Supreme Court hands wine trade a small victory, but Trump plots new levies
The highest court in the US has ruled that sweeping import tariffs exceeded presidential authority, offering a brief reprieve for the global wine trade. The relief may be short-lived, however, as Donald Trump moves swiftly to impose fresh levies under a seldom-used 1974 trade law.
The US Supreme Court has struck down tariffs on imported wines in a 6 to 3 decision that curtails the use of emergency powers to impose sweeping trade measures. According to the ruling in Learning Resources, Inc. v. Trump, the court found that the International Emergency Economic Powers Act of 1977 did not authorise broad-based tariffs without clear congressional approval.
The decision brings to an end levies of between 15-25% that have weighed on the international wine trade for several years. Those tariffs formed part of a broader regime introduced last year under the 1977 statute, known as the IEEPA, which the court determined had been used beyond its intended scope.
Trump’s response
Within hours of the judgment, President Donald Trump said he would replace the scrapped measures with a 10% levy on all goods entering the United States. Speaking after the ruling, he said the new tariffs would be imposed under Section 122 of the Trade Act of 1974, a provision that has never previously been used in this way.
On Saturday, he wrote on Truth Social that the rate would be increased to 15 per cent, the maximum permitted under that statute. According to the BBC, Section 122 allows such tariffs to remain in place for around five months before the administration must seek congressional approval.
The original 10% tariffs had been scheduled to take effect on 24 February. It remains unclear whether the revised 15% rate will be implemented from that date.
Relief for wine and spirits trade
For the drinks sector, the court’s decision offers immediate respite from the specific wine-related levies imposed under the emergency statute. The Wine and Spirits Wholesalers of America welcomed the judgment, stating that it restores clarity regarding executive authority.
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In a statement issued on 20 February, the organisation said the ruling “provides important clarity regarding the scope of executive authority and reaffirms Congress’s central role in trade policy”. Francis Creighton, president and chief executive of the association, said: “For wine and spirits wholesalers, and the restaurants, bars, retailers, and consumers we serve, certainty and predictability in trade policy are essential. [Friday’s] decision restores clarity and helps stabilise an industry that depends on open markets and longstanding international partnerships.”
According to the association, the tariffs included a 10% base rate on most imports alongside higher reciprocal rates on certain countries. It said these measures functioned as direct taxes on American businesses and consumers, increasing costs throughout the supply chain and placing additional pressure on hospitality operators. With thousands of products tied to specific geographic origins, the tariffs affected wines and spirits that cannot be replicated domestically.
Investment markets anticipate renewed liquidity
Fine wine investors have also responded swiftly. Alexander Westgarth, founder and chief executive of WineCap, described the ruling as “a landmark victory for the global wine industry”.
“These tariffs were an arbitrary barrier that distorted market values and placed an unnecessary burden on collectors and investors alike,” he said. “At WineCap, we expect to see an immediate uptick in cross-border trade as the friction of these additional costs disappears. This is a win for transparency, a win for the free market, and most importantly, a win for those who view fine wine as a cornerstone of a diversified investment portfolio.”
His comments suggest that secondary market liquidity, dampened by the additional cost of transatlantic movement, may recover swiftly if replacement tariffs are not applied to wine imports.
Canadian ban remains unresolved
The Wine Institute drew attention to the continuing ban on US wines in parts of Canada, introduced on 4 March 2025 in response to tariff disputes. According to the institute, before the ban Canada accounted for 36% of all US wine exports, representing US$459.5 million in shipments.
Steve Gross, interim president and chief executive of the Wine Institute, said: “Today’s Supreme Court ruling marks the importance of durable, predictable trade policy for American small businesses and agricultural exporters. As we approach one year since US wines were removed from store shelves across Canada, Wine Institute remains laser-focused on expanding export opportunities for American wineries, including restoring access to Canada, our most important export market. We hope the administration will take this opportunity to move toward a resolution and bring an end to the unprecedented Canadian ban on our world-class wines.”
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