EU-US trade deal approved by European Parliament

The legislation represents a significant step towards restoring greater certainty and stability to the transatlantic trading relationship while helping to reduce the risk of further trade disputes.

The Parliament has approved two regulations that underpin the market access commitments made under the agreement. These provide for:

• The elimination of EU import duties on all US industrial goods.
• Preferential market access for certain US seafood and agricultural products through tariff quotas and reduced duty rates.
• The continuation of duty-free imports for certain processed lobster products.

In return, the United States has committed to capping tariffs at 15% on the majority of EU exports, including products in the automotive, pharmaceutical and semiconductor sectors.

Near “Most Favoured Nation” tariff treatment will continue to apply to a number of strategically important product categories, including:

• Aircraft and aircraft parts
• Selected chemical products
• Generic pharmaceutical products
• Specified natural resources

Safeguards remain in place

While the agreement provides greater market access, the EU has also incorporated a number of safeguard measures designed to protect European businesses should market disruption occur or the United States fail to comply with its commitments.

These include a sunset clause, an enhanced suspension mechanism and additional safeguard provisions that would allow the EU to suspend preferential treatment where necessary.

The legislation will now be considered by the European Council. Subject to its approval, the regulations will enter into force on the day following their publication in the Official Journal of the European Union.

What does this mean for businesses in Ireland?

For businesses operating across the island of Ireland, the agreement provides greater tariff certainty for Irish and EU exporters trading directly with the United States.

However, businesses should also be aware that the United Kingdom has a separate trade arrangement with the United States, which applies to Northern Ireland and contains different tariff provisions.

At the same time, cross-border trade between Northern Ireland and the Republic of Ireland continues to operate under the Windsor Framework. As a result, goods moving across the land border generally continue to benefit from simplified customs arrangements, with no routine customs declarations, tariffs or physical border checks.

Businesses with complex cross-border supply chains should therefore consider both the EU-US and UK-US arrangements when assessing the potential impact on their operations.

If you would like to discuss how these developments could affect your business or supply chain, please contact our team. We would be pleased to help you assess the implications and identify any actions that may be required.