Now that the 2024 U.S. election is behind us, U.S. companies have a lot of questions about what international trade and trade compliance might look like in 2025 and beyond.
Post-election transitions always bring uncertainty, especially around potential shifts in Washington’s trade policies. And that seems to be even more true this year, with tariffs being a major plank in the winning party’s platform.
In the meantime, there’s daily news about a possible trade action that the new administration will take—or is considering. Keeping up with the latest news and speculation is difficult, but staying compliant in an ever-changing trade environment can be time consuming and costly.
How U.S. importers consider and prepare for international trade in 2025 depends on what actions are taken and how tariffs and other trade restrictions are implemented. Let’s take a few vital areas into closer consideration and explore a few possibilities and how shippers can prepare.
Trade remedy tariffs
Trade framework. Section 301 of the Trade Act of 1974 allows the President to impose tariffs on goods from countries that are violating trade agreements or engaging in unfair trade practices. The process involves a detailed investigation by the Office of the U.S. Trade Representative (USTR) that typically includes public hearings and an open comment period.
Similarly, Section 232 of the Trade Expansion Act of 1962 gives the President the power to regulate the import of goods and materials from other countries if they threaten national security. The President can do this by imposing tariffs or other measures.
Example. Section 301 was used in 2018 to levy tariffs on many goods from China, and most of those tariffs are still in place today. During the first Trump administration, Section 232 tariffs were also levied on certain steel and aluminum products from various countries.
Some countries negotiated tariff rate quotas on these goods, rather than having their exported steel and aluminum be subject to the full rate. This led to an additional compliance complexity of tracking import volume of certain commodities to determine tariff impact.
What’s possible. When President-Elect Trump says he will levy “an additional 10% tariff, above any additional tariffs” on imports from China on Jan 20, 2025, it’s possible that action could be taken using the 2017 petition that found China engaging in forced technology transfer that led to the current Section 301 tariffs on Chinese goods—and could be enacted immediately.
Such an increase would be published by the USTR in the Federal Register with an implementation date of the USTR’s choosing. It’s important to note that exclusions formerly given under past Section 301 tariffs may or may not be considered if additional tariffs are implemented using that or other petition findings.
How to prepare. When the USTR or the Department of Commerce is undertaking a trade remedy investigation, public comment is usually part of the process. U.S. importers can look for announcement of such investigations, and proposed tariffs, in the Federal Register (federalregister.gov) and offer comments regarding the proposed actions and commodities under consideration.
New Section 301 tariffs can be implemented as quickly as 210 days after the petition is filed, initiating the investigation. New Section 232 tariffs can be implemented in under a year from the time the investigation is requested. Once an investigation is initiated, it’s a good idea to identify goods in your supply chain that might be impacted given the scope.
Calculate the impact additional tariffs might have so that comments can be filed and exclusion requests can be prepared in the case that tariffs are levied and exclusions are made available. Updates on status of trade remedy tariffs can be found in the Federal Register.
Be sure to read the details of the proclamations, resulting agency announcements and filing rules published by Customs and Border Protection (CBP) to know what steps need to be taken.
The International Emergency Economic Powers Act (IEEPA)
Trade framework. The International Emergency Economic Powers Act (IEEPA) is a federal law that gives the President of the United States the authority to regulate international commerce in response to a national emergency.
Since its enactment in 1977, beginning with Jimmy Carter in response to the Iran Hostage Crisis, presidents have invoked IEEPA to safeguard U.S. national security interests by freezing assets of belligerent foreign governments or certain foreign nationals abroad or sanctioning the importation of goods from foreign countries. Doing so requires declaring a national emergency, which can then be followed by a trade-impacting action.
Example. On May 30, 2019, the White House announced that then President Trump would use IEEPA powers to introduce tariffs on Mexican exports in response to the national security threat of illegal immigration from Mexico into the United States. There was not, however, a formally declared national emergency, as then President Trump later said Mexico was sufficiently addressing illegal immigration. The announced tariffs on Mexican exports were not implemented.
What’s possible. Many put a high likelihood on IEEPA being used if President-Elect Trump decides to levy “across the board” tariffs. Examples might include the 25% tariffs on all imports from Canada and Mexico that were announced via social media on November 25, 2024.
While Canada and Mexico might request consultations under the Dispute Settlement chapter of the United States-Mexico-Canada Agreement (USMCA), and other legal challenges could be brought against the tariffs by individual companies, it’s unclear if a U.S. court would issue an injunction on the tariffs while such a consultation is being held and challenges
are adjudicated.
How to prepare. Threat of tariffs on exports from Canada and Mexico could be a negotiating tactic and might not last long—or happen at all. Unlike the trade remedy tariffs discussed earlier, tariffs using the IEEPA powers do not require an investigation and could go into effect as soon as the national emergency is declared.
For this reason, having all imported commodities, their country of origin and their classification in a database for easier “what if” calculations will be helpful if such tariffs are declared and impact is urgent. Declarations are announced via Presidential Proclamation, and it’s unclear how the execution of tariffs would be announced, either by filing instructions from CBP or an earlier Federal Register Notice.
U.S.–Mexico–Canada Agreement (USMCA)
Trade framework. The U.S.-Mexico- Canada Agreement (USMCA) requires a “joint review” of the Agreement six years after entry-into-force. This means the first review will be on July 1, 2026, during which the U.S., Mexico, and Canada must confirm, in writing, if each intends to continue the agreement. Any one of the three can choose not to renew or submit terms to be reviewed and negotiated before agreeing to renew.
Example. Because this is the first joint review of USMCA since its enactment, we don’t have any examples of how this process might impact U.S. trade. If one party does not agree, but does not withdraw, the three countries will conduct a review annually until its termination on July 1, 2036. The parties can extend the agreement for an additional 16 years at any time during subsequent annual or six-year joint review periods.
What’s possible. Prior to USMCA, trade agreements provided certainty and stability for supply chains. The required six-year review and sunsetting term was purposefully included in USMCA to guarantee that the trade agreement would be revisited and not remain untouched for long stretches of time.
According to the United States’ USMCA implementing law, USTR is required to initiate public consultations on the review at least 270 days before the review, which would be around October 2025. USTR would publish a Federal Register notice to invite public comments and hold public hearings, providing opportunities for businesses and other stakeholders to make their voices heard.
Subsequently, at least 180 days before the review (in or around January 2026), USTR must report to Congress explaining the actions the Trump administration would recommend for the USMCA and a decision on whether the USTR would confirm at the 2026 review that the United States wishes to extend the USMCA past 2036.
How to prepare. U.S. companies should be aware of provisions in USMCA that take effect in the coming years even if no renegotiation occurs. This includes increases in required North American steel content for passenger vehicles, light trucks, and heavy trucks as well as additional rules of origin requirements that aren’t fully implemented until 2027.
The Office of the USTR has already sought stakeholder input as they prepare for negotiations with Canada and Mexico ahead of and during the six-year review scheduled for July 2026. U.S. manufacturers and distributors should follow these talks closely, look for announcements of public comment, and offer input.
Summary
One thing is certain: U.S. trade in 2025 will be uncertain. U.S. importers need to proactively assess the impact of proposed tariffs on their business in the short and long term.
U.S. exporters must also keep a keen eye on retaliatory tariffs in other countries to assess the impact on their sales. U.S. companies may look to mechanisms, such as utilizing U.S. FTZ, to buffer against surprise costs and fluctuating compliance requirements.
Purchasing, logistics, and trade departments will have a busy year ahead, and should count on doing a lot of cost projections for various tariff scenarios, even though exact calculations can’t be made until official announcements are made with implementation details and deadlines.
