EU Approves Trade Legislation with the U.S.

On Thursday, the European Union gave the green light to new legislation that fulfills its trade commitments based on an agreement made with the U.S.

The Council of the European Union announced it has adopted two key regulations that will eliminate customs duties on industrial goods coming from the U.S. Additionally, U.S. seafood and certain agricultural products will now have preferential entry with reduced tariffs and tariff rate quotas. There’s also an extension on the existing pause regarding barriers to lobster imports. This decision is part of the commitments laid out in a joint statement from August 2025, which positioned the agreement as “reciprocal, fair, and balanced trade.” This announcement followed a favorable vote from the European Parliament just a week earlier, as reported by Reuters.

The August statement outlined that the U.S. would cap tariffs on EU products at 15%, while the EU would eliminate tariffs on U.S. goods. The EU also committed to increasing its purchases of U.S. AI technology and defense products, alongside investing hundreds of billions into the U.S. economy. Furthermore, the EU plans to buy oil, natural gas, and nuclear energy from the U.S., with a projected value that could hit $750 billion by 2028.

The Council emphasized that these commitments aim to foster stability and predictability in transatlantic trade, all while ensuring protections for EU businesses and workers.

This agreement marks a follow-up to the framework established 11 months ago, intended to avoid escalating tariffs between these major economies.

Back in May, former President Donald Trump expressed his hopes on Truth Social for the EU to finalize the agreement before July 4. He mentioned that a promise was made to cut EU tariffs to zero, and that there would be consequences otherwise.

The extension of duty-free lobster imports continues an arrangement made during Trump’s first term.

The EU Council stated that the adoption signals its dedication to a stable and mutually beneficial transatlantic trade relationship, wrapping up the legislative process.

The legislation is expected to last until the end of 2029. However, it does include provisions that would allow the EU to suspend or revoke tariff concessions if the U.S. breaches the terms of the agreement.

This step represents a significant move in U.S.-EU trade relations, highlighting how both sides are keen to maintain strong economic connections amidst rising competition globally.

Yet, trade negotiations with Canada seem to be stuck. Tensions have arisen between Trump and Ontario’s Premier Doug Ford, particularly when Ford’s province aired ads criticizing the tariffs, resulting in Trump halting discussions in October 2025. Ford even threatened to cut power supplies to New York, Minnesota, and Michigan in March 2035.