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Brussels’ reaction to the American president’s announcement was immediate Donald Trump for intent to increase the duties to European cars warning that if the US takes measures that are not in line with the trade agreement (on the basis of the EU-US Joint Declaration) they keep all options open to protect European interests.
“The European Union is implementing the commitments of the Joint Declaration in accordance with the usual legislative practice, keeping the American side fully informed throughout the process,” said the responsible representative of the Commission, Olof Gill.
As he said, “we remain in close contact with our counterparts, while also seeking clarity regarding the commitments of the US”, while he warned that “the E.U. remains fully committed to a predictable and mutually beneficial transatlantic relationship. However, if the US takes steps inconsistent with the Joint Declaration, we will keep all options open to protect European interests.”
Earlier today, Trump said he plans to raise tariffs on cars and trucks imported from the European Union to 25 percent. In a social media post, Trump argued that the decision is based on “the European Union not complying with our trade agreement,” adding that no tariffs will be imposed on vehicles manufactured within the United States.
This development marks a substantial reversal of the agreement reached by the two sides last summer. In particular, on July 27, during the meeting in Scotland between Trump and the President of the European Commission, Ursula von der Leyen, the foundations of a new trade approach were laid, which were reflected in the Joint Declaration made public on August 21.
What did the bilateral agreement provide for?
The agreement provided that the United States would reduce tariffs on European cars and parts – in most cases – to 15% from 27.5%, provided that the E.U. would move forward with legislation to eliminate tariffs on all US manufactured goods. At the same time, it included a joint stance against countries that impose restrictions on exports of critical raw materials, such as China, as well as provisions for greater flexibility in the European carbon tax system for American companies.
In terms of commitments, the E.U. had expressed its intention to procure a total of $750 billion worth of US energy products by 2028, including liquefied natural gas, oil and nuclear power products, as well as buy at least $40 billion worth of US artificial intelligence chips. In addition, European companies were expected to invest about $600 billion in the US economy in strategic sectors during the same period.
Recently the European Parliament approving the agreement added “safeguards”, which include terms such as a “sunset clause”, according to which the agreement will expire in March 2028, unless there is a joint decision to extend it. At the same time, the “sunrise clause” was introduced, linking the implementation of preferential tariffs to full US compliance with its Turnberry commitments — effectively making the benefits of the agreement conditional.
MEPs also incorporated “suspension” mechanisms, which allow the EU to “freeze” the agreement in case of unilateral actions by the US, such as the imposition of new tariffs or actions that affect the territorial integrity of member states.
So, one of the measures that the EU could take against Trump’s “threat” would be to consider retaliating through tariffs on American products.
Such measures could target strategic sectors of the US economy, such as agricultural production, industry or even high value-added products.
In addition, the Union’s “arsenal” includes the so-called Anti-Coercion Instrument, which has been adopted in recent years to deal with pressure from third countries. Through this, the E.E. it can limit the access of American companies to the European market, impose restrictions on public contracts or even take measures in the field of investment and services.
Also, Brussels could “freeze” or review individual commitments of the agreement, such as the planned increase in energy or technology imports from the US, as well as the investments of European companies in the American economy.
