The Agreement

The European Union and the United States have reached an agreement setting tariffs on European imports to the USA at 15%. This represents the highest level in recent decades, but significantly lower than initial proposals ranging from 20% to 50%.

Certain strategic sectors such as aerospace, selected chemicals, semiconductors, agricultural products, and critical minerals remain completely exempt in both directions. U.S. exports to the EU face no tariff increases, while Brussels has withdrawn retaliatory threats.

The new 15% rate applies particularly to automobiles and components, replacing the current 27.5% tariff under the U.S. Section 232 for national security reasons. However, the situation remains paradoxical: under these conditions, European and Japanese manufacturers could find themselves paying lower tariffs than Detroit automakers themselves, who remain subject to higher duties on steel and components.

European steel and aluminum remain outside the new framework, still subject to a 50% rate pending an agreement based on tariff-rate quotas.

Beyond tariffs, the agreement signals Brussels and Washington’s commitment to “collaborate against global overcapacity,” a first step toward forming a trade bloc with low internal tariffs and higher duties toward external competitors. There are no developments regarding European digital regulations and national digital taxes, which remain excluded from the agreement’s scope.

Unresolved Issues

European Commission President Ursula von der Leyen stated that 15% is a “maximum ceiling” and that tariffs will not be cumulative with other rates. However, it remains unclear whether the new tariffs include MFN (most favored nation) tariffs or are added to them, as occurs in other reciprocal agreements signed by the United States.

Furthermore, the term “automotive” itself has not yet been officially defined, leaving room for interpretation regarding which HS codes will be included.

The same applies to pharmaceutical products, both branded and generic: the agreement does not specify applicable rates.

Another unresolved issue is the quota system for steel and aluminum, which has only been announced. Details are also missing on HS codes for sectors declared tariff-free (e.g., semiconductors and aerospace).

Implications

For businesses, the positive news is that the worst-case scenario of a full-scale trade war has been avoided. There will be no 20–50% tariffs, and the threat of European retaliation has been withdrawn. However, the 15% tariffs represent a significantly higher level compared to December 2024 and will have tangible impacts on the margins of European exports to the USA.

This means that companies must:

• • • Review cost structures and pricing strategies: to absorb or transfer the impact of tariffs.

    • Reconsider supply chains: the new tariff could shift competitiveness toward American or non-EU suppliers.

    • Conduct targeted product-level impact analyses: based on the HS codes actually involved.

The deal is complex, many parts are still under negotiation, and the duration of the agreement itself is uncertain. Companies must therefore continuously monitor regulatory developments, lobby policymakers, and build alternative scenarios.

The most structured companies are already creating “tariff command centers,” internal teams dedicated to managing customs compliance, supply chain, pricing, and mitigation policies. For those who have not yet done so, now is the time to prepare: regulatory complexity will be the norm, not the exception.

Even those not directly trading between the EU and USA may experience indirect effects. If European products become less competitive in the American market, other global suppliers could gain market share, altering sectoral dynamics and value chains.

For further insights: U.S. Tariffs: Commercial Strategies 2025