The U.S. Court of International Trade has ruled that President Donald Trump exceeded his legal authority in imposing global tariffs under a decades-old emergency powers law, throwing into question the legality of duties that had disrupted international trade and sparked lawsuits from states and businesses, according to the Wall Street Journal.

In a decision issued Wednesday, a three-judge panel found that the International Emergency Economic Powers Act (IEEPA) does not grant the president unlimited tariff-setting authority. The court struck down the so-called “Liberation Day” tariffs, which had levied broad duties on nearly all U.S. trading partners, citing national security and economic threats as justification.

“The court does not read IEEPA to confer such unbounded authority,” the panel wrote in its opinion, as reported by the Journal.

The decision is a significant blow to Trump’s trade agenda, which relied heavily on IEEPA to justify tariffs against countries like China, Mexico and Canada. It also challenges a key precedent for using executive powers in trade without congressional approval.

White House attorneys have announced plans to appeal the ruling. A successful appeal could restore the administration’s use of IEEPA for trade measures, while an unsuccessful one may force the use of other legal frameworks, such as Section 301 of the Trade Act of 1974.

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