US motion for stay of enforcement in Turkish steel tariff dispute denied

Posted on 21 September 2020

The US Court of International Trade has denied a motion by the US government for a stay of enforcement regarding a July decision in which the court found that President Donald Trump's decision to impose additional duties on imports of Turkish steel under Section 232 of the Trade Expansion Act of 1962 was in violation of the law, according to a recent court opinion.

The US government failed to demonstrate to the court that it would be able to succeed in appealing the ruling, judges for the CIT said in an opinion dated Sept. 15.

In a July 14 ruling, the CIT found that Trump's decision to impose additional tariffs on Turkish steel under Section 232 was a violation of statutorily mandated procedures and the Constitution's guarantee of equal protection under the law.

Following a tweet from Trump, the US on Aug. 13, 2018, raised Turkey's steel import tariff to 50% from the 25% assigned to all countries without an individual negotiated deal in March 2018. The higher tariffs remained in place until May 21, 2019.

Plaintiff Transpacific Steel, a US importer of steel, and other plaintiffs in the case requested a refund of the additional tariffs paid as a result of the higher tariffs. The plaintiffs argued the move to double Turkey's steel tariffs was unlawful as it lacked a nexus to national security, was issued without following mandated statutory procedures, and singled out importers of Turkish steel products in violation of Fifth Amendment Equal Protection and Due Process guarantees.

"In order for defendants to prevail, the Court of Appeals would have to overrule both the statutory and the constitutional holdings that the President's imposition of additional tariffs on certain steel articles from Turkey is unlawful," the Sept. 15 court opinion states. "Defendants claim that the Court of Appeals might disagree with the court's reasoning, but point to no intervening authority or evidence that would raise substantial questions as to the propriety of any of the court's holdings."

However, the court did enjoin the US during the reminder of the litigation, including any appeals, from issuing instructions to liquidate or permitting liquidation of any of the plaintiff's entries subject to "the unlawful 50% tariffs imposed on steel articles from Turkey."

The court denied the plaintiffs motion to enforce judgement.

"As [the] plaintiffs acknowledge, the court's judgment does not provide a deadline for compliance, and [the] plaintiffs do not provide any reason to doubt that [the] defendants will promptly comply with the court's judgment should they fail to obtain a stay of enforcement from the Court of Appeals," the opinion stated.

Source : Platts