The U.S. trade court has ruled against President Donald Trump’s 10 per cent global tariff on the ground that the tariff is not justified under a 1970s trade law.

A panel of federal judges of the U.S. Court of International Trade on Thursday ruled against the tariffs, which took effect on February 24, and were challenged by small businesses.

The ruling was 2-1 in favour of small businesses that challenged the tariff in court. However, one of the judges argued it was premature to grant victory to the small business plaintiffs.

Citing a landmark U.S. Supreme Court decision that struck down the Republican president’s 2025 tariffs imposed under the International Emergency Economic Powers Act, the small businesses argued that the tariff violated the Supreme Court decision.

Mr Trump’s administration is expected to appeal the court’s verdict.

In his February order, Mr Trump invoked Section 122 of the Trade Act of 1974 to declare the 10 per cent across-the-board tariffs. However, Thursday’s court verdict now blocks the tariffs, marking a second setback to Mr Trump’s economic policy.