The Federal Circuit’s recent 7-4 decision on President Trump’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs has sparked significant uncertainty for businesses and supply chains. While the case now heads to the Supreme Court, a key date looms: October 14, when the Federal Circuit’s stay on its ruling is set to expire.
However, waiting for clarity may be the biggest mistake businesses can make. The uncertain timeline-from the Supreme Court’s decision to the administration’s use of other trade tools-demands that companies act now. Delaying decisions or pausing operations to “wait and see” will only leave businesses more vulnerable to the risks of prolonged tariffs or sudden policy changes.
What Happens If the Supreme Court Delays?
The Supreme Court’s next steps could have a significant impact on tariff policy and supply chain strategies. The Court may take months to decide whether to hear the case, and if they grant certiorari, a final decision could be delayed until mid-to-late 2026. In the meantime, the current tariffs remain in effect, creating prolonged uncertainty. It is important to note, any countries that have bi-lateral agreements in place remain in force and are not impacted by this ruling. That list is substantial…
Without clarity on the legal timeline, businesses face the risk of tariffs being extended indefinitely by default. This is why inaction is not an option-companies must prepare for disruptions now, rather than waiting for a resolution that may take years to arrive.
Other Tools the Administration Can Use
While the legal fight over IEEPA tariffs unfolds, the administration has other powerful trade enforcement tools at its disposal, including Section 301, Section 232, and other trade policy instruments that could further impact global supply chains.
1. Section 301 Tariffs
- What It Is: Section 301 of the Trade Act of 1974 allows the U.S. to impose tariffs or other trade restrictions on countries engaging in unfair trade practices, such as intellectual property theft or forced technology transfers.
- Current Use: This was the primary tool used to impose tariffs on over $300 billion worth of Chinese goods during the U.S.-China trade war.
- Future Risk: The administration could expand or modify Section 301 tariffs, especially if negotiations with China or other key trading partners stall.
2. Section 232 Tariffs
- What It Is: Section 232 of the Trade Expansion Act of 1962 allows the U.S. to impose tariffs on imports deemed a threat to national security.
- Current Use: This tool was used to impose tariffs on steel and aluminum imports globally.
- Future Risk: The administration could broaden the use of Section 232 to target additional industries, such as critical minerals or semiconductors, to safeguard U.S. supply chains.
3. Anti-Dumping and Countervailing Duties (AD/CVD)
- What It Is: These measures target products sold in the U.S. at below fair market value (dumping) or subsidized by foreign governments (countervailing).
- Future Risk: Expect increased enforcement of AD/CVD measures, especially on imports from countries like China and Vietnam.
Why Acting Now Is Critical
The uncertainty surrounding tariffs and trade policy may tempt companies to delay decision-making, but this approach will only increase exposure to risk. Inaction is no longer a viable strategy. Businesses that act now to strengthen their supply chains and prepare for multiple scenarios will be far better positioned to weather the storm.
Here’s why taking proactive steps is vital:
- Uncertainty Is the New Normal: Waiting for clarity could leave your business scrambling to adapt when new tariffs or enforcement measures are suddenly announced.
- Supply Chain Shifts Take Time: Diversifying suppliers or nearshoring operations can take months-or even years-to implement. Delaying action means falling behind competitors who are already building resilience.
- Opportunities Arise During Turbulence: Companies that prepare now can seize opportunities to secure new suppliers, renegotiate contracts, and gain a competitive edge over less-prepared rivals.
What Supply Chain Leaders Should Do Now
To navigate the uncertainty, supply chain leaders must prioritize resilience and preparation. Here are the key steps to take immediately:
1. Assess Your Exposure to Current and Potential Tariffs
- Identify which parts of your supply chain are affected by IEEPA, Section 301, Section 232, or other tariffs.
- Calculate how potential new measures-or their sudden removal-could impact your costs and operations.
2. Build Optionality in Your Sourcing
- Diversify suppliers to reduce dependency on countries facing tariffs.
- Explore regions like Southeast Asia, Eastern Europe, or Latin America as alternatives to tariff-heavy markets.
3. Strengthen Regional Supply Chains
- Look at opportunities to nearshore or reshore production, especially in North America under USMCA.
- Regionalized supply chains can help mitigate tariff risks and improve agility.
4. Monitor Legal and Policy Developments
- Stay updated on Supreme Court activity and potential new actions under Section 301, Section 232, or other trade tools.
- Engage with trade advisors or legal counsel to understand how potential changes could impact your industry.
5. Prepare for a Range of Scenarios
- Use scenario planning tools to model how different outcomes–prolonged tariffs, sudden removals, or new trade measures–could affect your operations.
- Build flexibility into your contracts with suppliers and logistics providers to adapt quickly as changes arise.
6. Focus on Long-Term Resilience
- Invest in technology to improve supply chain visibility and agility.
- Strengthen collaboration with suppliers and partners to ensure alignment in case of sudden tariff or trade policy changes.
Call to Action: Let’s Build Resilience Together
This Supreme Court case, combined with the administration’s ability to deploy other trade tools, represents a pivotal moment for global trade policy. Whether the Court acts quickly or delays for months-or even years-businesses must act now to reduce risks and future-proof their supply chains.
Here’s how I can help:
- Tariff Impact Analysis: Identify vulnerabilities and assess how extended tariffs or new trade measures could impact your supply chain.
- Scenario Planning: Map out potential outcomes and develop actionable contingency plans.
- Supplier Diversification: Build sourcing strategies to reduce reliance on high-risk regions.
- Advocacy and Engagement: Collaborate with trade groups to advocate for your industry’s needs during this critical period.
- Resilience Strategies: From simple steps to reshoring to digital transformation, I can help you future-proof your supply chain for long-term success.
Final Thoughts
The Supreme Court’s decision to take up this case–or delay it–along with the administration’s ability to deploy tools like Section 301 and Section 232 tariffs, could have profound implications for tariff policy and global supply chains. While clarity remains elusive, waiting is not a strategy. The best approach is to focus on resilience, optionality, and preparation—and act now.
Let’s connect and start building your strategy today. Together, we can ensure your supply chain is ready for whatever comes next. Reach out now to take control of this uncertainty and turn it into an opportunity!
