The European Commission has unveiled a proposed response to the US tariffs on cars and automotive parts, as well as the so-called reciprocal tariffs. These countermeasures from the European Union (EU) will be adopted if the ongoing negotiations with the US administration fail. As mentioned in our last blog, the EU decided to pause for 90 days, until 14 July, the implementation of EU countermeasures on a list of US-origin products that could potentially be subject to additional import duties, adopted in response to US tariffs on iron, steel, and aluminium products.
Like other retaliatory measures adopted in the past in response to US tariffs, the proposed EU countermeasures would take the form of rebalancing concessions in accordance to Regulation (EU) No. 654/2014.
A public consultation has been launched today for stakeholders to share their views on two lists of products which could be subject to possible:
- Import duties: the scope of the measures is particularly broad and covers a large list of agricultural and industrial products. Most sectors will be affected as a result.
- Export restrictions: for the first time in its countermeasures against US tariffs, the European Commission is also considering export restrictions (mainly on steel scrap and chemical products).
Stakeholders have until 10 June to express their views on the measures proposed by the European Commission. Once the consultation ends, the examination procedure (or comitology process) will start to collect the opinions of the representatives of the Member States that must approve the proposal by the European Commission. Please refer to our previous blog posts that detail the process for adopting countermeasures in the EU (here and here).
Additionally, the EU has announced that it will formally submit a request for WTO consultation, which may lead to the establishment of a panel if the two-month consultation process with the US administration does not result in a mutually agreed solution.
Unlike between the UK and the US, there is currently no sign that a trade deal will be agreed upon between the EU and the US before July. Therefore, we strongly encourage businesses to participate in the stakeholder consultations and start preparing contingency plans as soon as possible to anticipate additional import tariffs and export restrictions.
