On 8 May 2025, the European Union launched a public consultation on potential countermeasures in response to U.S. automotive tariffs and the potential imposition of a 20% “reciprocal” tariff on EU-origin goods—covering around €379 billion of EU exports to the U.S.  In particular, the EU is considering imposing tariffs on U.S. imports worth approximately €95 billion, covering a wide range of industrial and agricultural products.  The Commission is also evaluating possible restrictions on EU exports to the U.S., principally steel scrap and certain chemical products, valued at €4.4 billion.  If implemented, the export restrictions could take the form of export duties, quantitative restrictions such as quotas or licensing requirements, additional administrative charges, or a combination of these measures.  No specific tariff rates have been proposed at this stage and the consultation is open until 10 June.  Notably, the EU has not thus far targeted U.S. services as part of its retaliatory measures.

These countermeasures could be activated if ongoing EU-U.S. negotiations fail to deliver a mutually acceptable resolution, and the U.S. tariffs remain in place.  While the U.S. currently imposes a 10% global reciprocal tariff on most imports, the negotiations follow a decision by President Trump to pause higher, country-specific tariff rates that were scheduled to come into effect on April 9 and would have increased the reciprocal tariff rate on U.S. imports from the EU to 20%.  Those higher tariffs are paused for 90-days, or until 9 July 2025, absent an extension.  EU exports of autos and auto parts to the U.S. are also subject to 25% tariffs, while the U.S. is also considering imposing additional sector-specific tariffs on—among other sectors—imports of pharmaceuticals and related ingredients; semiconductors and semiconductor manufacturing equipment and their derivative products; critical minerals and their derivative products; as well as commercial aircraft, jet engines, and related parts.  Should it proceed with any of these measures, the EU is likely to increase the scope of its proposed response.

If adopted, the EU countermeasures would supplement the existing EU “Rebalancing Tariffs” previously introduced—and suspended until 14 July—in response to increased U.S. steel and aluminum duties.  Most of the products covered by the Rebalancing Tariffs would be subject to a 25% ad valorem duty, with some facing a reduced rate of 10%.  The Rebalancing Tariffs would apply to U.S. goods exports worth up to €26 billion.

The Enforcement Regulation and the Anti-Coercion Instrument

In preparing for a scenario in which negotiations with the U.S. fail to bring tariff relief, the EU has several legal instruments at its disposal to take responsive countermeasures, most notably the Enforcement Regulation and the Anti-Coercion Instrument (ACI), with some overlapping and some distinguishing features.

A. Intended Use of the Two Instruments

The Enforcement Regulation is a long-standing mechanism designed to enforce the EU’s rights under international trade agreements, including under World Trade Organization (WTO) agreements.  Initially adopted in 2014 and amended in 2021, it empowers the EU to respond to breaches of trade obligations—particularly when a trading partner withdraws concessions granted under WTO agreements or fails to implement a ruling adopted by the WTO Dispute Settlement Body.  Crucially, the amended Regulation now allows the EU to act unilaterally when multilateral adjudication is not possible, including in the absence of a functioning WTO Appellate Body (which has lacked the necessary quorum since late 2019, following a U.S. refusal to appoint additional members to the body).Continue Reading EU Consults on New Tariffs on €95 Billion of U.S. Imports