A US trade court ruled on Thursday against Donald Trump’s recent 10% global tariffs, determining that the sweeping measures were not warranted under a trade statute from the 1970s.

The US Court of International Trade sided with a group of small businesses that had challenged the tariffs, which came into force on 24 February. The decision was issued in a 2-1 vote, with one judge dissenting on the grounds that it was too early to grant judgment in favor of the plaintiffs.

The small businesses contended that the new tariffs were an effort to bypass a significant US Supreme Court ruling that had invalidated the Republican president’s 2025 tariffs enacted under the International Emergency Economic Powers Act.

In his February directive, Trump relied on section 122 of the Trade Act of 1974, a provision that permits temporary duties of up to 150 days to address serious “balance of payments deficits” or to prevent a looming devaluation of the US dollar.

The court concluded on Thursday that this statute did not properly apply to the type of trade imbalances cited by Trump in his February order.

At the same time, Trump announced on Thursday that he would give the European Union until 4 July to fulfill its trade agreement commitments before increasing tariffs on EU exports, including automobiles, to what he described as “much higher levels.”

In a post on Truth Social, the president said he set the new deadline during what he called a “great call” with European Commission president Ursula von der Leyen. He added that the two leaders also agreed that Iran must never obtain a nuclear weapon.

In an unexpected move last Friday, Trump declared that he would raise tariffs on EU vehicles to 25%, up from the previously agreed 15%, arguing that the EU had failed to honor the terms of a trade deal reached in Scotland last July.

Under that agreement, the EU committed to eliminating tariffs on US industrial goods and to granting duty-free quotas for certain American agricultural and seafood products. However, the required implementing legislation has progressed slowly through the European Parliament.