EU Strikes Deal on US Trade Pact with Safeguards and Sunset

The European Union reached a late-night provisional agreement on Tuesday to implement the controversial EU-US trade deal known as the “Turnberry Agreement,” adding robust safeguard mechanisms and a sunset clause expiring at the end of 2029. The compromise averts President Donald Trump’s threatened 25 percent tariff on European cars, which he had set as a deadline of July 4, 2026 — the 250th anniversary of American independence.

The Turnberry Agreement

The original deal, signed by European Commission President Ursula von der Leyen and US President Donald Trump in July 2025 at Trump’s golf resort in Turnberry, Scotland, committed the EU to scrapping tariffs on US industrial goods and providing improved market access for certain products. In return, Washington pledged to cap general import tariffs on European goods at 15 percent. The EU also pledged €514 billion ($596.3 billion) in investment into the United States through 2028 and committed to purchasing $750 billion worth of US energy, according to Deutsche Welle.

A Fractured Path to Approval

The European Parliament froze the deal in February 2026 after Trump threatened to annex Greenland, a Danish territory, and after the US Supreme Court struck down many of Trump’s earlier global tariffs. Parliament demanded stronger safeguards before it would approve implementation.

Trump then gave the EU until July 4 to approve the deal, threatening to raise tariffs on European cars to 25 percent if the deadline was missed. The pressure mounted as the €1.7 trillion annual transatlantic trade relationship faced potential disruption, compounded by an energy supply shock from the Middle East conflict weighing on European economic growth, as POLITICO Europe reported.

The Compromise

After more than five hours of overnight negotiations in Strasbourg, negotiators from the European Parliament, the Council of the EU, and the European Commission reached a compromise. The final text includes several key safeguards:

Steel and Aluminum Suspension: The Commission can suspend the deal if the US fails to reduce tariffs on European steel and aluminum products — currently as high as 50 percent — to 15 percent by the end of 2026.
Sunset Clause: The agreement expires at the end of 2029, nearly a year after Trump is due to leave the White House.
Import Monitoring: The Commission must investigate if imports from the US threaten serious injury to EU producers, potentially leading to suspension.
Member State Trigger: Three EU countries can jointly request an investigation into whether imports pose a threat.

However, language to void the deal if the US threatens EU territorial sovereignty — demanded after Trump’s Greenland comments — was dropped after EU capitals opposed it, according to Euronews.

Reactions

“I am proud to announce that Europe has avoided a damaging escalation of transatlantic trade tensions and protected European companies, investments and millions of jobs on both sides of the Atlantic,” said Željana Zovko, the lead trade negotiator for the center-right European People’s Party, as reported by VRT NWS.

European Commission President Ursula von der Leyen welcomed the agreement, stating: “Together, we can ensure stable, predictable, balanced, and mutually beneficial transatlantic trade.”

German Chancellor Friedrich Merz said the agreement showed the bloc was “delivering on its commitments” and meant “more security and stability for our businesses.”

EU Trade Commissioner Maroš Šefčovič told reporters: “The EU has demonstrated once again that we are a rather reliable trading partner that honors its commitments.”

Bernd Lange, chair of Parliament’s trade committee and chief negotiator, detailed the safeguards: “There is a suspension mechanism if the US does not abide by the deal, a monitoring mechanism for the impact on our economy, provisions for unjustified tariffs on certain products, an expiry date for the legislation, and strong involvement of the European Parliament.”

What Was Given Up

Despite the safeguards, critics note that Parliament’s original demands were substantially weakened. The “sunrise clause” — which would have made EU tariff cuts conditional on US compliance first — was removed entirely. The sunset clause was pushed back from March 2028 to the end of 2029. The automatic suspension mechanism was replaced with a Commission-led assessment process, and the Greenland sovereignty clause was dropped.

As VRT NWS journalist Rob Heirbaut noted: “I think the Americans will be happy that the conditions are not stricter.”

Next Steps

The text now heads to a final vote in the European Parliament plenary session scheduled for June 15-18, 2026. Approval by EU member state ambassadors is also expected. Sabine Weyand, the outgoing chief of the Commission’s trade department, called the ambassador approval “a walk in the park,” according to Belga News Agency.

However, some liberal and left-wing MEPs remain hostile to the deal, and the final vote is closely watched. Failure to ratify would humiliate chief negotiator Bernd Lange and leave the EU exposed to Trump’s threatened car tariffs.

Broader Implications

The agreement provides temporary stability for the €1.7 trillion transatlantic trade relationship, but significant risks remain. The US has already imposed steel tariffs up to 50 percent despite the Turnberry cap, and there is no guarantee Washington will comply by the end of 2026. Moreover, the deal does not prevent Trump from using tariffs as political leverage on non-trade issues including NATO, Ukraine, and the Middle East.

The sunset clause, timed to expire nearly a year after the next US presidential election, reflects the EU’s cautious approach to a trade relationship that remains deeply vulnerable to the unpredictability of American politics.