Suspension clause in case of new US tariffs

Sunrise clause: tariff preferences only effective when the US respects commitments

Stronger protection regarding steel imports

The International Trade committee adopted its position on Thursday on two proposals implementing certain tariff aspects of the EU-US Turnberry trade deal.

The International Trade committee adopted its position on Thursday on two proposals implementing certain tariff aspects of the EU-US Turnberry trade deal.

MEPs in the International Trade Committee adopted their position on two legislative proposals that eliminate most tariffs on industrial and agricultural goods from the US, by 29 votes in favour, 9 against and 1 abstention.
Parliament’s rapporteur for the file Bernd Lange (S&D, DE), said: “Today we have reached a broad majority behind a strong text that aims to provide a dose of stability, fairness and firmness in our trade relationship with the United States. Our message is clear: we will not be taking any final decision without clarity. Parliament intends to remain in the driving seat and have the last word on the application of the deal.
“With this in mind, we have agreed to a clear, multi-tiered safety net addressing key shortcomings of the Commission proposal.
Suspension and sunrise clauses
“First, we have made clear that any tariff imposed on the EU or one of its member states because of their foreign policy decisions is unacceptable. In that regard we updated and strengthened the suspension clause. If tariffs were to materialise, we would immediately suspend the legislative work implementing tariff preferences on US products. Tariff threats against one of us are a threat against all of us.
“Secondly, we have agreed to a sunrise clause, meaning that whilst we would be able to adopt legislation implementing the deal, the tariff preferences for US products would only become effective when the commitments agreed at Turnberry are effectively respected by the US side”.
Conditions on EU products containing steel
“Another criteria that will need to be fulfilled before the regulation takes effect is the lowering of tariffs on EU products that contain less than 50% steel or aluminium, from 50% to 15%,” Lange said.
“This new set of conditions complement the text already negotiated and agreed by Parliament’s negotiators, covering the so-called five “S’s”: a dedicate solution for steel and aluminium, a sunset clause, a standstill provision, a safeguard mechanism and a strengthened suspension article.
“It is also clear that should the US decide to increase the current Section 122 tariffs from 10% to 15% across the board, most EU products would be subject to an effective tariff higher than the 15% ceiling due to the addition of the Most Favoured Nation tariff. This would also be unacceptable and would lead to the suspension of our work on the files.
“We were ready to vote in January, but the US threats against Greenland and the uncertainty caused by the US administration’s response to the ruling by the US supreme court have twice forced us to postpone our vote.
“I do hope that with this vote we are launching a positive dynamic of trade cooperation where mutual interests converge, where tariff threats disappear, and where business and consumer can plan ahead to increase our shared prosperity and affordability”.
Next steps
The two legislative proposals will now be voted by the whole Parliament at the next plenary session, on 26 March, before negotiations with EU governments can start on the final shape of the legislation.
Background
In July 2025, the EU and the US reached a political agreement on tariff and trade issues (Turnberry Deal). These were outlined in detail in an August 2025 joint statement announcing an EU-US Framework Agreement. The Commission then published two legislative proposals aimed at implementing certain tariff aspects of the EU-US Framework Agreement.
The International Trade Committee is responsible for steering the legislation through Parliament and for leading negotiations with EU governments on the final shape of the customs duties on goods imports from the US.

 
 
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The U.S. Department of Commerce today announced further implementation of the American AI Exports Program with a Call for Proposals from U.S. industry-led consortia to export full-stack AI technology packages. Under President Donald J. Trump’s AI Action Plan and export directives, the Department of Commerce is implementing a full-stack AI export package promotion program to advance America’s AI leadership globally.
“America’s continued global leadership in AI depends on our ability to export our AI to allies around the world,” said Under Secretary of Commerce for International Trade William Kimmitt. “We will continue to focus our resources to most effectively implement the President’s export directives and position America’s AI innovators and workers to win globally.”
Beginning April 1, 2026 and for 90 days, industry-led consortia may submit proposals for full-stack AI export packages, including AI optimized computer hardware, data center storage, models, cybersecurity measures, and applications for various sectors.
The call for proposals includes two types of industry-led consortia: pre-set consortium and on-demand consortium. Pre-set consortia demonstrate capability across all layers of the AI technology stack and maintain global offerings ready for deployment on an ongoing basis. These will become the U.S. Government’s offerings to allies and partners around the world. On-demand consortia are formed by industry in response to a specific opportunity identified by the Program and need only cover the stack layers required for the specific deal. These on-demand consortia are formed as “custom-made” options for specific opportunities.
Both pre-set and on-demand consortia are designated through a single selection process: the Secretary of Commerce, in consultation with the Secretary of State, the Secretary of War, the Secretary of Energy, and the Director of the Office of Science and Technology Policy, selects proposals for inclusion in the Program. Once approved, full-stack AI technology can be available to trusted foreign buyers of U.S. technology.
Under the Program, approved consortia may also receive support from across the U.S. Government, including priority for export control license reviews, prioritized access to U.S federal credit programs, government-to-government engagement via direct advocacy, and dedicated interagency coordination.
Full program information and proposal processes will be published in a forthcoming Federal Register notice.
For more information, visit AIexports.gov.
 
