a meeting in Turnberry, Scotland, between Commission President Ursula von der Leyen and President Trump. This agreement was formalized through a joint declaration on August 21, 2025. A key point of the agreement was the application of a uniform tariff rate of 15 percent on most EU goods exported to the US. This ceiling replaced the significantly higher 20 percent tariff applied during the Liberation Day period and the provisionally proposed 30 percent tariff.
The agreement stipulated that this 15 percent ceiling would also apply to sensitive product categories such as automobiles and auto parts, pharmaceuticals, semiconductors, wood, and civil aviation products. For some strategic products like natural resources, generic drugs, and chemical precursors, an agreement was reached to apply only a minimal, near-zero, paramount national tariff. The 50 percent tariffs on steel and aluminum were to be negotiated separately, with the aim of reducing them and implementing a quota system.
In return, the EU committed to suspending its prepared countermeasures and importing hundreds of billions of dollars worth of energy supplies from the US. Subsequently, the EU suspended previously planned counter-tariffs on $93 billion worth of US goods. This suspension was extended until August 2026.
With the legal threat now averted, the EU Trade Committee sees no foundation for the trade agreement hastily concluded between Brussels and Washington in the summer of 2025. While German companies may now receive billions in refunds for overpaid tariffs, Trump is reacting with unprecedented outrage—and issuing a new tariff ordinance. Is the global trade war spiraling out of control, or does the EU now have a unique opportunity to turn the tables at the negotiating table? This in-depth analysis clarifies the most important questions about the future of EU-US trade, assesses the constitutional dimension, and highlights the strategic options now available.
