EU agrees on terms, signs trade deal with the US

The United States and the European Union have finalized the details of a trade agreement, formalizing a truce that almost went sour between the world’s two largest economies. The pact was published in a joint statement on Thursday, and sets out tariff reductions and regulatory commitments from the verbal deal reached in July.

According to the White House briefing, the Framework on an Agreement on Reciprocal, Fair, and Balanced Trade showed that the EU has acknowledged the concerns of the US trade market. 

“The United States and the European Union intend this Framework Agreement to be a first step in a process that can be further expanded over time to cover additional areas and continue to improve market access and increase their trade and investment relationship,” the presser read.

Automobile tariffs will reduce if EU lowers American product barriers

Under the agreement, Washington will keep its tariffs on European automobiles unchanged until the bloc introduces legislation lowering barriers on American industrial and agricultural products. Once the EU acts, the United States will cut tariffs on car imports from 27.5% to 15%.

The discounted auto tariffs will be applied the same month the EU’s legislative proposal is advanced, US officials said. The move could take effect within weeks to relieve European exporters, particularly Germany, which shipped $34.9 billion worth of cars and auto parts to the US in 2024.

The United States pledged to apply the higher of either its Most Favored Nation (MFN) tariff or a combined 15% levy on European goods. From September 1, 2025, only the MFN tariff will apply to certain categories, including cork, aircraft and aircraft parts, generic pharmaceuticals, and chemical precursors.

The agreement further states that for products subject to Section 232 tariffs, including automobiles, semiconductors, pharmaceuticals, and lumber, Washington will cap rates to 15%. Vehicles and auto parts with MFN tariffs of 15% or higher will face no additional Section 232 duties. For goods with lower MFN rates, a combined tariff of 15% will be imposed.

Agricultural and seafood access

Brussels has committed to eliminating tariffs on all US industrial goods and granting preferential access for several agricultural exports. This includes tree nuts, dairy products, pork, bison meat, soybean oil, and both fresh and processed fruits and vegetables.

The EU will extend its expired 2020 tariff agreement on seafood such as US lobster, which lapsed in July 2025, and expand it to include processed lobster. Officials said the changes would push up American seafood producers’ position in European markets.

The deal also addresses digital trade, where disagreements had threatened to prolong negotiations. The EU pledged not to impose network usage fees, a policy US officials had lambasted and considered as a barrier to digital services.

Corporate sustainability commitments

The joint statement also addresses US criticism of European corporate sustainability rules. The EU pledged to prevent its Corporate Sustainability Due Diligence Directive (CSDDD) and Corporate Sustainability Reporting Directive (CSRD) from restricting trade across the Atlantic.

Brussels committed to lowering administrative burdens, mostly for smaller companies, and reconsidering its requirement for a harmonized civil liability regime in cases of due diligence failures. The EU also said it would revisit climate-transition obligations that US officials argued risked penalizing non-EU businesses that already meet high standards.

As reported by Cryptopolitan in June, before the agreement was reached, both sides were bracing for a damaging confrontation. President Donald Trump had threatened tariffs of up to 30% on European goods, while the bloc was preparing retaliatory measures of its own. The White House had warned it would respond aggressively to any counteraction.

If you're reading this, you’re already ahead. Stay there with our newsletter.