The US Supreme Court ruled Friday morning that President Donald Trump did not have the legal authority to institute most of the tariffs he levied on international products coming into the country. That includes tariffs on Canadian products that shellshocked many Canadian companies over the past year. While some Canadian businesses are breathing a bit easier, uncertainty is still in the air.
“Should we brace for something similar? Worse? Or is this really good news?”
Jean-Simon Fortin,
Paperplane Therapeutics
The tariff saga began in February 2025, but months of US policy pauses and changes brought continued economic uncertainty. The direct and knock-on effects left Canadian businesses, particularly those with physical goods that cross the border, struggling to strategize and cope with rising costs. Companies like Smart Nora and Ssense said the changes to US import policies were part of the reason they went insolvent.
The Supreme Court appears to have put an end to most of the current tariffs by ruling that Trump exceeded his authority by imposing them with a law that’s supposed to be reserved for a national emergency.
CBS News has pointed out that the Supreme Court’s ruling restricts the president’s ability to use the emergency powers law to set duties, but it doesn’t stop the president from imposing tariffs under different trade authorities.
Not long after the Supreme Court’s ruling, Trump said in a speech that “effective immediately” all tariffs would remain in place and that he planned to sign an executive order applying a global 10-percent tariff. It’s not clear under what legal framework those tariffs would be imposed.
Even before Trump promised his new, 10-percent tariffs, Canadian business leaders told BetaKit that they didn’t believe the saga was over yet. One victim of the tariff carousel was Paperplane Therapeutics, a Montréal-based medtech company whose software is part of devices sold to clients in the US. CEO Jean-Simon Fortin told BetaKit last year that logistical challenges and additional costs from hiring an import-export agency hurt the company’s key metrics.
In a call following the Supreme Court’s ruling on Friday, Fortin said the tariffs had created a complicated supply-chain “nightmare” for his company. While Paperplane wasn’t as affected as those in the aluminum or auto industry (those tariffs remain in place), he added that he’s looking forward to the coming days.
“I do see this as making our business a lot more simple, in terms of just managing the flow of our products across the border,” Fortin said. “Especially if we go back to what it was before, where it was easy for us to ship to US clients without having to worry about tariffs.”
However, Fortin was not convinced that this was the end of the road. He said he foresaw the possibility of the US administration replacing tariff policies with something similar, perhaps under a different law, returning his business to the “nightmare round” of figuring out what has extra taxes and what doesn’t.
“I’m not sure that the administration will just fold and kind of go back to what the weight was; the stakes are too high,” Fortin said. “Should we brace for something similar? Worse? Or is this really good news?”
Dan Kelly, president of the Canadian Federation of Independent Business, also thought there was more to be played out, particularly as Canada and the US negotiate a continuation of the CUSMA free trade agreement.
“While we should not expect the administration to end its efforts to impose tariffs, this decision may help sway other US political leaders against this harmful approach as both countries review the CUSMA agreement,” Kelly said. “While uncertainty continues, this is a good day for Canadian businesses.”
Kevin Bryan, an associate professor at the Rotman School of Management and the chief economist for Creative Destruction Lab Toronto, isn’t so sure.
Bryan told BetaKit over the phone that, for the most part, goods covered under CUSMA were “essentially already unaffected” so would not experience a change in rates under this ruling. Bryan explained that these exemptions granted Canada the lowest tariff rate with the US of any country in the world, so he suspects that if across-the-board tariffs end, it may be a net negative for Canada, as now, countries with much higher tariffs will see an easier path to trade.
The tariffs meant that “the relative price of Canadian goods going into the US compared to goods from other parts of the world got better,” Bryan said. “The tariff war actually wasn’t really affecting Canada very much.”
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Still, Stephanie Lipp, CEO of mushroom-based leather product developer Mycofutures, and Josh Ogden, CEO of drone component manufacturer AVSS, have both previously discussed with BetaKit how tariffs affected their business and planning. Following the ruling, but before Trump’s comments that tariffs may continue, Ogden and Lipp both said they were “cautiously optimistic.”
“The ruling is a relief after a period of serious uncertainty and real consequences for many founders navigating cross-border growth,” Lipp said. “While our strategy at Mycofutures has never been focused or dependent on the US as our first growth market, our recent go-to-market pivot makes the US market inevitable.”
While nearly all the business leaders BetaKit spoke to mentioned the risk of tariffs coming back through other means, Bryan said he actually expects the sense of uncertainty in Canadian business to go down. He said this is because the Supreme Court ruling means economic policy should have to go through conventional processes that would take more time than a presidential declaration.
“There’s probably things [Trump] can do, but even those have a lot more process than the tariff authority that got struck down today,” Bryan said. “So it’s not like the kind of thing where you see it on the news and it’s done, it’s much more certain.”
On the public markets, while prices wobbled, trading volumes quickly rose on the Toronto Stock Exchange following the news. The largest winner appeared to be the IT sector, which rose more than two percent Friday morning, led by gains from Shopify ($SHOP) and Constellation Software ($CSU)—two companies that were largely expected to be insulated from the tariff’s ongoing effects.
Andrew Foran, senior economist with TD Economics, said in a note that while the end to tariffs offers near-term relief, “it would be optimistic to assume it’s permanent,” and that the ongoing focus should be on CUSMA negotiations.
Montréal-based retail payments company Lightspeed Commerce ($LSPD) also saw its stock bounce. The publicly traded company pulled back its revenue outlook for the 2025 fiscal year last March, stating that “several macroeconomic conditions” had “deteriorated” in the month following its Q3 2025 earnings, a decline that lined up with the beginning of the Canada-US trade war.
In an email to BetaKit, Lightspeed founder and CEO Dax Dasilva said that, since the original tariffs were put in place just over a year ago, his company has focused on helping its merchants stay “nimble.”
“It’s still very early with today’s decision to understand how these impacts are going to play out over time,” Dasilva said. “Historically, periods of uncertainty tend to reward businesses that are adaptable and data-driven, and that’s exactly where we see our merchants leaning in.”
Feature image courtesy Unsplash. Image by Fine Photographics.
CORRECTION (20/02/2026): A previous version of this story referred to the Rotman School of Business. It has been corrected to read Rotman School of Management.