The Biden administration’s announcement on September 26, 2025, of sweeping new tariffs on pharmaceuticals, furniture, and heavy trucks has reshaped the landscape for businesses that rely on international trade. For in-house counsel, these policy shifts present an urgent challenge. Beyond immediate financial implications, the new measures carry significant risks of contractual disputes, regulatory scrutiny, and potential litigation. Companies with global supply chains now face the dual task of managing operational disruptions while ensuring legal resilience in the face of growing uncertainty.
One of the most pressing issues is compliance. Every tariff regime hinges on the classification of goods under U.S. customs codes, and errors in classification can have far-reaching consequences. Misclassified imports may result in overpayment of duties, penalties, or missed opportunities to claim exemptions. Legal teams must work closely with customs specialists to reassess import flows, confirm accurate classifications, and determine whether products qualify for exclusions. For companies that source across multiple jurisdictions, this review process is both complex and indispensable, as even small missteps can lead to significant liabilities.
The new tariffs also carry serious contractual implications. Suppliers abroad, suddenly faced with steep duties, may seek to invoke force majeure clauses or renegotiate terms to pass on added costs. Buyers, meanwhile, may argue that existing contracts did not anticipate such dramatic price shifts, leading to disputes over performance obligations. In-house attorneys will need to examine the fine print of contracts to determine how doctrines such as impossibility, commercial impracticability, or frustration of purpose might apply. In industries with narrow profit margins, even small increases in costs could render agreements unsustainable, creating fertile ground for legal conflict.
Litigation risk is another layer of exposure. Downstream customers may pursue claims if higher costs or delayed shipments disrupt supply chains. Shareholders could allege that companies failed to disclose tariff risks adequately, opening the door to securities litigation. In sectors like pharmaceuticals, where pricing and supply chains are closely scrutinized, the reputational and financial stakes are even higher. Legal teams must therefore reassess disclosure practices to ensure that risks tied to tariffs and trade policy shifts are communicated transparently to investors, regulators, and stakeholders.
Forward-looking legal strategies are essential to mitigating these challenges. One critical step is conducting a proactive audit of supply chains, contracts, and import volumes to measure tariff exposure with precision. By quantifying risk, general counsel can better advise executive leadership on whether to seek alternative sourcing arrangements, adjust pricing models, or restructure supplier contracts. The goal is to anticipate disputes before they materialize and build flexibility into business operations.
Future contract drafting will also evolve in response to these developments. Many in-house legal teams are already considering the inclusion of tariff-sharing provisions, adjustment clauses, or termination triggers that explicitly address sudden shifts in trade policy. By clarifying how costs will be allocated in the event of new tariffs, these provisions can help minimize disputes and provide greater certainty for both buyers and sellers.
Customs law offers additional avenues for relief, and legal teams are expected to make greater use of them. Filing protests of tariff classifications, applying for product-specific exclusions, and leveraging duty drawback programs to recover duties on goods that are re-exported are all strategies that can soften the financial blow. To succeed, in-house counsel will need to maintain close collaboration with customs attorneys, trade consultants, and industry associations. Monitoring challenges at the World Trade Organization and potential U.S. trade relief actions will also be vital, as global disputes could alter the policy environment in unpredictable ways.
Ultimately, the new tariff regime underscores a larger shift: trade risk must be integrated into the very fabric of corporate legal and compliance frameworks. No longer peripheral, these risks affect supply chains, contracts, disclosures, and long-term strategy. General counsel who take a proactive and holistic approach—auditing vulnerabilities, embedding resilience into contracts, engaging with regulators, and maintaining transparent communication with stakeholders—will place their companies in a stronger position to withstand sudden shocks.
The September tariff announcement is a reminder that global trade volatility is not merely an economic issue; it is a legal one. For in-house counsel, this evolving environment demands vigilance, foresight, and adaptability. Those who can transform legal risk management into a source of strategic advantage will not only protect their organizations but also help guide them through a turbulent and uncertain chapter in global commerce.
