Changes from report parliamentary committee draft to plenary report

Introduction

This legislative proposal constitutes the main instrument through which the Commission intends to implement the commitments undertaken by President von der Leyen at the meeting with United States President Donald Trump in Turnberry, Scotland, on 27 July 2025, and subsequently formalised through the Joint Statement on a United States–European Union framework for an agreement on reciprocal, fair and balanced trade of 21 August 2025.

Despite its title, the commitments resulting from the Joint Statement do not appear to be reciprocal, fair, or balanced. On the contrary, the Joint Statement consolidates an asymmetry that favours United States producers and merchandise over those of the Union.

The European Parliament was not involved in the deliberations that led to the Turnberry meeting. However, through the ordinary legislative procedure, it is now indirectly called upon to determine whether the benefits of the Joint Statement outweigh its drawbacks.

The Commission strongly defends the agreement, emphasising in particular that the United States has lowered tariffs on cars and car parts following the presentation of the legislative proposal under consideration. It also notes that United States tariffs are now limited to 15 % for goods subject to ongoing Section 232 investigations (pharmaceuticals, timber, semiconductors). Furthermore, from 1 September, the United States applies only MFN tariffs—and not the 15 % duty—to unavailable natural resources (such as cork), to all aircraft and parts, to generic pharmaceuticals and their precursors, and to certain chemicals.

The Commission further maintains that this is the most favourable trade arrangement the United States has extended to any partner, thereby ensuring the continued competitiveness of Union exports to the US market. Nevertheless, its main argument is that the agreement should be assessed on the basis of the stability it provides in comparison with the unquantifiable risks and damages of a potential spiralling trade war in the absence of an accord.

The Rapporteur acknowledges that there is some merit in the Commission’s reasoning. However, any assessment of the agreement should be more nuanced and balanced and, above all, subject to continuous reassessment in light of United States policies and their impact on the Union economy, industry, and consumers. There is a conspicuous absence of any impact assessment and of public or stakeholders' consultation prior to the presentation of the proposal to Parliament. This is clearly not in line with the Interinstitutional Agreement on Better Law-Making which provides that an impact assessment is required for Commission proposals with an economic or social impact.

Before expressing a position on the proposal, the Rapporteur considers it necessary to recall certain contextual elements concerning EU–US trade relations at the beginning of the second Trump administration.

EU–US Trade before Turnberry

The Rapporteur is firmly convinced that the EU–US trade relationship prior to the second Trump administration was a fair and balanced one, evenly distributed between exchanges of goods and services. The Rapporteur rejects the notion that only trade in goods should be considered when assessing the balance of trade. Trade in services and capital flows should be considered as well. Furthermore, prior to the imposition of United States tariffs, the average tariff rate applied by both sides was very low, and United States producers benefited from low entry barriers and high levels of investment protection in the Union.

Despite this balanced situation, President Trump targeted the Union from the outset. The Rapporteur recalls that the initial baseline tariff was set at 20 % for the Union on 2 April, subsequently reduced to 10 % following the announced ‘pause’ on 9 April. President Trump later threatened to raise the baseline tariff to 50 % on 23 May, then set it at 30 % in his letter of 12 July. Before the meeting between President von der Leyen and President Trump, the Union had also been subject to a 25 % tariff of steel and aluminium, which was then doubled to 50 %. Union exporters were also subject to an additional 25 % tariff on cars and car parts. Before Turnberry, President Trump also announced a 50 % tariff on copper imports and implemented it at the beginning of August.

The Rapporteur notes that, while tariffs continued to accumulate on Union exporters, the Commission and the Member States consistently postponed any form of retaliation. The Union did not implement rebalancing measures in response to the United States steel and aluminium tariffs, even after these duties were doubled by the United States on 3 June 2025. Nonetheless, the Rapporteur also recognises the geopolitical circumstances in which the Union operates and acknowledges that no easy alternative was available.

On the Limits of the Joint Statement

President Trump’s subsequent tariff announcements and measures from August 2025 onwards clearly demonstrate the limits of the argument that the Turnberry deal provides stability and legal certainty. In the joint statement there is no "standstill" clause.