 
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Why is the Commission proposing EU Inc.?
Today, for too many entrepreneurs and innovative companies, expanding across EU borders means navigating a fragmented corporate legal landscape. European companies looking to grow and scale are faced with navigating 27 national legal systems and over 60 company forms. On top of that, many processes still require manual paperwork, in-person appointments, and unnecessary documentation.
This can delay the setting-up of a company for weeks or even months, slowing growth, raising costs and discouraging scale. During the Commission’s public consultation activities, over 80% of respondents said that different national rules and forms were a significant obstacle to starting, running, or closing a business in the EU.
EU Inc. will provide a single, optional and harmonised set of corporate rules that companies can choose instead of navigating multiple national regimes, with the aim of unlocking the true potential of the Single Market.
What is the difference between the 28th regime and EU Inc.?
As part of the Competitiveness Compass, the European Commission committed to presenting a 28th regime with a single and simple set of EU-wide rules for innovative companies to reap the full benefits of the Single Market. EU Inc. is the cornerstone of the 28th regime. It provides a comprehensive set of corporate rules covering the entire lifecycle of a company. It makes it easier to start and grow a business in Europe, attract investment and reduce the costs of failure.
Entrepreneurs will now have the option of opting into the new EU Inc. Company form, or the 27 national company legal forms which sit alongside the EU Inc. proposal.
The 28th regime represents Europe’s broader offer to its businesses to help them seize the benefits of the Single Market.  It includes EU Inc., but also sets out other measures for innovative companies to get access to funding, and operate seamlessly across borders, in all matters concerning their business. This includes measures on digitalisation, access to finance, measures to attract and retain talent, taxation, and to ensure a clear, predictable and swift legal framework.
Is this proposal ambitious enough?
Yes. The benefits and the ambition are clear. EU Inc. responds to the call of founders and industry to address the fragmentation of national rules with an ambitious, optional, simple and harmonised set of rules. By proposing a Regulation, we ensure that the most appropriate instrument for a harmonised legal framework is used, effectively ending the fragmentation of the Single Market.
EU Inc. will be available to all founders who deem it suitable for their business model. It offers registration in 48 hours, simpler procedures, and lower risk for investors. Registration will be available through a single EU-level register. By providing for simpler and digital company procedures – such as online shareholder and board meetings—and removing in-person formalities, it makes it easier for EU companies to attract investment from within and outside the EU.
Who can use the EU Inc.? Will it be optional or will it replace national company laws?
The EU Inc. will be a new optional corporate legal regime. Anyone who wishes to set up a new company in the EU will have the choice to either use the new EU Inc. company form or an existing national company form, which will not be affected by the proposal. The new EU Inc. form will be the same in all Member States. In addition, EU entrepreneurs will be free to choose the Member State in which they would like to incorporate.
What will be the central EU-level register for EU Inc. companies?
The Commission will set up an EU interface for EU Inc. companies to register their company and submit their information. They will only need to submit their relevant information once. This will allow EU Inc. companies to focus on their innovation and business operations. Upon entry into application of the proposal, companies will immediately be able to register and submit their information via an EU-level interface connecting national business registers. The Commission will then establish a new central EU register for all EU companies to register their company information, no matter where they are established in the EU.
Will there be specialised courts for EU Inc.?
In the Communication, the Commission encourages Member States to designate specialised courts for EU Inc. companies. By centralising expertise, this approach would help improve consistency in rulings, minimise procedural bottlenecks, and deepen judicial understanding of EU Inc.’s unique aspect. This would, in turn, bolster investor confidence and facilitate cross-border trust. The Commission will use a set of tools to support such initiatives, for example in the context of the European Judicial Training Strategy 2025-2030.
