Importers File Lawsuit Alleging Increased Section 232 Tariffs on Turkish Steel Unconstitutional
Three steel importers recently filed a new lawsuit at the Court of International Trade alleging that an increase in Section 232 tariffs on steel products from Turkey to 50 percent is unconstitutional and violates statutory requirements. In a complaint filed Jan. 17, MedTrade, Transpacific Steel and A.G. Royce Metal Marketing (dba Concrete Reinforcing Products) seek a court order stopping implementation of the tariff increase and refunding any duties collected above the 25 percent applicable to other countries.
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In his Aug. 10 proclamation about the increased tariffs (see 1808120001), President Donald Trump had cited the failure of existing Section 232 tariffs to increase domestic capacity utilization. A tweet from about the same time also noted that relations with Turkey were “not good.” But the administration’s own trade data showed that Turkish steel exports to the U.S. had already declined by more than 50 percent since 2017 by the time the tariff increase to 50 percent was proclaimed, “more than any other country subject to the 232 tariffs,” the complaint said.
“The facts do not support the contention that doubling the Section 232 tariffs on Turkey serves the proclaimed national security purpose of increasing the domestic steel industry’s capacity utilization rate,” the complaint said. “There is, in fact, no nexus between the President’s action and achievement of the national security purpose, as defined by the President, that the action is asserted to promote.” Section 232 requires a national security purpose, so the increase was “outside the bounds of the authority delegated to him by Congress under Section 232” and therefore illegal, the complaint said.
Nor did Trump follow the procedures set by Congress in Section 232 when he imposed the increased tariffs, the complaint said. “There was no investigation, report or consultation to determine the effect on the national security of imports from Turkey prior to the issuance of the challenged proclamation to support the doubling of the tariffs on steel imports from that country alone,” it said.
The tariff increase was also unconstitutional, violating the equal protection and due process clauses, the complaint said. It put in place more burdensome treatment of U.S. importers of steel products from Turkey, without any “legitimate governmental purpose for this discriminatory treatment,” the importers said. It was also imposed on the importers with no benefit of due process, depriving importers of their property without any procedures “regarding the resolution of disputed facts,” the complaint said, citing Federal Circuit precedent.
The complaint requests that CIT “enter judgment in favor of [the steel importers]” and “declare the Steel Proclamation on Turkey unconstitutional, null and void.” It also requests an injunction barring the government from implementing or enforcing the “Steel Proclamation on Turkey” against the steel importers. Finally, the complaint asks that CIT “order CBP to refund [to the steel importers] the difference between any tariffs collected by CBP on their imports of steel products pursuant to the Steel Proclamation on Turkey and the 25% ad valorem tariff that would otherwise apply on these imports.”
(MedTrade Inc. et al v. U.S., CIT # 19-00009, filed 01/17/19)
Email ITTNews@warren-news.com for a copy of the complaint.