Berlin, 03 November 2025 – The international law firm ADVANT Beiten continues to…
On 21 August 2025, the United States and the European Union issued a “Joint Statement on a United States-European Union framework on an agreement on reciprocal, fair and balanced trade” (the “Joint Statement”).
Beyond broader trade issues, the Joint Statement specifically addresses tariffs, in line with a new protectionist US trade policy.
Following months of what the EU expected to be a negotiation on an agreement on customs duties and related issues, the EU and the USA have published the Joint Statement, which is not a legally binding instrument, but a political document outlining the commitments of both parties on the new parameters of their trade relationships.
With specific respect to tariffs, the US will apply to the majority of EU products the higher between:
the current US Most Favoured Nation (MFN) tariff rate; and
a tariff rate of 15%.
This entails that EU products already subject to MFN tariffs equal or higher than 15% will not be subject to the new tariffs announced by the US administration. This a better outcome than what the UK achieved
In addition, as from 1 September 2025, the US commits to apply only the MFN tariff to the following EU products: unavailable natural resources, aircraft and aircraft parts, generic pharmaceuticals and their ingredients and chemical precursors. The parties will consider other sectors and products for inclusion in the list of products for which only the MFN tariffs would apply.
For other products – those subject to US Section 232 of the of the Trade Expansion of 1962 (including cars, pharmaceuticals, semiconductors and lumber) – the total tariffs will be capped at 15% (after the EU eliminates its own tariffs on US industrial goods and provide preferential market access for a wide range of US seafood and agricultural goods); this may result in a reduction, for these products, of the overall tariffs currently in place.
As for steel and aluminium, the framework remains undefined. The parties agreed in principle to cooperate on protective measures against global overcapacity and to develop secure supply chains, possibly through Tariff Rate Quota (TRQ) solutions. However, previous attempts to resolve tariff issues related to aluminium and steel remained futile.
Some of these tariffs may be impacted by the recent decision of the U.S. Court of Appeals for the Federal Circuit; pending appeal to the U.S. Supreme Court, the Appeals Court has left the tariffs in place until October 14. Whether the U.S. Supreme Court sides with the Administration argument, that the imposition of broad tariffs is in keeping with the powers granted through the “International Emergency Economic Powers Act” or goes beyond that authority remains to be seen.
It should also be noted that the de-minimis rule for products sold into the U.S. at up to US$ 800 via parcels has been scrapped. This has led to a halt on shipping such products by the big European logistics companies. The repercussions on Chinese direct sales enterprises, such as Shein and Temu will be considerable and also be felt with European business in the direct sales area. To put the importance of this into context: the US Customs and Border Patrol estimates that in the last fiscal year, 1.36 billion packages were shipped to the U.S.
The Italian Government, while welcoming the Joint Statement, wishes o broaden the preferential treatments to sectors currently excluded, such as food and wine and to reach an agreement on steel and aluminium.
Apart from agriculture and wine, the Italian industry (in particular in the fashion and luxury, as well as the furniture and machinery sector) emphasize that for safeguarding the “Made in Italy” supply chains, broader exemptions or mitigating measures. are necessary.
The German government expressed a cautious but overall positive view, stating that it is a successful effort to avert a damaging trade conflict that would have severely impacted the German export-oriented economy. Needless to say, German industry leaders have warned that even the reduced 15% tariffs on EU exports to the US will have a significant negative impact on Germany's export-driven industries, from automotive to chemical to steel products.
French politicians have roundly criticized the Joint Statement without however convincingly demonstrating that they would have achieved a better result than the EU Commission, supported by the Member States. The French President has called on the EU to mobilize all of its instruments, including anti-coercion, which is a negotiation tool but also provides for severe mechanisms to be used as a retaliatory measure, to reach a satisfactory deal.
French industry representatives have also urged the French Government and the European Commission to secure broader exemptions, namely for the wine and spirits or the luxury sectors, but overall deplore the content of the Joint Statement, which they find too unbalanced. It should however be noted that the EU did not give in on reducing non-tariff barriers. Although the wording of the Joint Statement is very vague and further development should be monitored, the agreement does not seem to provide for any modification of the EU legislative framework.
The Spanish prime minister recently said that he would support the trade agreement, "but I do so without any enthusiasm". The Spanish industries, notable those producing steel, called for clarity on critical details of the Joint Statement, especially concerning the continuing 50% U.S. tariffs on steel and aluminum, pending quota arrangements. They called for temporary aid for sectors most affected, including vehicles and steel
In conclusion, considering the non-binding nature of the Joint Statement and the need for further legal implementation, future developments should be closely monitored. In the meantime, EU companies exporting to the US – particularly French, German and Italian businesses, as three of the largest European exporters to the US – are advised to proactively review their cross-border commercial agreements, paying careful attention to clauses on pricing, allocation of duties, force majeure, hardship, and supply chain resilience, in order to mitigate risks, preserve margins, and prevent disputes. Such clauses could also be reviewed to include in their definition significant changes in international trade law.
Prof. Dr Rainer Bierwagen
Filippo Federici
Simone Gaggero
Morgane Gandaubert
Paolio Gallarati
Marie Hindré
Prof. Dr Hans-Josef Vogel
