Berliner Boersenzeitung - Trump orders new 50% tariff on many Canadian goods

The tariffs will take effect in 30 days and cover a range of items including wine, hockey sticks and cement, according to a White House fact sheet.

Trump, who saw many of his tariffs struck down by the Supreme Court earlier this year, tapped an untested legal provision for the new duties -- Section 338 of the Tariff Act of 1930.

The latest duties will not apply to energy, potash and goods already impacted by sector-specific tariffs, the White House said.

Crucially, however, they will hit products covered under the US-Mexico-Canada free trade agreement (USMCA).

While Trump has slapped sweeping duties on US trading partners since returning to the presidency last year, the orders have generally exempted goods entering his country under the North American free trade pact.

His latest actions threaten to further strain ties between Washington and Ottawa, and come just days after he threatened Canada with increased tariffs over wildfire smoke that drifted into the United States.

The White House, in announcing the new tariffs, said Canada was one of only two countries -- along with China -- to retaliate against Trump's sweeping tariffs last year.

It also took aim at the fact that most Canadian provinces have halted purchases of US alcohol, boycotting the products over Trump's tariff threats and repeated calls for annexation of Canada as America's "51st state."

"Canada has taken US alcohol products off Canadian shelves, given better market access to dairy products from the European Union, and has put a cap on US vehicle exports to Canada from companies reshoring to the United States," charged US Trade Representative Jamieson Greer in a statement.

The tariff announcement aims to "hold Canada accountable for its retaliation and discrimination," he added.

- 'Litigation risk' -

Trump's move marks the first time that Section 338 has been used to impose tariffs, Scott Lincicome of the libertarian Cato Institute told AFP.

Many experts believe that the law has been superceded by other authorities, he said, arguing that Trump has "demonstrated a willingness to use and abuse any statute on the books."

Ryan Majerus, a former US trade official, told AFP that the law is "subject to a lot of litigation risk" and has never been tested.

"This is clearly designed to get some leverage over Canada," added Majerus, who is now a partner at law firm King & Spalding.

He noted that negotiations surrounding the USMCA were ongoing, and that the United States' talks with Mexico have proceeded at a much faster pace than those with Canada.

"This could be an effort to try to get them going," he said, pointing to the 30-day delay in the tariffs' implementation.

If the tariffs were to take effect as announced, however, Majerus expects that the removal of exemptions for USMCA imports would be highly negative to US supply chains and businesses.

(P.Werner--BBZ)