Recent Focus on National Security Related Trade Restrictions
In June 2025, President Trump issued a new proclamation doubling the steel and aluminum tariffs to 50 percent.
National Security Related Import Restrictions
Once considered a narrowly focused national security-related law, Section 232 of the Trade Expansion Act of 1962 (Section 232 or 232) has, since the first Trump Administration, emerged as a significant tool for protecting US industries from imports—one that is not tempered by input from an independent federal agency like the ITC. Section 232 authorizes the Secretary of Commerce, consulting with the Secretary of Defense, to conduct comprehensive investigations to determine the effects of imports of any article on the national security of the United States and authorizes the President to impose any necessary adjustment to imports, which can take virtually any form.
President Trump has initiated investigations or taken action in proceedings involving ten separate industries since taking office in January. A summary follows below:
Steel and Aluminum
Section 232 was the basis for the 25 percent steel and 10 percent aluminum tariffs imposed by President Trump in 2018, which was later expanded to include certain derivative products and significantly intensified in February 2025 when President Trump increased aluminum tariffs to 25 percent and summarily terminated less-draconian bilateral tariff-rate quota agreements negotiated during the first Trump and Biden Administrations with Argentina, Australia, Brazil, Canada, Japan, Mexico, South Korea, the European Union, Ukraine, and the United Kingdom. In doing so, the President claimed that those agreements had “inadvertently created loopholes that were exploited by China and others with excess steel and aluminum capacity, undermining the purpose of these exemptions.” The 2025 executive order also directs the Commerce Secretary to terminate the product exclusion process, including not renewing or considering new requests and phasing out previously granted product exclusions. In June 2025, President Trump issued a new proclamation doubling the steel and aluminum tariffs to 50 percent.
Autos
The 2025 Section 232 steel and aluminum tariffs were followed a month later by a proclamation in which President Trump increased tariffs on imported autos and auto parts to 25 percent, based on an earlier Commerce Department Section 232 investigation in 2019. In his executive order implementing the tariffs, President Trump indicated that the national security concerns related to the auto sector had only escalated since then, with the COVID-19 pandemic exposing “critical vulnerabilities and choke points in global supply chains, undermining our ability to maintain a resilient domestic industrial base.” As with steel and aluminum, the executive order highlighted loss of domestic market share by US-based manufacturers.
Copper
On February 25, 2025, President Trump invoked Section 232 again in directing the Secretary of Commerce to determine the effects on national security of imports of copper in all forms, including but not limited to: raw mined copper; copper concentrates; refined copper; copper alloys; scrap copper; and derivative products. In highlighting the perceived national security threat, the President pointed to China, although not directly by name: “The United States has ample copper reserves, yet our smelting and refining capacity lags significantly behind global competitors. A single foreign producer dominates global copper smelting and refining, controlling over 50 percent of global smelting capacity and holding four of the top five largest refining facilities. This dominance, coupled with global overcapacity and a single producer’s control of world supply chains, poses a direct threat to United States national security and economic stability.” Despite China’s dominant copper smelting capacity, it is not a major exporter of copper to the United States. Rather, the biggest sources of US copper imports are Chile, Canada, Mexico and Peru. The President’s executive order focused on the defense-related applications of copper: “Copper, scrap copper, and copper’s derivative products play a vital role in defense applications, infrastructure, and emerging technologies, including clean energy, electric vehicles, and advanced electronics. The United States faces significant vulnerabilities in the copper supply chain, with increasing reliance on foreign sources for mined, smelted, and refined copper.” The Commerce Department requested public comment on this investigation the following month.
Other Ongoing Investigations
The Trump Administration also launched Section 232 investigations into the national security impact of US reliance on imported processed critical minerals and their derivative products; imports of timber and lumber; imports of medium-duty and heavy-duty trucks, including their parts; semiconductors and semiconductor manufacturing equipment (SME), and their derivative products; pharmaceutical imports; and, aircraft and engines imports. The Trump Administration spent a good part of the spring and summer of 2025 engaged in bilateral tariff negotiations with a range of trading partners.
Reaction By Trading Partners
The 2018 US decision to impose tariffs on steel and aluminum under what is essentially a national security statute was met by a strong backlash from trading partners, who responded with WTO challenges and retaliatory tariffs against US exports. In 2022, a WTO panel found that US Section 232 duties on steel and aluminum were inconsistent with the WTO because they exceeded the agreed-upon tariff rates. The WTO also found that exemptions from the duties granted to steel and aluminum products from certain countries were inconsistent with the WTO requirement of most-favored-nation treatment , which requires equal treatment of all agreement signatories.
