UPDATE: This article has been updated on February 3 to reflect the news that the Trump administration has paused the Executive Order tariffs on Mexico and Canada for one month while each of the countries negotiate. Please read below.

On February 1, President Trump signed Executive Orders imposing additional tariffs on imports from Canada, Mexico, and China. Leveraging the International Emergency Economic Powers Act (IEEPA), Trump is imposing additional tariffs in response to the "sustained influx of illicit opioids and other drugs" into the United States.

The tariffs will be effective beginning on February 4, 2025, except they will not apply to products that were loaded onto a vessel or in transit on final mode of transport before February 1 and where the importer files appropriate certifications. All products from Mexico will be subject to 25% tariff. All products from Canada will be subject to 25% tariff, except for energy or energy resources products, which are defined as “crude oil, natural gas, lease condensates, natural gas liquids, refined petroleum products, uranium, coal, biofuels, geothermal heat, hydropower and critical minerals,” which will be subject to 10% tariff. And all products from China will be subject to an additional 10% tariff. These rates are in addition to other tariffs that apply currently to the imported products. 

The Executive Order makes clear that no drawback and no de minimis rules (shipments under $800) will be available for these duties, and no duty inversion benefits may be used when entering products into the U.S. through foreign trade zones. There is currently no mechanism for importers to seek exclusions or exemptions. The president may increase duties or expand the scope of duties if the countries retaliate against the United States. The White House Fact Sheet can be read here.

Canada and Mexico have announced counter tariff measures, and China has also announced intentions to take necessary countermeasures.

If you have legal questions about these breaking developments, how the tariffs impact you, or how you can prepare, please contact our Akerman International Trade team.

*****UPDATE*****

Mexico Executive Order: On February 3, after reaching a deal with Mexican President Claudia Sheinbaum, President Trump announced that he has agreed to pause the Executive Order tariffs on Mexico for one month. On his Truth Social platform, President Trump announced that the tariff delay resulted from a “very friendly” conversation with President Sheinbaum, who has agreed to “immediately supply 10,000 Mexican Soldiers on the Border” specifically tasked to “stop the flow of fentanyl, and illegal migrants.” 

Canada Executive Order: On February 3, Trump agreed to pause the tariffs on Canada for 30 days in exchange for Canadian border security.  Canadian Prime Minister Trudeau is set to implement a border plan to combat “organized crime, fentanyl and money laundering,” Trudeau wrote.