All the changes surrounding trade policy and tariffs mean your costs can change by court order. The capital being raised can fund your growth, but only if you account for the fluctuations and restrictions that come with debt or equity. The businesses that will stay ahead are building legal plans for both.
How Tariff Changes Impact Your Business
Appeals courts have been scrutinizing whether emergency powers under the IEEPA include broad tariffs, and different courts have reached different conclusions. It’s not certain when the Supreme Court will take up the issue, but Reuters postulates potentially by mid-2026.
If the tariffs are ruled unlawful, importers could be entitled to large refunds. If not, the president’s unilateral authority on tariffs would redefine trade policies and processes for years to come.
What Tariffs Mean For Business Owners
The tariffs signal the importance for all business owners to assess their business practices, regardless of whether they favor these policies or not. Business owners who want to stay ahead of the legal pitfalls that come with these complicated and continuously changing tariff policies can better prepare by developing a solid legal plan.
Moving Forward In Light Of Tariffs
Right now, almost every business is feeling the impact of tariffs, either directly or indirectly through higher costs. Here’s how you can protect your business:
- Update your product codes and keep detailed records.
- Add tariff adjustment clauses to your contracts with customers and suppliers. This lets you share or adjust for fluctuations and unexpected tariff costs instead of absorbing the entire cost.
- Look into duty drawbacks or if necessary, see if moving production closer to home or changing where your products come from could lower your tariff rates.
Raising Capital While Staying Ahead
Your tariff exposure should influence your capital plan. Review these key considerations:
- Understand that loans can help you move fast, but remain aware of restrictions on assets, acquisitions, or profits.
- Equity can bring in partners who may help protect the business long-term.
- Make sure your term sheets clearly explain the details on who gets paid first, how much control investors have, and what rights they get.
Remember to plan for the best success. Reach out to the Corporate Law Team at Mandelbaum Barrett PC to see how we can help you avoid legal mishaps and structure your business for success.