Trade agreement text between EU and US edging towards finalisation, with Washington offering revisions
The US and EU have taken a significant step forward in their trade relations with further technical and political engagement now underway. The recent joint statement, announced on August 21, 2025, has set a 15% tariff ceiling and exempted certain goods from the Most Favored Nation (MFN) tariff.
The current status of the agreement is that it is not yet legally binding, but it provides technical details and includes a list of goods that will be exempt from tariffs. The EU has expressed its firm intention to present the legislative proposal and launch the formal process before the end of August 2025, implying that the detailed final implementing text should be available soon.
The agreement is a first step toward expanded and more balanced trade relations between the two economic powerhouses. Starting September 1, 2025, the US will apply only the MFN tariff to certain EU products, including unavailable natural resources like cork, all aircraft and parts, generic pharmaceuticals and their ingredients, as well as chemical precursors.
However, the automotive industry in Europe is concerned about the delays in the implementation of the EU-US trade deal, as the tariff rate for this sector remains at 27.5%. The EU Commission has received a text from the United States with suggestions for finalizing the document of the tariff exemptions and is optimistic that the text will be finalized soon.
The EU has also committed to purchasing US energy products worth €750 billion and investing €600 billion Stateside before the end of Donald Trump's term. The US president has not yet signed the executive order on car imports, but the EU Commission spokesman is not concerned, as the US has made political commitments to reduce tariffs.
Olof Gill, the spokesperson for the European Commission, has confirmed that they will look at the US text. The EU will make its own suggestions back in the negotiation process. The US and EU reached a political agreement ending their trade dispute more than two weeks ago.
As the final text of the agreement is anticipated, both parties are optimistic about the future of their trade relations and the potential for a more balanced and expansive partnership. The EU remains committed to making its own suggestions in the negotiation process and looks forward to the US commitments being implemented.
The upcoming legislative proposal in the EU marks a critical phase in the policy-and-legislation process, aiming to formalize the recently announced trade agreement between the US and EU. The political engagement surrounding this deal, including the details of tariff exemptions, is set to continue, with both parties expressing optimism about the future of their general-news relations and the prospect of a more balanced and expansive partnership.
