Trade Cases

AIIS: Disappointed But Not Surprised by Section 232 Decision

Written by Sandy Williams

March 5, 2020

Earlier this week the U.S. Court of Appeals for the Federal Circuit ruled against an appeal by the American Institute for International Steel challenging the constitutionality of the Section 232 tariffs. The court affirmed a ruling by the U.S. Court of International Trade, which upheld the Trump administration’s tariffs on imported steel.

“While disappointed, we are not surprised by the appeals court ruling,” said AIIS President Richard Chriss. “We have expected all along for this constitutional question, ultimately, to be decided by the nation’s highest court. We intend to seek Supreme Court review promptly, and we are hopeful that the court will act before it adjourns in June.”

AIIS argues that Congress, by enacting Section 232 of the Trade Expansion Action of 1962, delegated unrestricted powers to the executive branch that the Constitution reserves solely to Congress. This violation of the separation of powers led to the Trump administration imposing tariffs on steel imports under the auspices of national security.

The USCIT and the Court of Appeals based their rulings on the 1976 Supreme Court case, Federal Energy Administration vs. Algonquin SNG, Inc., which upheld the constitutionality of Section 232. Previous administrations have used the provision for explicit trade restrictions such as quotas, said AIIS, but Trump is the first president to use it to impose tariffs.

Sandy Williams

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Do we want the benefits of the Section 232 tariffs to flow to the bottom lines of foreign steel and aluminum producers or to the US government and, ultimately, domestic manufacturers and their workers? In our view, the answer is simple. Section 232 exceptions do nothing more than lead to underserved profits for foreign manufacturers who are harming the US industrial base. That revenue could be used to pursue the Trump administration’s other policy priorities - such as deficit reduction or expanded tax cuts.