US trading partners have threatened to or taken similar legal actions to the United States’ use of Section 232 in 2025, with Canada requesting WTO consultations on US steel, aluminum and auto sector tariffs and China requesting consultations on a range of US tariff actions.
Process
Any interested party or the head of any federal department or agency may request an investigation to determine the effects of imports on national security, which the US Department of Commerce must immediately initiate.
The Commerce Department may also self-initiate an investigation. The Commerce Department must immediately notify and consult with the US Department of Defense regarding the methodological and policy questions raised. The Commerce Department must also seek information and advice from and consult with other officers, as appropriate. Finally, the Commerce Department must hold public hearings or otherwise afford interested parties an opportunity to present information and advice relevant to such investigation, as appropriate and after reasonable notice.
The Commerce Department must submit a report to the President of the United States no later than 270 days after the investigation is initiated detailing its findings on the effect of imports of the article(s) under investigation on the national security of the United States, specifically whether such articles are being imported into the United States in such quantities or under such circumstances as to threaten to impair the national security; and, recommendations for action or inaction.
Remedy
If the President concurs with the Commerce Department’s report, the President must, within 90 days, determine the nature and duration of the action that must be taken to adjust the imports of the article and its derivatives so that such imports will not threaten to impair national security.
The President must then take action within 15 days and report to Congress within 30 days.
As such, the President has broad discretion in applying a remedy, which has included consultations, agreements, monitoring, working groups, tariffs and tariff-rate quotas.
Close US allies like Canada questioned how their exports of steel to the United States could possibly be found to impair the national security of the United States.
What You Need To Know
Distinguishing Section 232 from Section 201 Cases. The ITC is an independent, nonpartisan, quasi-judicial federal agency. While the six commissioners who decide ITC cases are appointed by the President with the approval of the US Senate, they are not a part of a presidential administration and may not be fired by the president except for cause. This gives the Commissioners freedom to decide cases independent of political considerations or the policy preferences of the Administration. The commissioners serve for a term of nine years and no more than three of the six may be of the same political party. This stands in contrast to Section 232 cases, which are overseen by the Secretary of Commerce in consultation with the Secretary of Defense, both of whom are members of the President’s Cabinet, serve at the pleasure of the President,” and are expected to implement his policies and may be fired at any time for not doing so. Unlike Section 201, neither the ITC nor any other independent agency plays a part in that process. This fact raised questions among US trading partners as to the motivation of the United States in choosing Section 232 for the steel and aluminum cases, as opposed to Section 201. Close US allies also questioned how their exports to the United States could possibly be found to impair the national security of the United States.
US Exporters Have Faced Retaliation in Response to Section 232 Tariffs. As noted above, a number of US trading partners imposed retaliatory tariffs against a wide variety of US exports in response to the 2018 Section 232 steel tariffs. Those exports included, among other products: steel and other metals, recreational equipment and vehicles, coal, paper, appliances, , alcohol products, textiles, chemicals, machinery, distilled spirits textiles, footwear and agricultural products—especially agricultural products. Although the bilateral tariff situation is in flux as of the publication of this article, a number of countries have either imposed retaliatory tariffs on US products or have threatened to do so in response to Section 232 and other US tariffs, including Canada, Mexico, China, and the European Union. Targets include a range of US agricultural products, energy products, metals, spirits, appliances, machinery, trucks, motorcycles, apparel, paper products, electricity and coal, among others.
US companies potentially subject to retaliatory tariffs should monitor Section 232 cases carefully and consider taking part in any future Section 232 process at the US Commerce Department. They should also consider making their congressional representatives aware of the potential impact of retaliatory tariffs on workers and businesses in their districts. As noted above, the Commerce Department must hold public hearings or otherwise afford interested parties an opportunity to present information and advice relevant to such an investigation, as appropriate and after reasonable notice, a process that was followed in the steel and aluminum investigation.
