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The European Union has cleared a key legislative hurdle to implementing provisions of a framework trade agreement it struck with the United States last year.
On Thursday, the European Parliament voted in favor of two proposals from the deal that would eliminate most tariffs on U.S. industrial goods while providing preferential market access to a range of agricultural and seafood products. Under the pact, reached last August, the U.S. agreed to lower tariffs on many EU products to 15%.
The parliament also approved the inclusion of several new safeguard provisions to protect EU interests against shifts in U.S. trade policy. These include a strengthened suspension clause, which would allow the bloc to suspend the agreement if the U.S. imposes tariffs that would exceed the 15% cap set for EU goods.
“The suspension clause could also be activated if the US, for example, undermined the objectives of the deal, discriminated against EU economic operators, threatened member states’ territorial integrity, foreign and defence policies, or engaged in economic coercion,” according to a parliament press release.
The mention of threats to member states’ territorial integrity is particularly relevant given U.S. President Donald Trump previously said he would hike tariffs on eight European countries as part of a campaign to annex Greenland. The EU paused implementation of the framework deal in response but resumed its efforts after Trump walked back the threat.
Beyond the suspension clause, the parliament also approved additional measures to ensure the U.S. holds up its end of the framework agreement. Namely, a sunrise clause that would require the U.S. to follow through on capping tariffs on EU steel and aluminum products at 15% before the bloc puts its own tariff reductions into effect.
Additionally, the parliament set a March 21, 2028, expiration date for the approved regulations, although that could be extended by new legislative proposals. The approved proposal also features a safeguard mechanism that would allow the bloc to suspend its tariff reductions if U.S. import levels threaten to seriously harm EU industry.
The EU’s inclusion of what Bernd Lange, chair of the European Parliament’s International Trade Committee, last week called a “muli-tiered safety net” comes as uncertainty swirls around U.S. trade policy.
Last month, the Supreme Court ruled against a raft of tariffs Trump imposed under the International Emergency Economic Powers Act last year, leading the president to enact a temporary 10% global surcharge using a different statute. Trump and administration officials have hinted at plans to increase the levy to 15%, although that has yet to materialize.