BYD, a leading Chinese electric vehicle (EV) manufacturer, has filed a lawsuit against the US government challenging President Donald Trump’s actions in imposing import tariffs on the company’s products, in addition to demanding a refund of all taxes paid since April.
The lawsuit was filed in the US Court of International Trade on January 26 and is the first case by a Chinese automaker to formally challenge US tariffs in court.
According to BYD, Trump used the International Emergency Economic Powers Act (IEEPA) to impose tariffs, but the law does not provide explicit authority to impose import taxes.
BYD argues that the text of the IEEPA does not mention the word ‘tariff’ or any term with a similar meaning.
The case comes as thousands of global companies operating in the US have also filed legal challenges to Trump’s use of emergency powers to impose border taxes.
Although BYD does not sell passenger cars in the US, the company has large operations involving buses, commercial vehicles, batteries, energy storage systems and solar panels.
Its unit, BYD North America, employs about 750 people at its truck factory in Lancaster, California.
BYD said the lawsuit was filed separately to protect its right to reclaim the tariffs it has paid, should a court rule that the tariffs are invalid.
The issue has also gained national attention as the US Supreme Court is expected to make a landmark ruling on the validity of the tariffs.
US Trade Representative Jamieson Greer said the case has "significant economic implications".
Trump has previously often claimed that Chinese car imports threaten the US auto industry, but in separate statements he has expressed his willingness to accept Chinese manufacturers if they build factories on American soil.
The decision in the case has the potential to be a major benchmark for the US president's power to impose tariffs and could have a broad impact on global trade.