Section 232 Steel Tariffs Have an Impact on Downstream Manufacturers. Most analyses of the tariffs imposed during the first Trump and Biden Administrations conclude that the Section 232 and other tariffs reduced US employment, especially in downstream industries, and predict a similar outcome from the 2025 tariffs. US manufacturers that integrate steel into their final products have complained that Section 232 tariffs have increased their costs, disrupted their supply chains and made them less competitive with producers whose foreign-made end products are not subject to US steel and aluminum tariffs. US agricultural producers complained about the loss of export markets due to Section 232 tariffs, as well the increased cost of imported farm products made from steel and aluminum, including grain bins, tractors, fencing and tractors and equipment parts. End users, including US manufacturers of healthcare, industrial, utility, transportation, and lighting equipment, indicate that increased costs due to the 232 tariffs have decreased their competitiveness with foreign producers. The ITC agreed, indicating that the economic effects on downstream industries were all negative. In addition, US producers have indicated supply chain disruption due to the inability to find new suppliers familiar with the producers’ exacting qualification requirements.
Tariff Exclusion Process. The tariff exclusion process for any steel article “determined not to be produced in the United States in a sufficient and reasonably available amount or of a satisfactory quality and is also authorized to provide such relief based upon specific national security considerations,” which has served as a critical buffer for US steel- and aluminum-consuming companies that rely on imported inputs to meet product standards and qualifications, has been phased out by the Trump Administration.
The WTO Has Ruled against the United States. As noted above, a WTO panel ruled that the 2018 Section 232 steel and aluminum tariffs violated US WTO commitments The United States had argued that the tariffs were imposed as a national security remedy to address the national defense and economic implications of global excess capacity in steel and aluminum, and that such actions were permitted under WTO “security exceptions.” While the panel agreed that the US Section 232 tariffs were, in fact, based on national security concerns, it concluded that it was not persuaded that the impacts of global excess capacity “rises to the gravity or severity of tensions on the international plane so as to constitute an "emergency in international relations," as required by the WTO agreements. The United States has appealed this ruling.
Reciprocal Tariffs
The Trump Administration invoked the International Emergency Economic Powers Act (IEEPA) to substantially increase tariffs on most products from most countries by declaring that the US trade deficit is an economic emergency that must be addressed. The President had three months earlier relied on IEEPA in imposing tariffs against China, Mexico and Canada, to address what he called the national emergency “posed by illegal aliens and drugs, including deadly fentanyl.” As will be discussed in more detail in other sections below, IEEPA empowers the US president to impose a range of remedies to deal with “an unusual and extraordinary threat to the national security, foreign policy, or economy of the United States,” when the threat comes from outside of the United States and the president declares a national emergency.
Although IEEPA has provided the legal justification for decades for a range of executive actions including US foreign sanctions, this is the first time it has been used as the basis for a protective trade measure. The emergency in the case of reciprocal tariffs—also called “liberation day” tariffs by the Trump Administration – is “the large and persistent trade deficit that is driven by the absence of reciprocity in our trade relationships and other harmful policies like currency manipulation and exorbitant value-added taxes (VAT) perpetuated by other countries.” To address this perceived national emergency, President Trump ordered the imposition of 10-percent across-the-board tariffs on all countries, with “an individualized reciprocal higher tariff on the countries with which the United States has the largest trade deficits.” The Trump Administration’s overarching complaint is that US trading partners impose tariffs that are not set at the exact level of US tariffs, so US tariffs must be adjusted accordingly to make up the difference.
While these actions are described as “reciprocal tariffs,” they do not change every tariff rate for every product from every country to mirror US tariffs, as the term implies, which would have required thousands of tariff re-classifications. Instead, the administration divided the US trade deficit with a trading partner by the US imports from that country and then cut that number in half. For example, the US goods trade deficit with Vietnam was $123.5 billion in 2024, which when divided by the $136.6 billion level of US imports from Vietnam equals .904 percent, which when cut in half equals 46 percent, which is the “individualized US reciprocal tariff” set for Vietnam.
The basic idea behind the formula is that trade deficits are bad, need to be erased and are based on unfair trade practices set by other countries. The rules of the World Trade Organization, however, are in many ways the very opposite. Tariff levels are not set based on every country having the same tariff levels on every product on which they trade. Rather, the fundamental underlying principle of the WTO is known as Most Favored Nation, under which countries set their tariff levels in WTO negotiations and then must generally apply those tariffs and other trade measures equally to all members of the WTO without discrimination. The goal is to facilitate tariff reduction and trade, and bring stability and predictability to global markets, not to balance bilateral trade.
