After last-minute negotiations, representatives of the European Parliament and of the Member States reached, on the night of Tuesday 19 to Wednesday 20 May, a provisional agreement on the trade pact concluded by the European Commission and the United States in July last year. The European Parliament and the EU Council introduced new measures aimed at protecting the European Union from American unpredictability.
“An agreement is an agreement, and the EU honours its commitments”, European Commission President Ursula von der Leyen reiterated, welcoming the adoption of the agreement last night. This one “is fully in line with the joint EU-US statement”, the European Commissioner for Trade, Maroš Šefčovič, said.
The news was also well received by businesses. “This agreement is an important step towards greater predictability and greater stability for businesses active in transatlantic trade”, spiritsEUROPE, which represents European spirits producers, reacted in particular. That assessment was shared by BusinessEurope, the leading European employers’ organisation, which called on X for the agreement to be implemented quickly.
Under the compromise reached in Scotland last summer, the Union had committed to Washington to remove customs duties on most imports from the United States, in exchange for a cap of 15% on the tariffs imposed by Donald Trump.
The European Parliament negotiators were under pressure for several days to conclude the interinstitutional negotiations (trilogue) before the 4 July deadline (see EUROPE 13865/5). The EPP group in the European Parliament was calling for the agreement to be adopted swiftly, even if that meant not changing its initial terms, in order to guarantee greater predictability for businesses on both sides of the Atlantic.
The liberal groups, however, insisted on negotiating a number of safeguards compared with the Commission’s initial proposal, in order to strengthen the text and secure its approval by MEPs. Parliament nevertheless failed to include a ‘sunrise clause’, under which the agreement would enter into force once its conditions had been met on the US side. “We decided to show greater flexibility in order to avoid an automatic escalation [of trade tensions]”, the EPP rapporteur, Željana Zovko (Croatian), explained on Wednesday.
Steel and aluminium derivative products. In the absence of a ‘sunrise clause’, the compromise solution lies in the addition of new conditions for steel and aluminium products. In practical terms, the Union is giving the United States until the end of 2026 to lift the additional customs duties currently imposed on 407 categories of steel and aluminium derivative products.
Suspension clause. Moreover, the Commission may suspend the tariff preferences if the United States does not address the Union’s concerns regarding all of its exports. If Washington does not return to the agreed 15% cap, “we will then have to reflect on the way forward”, said Parliament’s chief negotiator on this file, Bernd Lange (S&D, German), without giving further details on the response envisaged by the EU at this stage.
Sunset clause. The principle of a sunset clause had been validated during the previous trilogue (see EUROPE 13864/8), but the date has been pushed back by several months. Thus, the agreement would not expire at the end of Donald Trump’s term of office, in November 2028, but in March 2029. It will therefore be subject to a review procedure two months after the inauguration of the future US president, and ahead of the next European elections.
Strengthened safeguard mechanism. The text also establishes a safeguard mechanism in the event that an increase in imports from the United States threatens to cause serious harm to industry and agriculture in Europe. This is a ‘strengthened’ mechanism, giving a greater role to the European Parliament. In detail, the institution “will not be able to trigger the safeguard clause itself, but will play a consultative role and act as leverage to activate that clause”, Benoît Cassart (Renew Europe, Belgian) told Agence Europe.
While the conclusion of this agreement is a relief in Brussels, two questions remain unresolved: its formal approval by the European Parliament and Donald Trump’s reaction to the new conditions added to the text.
Reaction across the Atlantic. In a message posted on X, the United States ambassador to the European Union, Andrew Puzder, welcomed the adoption of the agreement “to reduce tariffs on US industrial exports, as agreed by President Trump and President von der Leyen last year at Turnberry”. The US administration will review the details “closely”, he added. At the time of going to press, Donald Trump had not reacted.
Final step. As for the final step of the plenary vote, Bernd Lange said he was “fairly confident” about the adoption of the text by the whole of the hemicycle. The reaction from the centrist group was similar: “This agreement is completely unbalanced”, Benoît Cassart stressed, “but I think the text will nevertheless be approved in plenary, because a number of conditions have been retained”. The EPP group, which is the leading political force in Parliament, is largely in favour. “We are very satisfied with this agreement, which reflects the position we have defended from the outset”, Željana Zovko told Agence Europe.
The text will be examined during an extraordinary meeting of the Committee on International Trade (INTA) on 2 June. The final vote is expected to take place during Parliament’s next plenary session, on 16 or 17 June. (Original version in French by Juliette Verdes)