The Revival of Section 301 — The Legal Rebuild of Trump's Tariff System and the Race Against Time

In February 2026, the U.S. Supreme Court struck down the legality of the global tariffs President Trump had imposed by invoking the International Emergency Economic Powers Act (IEEPA). Four months on, monthly tariff revenue has fallen from a peak above $31.4 billion to a $25.6 billion loss in June — refunds now exceed collections. Yet Trump has not given up. He is rebuilding the tariff wall as fast as the law allows.

The 150-Day Window and the July 24 Countdown

The Supreme Court's ruling stripped Trump of IEEPA, his most flexible tariff tool. But he quickly found a substitute: invoking Section 122 of the Trade Act of 1974, he imposed a 10 percent tariff on goods worldwide.

The problem is that Section 122 tariffs have a shelf life of only 150 days. July 24 was the deadline.

Congress could extend these tariffs, but with the midterm elections approaching (November 3) and voters angry over the high cost of living, lawmakers are unlikely to vote for an extension. That means Trump had to find a more durable legal basis before July 24 — otherwise the tariff wall would face a gap.

The Return of Section 301

Trump's answer was to return to Section 301 of the Trade Act of 1974 — the same provision he used during his first term to impose steep tariffs on China. Unlike IEEPA, Section 301 tariffs come with explicit rules on expiry and renewal: they lapse after four years unless renewed, and there is no cap on the rate.

But Section 301 carries procedural requirements — an investigation, a public comment period, and hearings. The Trump administration has already launched two large-scale Section 301 investigations:

The first accuses 60 countries — accounting for 99 percent of total U.S. imports — of failing to do enough to combat imports of goods made with forced labor. Last month, U.S. Trade Representative Greer proposed tariffs on these countries: 10 percent for 16 of them and 12.5 percent for 44, matching or slightly exceeding the 10 percent Section 122 rate they are meant to replace. That process remains in the public-comment phase.

The second is examining whether 16 trading partners (including China, the EU, and Japan) engage in overcapacity and price undercutting. Trade lawyers expect the administration to propose higher tariffs within a month or two, with the effective date timed to fall after the midterm elections — "for obvious reasons."

As recently as this past Wednesday, Trump had already announced 25 percent tariffs on selected Brazilian imports, accusing the world's eleventh-largest economy of unfair trade practices. Brazil's presidential office subsequently refused to accept the move and rejected the charges of unfair trade.

The Fragility of the Legal Foundation

Trade lawyers and former U.S. trade officials broadly agree that the administration will complete the forced-labor tariff replacement before July 24, ensuring "little or no gap" between the Section 122 and Section 301 tariffs.

Whether the new Section 301 framework can withstand court challenges is another question.

Former U.S. trade official Sarah Bianchi put it with particular sharpness: Section 301 has always been legally sturdy — but no one has ever tried to use it to "effectively implement universal tariffs." Converting an investigative tool aimed at specific countries' trade practices into a universal tariff covering 99 percent of global import value goes well beyond the original design of Section 301. Bianchi expects it to face legal challenges.

In other words, the road Trump is walking is not the one the law laid out for tariffs; it is a new road cut through legal gray zones. How far it leads may, in the end, once again be a matter for the Supreme Court to decide.

The Cost of Uncertainty Itself

The reporting also reveals a side that is easy to overlook: uncertainty hurts businesses no less than the tariffs themselves.

Unable to foresee how trade rules will change, companies are holding back on investment and decisions. From IEEPA to Section 122 to Section 301, every swap of legal instruments means the rules are reshuffled again. Compared with the old IEEPA tariffs, which could be adjusted "at will," Section 301 imposes more procedural constraint — Bianchi describes it as "less uncertainty, but not zero." Uncertainty does not disappear; it merely changes scale.

And what businesses fear most is not high tariffs, but not knowing what tomorrow's rate will be.

July 24, Delivered — Section 301 Tariffs Land in Full

In the small hours of July 24, the Section 122 global tariffs formally expired. Simultaneously, the Office of the U.S. Trade Representative announced new tariffs of 10 to 12.5 percent on 60 economies under Section 301 of the Trade Act of 1974, covering 99.4 percent of total U.S. imports. The timing was no coincidence — the final hour of Section 122's 150th day was the zeroth hour of Section 301. Trump met the deadline he had set for himself and left the tariff wall with no gap at all.

The "Forced Labor" Brand — Old Wine in New Bottles

The public justification for this Section 301 investigation is that countries have "failed to effectively enforce bans on imports of goods made with forced labor." After months of investigation, the Office of the U.S. Trade Representative sorted the 60 economies into two groups: 54 that "failed to adopt and effectively enforce" such bans, and 6 that "failed to effectively enforce" them. The former face the 12.5 percent rate; the latter, deemed to have "taken partial measures," get the lower 10 percent.

But reporting by Lingshi Xiantan ("Consular Chats," a Weibo commentary account that translates and digests U.S. policy documents) exposed the real character of the list:

• The list covers virtually every U.S. trading partner — including China, the EU (all 27 members), Japan, India, Saudi Arabia, the United Kingdom, and Israel
• Some allies were granted the lower 10 percent rate, yet administration officials openly conceded that "they do not believe these countries will eliminate forced labor in the near term"
• Oil, natural gas, fertilizer, and other bulk commodities are exempt — as are products covered by the USMCA framework

Replace "forced labor" with "national security," and the two lists would barely differ. This is not a punishment aimed at any particular trade practice — it is a reconstruction, using the Section 301 toolbox, of a global tariff system equivalent to the original IEEPA tariffs.