Since Turnberry, the United States has continued to announce new Section 232 investigations, including on robotics and industrial machinery, personal protective equipment and medical devices, pharmaceuticals, medium- and heavy-duty trucks, upholstered furniture, kitchen cabinets, bathroom vanities and timber. Italian pasta has also been targeted by an antidumping investigation that may result in additional duties of up to 92 %. The US also implemented US Section 232 tariffs on copper and their derivatives as a result of an investigation that started in February 2025.

Of all these announcements, the most problematic is that of 18 August 2025, when the Department of Commerce added 407 product categories to the list of “derivative” steel and aluminium products covered by Section 232 tariffs. Consequently, the steel and aluminium content of these products is now subject to a 50 % duty. The timing, content, and procedure of this measure raise serious concerns. It was announced after the Turnberry meeting and only days before the publication of the Joint Statement. The measure affects approximately USD 56 billion worth of Union exports, ranging from wind turbines to mobile cranes, bulldozers, furniture, compressors, pumps, agricultural machinery, engines, injection molding machines, motorbikes, and cosmetics. Despite the United States’ criticism of Union regulatory burdens, the administrative burden imposed by this measure on Union exporters is enormous, as calculating the steel and aluminium content of each product is both complex and costly. A wrong declaration of a product could lead to a 200 % tariff. If a clear calculation is not possible, the products are subject to a full 50 % tariff. This means that a lot of European products will de facto be excluded from the US market and puts the viability of many European manufacturers at risk. Moreover, Union exports of these goods pose no conceivable security risk to the United States. Despite the deal, in September 2025 a new public consultation was launched for the potential inclusion of further new products and the list could further be extended every 4 months.

Another major concern relates to the blow dealt to the WTO and the international rules-based system. The most-favoured-nation principle has clearly been disregarded in the Joint Statement. On the Union’s side, it must be made clear that these measures are exceptional and are accepted only because of the United States’ disregard for international norms. It must also be stated unambiguously that the United States’ systematic undermining of the WTO does not constitute global leadership; rather, it further weakens the very system it helped establish. Turnberry did not create a coherent framework but an ad hoc arrangement that should not serve as a model for future trade relations with third countries.

Regulatory autonomy is another area requiring constant vigilance by the European Parliament. President Trump has repeatedly expressed his opposition to Union regulations. The Joint Statement explicitly refers to those that are most problematic for the United States administration: sanitary and phytosanitary standards, the EU Deforestation Regulation, the Carbon Border Adjustment Mechanism, the Corporate Sustainability Due Diligence Directive (CSDDD), and the Corporate Sustainability Reporting Directive (CSRD). Although the Digital Services Act (DSA), the Digital Markets Act (DMA), and the AI Act are not mentioned explicitly, United States opposition to them is equally well documented. In the Joint Statement, the Commission carefully balanced the commitment to cooperation with the preservation of the Union’s regulatory sovereignty. While cooperation is welcome, changes to the Union acquis remain a sovereign prerogative and cannot be subject to negotiation. In a post on Truth Social of 26 August 2025, President Trump made clear that he is willing to impose “substantial additional tariffs” on countries with digital regulations.

To the credit of both sides, the Joint Statement does shield Union exports of semiconductors, timber and pharmaceuticals from the newly announced or future tariffs, and these benefits are tangible. However, the Rapporteur believes that President Trump is unlikely to fully stabilise the use of tariffs against the Union. The United States administration regards tariffs as an exceptional revenue-generating tool. According to the Committee for a Responsible Federal Budget, monthly tariff revenue has more than tripled—from USD 7 billion late last year to approximately USD 25 billion in July—and is projected to rise further. The new tariffs are expected to generate USD 1.3 trillion in net new revenue by the end of President Trump’s term before accounting for economic effects. Another stated objective is to reduce the persistent United States trade deficit in goods. The administration seeks to reduce import demand to address this imbalance. Tariffs have also been used to pursue non-trade objectives, including migration control, counter-narcotics, and support for political allies.

Even if these objectives are at times contradictory, the Joint Statement is unlikely to end their pursuit. It may, however, moderate their most destabilising effects. In other words, the Joint Statement will not ensure stability and security in transatlantic trade but may help limit the worst forms of instability.

