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The EU is delaying ratification of its trade deal with the US after the Supreme Court ruled that the tariffs introduced by the Trump administration were illegal.
The European parliament’s trade committee on Monday paused work on ratifying last year’s agreement struck between Donald Trump and European Commission president Ursula von der Leyen until there was more legal clarity about the tariffs.
Under the “napkin” deal reached in Turnberry last year, a 15 per cent rate applied on most EU exports, while the bloc agreed to slash its own levies on American industrial goods and some agricultural products as low as zero.
But after the Supreme Court last week deemed Trump’s levies illegal he hastily introduced a 15 per cent global tariff using a different law.
Bernd Lange, chair of the EU parliament’s trade committee, said the “tariff chaos” meant there was no other option than to delay ratification. “We want to have clarity from the US that they are respecting the deal. We want to have stability. It is specifically important for investment.”
A majority of parties backed the delay.
“We will not be able to vote on the Turnberry Agreement until we have full clarity on how the Supreme Court’s ruling affects the tariff arrangement,” said Karin Karlsbro of the Liberal Renew group. “The US must get its trade policy in order; this level of chaos is not serious.”
Željana Zovko, lead negotiator for the centre-right European People’s party group, said the delay should be temporary: “Our responsibility now is to uphold our commitments, ensure legal robustness and bring this agreement to a swift and responsible conclusion. Any further delay would undermine our credibility and send the wrong signal to our transatlantic partners.”
When added to pre-existing “most favoured nation” levels, EU exports will be subject to a levy of 15.8 per cent on average, according to analysis by Global Trade Alert, an independent trade monitoring body.
Some industries such as aircraft parts and pharmaceuticals were exempted, but several products that the US agreed to exempt in the Turnberry deal now face tariffs.
“The US needs to tell us precisely what is going on,” said European Commission trade spokesman Olof Gill.
He said that trade commissioner Maroš Šefčovič was set to brief member state ambassadors later on Monday.
“Our intention is to honour and continue implementing the aspects of the agreement we made with the US on our side. And by the same token, we expect them to be able to tell us precisely what is happening in order that they can continue implementing their side of the agreement.”
“We’re now in a mode of waiting for clarity from the US but at the same time consulting with member states and with our MEPs.”
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