On Tuesday evening in Strasbourg, the European Parliament and representatives of EU member states will convene for what many see as the final opportunity to salvage the EU-US trade deal. With former President Donald Trump threatening to raise tariffs on European goods—including cars—to "much higher levels" by 4 July, the clock is ticking on an agreement that would eliminate European tariffs on US products and cap American duties on European imports at 15%.
The deal, which has been under negotiation for months, reached a provisional stage last week between Parliament and the Council. However, several critical details remain unresolved, and political groups within the Parliament are far from united. The most contentious issue is the so-called "sunrise clause," which determines when the agreement takes effect.
Sunrise Clause Sparks Division
MEPs insist that the deal should only come into force once Washington complies with the 15% tariff cap. This demand stems from a February ruling by the US Supreme Court, which declared the 2025 US tariffs illegal. In response, the Trump administration introduced new duties on European goods that now average above the agreed ceiling—a clear violation of the deal's terms. The European Commission and several member states, however, prefer the agreement to begin immediately, arguing that delays could harm European businesses already facing uncertainty.
Swedish EPP MEP Jörgen Warborn, who is leading the Parliament's negotiating team, emphasised the urgency: "The earlier we can close negotiations, the earlier we give clarity for businesses and indeed more predictability in a turbulent situation." His comments came after a previous attempt to finalise the deal failed two weeks ago.
On the other side, the Socialists and Democrats (S&D) group, led by top negotiator Bernd Lange, has taken a firmer stance. Lange has refused to advance talks without the inclusion of robust safeguard clauses, arguing that European legislation must not be shaped by threatening social media posts from Washington. The S&D also wants the EU to be able to suspend the deal in the event of threats to the bloc's territorial integrity—a provision the Commission opposes.
Fragile Centrist Coalition Under Strain
The negotiations are testing the fragile "centrist majority" that supports European Commission President Ursula von der Leyen. The European People's Party (EPP), S&D, and Renew Europe all agree on the need for the deal, but they diverge on the negotiating line. The EPP is more inclined to compromise to avoid disruptions for European industry, while the S&D insists on stronger protections.
Beyond the sunrise clause, MEPs are also pushing for an expiry date of March 2028 for the agreement, as well as the ability to suspend it if market disruptions arise from a surge in US imports. While a provisional deal has been reached on the suspension mechanism, other details remain to be ironed out.
The stakes are high. If the deal is not finalised before the Parliament's next plenary session in June, it will miss Trump's 4 July deadline, potentially triggering a new wave of tariffs that could hit key European exports. The outcome of Tuesday's talks in Strasbourg will determine whether the EU can present a united front or whether internal divisions will hand Washington the upper hand.
As Europe navigates this high-stakes negotiation, the broader geopolitical context looms large. Recent developments, such as Trump's summit with Xi Jinping in Beijing, have underscored the shifting dynamics of global trade. For Brussels, the challenge is not only to secure a deal with Washington but also to ensure that Europe's interests are protected in an increasingly volatile trade environment.
