Under the leadership of President Trump, the US has adopted a new trade policy that may lead to the adoption of trade measures on imports from the EU. Given the importance of the US/EU trade relationship and the EU’s stated commitment to a free trade environment, the EU has said that it will adopt measures in response to such a US policy.
During the election campaign, President Trump spoke of tariffs to re-balance the US economy and replace some tax revenue (i.e. new tariffs as a permanent feature of the trading landscape). So far, the president’s use of tariffs has been more as leverage in negotiations on non-trade issues. The EU’s response may be calibrated according to the purpose of tariffs applied by the US Administration.
First, we offer an overview of the legal basis on which the US government could rely to set trade measures on US trading partners, including the EU. Second, we provide an insight into the functioning of perhaps the most assertive (yet so far unused) trade instrument at the EU’s disposal to retaliate, the EU Anti-Coercion Instrument.