How will insolvency procedures be simplified for innovative startups?
The proposal includes targeted changes of insolvency procedures to reduce the complexity, the costs and time involved for such procedures. The Commission proposes a single criterion to launch winding-up proceedings for EU Inc. companies that are innovative startups: the inability to pay debts. In addition, the Commission proposes to simplify the proceedings using a standard form while making the representation by a lawyer optional. The proposal also speeds up the lodging of claims by considering that the list of claims provided by the insolvency practitioner or the debtor is admitted, unless the creditor specifically objects.
How will insolvency procedures be simplified for all companies?
Digital communication will be obligatory for all communications between the competent authority, insolvency practitioner, and the parties to the proceedings. This will enable the competent authority to conclude the proceedings faster and to deliver a decision on the closure of the simplified proceedings six months after the submission of the request for the opening of proceedings. Member States are also required to establish and operate one or more digital auction platforms to convert company assets into liquidity at least for EU Inc. companies that are innovative startups.
How will the rights of employees be protected?
EU Inc. fully maintains workers’ rights. It is a proposal to streamline company law, and it does not affect labour, taxation or other laws. EU Inc. focuses on how companies are set up and managed – from registration to corporate governance, share structures, and digital company procedures.
Rules protecting workers continue to fully apply in the Member State where the work is habitually performed. This includes wages, working time, health and safety, equal opportunities for women and men, protection against discrimination, and dismissal protection.
Businesses have the same obligations towards workers, whether they are incorporated under national company law or under EU Inc.
The proposal clearly specifies that EU Inc. cannot be used to circumvent rights. This includes employees’ rights to participation in company boards (co-determination). In a Member State where these rules exist, they continue to apply to any EU Inc. company registered there.
Does EU Inc. protect businesses from ‘killer acquisitions’?
EU Inc. provides founders with several tools to stay in control of their vision and prevent hostile takeovers. For example, EU Inc. companies will be able to issue shares with multiple voting rights, which allow founders to take new investors on board while staying in charge. EU Inc. companies may also choose to make the transfer of shares subject to conditions, such as the company’s consent.
Why is the Commission adopting a recommendation on definitions of innovative enterprises, innovative startups and innovative scale ups?
Currently there are no single and widely accepted definitions based on objective and user-friendly criteria for innovative enterprises, innovative startups and innovative scale ups. Therefore, individual supporting measures use different definitions on a case-by-case basis. This has led to some fragmentation in innovation support in the EU and to a lack of transparency for enterprises. By establishing ready-to-use definitions based on selected objective criteria the Commission is proposing a new standard for future initiatives. Since the role of start-ups in disruptive innovation is well documented, proper definitions are increasingly needed for effective innovation policy making. Under the EU Inc. proposal, the definition of innovative start-ups set out in the Recommendation is used to identify the companies that are eligible to simplified insolvency procedures.
How are innovative enterprises, innovative startups and innovative scaleups defined?
Under the Recommendation, an innovative enterprise is a company whose research and development costs represented in the last three years at least 10% of its operating costs or at least 5% of its total sales. A company can also be considered an innovative enterprise if it has or will soon develop a major innovation, which holds risks of market or technological failure.
An innovative startup is an innovative enterprise with less than 100 employees and with an annual turnover or balance sheet of less than €10 million. It must have also been operating for less than 10 years.
Innovative scaleups are innovative enterprises with an annual turnover or balance sheet of more than €10 million, and which must have increased the number of its employees or revenues by 20% in the last two years, and either employs fewer than 750 persons or is not publicly listed.
 