Main Elements of the Draft Report

In light of the above, the Rapporteur considers it premature to issue a definitive judgement on the merits of the Joint Statement and therefore does not support granting the Commission a blank cheque, especially in light of its early reluctance to apply any form of rebalancing. At the same time, the Union should honour its commitments under the Joint Statement for as long as the United States does likewise.

Accordingly, the Rapporteur proposes several targeted amendments to the Commission proposal to strengthen parliamentary scrutiny of the implementation of the Joint Statement and to narrow the discretionary powers of the Commission and the Council, while safeguarding the Union’s own commitments. These amendments can be summarised as five “S”: Steel, Sunset Mechanism, Standstill Clause, Safeguard Provision, and a strengthened Suspension provision.

Steel (and Aluminium) – On steel, aluminium, and derivative products, the Union and the United States have expressed their intention to cooperate in addressing global overcapacity while ensuring secure supply chains between them, potentially through tariff-rate quota solutions. However, even after the political agreement on tariffs and trade, the United States’ 19 August 2025 unilateral decision to extend 50 % tariffs to 407 additional categories of derivative steel and aluminium products has increased instability in transatlantic trade, further affecting entire European industrial sectors already severely hit by previous tariffs. The rapporteur is of the opinion that this decision risks hollowing out the value of the Joint Statement and represents a breach of the spirit of the agreement. In this context, the elimination of tariffs on these products by the Union should occur only once sustainable and mutually acceptable arrangements have been reached. The Rapporteur therefore proposes the deletion of the Steel and Aluminium entries from the Annex and is of the opinion that, in the event of a satisfactory solution in this regard, the Commission could consider reintroducing the Steel and Aluminium CN codes in the Annex via a Delegated Act.

Sunset – This Regulation constitutes an urgent response to an exceptional and volatile situation and may have far-reaching consequences. Its application should therefore be limited to 18 months. A first evaluation report on the impact of the regulation on Union industry and seafood and agricultural goods producers as well as consumers should be published after 6 months after its entry in force. After 12 months of its entry into force, the Commission shall, where appropriate, present a legislative proposal, accompanied by a comprehensive impact assessment, to extend the duration of the regulation. The impact assessment should determine, among others, whether the Regulation has created injuries and imbalances in specific sectors including with respect to prices, how EU trade patterns have changed as a consequence of the EU-US trade as well as the impact and forecasts of the deal on the EU and national budgets, given the diminished tariff revenues collected. Such a sunset clause is important also in light of the WTO rules. If there is no further development in the direction of a comprehensive trade agreement, the exception under GATT Article XXIV will no longer be viable.

Safeguard – The Regulation grants the United States broad and exceptional tariff preferences that may lead to an increase in imports of covered goods, with possible adverse effects on Union industry. In the absence of an accompanying impact assessment, the economic implications of these preferences are difficult to evaluate. A safeguard mechanism is therefore necessary to protect Union industry in cases where the tariff preferences result in a surge of imports causing, or threatening to cause, serious injury. An increase in import volumes exceeding 10 % for a given product should be considered evidence of such injury or threat.

Strengthened Suspension – The Commission’s proposal allows for implementing acts suspending the application of Articles 1 or 2 of the Regulation. The Rapporteur considers that the power to suspend tariff preferences or tariff rate quotas, and to amend the Annexes accordingly, should instead be exercised through delegated acts. This would enable the Commission to make more tailored adjustments to the Annexes while retaining the capacity to suspend preferences entirely if necessary. The Rapporteur also strengthens and broadens the suspension Article by empowering the Commission to suspend Article 1 or 2 of the Regulation in the event that the US applies or threatens to apply a coercive measure.

Standstill – The Joint Statement establishes a new framework for EU–US trade relations. The proposed Regulation should therefore include a mechanism enabling the Union to respond to new US tariffs that deviate from the letter or the spirit of the Joint Statement.

The Rapporteur also introduces changes throughout the draft regulation to strengthen the role of the European Parliament by introducing clear reporting requirements for the Commission on the application of the regulation, by allowing the Parliament to submit substantiated information that may lead to the suspension of the Regulation and by introducing delegated acts, instead of implementing acts, with regard to the suspension, the safeguard and the steel provisions.