International Emergency Economic Powers Act

The International Emergency Economic Powers Act (IEEPA), passed by the U.S. Congress and signed into law by Pres. Jimmy Carter in 1977, permits presidents to create, eliminate, or modify a range of economic transactions with other countries in the event of a declared national emergency. The IEEPA thus enables presidents “to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States, if the President declares a national emergency with respect to such threat.” The law prohibits presidents from exercising such authority “for any other purpose.” In February 2026, the U.S. Supreme Court ruled that the IEEPA does not enable presidents to impose tariffs.

During the first year of his second term (2025– ), Pres. Donald Trump invoked the IEEPA and other laws to justify imposing tariffs on nearly every country in the world. In February 2025 he ordered what came to be known as trafficking tariffs on Canada, Mexico, and China after declaring national emergencies related to the smuggling of illicit drugs from all three countries and the “influx of illegal aliens” from Mexico. A much larger set of tariffs, ranging from 10 to 50 percent, were later directed at imports from nearly all trading partners of the United States under the declared emergency of “large and persistent annual U.S. goods trade deficits,” which reflect “asymmetries in trade relationships that have contributed to the atrophy of domestic production capacity, especially that of the U.S. manufacturing and defense-industrial base.”

Trump’s tariffs were soon legally challenged, partly on the ground that tariffs are nowhere explicitly mentioned in the IEEPA itself. After lower federal courts held that Trump’s tariffs were illegal, the Supreme Court agreed to conduct an expedited review of the rulings in a consolidated case, Learning Resources, Inc. v. Trump. During oral arguments before the Court on November 5, 2025, some justices suggested that Trump’s use of the IEEPA amounted to a violation of the Court’s “major questions” doctrine—the notion that a federal law cannot be interpreted to delegate vast economic or political powers unless such powers are clearly identified. The Court’s majority opinion in the case, issued on February 20, 2026, cited the major questions doctrine in its finding that Trump did not have the power to impose tariffs under the IEEPA.

The IEEPA is one of two laws enacted in the 1970s as necessary reforms of the Trading with the Enemy Act (TWEA) of 1917, which greatly expanded the president’s control of the economy during times of war and later (as amended in the 1930s) during declared national emergencies. After discovering that several national emergencies were still in effect after more than 40 years, Congress passed the National Emergencies Act (NEA) of 1976, which terminated most emergencies earlier declared under the TWEA, except those used by presidents to control foreign exchange, domestic banking, and domestic assets and properties owned or used by foreign governments or nationals. The NEA conditioned the exercise of emergency powers on the immediate notification of Congress of the declared emergency; it also granted to Congress the power to terminate declared emergencies under a joint resolution. The IEEPA of 1977 established a more limited and better regulated set of emergency presidential powers as compared with those permitted under the TWEA. One such restriction is that presidents may employ powers delegated under the IEEPA only for emergencies that have been declared under the IEEPA itself rather than under other laws. From 1979 to July 30, 2025, presidents declared 89 national emergencies under the NEA, 82 of which invoked the IEEPA. Twenty-two of those emergencies were declared by Trump during his first and second terms.