Turnberry trade deal frays as US tariff authority expires Friday
One year after the Turnberry agreement, transatlantic trade is booming but facing fresh legal uncertainty as Washington's tariff authority expires this week.
US tariffs imposed under the Turnberry trade deal are set to lapse on July 24, with Congress considered unlikely to extend them ahead of the midterm elections. The White House was forced to adopt this temporary legal basis after the US Supreme Court ruled in February that the original 2025 duties were illegal.
The legal turbulence has done little to dent overall transatlantic commerce. EU-US goods and services trade rose 4.5 percent to €1.8 trillion in 2025 as companies front-loaded shipments to beat tariff deadlines. US importers paid roughly €31 billion in additional duties last year, compared to a €7 billion baseline, though $81 billion has been refunded globally following the court ruling.
European businesses have largely honored the political commitments made by Commission President Ursula von der Leyen. The bloc has pledged €242 billion in US investments across sectors like IT and chemicals. Energy purchases are set to exceed the €700 billion target by 2028, with EU buyers locking in more than $250 billion in US energy deals last year alone amid the phase-out of Russian gas and the Iran war.
Despite this compliance, European officials expect Washington to soon unveil fresh tariffs targeting forced labor and overcapacity under Section 301 of the Trade Act of 1974.
Brussels is prepared to tolerate the new levies provided they do not breach the 15 percent ceiling established at Turnberry.
Sectoral battles loom
Even within that cap, specific industries remain exposed. Brussels has submitted a list to Washington seeking exemptions for around €150 billion in exports, covering goods like wine, olive oil and Roquefort cheese.
Heavy industry faces a steeper challenge. The US still maintains 50 percent global tariffs on steel and aluminum, and the White House shows little willingness to grant concessions as it tries to reshore production and counter Chinese overcapacity.
Pharmaceutical executives are also watching a separate US investigation into German drug pricing. If the US Trade Department determines that Berlin's payments for innovative drugs are unreasonable or discriminatory, it could trigger another wave of punitive tariffs.
