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The European Commission has a solid strategy in place to respond to anticipated US tariffs, according to its president. On Tuesday, Ursula von der Leyen told the European Parliament that the EU is ready to counteract, especially in sectors like services exports, which could impact major US tech firms, if US President Donald Trump goes ahead with “reciprocal tariffs” on imports.
Von der Leyen emphasized that the EU plans to negotiate “from a position of strength.” She pointed out that Europe has significant leverage in areas like trade, technology, and market size. This strong stance is backed by a willingness to implement decisive countermeasures, with all options available on the table.
The EU could potentially target the services export sector, an area where the US maintains a trade surplus. Measures could include suspending certain intellectual property rights and restricting companies from participating in public procurement under the enforcement regulation.
In more severe cases, the EU might resort to using the “anti-coercion” tool for the first time, which would enable even tougher actions on intellectual property and procurement. This could lead to limiting the access of US financial services in the European market.
Implementing such moves would require a consensus among most member states.
Although extra duties on up to €26 billion of American goods have been postponed, following US tariffs on steel and aluminum, due to some countries’ concerns over a potential harsh US counter-response, the EU has yet to react to Trump’s 25% tariffs on cars. Von der Leyen mentioned that the US might next target semiconductors, pharmaceuticals, and timber.
Despite the tensions, von der Leyen expressed a preference for negotiation, noting that tariffs would likely increase inflation, reduce US jobs, and complicate customs procedures.
Officials hope that the US announcement on Wednesday will lead to discussions. However, the US administration is also pushing to address issues beyond tariffs, such as taxation and EU health standards, which they claim restrict American agricultural products.
Washington has raised concerns over the VAT systems in EU countries, claiming they disadvantage American businesses. It also calls for the repeal of digital taxes on tech companies and argues that EU digital regulations unfairly penalize US firms while hindering innovation and free speech.
According to the Financial Times, the European Commission is on the verge of fining Apple and Meta for violations of its Digital Markets Act.
Von der Leyen also suggested collaborating with the US to pressure China towards adjusting its export-driven economic policies without directly naming China. She acknowledged the presence of significant global trade issues, including overcapacity, imbalances, unfair subsidies, restricted market access, and intellectual property theft. “I understand when Americans say some have exploited the rules. I agree. We suffer too. Let’s work together on these challenges,” she stated.
