EU–US trade agreement? Hardly: EU drops duties while US plans 15% tariff wall.

Key elements of the provisional EU–US trade agreement

• The EU would eliminate all import duties on US industrial goods (zero-for-zero tariff).
• The United States would impose a flat 15 % import duty on almost all EU goods, including autos and parts, pharmaceuticals and semiconductors.
• Steel, aluminium and copper would remain subject to a 50 % duty until a separate pact on resilient supply chains is reached.
• Strict rules of origin are designed to prevent third countries from benefiting from the lower duties.
• The EU and US pledge deeper cooperation on export controls, investment screening and fraud prevention.

Why European industry is sceptical of the EU–US trade proposal

A flat 15 % US tariff is a structural cost increase for European exporters – especially in autos, pharmaceuticals and semiconductors – while the EU, for its part, removes its remaining duties on US industrial goods. That asymmetry explains why European industry groups fear an erosion of competitiveness.

On 31 July 2025, the White House issued an Executive Order implementing a tariff-ceiling mechanism for EU goods (topping up US MFN rates to 15 % where they’re lower). It took effect seven days later, on 7 August 2025. At the same time, there is still no comprehensive, legally binding agreement text: the European Commission describes the 27 July announcement as a political agreement, not a binding treaty, with further negotiation required. In practice, that means scope, timing and technical parameters (rules of origin, tariff-line coverage and any quotas) can still be adjusted as the legal texts are finalised.

One major open point is metals. The White House fact sheet says steel, aluminium and copper tariffs remain at 50 % pending supply-chain talks, whereas the Commission’s Q&A says the sides will establish tariff-rate quotas at historic levels, cutting the current 50 % rate. This discrepancy underscores that some details are unsettled and will need clarification in the final legal instruments.

What happens next in the EU–US trade negotiations

There are several possible scenarios about what can happen next. Firstly, if the fact-sheet wording is adopted unaltered, the EU’s zero-duty concession would enter into force alongside a 15 % US tariff on most European exports. EU manufacturers would face an immediate cost hike and might start rerouting production via US affiliates to soften the blow.

Alternatively, there could be a negotiated adjustment. During the legislative process the text could still shift. The EU might demand reciprocity or carve-outs for sensitive sectors. That could ease the tariff pressure, but would prolong uncertainty for supply-chain planning.

Finally, there could be an escalation into a tariff war. Should talks collapse, Brussels has already sketched countermeasures worth an estimated €93 billion in US goods. Both sides would then face higher costs, new administrative layers and growing political friction.

Why the EU–US trade agreement is not yet final

In conclusion, this is not a done deal. Too many stakeholders are behaving as if the White House fact sheet were already law. It is not. Between a press release and enforceable obligations lies a formal process on both sides of the Atlantic: drafting, notification, scrutiny and adoption. Until that happens, scope, timing and technical parameters – rules of origin definitions, tariff line coverage, quota volumes and transitional arrangements – remain open to clarification and adjustment. Presenting the outline as settled obscures that legal reality and risks turning a provisional concept into a self-fulfilling narrative.

Substantively, the current outline is not reciprocal: the EU would remove industrial tariffs, while a broad 15 % US tariff would apply to most EU exports, and sensitive metals would remain at 50 %. If enacted unchanged, that asymmetry would embed a structural cost disadvantage for European exporters.

The accurate description at this stage is therefore straightforward: a proposal, not a pact. Stakeholders should communicate accordingly and plan with contingencies. Until reciprocity and enforceability are written into law, calling this a “deal” is premature.