Transatlantic Trade: EU Consults to Respond to US Steel and Aluminum Tariffs

Key Points

• The EU confirms decisive retaliation in reaction to the U.S. tariffs on steel and aluminum, in two stages.
• Tariffs will apply on a broad range of products imported from the United States on 1 April 2025. Tariffs on an expanded list of products are expected to apply starting mid-April.
• The Commission is requesting comments on the expanded list of products and on impacts of potential commercial measures with a deadline of March 26 noon CET.

The European Union (EU) had said repeatedly that it will retaliate in case of U.S. tariffs, which the EU sees as unjustified. The EU preferred (and attempted) a negotiated solution but moved swiftly to retaliation once the U.S. enacted steel and aluminum tariffs on March 12. The retaliation comes in two steps, while keeping the door open to further negotiations.

“Immediate” Measure

The first step has been clear for some time as it involves the reimposition of countermeasures adopted by the EU in 2018 (see Regulation 2018/886) and 2020 (see Regulation 2020/502) as a response to the steel and aluminum tariffs imposed by the first Trump administration in June 2018. These countermeasures were suspended in 2022 and again in 2023 until the end of March 2025 as part of an agreement reached with the U.S. The EU will allow the suspension to lapse and the measures will come into effect on 1 April. These measures affect U.S. exports to the tune of 8 billion Euros.

Further Measures

A larger impact, both economic and political, is envisaged to come from the second step. The EU seeks to enact tariffs on U.S. exports worth 18 billion Euros and plans to target products and constituents of current key U.S. decision-makers. The European Commission, the EU’s executive body, has drawn up a list of potential retaliation target products, at the 8-digit Combined Nomenclature (CN) level, across the entire nomenclature. The proposed target products include a mixture of industrial and agricultural products. Industrial products include, e.g., steel and aluminum products, textiles, leather goods, home appliances, house tools, plastics and wood products. Agricultural products include, e.g., poultry, beef, certain seafood, nuts, eggs, dairy, sugar and vegetables.

Following a two-week stakeholder consultation and a joint decision with the EU member states following the comitology process under a qualified majority of 55% of EU countries representing at least 65% of the total EU population, the Commission plans to enact these second step measures in mid-April.

As a legal basis, the EU considers the U.S. measures effectively as safeguards and thus is proceeding under the Enforcement Regulation (Regulation 654/2014) and sees its measures as World Trade Organization (WTO)-compliant under Article 8 of the WTO Agreement on Safeguards.

Apart from the Enforcement Regulation, the EU has various instruments at its disposal. See Akin’s break down of the “trade bazooka”, the Anti-Coercion Instrument (ACI, Regulation 2023/2675), its potential deployment and learn how businesses can navigate and influence this high-stakes process in this video.

Public Consultation

The Commission has now launched public consultations to gather information from “anyone who is affected by the United States’ measures and by the possible EU measures in response.”

Respondents are being asked to provide views and information on the following:

• The effects of the tariffs introduced by the United States against EU exports, applicable as from 12 March 2025, on the EU economic interests (see below).
• The EU economic interests in products imported from the United States that may be affected by possible EU retaliatory measures. The list of products proposed by the Commission is attached (it is the same list circulated earlier).
• The Commission will use the following criteria to determine the final list of products that will be subject to the retaliatory measures:
• Effectiveness in inducing compliance of third countries with international trade rules.
• Potential to provide relief to economic operators within the EU, affected by third country measures.
•  Availability of alternative sources of supply for the goods concerned, in order to avoid or minimize any negative impact on downstream industries, contracting authorities or entities, or final consumers within the EU.
• Avoidance of disproportionate administrative complexity and costs in the application of the measures.
• Any specific criteria that may be established in international trade agreements.

The deadline to submit comments is March 26 noon CET. This is an opportunity for affected businesses to argue for exemptions from the preliminary list or to submit other comments to the Commission.

Akin lawyers and advisors stand ready to respond to questions or assist those interested in preparing comments to be submitted to the Commission.