 
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Blog | “Forever chemicals” are synthetic substances that have been widely used for decades in industrial and consumer products due to their resistance to heat, oil, and water. Officially called per- and polyfluoroalkyl substances – or PFAS – they are man-made chemicals that do not degrade easily and accumulate in soil, water, air, and ultimately, the food we eat.

Forever chemicals can pose serious environmental and health risks, but they are also fast becoming a challenge in international trade, resulting in import bans and customs delays. Countries risk being excluded from global value chains, unless they can adapt to a growing patchwork of emerging regulations and standards. At the center of this challenge is testing and measurement capacity: PFAS-compliance is only as credible as a country’s ability to detect them.
The impacts for society are potentially wide-ranging, not just for people’s health and well-being, but for the broader economy. Businesses and firms can face challenges expanding, thus hindering job creation and better opportunities for people. Addressing PFAS is complex because they are found in everyday products, from clothing, cookware and cosmetics to cleaning products, electronics and food.
In industries that rely intensively on PFAS, exports also generate a “double pollution” effect: PFAS are embedded in products shipped abroad, while being simultaneously released into domestic soil and water through manufacturing sites or wastewater treatment plants, creating aligned incentives for exporting and importing jurisdictions to act.
The impacts on people’s health can be significant. Long-term exposure to PFAS is linked to hormone disruption, immune-system effects, liver and heart impacts and certain cancers. As such, major economies are rapidly tightening controls around forever chemicals.
Some countries are setting bans on certain products and limiting access to potentially contaminated drinking-water. For example, the European Union (EU) limits PFAS residues in food and food packaging materials, and will soon introduce one of the world’s broadest PFAS bans under its Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) Regulation. Other large economies such as Australia, Brazil, Japan, South Korea, and China are following suit.
A recent EU study found that current levels of pollution due to PFAS could cost the EU approximately EUR 440 billion by 2050. These costs far exceed the value added that is generated by the production and use of PFAS, and are borne domestically. Yet, in many countries, these challenges remain unaddressed, slowing investment in PFAS-free alternatives and testing and enforcement capacity.
For exporters, this rapidly evolving patchwork of different regulations is more than a technicality – they are market access requirements. To remain competitive in international trade, industry sectors in high-income countries are taking action to identify, mitigate and prevent PFAS-related risks in their supply chains.
As consumer awareness grows, products with third-party verified “PFAS-free” labels will gain a competitive advantage in the market, further adding to the complexity. Together, these new standards and regulations are reshaping global supply chains and setting new market access conditions. The 2025 World Development Report on “Standards for Development” argues that, without action, developing countries will be unable to participate and risk losing out on export opportunities.
Countries would benefit from starting to develop their own robust PFAS regulations, using international standards where available and possible to address industrial pollution and protect human health – but also to avoid imports of waste contaminated by PFAS. A major constraint, however, is access to credible testing and verification services to demonstrate compliance with new PFAS standards.
Thousands of PFAS compounds are under scrutiny, and even advanced laboratories can test only a limited subset of them using methods that are still evolving and not fully harmonized across jurisdictions. This challenge is amplified by the extreme sensitivity required for the detection of PFAS. Many regulatory thresholds are set at parts per billion—levels comparable to finding a single drop of water in 20 Olympic-sized swimming pools.
Detecting PFAS requires specialized equipment, skilled technicians, and rigorously accredited laboratories, which remain scarce even in advanced economies and largely absent in most developing ones.
The majority of developing economies with exports high in PFAS have limited capacity to detect them. Export requirements create demand for testing, documentation, and traceability—often drawing on the same laboratories and inspection bodies that support domestic food safety, water quality monitoring, and environmental protection. Overstretching these systems can disrupt both trade and environmental monitoring and public health.

PFAS are used across almost all sectors of the economy—from pharmaceuticals and medical devices to aviation, electronics, and automotive manufacturing. Many countries have a high level of dependence on PFAS-sensitive exports, and these products account for a sizeable share of total exports and GDP. As the chart above illustrates, several economies with high exposure to PFAS-sensitive exports—such as Viet Nam, Malaysia, Taiwan (China), and Thailand—also operate with relatively limited accredited chemical testing capacity, while advanced economies tend to cluster toward higher laboratory availability.
Forever chemicals are frequently present where firms least expect them—embedded in coatings, electronics, or packaging materials rather than final products. Firms would do well to monitor regulatory developments, assess risks related to PFAS across their entire supply chain, and invest in traceability and reporting systems to document compliance.
Trade can act as a “blessing in disguise” in addressing market access and public health concerns around PFAS. Investments in building detection capacity can help preserve market access and bring about public health benefits. However, this cannot be addressed through narrowly targeted, export-specific measures alone – it requires a coherent and strategic whole-of-government approach.
Closer integration of policy approaches across different sectors such as trade, health, the environment, and industrial policy can play a key role in addressing the PFAS challenge, ultimately boosting trade and export opportunities and improving people’s lives.

 
 
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