On 10 November 2020, the European Union (EU) started to impose additional tariffs on a wide range of goods originating in the United States (US). This is in retaliation for illegal subsidies to Boeing.

The new EU restrictive trade policy measures were implemented with the EU Commission Regulation 2020/1646, published in the EU official journal on 9 November 2020. These restrictive measures were approved by the World Trade Organization (WTO) on October 13, allowing the EU to impose tariffs worth USD 4 billion on US-originating products as a retaliation for the illegal US subsidies to the American aircraft manufacturer, Boeing.

The additional tariffs - adding customs duties of 15% and 25% - are hitting different industries and sectors, such us agricultural products, foodstuffs, tobacco, aerospace, automotive,  construction products, spirits, etc. The products affected are, ranging from airplanes and parts, oils, bags and suitcases, chocolate, cheeses, coffee, orange juice, machinery, video game consoles, vehicle and motorcycle parts and accessories, protein substances, sauces, tobacco, tractors to grape wine, rum and vodka. The full list of affected products is included in the annexes of the Regulation. 

These additional duties are being levied immediately after the publication of the regulation, i.e. 10 November 2020. On the contrary, no additional duties are levied on products that:

  • obtained an import license (stating an exemption or reduction of duties) by November 9;
  • were exported from the US prior to 9 November 2020. 

There is no sunset clause on the additional tariffs. However, in a tit-for-tat move, the EU Commission would suspend its application if the US suspends its countermeasures against imports from the EU. Great store is set on negotiations with the newly elected President.

The tariffs could add a hefty price hike to these products in a time when price increases are not called for as the economy is already hamstrung due to COVID 19 hit. We therefore recommend that companies review the full list of products affected (annexes I and II of the Regulation), assessing the impact of these additional duties on their imports of US-originating products into the EU. 

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