EU secures compromise on US trade pact ahead of Trump tariff deadline
The European Union has reached a deal to implement its trade pact with the United States, ending months of wrangling as President Donald Trump threatened new tariffs unless the accord was approved by July 4.
EU lawmakers and member states reached a compromise in the early hours of Wednesday to implement the bloc’s trade pact with the United States, ending months of negotiations. The agreement follows President Donald Trump’s ultimatum to approve the deal by 4 July or face new tariffs. The pact, originally struck in July 2025, sets levies on most European goods at 15 percent.
Key concessions included scaling back parliament’s demands on a suspension clause and adjusting sunset provisions. The EU agreed to give the US until the end of the year to drop surtaxes on steel components. The sunset clause was pushed back to the end of 2029, while the sunrise clause was removed.
Cyprus’s energy, commerce and industry minister Michael Damianos announced the deal, stating the EU delivers on its commitments. He emphasised that maintaining a stable, predictable and balanced transatlantic partnership is in the interest of both sides. The agreement puts the bloc on track to meet Trump's deadline for ratification of the deal sealed in Turnberry, Scotland between Trump and EU chief Ursula von der Leyen.
Bernd Lange, head of parliament's trade committee, declared that parliament has prevailed with its demands for a comprehensive safety net. He cited a suspension mechanism if the US does not abide by the deal, a monitoring mechanism for the impact on the economy, and strong involvement of the European Parliament.
The European People's Party (EPP) pushed hard to implement the accord to end damaging uncertainty for EU businesses. The assembly's largest force argued the accord is vital for ending uncertainty, despite previous delays caused by Trump's designs on Greenland and a US Supreme Court ruling striking down many of the president's tariffs.
Short of meeting the deadline, Trump had warned the European Union should expect "much higher" tariffs and had already vowed to raise duties on European cars and trucks from 15 to 25 percent. The tariff blitz unleashed by Trump before the Turnberry accord, including hefty levies on steel, aluminium and car parts, has jolted the bloc into cultivating trade ties around the world.
The EU cannot afford to neglect the 1.6-trillion-euro ($1.9-trillion) relationship with the United States, its largest trade partner. Negotiators from the EU's parliament and capitals wrangled late into the night, finally emerging several hours after midnight with news of a hard-fought compromise.