Critics of this fundamental principle suggest that the United States should instead apply so-called reciprocal tariffs by giving the President new authority to bring any American trading partner that is currently applying higher nonreciprocal tariffs to the negotiating table. If that trading partner refuses to lower tariffs to US levels, the President then would have the authority to raise US tariffs to match or “mirror” the foreign partner’s tariffs.
While the ”liberation day” tariffs did not follow this approach exactly, they did announce, in no uncertain terms, that the United States would no longer follow the MFN principle. As noted, MFN has been one of the primary principles of global commerce since it was listed as Article 1 of the first General Agreement on Tariff and Trade in 1947. The GATT came in the wake of two devastating world wars and the Great Depression, during which global trade contracted sharply due in part to a global tariff war. MFN and other WTO principles such as “national treatment,” were designed to bring predictability to global commerce following a very unstable period. As explained on the WTO website, “Sometimes, promising not to raise a trade barrier can be as important as lowering one, because the promise gives businesses a clearer view of their future opportunities. With stability and predictability, investment is encouraged, jobs are created and consumers can fully enjoy the benefits of competition — choice and lower prices. The multilateral trading system is an attempt by governments to make the business environment stable and predictable.”
Critics of the so-called reciprocal tariff approach argue that trade deficits are caused by a variety of factors, including the strength of the US dollar, the low US savings rate, the attractiveness of the US market for foreign investors and the spending power of US consumers compared to those of other nations. More fundamentally, they argue, the Trump Administration’s approach will further dilute the role of the WTO, which has already been hampered by the refusal of the United States to permit appointment of individuals to WTO appeals panels, thereby making enforcement of WTO panel decisions all but impossible.
As noted above, the US Court of International Trade (CIT) has ruled that the broad “reciprocal tariffs” exceed the president’s constitutional authority. Noting that the Constitution assigns Congress the exclusive powers to “lay and collect taxes, duties, imposts and Excises,” and to “regulate Commerce with foreign Nations,” the court concluded that IEEPA does not delegate “these powers to the President in the form of authority to impose unlimited tariffs on goods from nearly every country in the world. We instead read IEEPA’s provisions to impose meaningful limits on any such authority it confers.” The CIT also struck down the “fentanyl” tariffs on statutory grounds, concluding they “fail because they do not deal with the threats set forth in those [executive] orders.” As of the writing of this article, a federal appeals court has temporarily halted the CIT’s decision based on the Trump Administration’s challenge of the lower court decision.
The Court of International Trade concluded that IEEPA does not delegate “powers to the President in the form of authority to impose unlimited tariffs on goods from nearly every country in the world.”
What You Need To Know
There has been much discussion of whether the Trump Administration is abandoning the post-World War II international order that the United States was instrumental in creating, including the General Agreement on Tariffs and Trade, the International Monetary Fund and the World Bank. The formation of these institutions was largely a response to two world wars and the Great Depression, which was fueled in part by a global tariff war. As noted, the Trump Administration’s “reciprocal tariffs” fly in the face of the fundamental principles of the World Trade Organization, the successor to the GATT, which has already been weakened by US refusal to allow appointments to the WTO’s appellate body, the core of the WTO dispute settlement process championed by the United States. President Trump has also questioned the United States’ role in NATO and has ordered the Secretary of State to conduct a 180-day review of “all international intergovernmental organizations of which the United States is a member” to determine which act contrary to US interests and whether the United States should withdraw from them.
What this potentially means for American businesses—including importers, exporters, investors, manufacturers, farmers and service providers—is a continued period of uncertainty marked by on-and-off again tariffs, different tariff levels for different suppliers, foreign retaliatory tariffs, disrupted supply chains and rising prices for consumers.
What this means for the global economy is also problematic. In its April 2025 World Economic Outlook, the IMF forecasts cumulative downgrade in global growth of 0.8 percent should the US tariffs and foreign retaliatory tariffs announced between February and April remain in place. The report also highlighted the vacuum left by the weakening of international institutions, noting that “The global economic system under which most countries have operated for the last 80 years is being reset, ushering the world into a new era. Existing rules are challenged while new ones are yet to emerge.” The World Trade Organization, in a separate report released in April, also predicted negative effects from a tariff war, warning that “global trade is now facing headwinds from a surge in tariffs and rising trade policy uncertainty. The volume of world merchandise trade is projected to decline by 0.2 per cent in 2025 — almost three percentage points lower than it would have been without the recent policy shifts.