A Year On from Liberation Day: Tariffs, Courts and a Rewired Trade System

Background

With continued developments in US trade policy, please see this week’s key updates in our latest round-up on tariffs, global tax and beyond.

One year on from “Liberation Day,” the moment when the United States unveiled its most sweeping tariff measures in decades, the global trading system is still adjusting to the aftershocks. What was framed as a decisive break from past trade policy has since reshaped supply chains, influenced pricing and investment decisions, and intensified debate over the role of tariffs in a modern, interconnected economy. As the anniversary passes, businesses and policymakers alike are taking stock of what has changed, and what the longer‑term consequences may be for international trade.

The Year in Summary

On 2 April 2025, the initial introduction of a 10% universal baseline tariff, alongside country-specific “reciprocal” tariffs of up to 50%, fundamentally altered the cost of accessing the US market. These measures were imposed using the Internal Emergency Economic Powers Act (IEEPA) and were complimented by expanded Section 232 national security tariffs.

As the year progressed, attention increasingly shifted from policy announcements to implementation and mitigation. The US‑EU Framework Agreement emerged as a pivotal development, establishing a 15% tariff ceiling for most EU goods and restoring MFN treatment for hundreds of products, including pharmaceuticals, aircraft and natural resources. Similar bilateral outcomes followed with the UK and Japan.

A defining moment came in February 2026, when the US Supreme Court struck down the use of IEEPA as a legal basis for imposing tariffs, invalidating a significant portion of the measures introduced since Liberation Day. This ruling created immediate implications for importers, including the potential unwinding of over $130 billion in collected duties, and shifted focus firmly onto refund eligibility, data readiness and administrative process. Subsequent rulings from the US Court of International Trade provided further clarity on liquidation mechanics, reinforcing the importance of clean customs data and proactive preparation by affected businesses.

One year on from Liberation Day, tariffs have shifted from a blunt policy instrument to a permanent and embedded feature of the global trade environment. For businesses, the focus has moved decisively from reacting to announcements toward structural tariff management, including supply‑chain re‑engineering, valuation planning, duty mitigation strategies and litigation readiness.

Current state of play

Within hours of the Court issuing its judgment striking down the IEEPA “reciprocal” tariffs, President Trump moved to reassert tariff authority by signing a proclamation imposing sweeping Section 122 tariffs, effective 24 February. The measures applied broadly across imports, subject to a series of sector‑specific exclusions, at a uniform rate of 10%, effectively re‑establishing a baseline tariff. By design, however, the regime is temporary: Section 122 tariffs are statutorily capped at 150 days unless extended by Congress, leaving the replacement measures scheduled to expire on 26 July.

Section 232 tariffs remain the most entrenched pillar of the US tariff regime, reflecting the administration’s continued reliance on national security authorities to impose and sustain trade restrictions. A broad range of measures have already been implemented, including tariffs of up to 50% on steel, aluminium and copper, 25% duties on automobiles and automotive parts (with exemptions for certain partners), and sector‑specific tariffs on semiconductors, manufacturing equipment, timber and lumber products.

At the same time, a significant pipeline of Section 232 investigations remains outstanding, covering strategically sensitive sectors such as pharmaceuticals, medical devices, commercial aircraft, integrated circuits, robotics, critical minerals and renewable energy technologies.

Potential Future Actions

On 11 and 12 March, The Office of US Trade Representative (USTR) launched two new Section 301 investigations, into excess supply and forced labour prohibition practices of economies from which over 99% of U.S. imports originate.

USTR is seeking public comments and will hold hearings from late April 2026, after which it may recommend additional tariffs or import restrictions if the practices are deemed actionable, with 60 economies, including the EU, UK, China, Japan and Canada, named as subjects of the investigations. If USTR makes the required findings, President Trump may impose tariffs or other trade restrictions.

CIT Expands Scope of IEEPA Duty Refunds, but Relief Remains Stayed

On 27 March, Senior Judge Richard Eaton of the US Court of International Trade (CIT) issued an order in Atmus Filtration Inc. v. United States that updates and broadens his 20 March ruling on refunds of duties collected under the International Emergency Economic Powers Act (IEEPA). The order clarifies that all entries subject to IEEPA duties, including finally liquidated entries, are eligible for refunds. This expansion covers entries that have completed both the 314‑day liquidation period and the 180‑day protest window during which importers may challenge CBP’s final duty assessment. By contrast, the 20 March order suggested that refunds were limited to unliquidated entries or liquidated entries that were not yet final.

Despite confirming universal refund eligibility, Judge Eaton stayed the order “to the extent that it requires immediate compliance.” As a result, refunds will not be issued at this time, pending further developments with respect to the US CBP CAPE system.

EU Parliament approves conditional EU/US trade deal

The European Parliament has approved legislation to implement an EU/US trade deal, following the uncertainty driven by President Trump’s tariff threats. A strong majority of lawmakers backed the measures on Thursday 26 March, while strengthening safeguards designed to ensure the United States complies with the agreement reached last July.

The vote follows prolonged delays linked to Trump’s threats to annex Greenland and a US Supreme Court ruling that found parts of his tariff regime unlawful. In total, the European Parliament approved the legislation by 417 votes to 154, with 71 abstentions.

MEPs moved to reinforce the deal’s protections, including a suspension clause that would halt the agreement if the US raises tariffs above 15% or introduces new duties on EU goods. Another safeguard would suspend the deal if the US were to threaten the EU’s territorial sovereignty. Lawmakers also added a “sunrise clause,” ensuring EU tariff reductions only take effect if the US upholds its commitments, including limiting tariffs to 15% on EU products containing less than 50% steel and aluminium.

The agreement must still be approved by all 27 EU member states, with a final parliamentary vote expected in April or May. When the framework was unveiled last summer, Trump stated that the US 50% tariff on global steel and aluminium would continue to apply to the EU.

Irish Exports to US Plunge as Tariff-Driven Volatility Continues

Irish goods exports to the United States fell dramatically in January, dropping by 72% year on year as trade disruption linked to US tariff policy continued to weigh on Irish exporters. Central Statistics Office (CSO) data show exports to the US declined by €8.8 billion, or 71.7%, to €3.5 billion compared with January 2025.

The sharp fall largely reflects a reversal of the surge seen at the start of last year, when companies accelerated shipments to the US to build up inventories and avoid the potential impact of punitive tariffs. Chemicals and related products accounted for most of the decline, with exports in this category, dominated by pharmaceuticals, falling by €8.9 billion (81.3%) to €2 billion. While pharmaceuticals remain Ireland’s largest export to the US and have so far avoided tariffs, the sector still drove much of the volatility.

Overall, Ireland exported €16.2 billion worth of goods globally in January, down €8.7 billion (35%) compared with the same month last year. Goods imports, by contrast, rose modestly to €11.4 billion, an increase of €341.5 million.

According to the CSO, the downturn was primarily driven by weaker pharmaceutical exports, following record export levels in the first quarter of 2025. Since then, goods exports have declined on average each quarter. Despite the fall, the US remained Ireland’s largest export destination in January, accounting for 21.6% (€3.5 billion) of total goods exports, followed by the Netherlands and Great Britain.  

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Keeping up to date with US trade policies, trade agreements and new and existing tariff reviews which may lead to further tariff measures is crucial to assessing the risk to your supply chain and the impact these tariffs may have. Understanding your product portfolio and the impact that tariffs may have on your imports is an important first step. We are here to support your business with this analysis and navigating these choppy waters.