Trade tensions between the EU and the United States (hereinafter “the US”) have intensified in recent years, particularly against the backdrop of the Airbus-Boeing dispute and the surtax implemented by the US on steel and aluminum.
Since 2018, the EU has taken a number of restrictive measures against imports of products originating from the US. These measures have been the subject of several Regulations, imposing additional ad valorem duties on a wide range of products (Implementing Regulation 2018/886 of June 20, 2018; Implementing Regulation 2020/502 of April 7, 2020). The measures imposed were severe: additional duties of at least 10% and, for certain products, up to 50% of the value of the product (see the Annexes to the above-mentioned Regulations detailing the relevant Combined Nomenclature tariff headings).
These restrictions were intended to counter the US safeguard measures introduced in 2018 for an unlimited period of time, targeting a number of steel and aluminum products originating in the EU. The US relied on Section 232 of the Trade Expansion Act, a rarely used tool that allows them to impose any measure against imports that would jeopardize the national security of the country concerned.
However, the US and the EU appear to be on the way to finding common ground. On May 17, 2021, through a joint statement, both parties attested to their desire to put an end to the disputes raised before the WTO (DS548: United States – Certain Measures on Steel and Aluminium Products).
Following this declaration, the Commission adopted on May 31, 2021, Implementing Regulation 2021/866, which suspended the application of the additional ad valorem duties listed in Annex II of the above-mentioned Implementing Regulation 2018/886. However, this suspension was limited in time, as it was to end on November 30, 2021. The objective was to see if on US side, easing measures on restricted products originating in the EU would also be adopted.
On October 31, 2021, the US announced important changes to the safeguard measures, which are to take effect on January 1, 2022. As of that date, the existing tariffs of 25% on steel products and 10% on aluminum products from the EU will be replaced by a tariff rate quota. The US has also decided not to apply Section 232 duties on imports from the EU of steel and aluminum products.
Accordingly, the Commission adopted on November 29, 2021, Implementing Regulation 2021/2083, suspending the application of the ad valorem duties imposed by the two above-mentioned Regulations 2018/866 and 2020/502, for a period until December 31, 2023.
The purpose of this suspension is to advance cooperation with the US with final goal to eventually eliminate the additional customs duties that the two parties impose on each other. The Commission specifies, however, that it may modify this Regulation if it deems it necessary, in view of developments likely to deteriorate the situation of EU exports still subject to US safeguard measures.
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