Washington ties tariff cut to EU legislative action
The United States will continue to impose a 27.5% tariff on vehicles from Europe until the European Union puts forward legislation to ease duties on American products, according to details of a new trade framework unveiled Thursday. The deal stipulates that once the EU introduces such laws, the US rate on cars and parts will fall to 15%.
Agreement struck after months of negotiations
The framework was finalized at Donald Trump’s Turnberry golf resort in Scotland on 27 July, following an hour-long discussion with European Commission president Ursula von der Leyen. Both sides pledged broader commitments, including EU plans to scrap tariffs on all US industrial goods and open its markets further to American seafood and farm exports.
Timeline depends on EU legislation
US officials have indicated the tariff cut could take place within weeks, but only once Brussels has formally introduced its legislative proposals. “From the moment the EU tables the legislation, we can move on tariffs,” one senior official said. “Both sides want this resolved quickly.” The joint text states that duties on European autos will be reduced “from the first day of the same month in which the European Union’s legislative proposal is introduced.”
European concerns and mixed reactions
Not all EU leaders are fully supportive. French prime minister François Bayrou criticized the agreement as a concession to Washington, while Spanish prime minister Pedro Sánchez said the deal offered little benefit to Spain’s economy, despite expressing conditional support.
Industry groups divided over outcome
Reactions from industry were similarly split. Spain’s Federation of Food and Beverage Industries called the deal preferable to a trade conflict but objected to restrictions on its exports. In the US, the Distilled Spirits Council condemned the framework, warning that a 15% duty on European spirits could cost over $1bn in sales and about 12,000 jobs. Its president, Chris Swonger, lamented that the deal “fell short of guaranteeing duty-free trade in spirits across the Atlantic.”
