U.S. Agrees to Temporarily Suspend Tariffs on UK and EU Goods in Large Civil Aircraft Dispute
In a joint statement released by the Office of the United States Trade Representative (“USTR”), the U.S. and European Union (“EU”) have agreed to temporarily suspend the additional tariffs from the Large Civil Aircraft Dispute. Goods imported from EU countries, including dairy products and liquors, will temporarily not be subject to the additional 25 percent duties under Section 301. The temporary suspension will initially last four months. USTR has not yet announced a specific date when the suspension on tariffs for EU goods will begin. USTR plans to share that information in a forthcoming Federal Register notice.
Additionally, the USTR announced a similar temporary suspension of tariffs imposed on goods imported from the United Kingdom (“UK”) related to the Large Civil Aircraft Dispute. The temporary suspension began on March 4, 2021 and will remain in effect until at least July 2021.
As previously reported, the initial onslaught of duties occurred in October 2019 when the U.S. imposed duties on new European large civil aircrafts and 25 percent tariffs on agricultural and other products. In retaliation, in November 2020 the EU imposed $4 billion of tariffs on American products. In a statement, EU President von der Leyen sees this as a “fresh start” with the U.S. President von der Leyen also expressed that both countries are “committed to focus on resolving our aircraft disputes, based on the work our respective trade representatives. This is excellent news for businesses and industries on both sides of the Atlantic, and a very positive signal for our economic cooperation in the years to come.”
The UK government had suspended retaliatory tariffs on U.S. goods subject to tariffs on January 1, 2021. Given the current suspension of the tariffs, the UK government and USTR intend to use this time to focus on negotiating a settlement to the dispute and address challenges posed by new entrants to the civil aviation market.
Emily Lyons is an attorney in Husch Blackwell LLP’s Washington, D.C. office.
Turner Kim is an Assistant Trade Analyst in Husch Blackwell LLP’s Washington D.C. office.