Resolution Criteria

This market resolves YES if a court with appropriate jurisdiction rules that President Trump's "reciprocal tariffs" announced in early April 2025 are unlawful, AND enforcement of these tariffs ceases as a direct result of this ruling. The market resolves NO if no such court ruling occurs, or if a ruling occurs but enforcement of tariffs continues despite the ruling.

See also the same market for EOY 2025: https://manifold.markets/B/trumps-reciprocal-tariffs-found-unl

This contract will resolve positively if and only if April 2025 reciprocal tariffs

(a) on at least 50% of trading partners are found unlawful and reduced or eliminated, OR

(b) on at least 50% of trading partners by import volumes are found unlawful and reduced or eliminated (i.e., weighting in favor of large trading partners)

...by EOY 2026.

If original April 2025 tariffs are reduced, and then the court explicitly rules after the fact those reductions would be required and implicitly or explicitly prohibits restoring them, the market will still resolve YES.

Background

On April 2, 2025, President Trump announced a universal 10% tariff on all imports starting April 5, followed by higher "reciprocal tariffs" on products from various countries beginning April 9. These measures were implemented as part of Trump's strategy to address trade deficits and what he characterized as non-reciprocal trade practices by other countries.

Considerations

Court challenges to presidential tariff actions can take various forms, including challenges based on constitutional authority, compliance with international trade agreements, or adherence to domestic trade laws. The timeline for such legal challenges can vary significantly, potentially extending beyond the term of this prediction market.

@RichardHanania recently detailed one such challenge:

https://x.com/RichardHanania/status/1908858817515045342

I think there's a decent chance courts might save us from Trump's tariffs. The president's power to do what he has done rests on shaky legal grounds. This can be seen in the complaint of a Florida stationary company suing to stop Trump's tariffs with the support of a conservative legal organization.

You might ask what gives the president the power to wreck the global economy on his own? The plaintiffs argue no such power exists:

> President Trump is attempting to bypass these constraints by invoking the [International Emergency Economic Powers Act]. But in the IEEPA’s almost 50-year history, no previous president has used it to impose tariffs. Which is not surprising, since the statute does not even mention tariffs, nor does it say anything else suggesting it authorizes presidents to tax American citizens.

The IEEPA mentions things like embargoes and sanctions, and has been traditionally used against hostile powers like Russia and North Korea.

The complaint goes on:

> Even if the IEEPA did permit tariffs in some cases—which it does not— it still would not permit them here. The IEEPA limits presidents to actions that are “necessary” to address the specific emergency at hand. Here, President Trump declared an emergency relating to China because of illegal opioids entering the United States. But his China Executive Orders show no connection between the opioid problem and the tariff he ordered—much less that the tariff is “necessary” to resolve that problem. The means of an across-the-board tariff does not fit the end of stopping an influx of opioids, and is in no sense “necessary” to that stated purpose.

Obviously, the IEEPA allows certain actions for certain purposes. It doesn't allow the president to just shut off all foreign trade because he thinks trade is bad.

The complaint goes on to argue that even if the IEEPA is to be read in this way, it would violate the non-delegation doctrine of the Constitution. Congress can't simply abdicate its constitutional role in setting tariff policy to the president without placing any limits on his power.

This is what courts exist to do, to stop lawlessness that has the potential to wreck the country. Let’s hope the judicial branch does its job.

• Update 2025-04-09 (PST) (AI summary of creator comment): Update from creator

  • Reduced Tariffs Exception: A ruling may find that the original tariff levels were unlawful even if the tariffs have been reduced (e.g., to 10%) and the reduced rate is not ruled unlawful. In such a case, if the effective reduction meets the criteria, the contract could resolve positively.

  • Country-Specific Rulings:

  • If a court ruling explicitly applies only to tariffs on China and states that other countries are not covered, then even if tariffs on those countries are reduced, the contract does not resolve positively.

  • If a ruling targets China specifically but is silent regarding other countries, the interpretation (using legal commentary) will determine whether the reduction on other countries is sufficient.

  • Effective Ruling Requirement: The court ruling must be effective in either mandating a reduction or validating that a reduction was necessary for at least 50% of trading partners (either by count or by import volume) for a positive resolution.

• Update 2025-04-12 (PST) (AI summary of creator comment): Clarified Outcome for Confirmatory Rulings

  • The market does not count a scenario where a court ruling merely confirms that the original tariff levels were improperly set without mandating a reduction or elimination (i.e. where the ruling only validates the administration’s initial action).

  • Only a ruling that directly mandates a reduction/elimination (or validates that such a reduction was necessary) for tariffs on at least 50% of trading partners (by count or import volume) is sufficient for a positive resolution.

  • This clarification reinforces that a ruling which leaves the reduced tariff rate intact (or simply confirms it was required) does not satisfy the resolution criteria unless enforcement ceases as a direct consequence of the ruling.