Section 301's Durability Advantage

Trade specialists broadly agree that Section 301 tariffs, grounded in the Tariff Act of 1931 and the Trade Act of 1974, are legally more durable than IEEPA measures because they have already survived prior court challenges. Unlike Section 122, Section 301 tariffs carry no 150-day expiration — they can remain in force indefinitely. The Trump administration has already begun preparing additional Section 301 investigations, one of them focused on allegations that China, Mexico, and the EU are worsening global manufacturing overcapacity.

The Window Before the Midterms

The timing of the new tariffs is delicate — barely four months before the November 3 midterms. On a call with reporters, White House officials explained that the current date was chosen to "avoid stacking" between the Section 122 expiry and the Section 301 effective date. But as The Guardian noted, the American public is already unhappy about the cost of living, and rolling out new tariff measures "is undoubtedly taking a risk."

This round of Section 301 tariffs has no 150-day expiry, but it is exposed to election outcomes — if Democrats take control of Congress, Trump's tariff toolbox could face new challenges at the legislative level. Meanwhile, the administration keeps exploring further "workarounds": earlier this week, the White House announced 50 percent tariffs on selected Canadian goods under a provision of the Smoot-Hawley Tariff Act that had never once been used.

From 60 to 80 — Rapid Expansion and International Backlash

In the first minutes after the Section 122 tariffs expired on July 24, the Section 301 tariffs landed on schedule. But on the very same day, Trump had already expanded the list from 60 economies to more than 80 countries and territories — adding not just economies, but also a broader test of legal frameworks.

The Holes in the Forced-Labor Narrative

Critics point out that Section 301 was designed to counter unfair trade practices by specific countries — it was never meant to impose universal global tariffs. Peter Harrell, a visiting scholar at Georgetown University Law Center, offered the most blunt verdict: Canada and the EU face tariffs nearly identical to China's — "which simply shows that the Office of the U.S. Trade Representative is using the forced-labor investigation as an excuse to impose the tariffs Trump wants, driven by his own economic theories and preferences."

The new tariffs sort countries into two tiers: 10 percent (e.g., Canada, the EU) and 12.5 percent (e.g., China, Japan, India). But the tiering was not based on any genuine assessment of labor rights — Canada has long banned imports of forced-labor goods, while the EU's ban does not take effect until 2027 — it was based on political convenience. At a congressional hearing, Democratic Senator Ron Wyden of Oregon said plainly:

Section 338 — The Nuclear Option

Alongside the full activation of the Section 301 framework, Trump has been exploring a legal tool no one had ever used — Section 338 of the Tariff Act of 1930, better known as the Smoot-Hawley Tariff Act. Earlier this week, he invoked Section 338 to impose 50 percent tariffs on billions of dollars of Canadian exports. It is the first actual use of the provision since it was written into law in 1930.

The Allies Push Back

The new tariffs cover virtually every traditional U.S. ally. The Japanese government said it "regrets" the move; Australian Deputy Prime Minister and Defence Minister Richard Marles called it "completely unjustified"; New Zealand Prime Minister Christopher Luxon condemned it as "deeply disappointing." All three pointed out that the United States had offered no meaningful evidence on forced labor.

Trump's trade team is well aware of this. "The specific legal authorities this administration relies on have changed, but the trade strategy has not," U.S. Trade Representative Greer said in congressional testimony.

The Yomiuri Shimbun Editorial — A Deeper Critique From an Ally

On July 25, Japan's Yomiuri Shimbun published an editorial delivering a more systematic critique of this round of Section 301 tariffs than any government statement had offered.

The editorial's core argument runs on three levels:

First, the legal level. The justification Washington offered under Section 301 — that countries are "failing to counter forced labor" — reads more like a hastily assembled pretext. The editorial noted that from April of last year, when the IEEPA tariffs were ruled illegal, through the subsequent rulings that struck down the replacement arrangements in turn, Trump's tariff policy has taken on a structural character of "improvising while improvising": whenever one tool is invalidated by the courts, another is swapped in — while the substance of the policy never changes.

Second, the economic level. Surging oil prices amid the Middle East crisis have already heightened inflation concerns. Against that backdrop, new tariffs will not only hit the export industries of Japan and other countries but also harm lower-income households inside the United States. History offers a warning: Washington has repeatedly used Section 301 to unilaterally sanction trading partners — and the painful memory of the U.S.–Japan trade friction of the 1980s and 1990s is being reawakened.

Third, the diplomatic level. Japan is still working to explore a path of mutual benefit with the United States, including the $550 billion investment pledge to the U.S. made last year. Although Washington included a capping mechanism in the new tariffs targeting Japan, the editorial argued that the approach "damages the spirit of the Japan–U.S. consensus." It further warned that the U.S. government is pressing ahead with additional Section 301 investigations into 16 economies — Japan included — on grounds of "overcapacity."

This is the first systematic critique from a top-tier media outlet inside the U.S. tariff alliance. Its significance lies not in the criticism itself — allied discontent is hardly news — but in the way it chose to go public. As one of Japan's most influential conservative newspapers, the Yomiuri Shimbun's editorials typically reflect positions the Japanese government finds inconvenient to state openly. The temperature gap between the editorial's tone and the government's official "regret" is itself the signal.