US reinstates aluminium, steel tariffs on Argentina and Brazil

US President Donald Trump has tweeted that he intends to re-impose tariffs, effective immediately, on all steel and aluminium shipped into the United States from Brazil and Argentina, a decision that would reverse agreements reached by the US with the two countries in 2018, when Trump announced global tariffs of 25 per cent on steel and 10 per cent on aluminium, based on national security concerns. 

Trump later approved exemptions for some countries, including Argentina and Brazil, which agreed to quotas in lieu of the tariffs.

“This announcement, in which President Trump also accused Brazil and Argentina of a “massive devaluation of their currencies,” appeared to come as a surprise to these governments,” according to Kevin O’Brien, a partner and trade expert at law firm Baker McKenzie.

The announcement also follows a positive meeting last week of the US-Brazil CEO Forum held in Washington, DC, during which CEO members provided joint recommendations to both governments on how to strengthen the US-Brazil commercial relationship and grow bilateral trade and investment.  The USTR and Commerce have not yet issued statements on how the new tariffs will be implemented and whether the product specific exclusion process in place for other countries will also apply. 

“The US President’s decision to re-impose tariffs pursuant to the National Security provisions of US trade law could invite another legal challenge,” according to Baker McKenzie’s O’Brien.

In November, the US Court of International Trade issued an opinion that faulted the President for violating the law by ignoring a 90-day deadline for imposing or altering tariffs when the US doubled the steel duties on Turkey in August 2018.  While that case addressed a relatively narrow issue, the Court’s opinion more generally questioned the use of National Security provisions to threaten or impose tariffs, O’Brien said.