European Parliament | EU-US Trade: Parliament Gives its Green Light to Tariff Legislation

On Tuesday, MEPs gave their final approval to two pieces of legislation implementing EU tariff commitments under the August 2025 EU-US joint statement.

• Sunset clause: tariff preferences set to expire on 31 December 2029, unless renewed
• Clear conditions set on tariff reductions on steel and aluminium derivatives
• Safeguard mechanism to protect EU industry and agricultural sector

Sunset clause

The main regulation on industrial and agri-food imports will expire on 31 December 2029. By 30 June 2029, the Commission will make a comprehensive assessment of its trade effects on EU industry, agriculture and small and medium-sized enterprises, and of changes in trade patterns with third countries, accompanied by a legislative proposal to prolong the regulation’s duration, if appropriate.

Steel and aluminium derivatives

In August 2025, the US added 407 product categories to the list of derivative steel and aluminium products subject to tariffs. Parliament considered that these new tariffs increased the level of trade instability and pushed for this issue to be addressed in the main regulation. As a consequence of this, the Commission will now be able to suspend tariff preferences if by 31 December 2026 the US continues to apply a tariff rate higher than 15% on EU steel and aluminium derivatives. The Commission will report to the European Parliament and to the Council, by 1 December 2026, on the tariff treatment of steel and aluminium derivatives.

Strengthened suspension clause

The Commission will also be able to suspend tariff preferences if the United States fails to address the EU’s concerns regarding the tariff treatment of Union exports which until 24 February 2026 benefitted from the 15% all-inclusive tariff ceiling.

Safeguard mechanism

Parliament and Council also agreed to establish a safeguard mechanism should tariff preferences granted to the US lead to increases in imports that threaten to cause serious injury to EU industry, including the agricultural sector. The Commission will be able to start an investigation on its own initiative, or on the basis of information provided by one or more member states or by the European Parliament. The Commission will also report to the Parliament and the Council on a quarterly basis on changes in trade volumes and values of US exports of the goods covered by this legislation.

Quote

Bernd Lange (S&D, DE), International Trade Committee Chair and standing rapporteur for the US, said: “Despite the pressure, Parliament stood its ground throughout these negotiations. Our determination has paid off, delivering a stronger agreement for European businesses and citizens and far more robust guardrails than originally envisaged.”

“By translating the EU’s commitments in the joint statement into law, this regulation becomes part of the EU’s defensive toolbox: it not only strengthens and stabilises EU-US trade relations, but it also gives the EU the ability to respond if the United States fails to uphold its side of the bargain. Thanks to Parliament’s firm stance, the final text now contains a far stronger safety net, including a robust suspension clause, a sunset clause, a safeguard clause, enhanced review mechanisms and stronger democratic oversight.”

“Having the right tools are only half of the job. Political will is also needed. We will continue to closely watch the implementation of this agreement. If the US side breaches either the letter or the spirit of the Turnberry agreement, Parliament will insist that the Commission makes full and timely use of every instrument provided by this regulation and the wider EU toolkit. A stable and prosperous transatlantic partnership can only succeed if both sides remain committed to it.”

Next steps

Once approved by the Parliament, it will be the Council’s turn to formally approve the agreed texts. The new legislation will then enter into force on the day after its publication in the EU’s Official Journal.

Background

On 27 July 2025, in Turnberry, Scotland, US President Donald Trump and European Commission President Ursula von der Leyen reached a deal on tariff and trade issues, outlined in a joint statement. On 28 August 2025, the Commission published two legislative proposals aimed at implementing the tariff-related aspects of the statement.

Compliments of the European Parliament