EU Freezes US Trade Deal as Trump Raises Global Tariff to 15%

Khac Phu Nguyen

Tue, February 24, 2026 at 2:53 AM GMT+9 2 min read

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This article first appeared on GuruFocus.

European Union lawmakers have moved to suspend ratification of the bloc’s trade accord with the United States, signaling that clarity from President Donald Trump’s administration could be a prerequisite before the deal advances. The pause follows the US Supreme Court’s decision to strike down Trump’s use of an emergency-powers law to impose so-called reciprocal tariffs, a ruling that appears to have introduced another layer of uncertainty into tariff policy. European equities and the S&P 500 (SPY) each slipped 0.3% as investors assessed the implications, while European Parliament trade committee chair Bernd Lange said lawmakers want assurance that the US is respecting the agreement before proceeding.

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The agreement, reached last summer but never fully implemented, had already faced resistance within the European Parliament. Under its initial terms, the EU agreed to a 15% tariff rate on most exports to the US and pledged to remove tariffs on American industrial goods entering the bloc, while Washington said it would retain a 50% tariff on European steel and aluminum imports. Frictions intensified after the US expanded that 50% metals tariff to hundreds of additional products, drawing criticism from European officials. Lawmakers had previously considered imposing tariffs on 93 billion ($110 billion) of US goods before abandoning that threat when the accord was struck, and later resumed ratification efforts with proposed adjustments, including a sunset clause that would require further negotiations with EU capitals if the deal is ultimately approved. That process is now on hold again.

The renewed delay comes as Trump recalibrates his broader tariff strategy. Within hours of the court ruling, he announced a 10% global tariff and then increased it to 15%, while stating that existing duties under Sections 301 and 232 would remain in place. He also directed the US trade representative to launch new Section 301 investigations on an accelerated timeline, a process that requires country-specific inquiries and findings before tariffs can be imposed and could eventually replace the baseline rate. European Commission spokesperson Olof Gill said full clarity on these developments is the minimum needed for the EU to assess its next steps, underscoring how the trajectory of the US-EU trade relationship could hinge on forthcoming details from Washington.

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