Steel Importers File Opening Brief at CAFC in Section 232 Tariff Challenge

A group of steel importers, after suffering a defeat in the Court of International Trade, brought their broad challenge to the Section 232 steel and aluminum tariffs to the U.S. Court of Appeals for the Federal Circuit, arguing that the statute includes procedural requirements that were ignored in President Donald Trump's expansion of the tariffs. Filing its opening brief on May 24, the importers say that plain use of the mandatory word "shall" throughout Section 232 means the procedural requirements, such as an underlying report from the Commerce Department precipitating tariff action, are required. The steel importers also again argued that the commerce secretary's report is considered final agency action, ready for judicial review (Universal Steel Products, Inc. et al., v. United States, Fed. Cir. #21-1726).

The lower court had held that Commerce's report was not final because it was advisory and did not directly affect the importers' legal rights (see 2102040026). Unlike with Section 301 tariffs, which require action based on the underlying report, Section 232 gives the president the discretion to agree or disagree with the report's findings. Since the president was able to take action that was different from what was recommended in the Commerce report, the findings do not constitute a final agency action, CIT had said.

The importers argued that "the President has no authority to adjust imports under Section 232 without an affirmative determination by the Secretary that imports 'threaten to impair' the national security." If that's true, it indicates that legal consequences flow from the agency determination, teeing them up for judicial review, the importers said.

The importers also cited language from the statute that "the president shall 'determine the nature and duration' of the action necessary to eliminate the threat to national security," to argue that it was illegal for the president to not indicate an expiration date for the tariffs, or at least continue to alter the tariffs without additional reports from Commerce. "It should not last forever, or be subject to sporadic changes; if the action is to change, it must be based on new information in the form of a report from the Secretary," the brief said. "And the determination, both of the Secretary and the President, must be from imports that 'threaten' national security. That word provides an important principle inherent in its definition -- that the danger from imports must be real and impending. Section 232 is not designed for remote contingency planning to meet dangers unlikely to materialize in the near future.”