Tariff and Trade Talks Moving Forward

This Trade Alert offers an overview of significant developments within this ever-changing terrain of tariffs and other trade restrictions. 

US-China Tariff Suspension

On May 12, 2025, the US and China issued a joint statement following several meetings in Geneva. The statement manifests an agreement to mutually reduce the general tariff rate by 115%, from 145% to 30% regarding US tariffs on China and from 125% to 10% regarding Chinese tariffs on the US, for an initial period of 90 days. The parties have also agreed to establish an unspecified "mechanism" to continue discussions about economic and trade relations. While the agreement does not offer a final resolution to the persistent trade tensions between the two countries, it certainly demonstrates the US's willingness to ease trade tensions if deemed to be in their national interest. Further announcements on the US-China trade relationship are to be expected in the upcoming weeks and months.

US-UK Trade Deal

Four days before the announcement of the trade deal between the US and China, the US also unveiled what it describes as a "Historic Trade Deal" between the US and the UK. Although all details are not yet publicly disclosed, some key aspects that have been revealed include:

• Elimination of tariffs on steel and aluminium.
• Reduction of tariffs on automobiles to 10% applicable to up to 100,000 UK cars.
• Continuation of the universal tariff of 10% on most UK goods imported into the US.

It should be noted that the US-UK trade deal requires approval from the US Congress before it can take effect, a process that may take several months. Additionally, further details are expected to be negotiated between the two parties before the deal is finalised and implemented. Nonetheless, the announcement suggests that the deal may be the first comprehensive agreement in a series of trade agreements between the US and its trading partners. As detailed above, a US-China trade agreement may potentially be one of the next in line.

The EU Consults on Possible Countermeasures and Readies WTO Litigation

Besides the US's trade deals with China and the UK, the EU Commission launched a public consultation on May 8, 2025, regarding possible countermeasures in response to US tariffs. Pursuant to Article 5 of Regulation (EU) 654/2014 (The Enforcement Regulation), the EU's contemplated commercial policy measures are categorised into two groups:

• Additional customs duties on a broad array of products of US origin, affecting imports worth EUR 95 billion. The range of products that might face additional customs duties includes, inter alia, automobiles, industrial machinery, IT equipment, food products, medical devices, aircraft and recreational equipment, as set out in the complete list published by the EU.
• Export duties or non-tariff export restrictions on certain products exported from the EU to the US, affecting exports worth EUR 4,4 billion. Products potentially subject to these export duties or restrictions include, in particular, certain chemicals and scrap products, as set out in the complete list published on the EU's website.

Anyone affected by US tariffs or potential EU countermeasures may submit their views though an EU Survey by June 10, 2025. It should also be noted that, despite the public consultation on potential countermeasures, the EU has underscored its commitment of finding a mutually beneficial resolution with the US. The countermeasures introduced by the EU on April 14, 2025, have also been postponed by 90 days to provide additional time and space for EU-US tariff negotiations.

Alongside possible countermeasures, the EUs announcement on May 8, 2025, also included an intention to initiate a WTO dispute against the US concerning its universal reciprocal tariffs and tariffs on automobiles and automobile parts, asserting that these actions "blatantly violate fundamental WTO rules". However, as detailed in our previous Trade Alert, a WTO dispute settlement process is unlikely to offer immediate relief for businesses due to the ongoing US blockage of appointments to the WTO Appellate Body. 

Norwegian Strategy on National Security

From a Norwegian perspective, it is worth to highlight the first ever National Security Strategy (Norwegian), launched by the Prime Minister's Office on May 8, 2025. The strategy underscores the crucial role of international trade and a rule-based trading system, especially for Norway's open and small economy, but also highlights the necessity of prioritising national security despite its possible implications for international trade. Key points identified in the Strategy include:

• A push for more effective export controls to prevent sensitive technology and knowledge from reaching countries with diverging national security interests.
• The need to expand the scope of controls on foreign direct investment (FDI), particularly in critical sectors such as energy, telecoms, the maritime sector, health, finance and defence.
• The need to reduce certain economic interactions and activities with China, despite China being Norway's largest trading partner in Asia. 

The Strategy is part of the broader conversation around balancing international trade with national security, an issue also prevalent in discussions about tariffs and other trade restrictions. Although Norway has already enacted amendments to its National Security Law (Norwegian) in 2023 and 2024 to expand restrictions on FDI and other activities threatening national security, further legislative measures may be anticipated in response to the ever-changing geopolitical landscape, including additional amendments to the Security Act and Norwegian export controls.