The temporary trade truce between the United States and European Union (EU) will continue after the EU issued a press release on December 19, 2023 announcing the customs union would suspend the reimposition of certain retaliatory tariffs on U.S. imports until March 31, 2025. The EU’s retaliatory tariffs, which were scheduled to resume January 1, 2024 in accordance with a deadline set in a 2021 temporary suspension agreement with the Biden administration, were initially levied in response to duties the United States, under the Trump administration, had imposed on steel and aluminum imports in 2018 citing the national security provisions of Section 232 of the Trade Expansion Act of 1962. The EU’s implementing regulation to continue the suspension of these tariffs is available here.

On December 28, 2023, President Joseph Biden, noting “substantial progress” in negotiations, reciprocated by signing two Presidential Proclamations to extend the EU’s access to U.S. tariff rate quotas (TRQs) for steel and aluminum for two additional years. This extension, combined with the EU’s continued suspension on tariffs on U.S. goods, will give both sides additional time to negotiate a global arrangement that addresses carbon intensity and non-market capacity in the steel and aluminum industries. The TRQ extension will take effect on January 1, 2024 and last until December 31, 2025. For background information on the Section 232 tariffs and how they relate to steel and aluminum imports from the EU, see Update of November 1, 2021.

The extension of the trans-Atlantic truce is welcome news to U.S. and EU negotiators who hope to produce a standard-setting agreement known as the Global Arrangement on Steel and Aluminum, but whose negotiations over the past two years have stalled as of late. The joint initiative aims to incentivize environmentally sustainable production of steel and aluminum, while also addressing steel overcapacity globally. According to U.S. Trade Representative Katherine Tai: “Our goal [with the EU] is to forge a forward-looking arrangement that will allow us to join forces economically to incentivize fair and clean production and trade in the steel and aluminum sectors…I am glad the EU has announced that it is taking steps to join us in extending the time for these negotiations and will [do so] by continuing to suspend its tariffs on U.S. products.” When the TRQ extensions were announced, Ambassador Tai further noted that, “[b]y extending the European Union’s steel and aluminum TRQs for an additional two years, we can continue negotiations on a forward-looking, high-standard arrangement, while providing predictability and stability to steel and aluminum workers and their families on both sides of the Atlantic.”