The EU proposed to cancel tariffs on US industrial products, grant partial preferential treatment to Shenzhen Agricultural Power Group and seafood products in exchange for the US lowering car tariffs.

The EU has stated that it has taken action in accordance with the request of US President Trump, drafting a bill aimed at eliminating all tariffs on American industrial products, and providing preferential treatment to some US agricultural and seafood products. According to a statement from the European Commission on Thursday, this will pave the way for the US to reduce tariffs on European cars and parts from 27.5% to 15%. The lower car tariffs will be implemented retroactively from August 1st. A Commission official stated that the relevant regulations still need to be approved by the European Parliament and member states, but the EU expects the US to immediately reduce car tariffs. The European Commission will skip the usual impact assessment process in such cases in order to quickly advance the proposal. Last month, the EU reached a politically charged trade deal with the US, which European Commission President Von der Leyen called "a strong but imperfect agreement." She defended the agreement, stating that it was necessary for businesses and provides stability and certainty. Although the agreement will lower US tariffs on almost all European products to 15%, Trump has stated that the 15% tariff will not apply to cars until legislation is proposed by Europe to eliminate industrial and other tariffs. Cars are reportedly one of the most important categories in EU exports to the US, with Germany alone exporting $34.9 billion worth of new cars and parts to the US in 2024. Additionally, the EU announced on Thursday that it will extend duty-free treatment for US lobsters. Despite this, Trump has threatened to impose tariffs and other penalties on countries that tax online services, but he has not specified which countries or if the EU is included. Trump has long criticized the EU's tech and anti-trust regulations targeting US tech giants such as Alphabet Inc. Class C (GOOGL.US) and Apple Inc. (AAPL.US). An EU official stated that measures against US tech giants are not part of the negotiations. EU industry chief Stephane Sejourne stated on Wednesday that if Trump follows through on the aforementioned threats, the EU may need to reassess the trade agreement. Sejourne stated, "So far, what I hear is intention, not a statement. If intention turns into a statement, then the terms of the agreement will have to be reviewed."