On February 20th, shortly after the US Supreme Court handed down their opinion regarding the President’s authority under IEEPA for establishing additional ad valorem duties on items imported to the United States, effectively striking down the use of IEEPA tariffs, President Trump signed an Executive Order invoking his authority under Section 122 of the Trade Act of 1974.

Section 122 gives the Executive emergency authority to prevent “depreciation of the dollar in foreign exchange markets” and to correct “an international balance-of-payments disequilibrium.” It allows up to a15% duty for up to 150 days. Beyond 150 days, Congress must approve to extend or remove the duties.

Effective at 12:01am EST on February 24th, 2026, a 10% ad valorem import duty will apply to articles imported into the United States. However, on a Truth Social post on February 21st, 2026, President Trump announced a planned increase of the 10% tariff to 15% “effective immediately”. FOCUS will monitor updates to the Executive Order for this change.

Items that are not subject to this order include:

• certain critical minerals, metals used in currency and bullion, energy, and energy products;
• natural resources and fertilizers that cannot be grown, mined, or otherwise produced in the United States or grown, mined, or otherwise produced in sufficient quantities to meet domestic demand;
• certain agricultural products, including beef, tomatoes, and oranges;
• pharmaceuticals and pharmaceutical ingredients;
• certain electronics;
• passenger vehicles, certain light trucks, certain medium and heavy-duty vehicles, buses, and certain parts of passenger vehicles, light trucks, heavy-duty vehicles, and buses;
• certain aerospace products; and
• informational materials (e.g., books), donations, and accompanied baggage.

The following goods will not be subject to Section 122 import duty:

• all articles and parts of articles that currently are or later become subject to section 232 actions;
• USMCA compliant goods of Canada and Mexico; and
• textiles and apparel articles that enter duty-free as a good of Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua under the Dominican Republic-Central America Free Trade Agreement.