EU Races to Finalise US Trade Deal as Trump’s July 4 Deadline Looms
By Aboki Forex —
European Union officials are meeting on Tuesday in a last-minute push to finalise legislation for the bloc’s trade agreement with the United States. Failure to reach a deal means the EU could miss President Donald Trump’s July 4 deadline for the accord to be in place.
Trump had threatened to hike tariffs on European auto imports from 15% to 25% because the EU had not moved fast enough to implement the deal, signed nearly a year ago. The disagreement risks pushing transatlantic relations to a new low and could trigger another round of tariff escalation between the allies.
The European Commission, which handles trade matters for the EU, has said it retains options to protect the bloc’s interests if Trump follows through on his threat to raise levies. Trump set the July deadline after speaking with Commission President Ursula von der Leyen.
“I agreed to give her until our Country’s 250th Birthday or, unfortunately, their Tariffs would immediately jump to much higher levels,” the US president posted on social media earlier this month.
The European Parliament has repeatedly blocked ratification of the agreement. This followed the US Supreme Court striking down Trump’s use of an emergency-powers law to impose global tariffs, and after the American president threatened to annex Greenland, a semi-autonomous territory of EU member Denmark.
Under the trade deal signed in July, the EU agreed to erase levies on US industrial goods in exchange for a 15% tariff ceiling on most EU products. EU officials say the US has not complied with all the requirements in the accord. They point to the fact that Washington widened a 50% tariff on European steel and aluminium in August to include hundreds of new products.
The US has implemented some provisions of the deal, capping tariffs on many EU exports at the agreed 15% level. Parliament finally approved the deal but added multiple amendments to the legislation. These include a stipulation that the agreement will not be implemented until the US honours its commitments, and a March 2028 expiration date unless both sides agree to an extension.
A landing zone could be a later date and provisions that would see the EU retaliate if circumstances change. A final version of the bill must be agreed by parliament, the commission, and the European Council, which represents the EU’s 28 member states. Once the three institutions agree on the language, it will need to be voted on.