Tariff Tensions: Trump’s New Trade Threats Are Imminent, or Are They?

Is a February 1 Deadline Feasible?

While President Trump’s statements have generated significant attention, several factors suggest that the implementation of these additional tariffs on goods from China, Canada, and Mexico by February 1 may be unlikely:

• America First Trade Policy: The additional tariffs set to begin February 1 are linked to issues like unlawful migration and fentanyl flows. However, under his America First Trade Policy, Trump has tasked the Secretaries of Commerce and Homeland Security to investigate these issues, with a report due by April 1, which could delay any immediate tariff actions.
• Comments from Peter Navarro: White House trade advisor Peter Navarro has indicated that it could take several months to increase tariffs on Mexico, suggesting a more extended timeline than the February 1 deadline.
• Negotiating tactics: President Trump is known for his transactional approach to international relations, often using tariffs as leverage in negotiations, such as those related to the United States-Mexico-Canada Agreement and trade relations with China. The threatened tariffs may be a bargaining tool.
• Practical challenges: Implementing significant tariff increases quickly poses practical and administrative challenges, including the need for administrative and logistical preparations from the agencies enforcing and collecting the tariffs, such as the US Customs and Border Protection.
• Legal considerations: While the International Emergency Economic Powers Act (IEEPA) could be a rapid route for implementing tariffs, this statute has never been used in this context.

Methods to Impose Additional Tariffs by February 1

Despite these considerations, reports from the White House Press Secretary as of January 28 suggest that Trump plans to proceed with the tariffs on Mexico and Canada by February 1. If he does, President Trump has legal avenues to do so:

1. Executive Actions on National Emergencies: Recent executive actions and media statements on immigration and drug trafficking through China, Canada, and Mexico may set the stage for using the IEEPA. The IEEPA allows President Trump to impose additional tariffs if there is a national emergency (e.g., immigration and drug trafficking), bypassing the need to wait for reports under the America First Trade Policy.
   • On January 26, President Trump announced plans to immediately impose 25% tariffs on goods from Colombia. These actions were a response to Colombia’s initial refusal to accept migrants deported from the United States. However, within hours of the announcement, the White House released a statement indicating that Colombia had agreed to accept the migrants, thereby averting the imposition of these tariff measures. The draft orders related to these tariffs were issued under the authority of the IEEPA, and other measures will remain unsigned unless Colombia fails to uphold its agreement. This situation underscores President Trump’s readiness to swiftly implement tariffs as a tool in international relations to ensure compliance with US terms. It appears the IEEPA may be the authority employed to implement immediate tariffs.
2. Existing Trade Actions: There is precedent for rapid tariff increases, such as the swift implementation of Section 232 tariffs on Turkey. Ongoing Section 301 actions against China also demonstrate a history of aggressive tariff measures, though with mixed or still open legal outcomes.

While the immediate implementation of these tariffs by February 1 appears unlikely due to logistical, legal, and strategic challenges, businesses should remain vigilant and prepared for potential rapid developments. The evolving trade landscape under President Trump’s Administration requires close monitoring and strategic planning to mitigate potential impacts.

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For insights and strategic guidance to navigate this dynamic trade environment, please contact our ArentFox Schiff team.