On 7 May 2026, the U.S. Court of International Trade (CIT) issued a closely watched ruling in State of Oregon et al. v. United States and related importer cases, finding that the administration lacked sufficient legal justification to impose the temporary 10% import surcharge under Section 122 of the Trade Act of 1974. The court concluded that the statutory conditions required to invoke Section 122; particularly the existence of “large and serious balance-of-payments deficits” had not been adequately established.
However, despite ruling against the legality of the tariffs, the court did not immediately halt collection of the duties at the border. Instead, the tariffs remain in force pending further judicial process, including likely appeals by the U.S. government. This outcome reflects procedural and institutional considerations commonly seen in trade litigation, where courts may avoid sudden disruption to customs administration and government revenue collection while appellate review remains ongoing.
For importers, this creates a highly unusual and commercially challenging situation: companies may continue paying tariffs that a federal trade court has already determined were unlawfully imposed. As a result, businesses face continued cash-flow pressure, pricing uncertainty, and difficulties in long-term sourcing and procurement planning.
The ruling significantly increases the importance of customs recordkeeping and post-entry recovery strategies. Importers should ensure that affected entries are properly tracked, maintain complete duty payment documentation, and monitor potential refund or reliquidation procedures should the ruling ultimately be upheld on appeal. Companies may also wish to evaluate protest rights, litigation exposure, and contractual tariff allocation clauses with suppliers and customers.
More broadly, the case underscores the growing legal uncertainty surrounding the use of expansive executive tariff authorities in the United States. For the wider trade community, the decision highlights the importance of integrating legal monitoring, customs strategy, and financial contingency planning into overall trade compliance governance.
Please see the attached court ruling: