United States, EU agree to replace and suspend tariffs in steel and aluminum trade disputes

General principles to “guide future cooperation”

General principles to “guide future cooperation”

The Office of the U.S. Trade Representative (USTR) yesterday issued a release following an announcement by the United States and the European Union (EU) regarding the U.S. tariffs and EU counter-tariffs originating from the imposition of additional customs duties by the United States on steel and aluminum imports from Europe.

According to the USTR release (October 31, 2021), the following general principles are to “guide future cooperation”—

  • Replace Section 232 tariffs with a tariff-rate quota (TRQ).  The United States will replace the existing tariffs on EU steel and aluminum products under Section 232 with a TRQ under Section 232.  Under the TRQ arrangement, historically based volumes of EU steel and aluminum products would enter the U.S. market without the application of Section 232 tariffs.
  • Agree to cooperate in trade remedies and customs matters and development of additional actions. Both sides agreed to expand their coordination involving both trade remedies and customs matters, and to meet regularly to consult and develop additional actions to address non-market excess capacity in these sectors.
  • Negotiation of global steel and aluminum arrangements that restore market-oriented conditions and address carbon intensity. The United States and EU resolved to negotiate future arrangements for trade in the steel and aluminum sectors that take account of both global non-market excess capacity as well as the carbon intensity of these industries. They also agreed to form a technical working group to enhance their cooperation and facilitate negotiations on these arrangements, and will invite like-minded economies to participate in the arrangements.
  • Lift the EU’s retaliatory tariffs and suspension of disputes before panels of the World Trade Organization.  The EU will suspend the additional duties imposed on U.S. goods, and the United States and the EU agreed to suspend the disputes they have initiated against each other regarding the U.S. Section 232 measures and the EU’s additional duties in light of the arrangements for moving forward.
  • Other measures relating to market-oriented conditions in the EU market. The EU will provide for market-oriented conditions in its market, including through the application of safeguards and other appropriate measures.

These arrangements build on May 2021 agreements. Read TradeNewsFlash
 

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