News: U.S. and Taiwan Trade Deal Thrown Into Uncertainty as Supreme Court Strikes Down Tariff Framework — What the Landmark Ruling Means for Chips, Trade, and Beijing
The sweeping trade agreement between the United States and Taiwan — signed just eight days ago to slash tariffs, lock in $250 billion in semiconductor investments, and deepen economic ties across the Pacific — now faces a dramatically altered legal landscape after the Supreme Court struck down the tariff framework that underpinned much of the deal's architecture. On February 20, 2026, the Supreme Court ruled 6-3 in Learning Resources v. Trump that the International Emergency Economic Powers Act (IEEPA) does not authorize the president to impose tariffs, invalidating the broad trade levies that had reshaped global commerce since April 2025. Chief Justice John Roberts, writing for the majority alongside Justices Gorsuch, Barrett, Sotomayor, Kagan, and Jackson, concluded that Trump's use of IEEPA represented a "transformative expansion of the President's authority over tariff policy" that lacked clear congressional authorization. Hours later, President Trump responded by imposing a new 10% global tariff under Section 122 of the Trade Act of 1974 — then raised it to 15% the following day. The implications for the U.S.-Taiwan trade agreement are profound. The original deal, negotiated under the umbrella of Trump's aggressive tariff regime, reduced duties on Taiwanese exports to 15% while securing massive commitments from TSMC and other Taiwanese firms to invest in American chip fabrication. With the legal basis for much of U.S. trade policy now upended, both governments face urgent questions about which provisions survive, how the new tariff structure affects semiconductor investment timelines, and whether Beijing will exploit the confusion.