24 States File Lawsuit Challenging Section 122 Tariffs: On March 5, 24 primarily Democratic-led states filed a lawsuit in the U.S. Court of International Trade (CIT) challenging the president’s use of Section 122 of the Trade Act of 1974 to impose tariffs. Last month, President Donald Trump issued a proclamation imposing a 10% Section 122 tariff on all imports, effective February 24. The statute authorizes the president to impose import quotas and surcharges of up to 15% for 150 days on a country or group of countries with whom the United States has a “large and serious” balance-of-payments deficit. President Trump previously announced that the duty would increase to 15%, but the administration has not taken any official action to raise the duty. According to New York State Attorney General Letitia James, the multistate coalition argues that the president’s use of Section 122 is illegal because a balance-of-payments deficit is distinct from a trade deficit. The states further contend that "balance of payments problems no longer occur” because the United States abandoned its fixed-rate exchange system in the 1970s.
 
United States and Mexico to Formally Launch USMCA Review Process: On March 5, U.S. Trade Representative (USTR) Jamieson Greer and Mexican Secretary of Economy Marcelo Ebrard announced the first round of bilateral discussions in preparation for the Joint Review of the U.S.-Mexico-Canada Agreement (USMCA). Negotiators will meet for the first time during the week of March 16, then regularly thereafter. The negotiations will focus on reducing dependency on imports outside the North American region, strengthening rules of origin, and enhancing North American supply chain security. The two trade officials had previously met on January 28 to lay the groundwork for the joint review process, committing to enhanced collaboration on critical minerals in addition to stricter rules of origin and coordinated anti-dumping policies. They came back together on February 4 to enact the U.S.-Mexico Action Plan on Critical Minerals, which was described as “an important step to strengthen bilateral cooperation” as the two countries approach the USMCA Joint Review.
 
Secretary Bessent Says Section 122 Tariff Will Increase: As of March 4, the Trump administration plans to raise the Section 122 global tariff from 10% to 15% later this week, according to Treasury Secretary Scott Bessent. The administration quickly imposed the temporary tariff following the Supreme Court’s decision to strike down tariff authority under the International Emergency Economic Powers Act last month, implementing a 10% duty on all countries. Section 122 of the Trade Act of 1974 allows for a tariff of up to 15% to be imposed for a serious balance of payments deficit for up to 150 days. After that period, Congress must approve an extension, but the authority does not provide expedited procedures in Congress.
 
Ambassador Greer Previews Section 301 Investigations: On March 3, U.S. Trade Representative (USTR) Jamieson Greer said the administration will complete Section 301 tariff investigations “by the time the five-month [Section 122] period has elapsed.” He continued, "We know there are countries out there with deals who are very interested in keeping the deals.” USTR officials have previously stated that the Section 301 investigations are meant to provide leverage for existing trade deals and ongoing negotiations, rather than impose new tariffs. The Trump administration previously launched Section 301 investigations into China, Nicaragua, and Brazil but has not indicated which countries are covered by the current, ongoing investigations. In late February, USTR Greer suggested that new 301 probes would cover “most major trading partners.” President Trump suggested that country-specific probes could result in tariffs being adjusted “somewhat upward,” as “every country … wants to make the deal they already have.”
 
Federal Courts Clear Path for IEEPA Tariff Refunds: On March 2, the U.S. Court of Appeals for the Federal Circuit denied the Trump administration’s request to pause implementation of the Supreme Court’s decision invalidating International Emergency Economic Powers Act (IEEPA) tariffs for up to four months. The Department of Justice (DOJ) argued that the appeals court should provide the administration with additional time “to allow the political branches an opportunity to consider options” before sending the case back to the CIT. The appeals court did not provide an explanation for its decision, which paved the way for the CIT to consider more than 2,000 lawsuits seeking tariff refunds.
 
Two days later, CIT Judge Richard Eaton ordered U.S. Customs and Border Protection (CBP) to re-liquidate imports subject to IEEPA-based tariffs in Atmus Filtration, Inc. v. United States. Liquidation refers to the process by which CBP finalizes the tariff rate for specific imports. Under U.S. customs procedures, importers pay an estimated duty upon good entry, but the final duty is not determined until liquidation, which typically occurs within 314 days of import. When CBP re-liquidates a shipment, it issues a refund for overpaid duties, with interest. If this order goes into effect, it would likely result in refunds of IEEPA tariffs that have been paid. The DOJ may appeal the decision, however, so it is possible that this order will be stayed until higher courts weigh in.
 
Today, CBP filed a declaration in the Atmus case, stating that the court order is not possible, but the agency has a system that it believes will allow it to issue refunds, possibly in 45 days. Again, CBP’s timeline could be altered if the DOJ appeals the judge’s order. But the administration’s acknowledgment that it could set up an efficient system for processing refunds for those deemed eligible is an encouraging sign.
 
USTR Releases 2026 Trade Policy Agenda and 2025 Annual Report: On March 2, the Office of the U.S. Trade Representative (USTR) released the president’s 2026 Trade Policy Agenda and 2025 Annual Report, which details the agency’s actions to Congress and future policy priorities. The report outlines the following six policy priorities in support of an “America First Trade Policy": (1) Continue the Agreement on Reciprocal Trade (ART) Program; (2) Pursue Robust Enforcement of ARTs, Other Trade Agreements, and United States Trade Laws; (3) Secure Supply Chains for Critical Minerals and Sectors; (4) Conduct the Review of the U.S.-Mexico-Canada Agreement (USMCA); (5) Manage Trade with China for Reciprocity and Balance and (6) Promote American Interests in International Fora. USTR emphasizes that the United States should enhance its production economy but highlights the importance of rebuilding manufacturing capacity in strategic sectors, such as semiconductors.