U.S./EU Framework Agreement: Key Updates on Reciprocal Tariffs, Autos, and Metals

The United States and the European Union finalized a broad trade agreement in late August, but several important changes have now been published as of September 29, 2025 in CSMS #66336270. These adjustments modify how reciprocal tariffs apply across the board, clarify tariff treatment for automobiles and auto parts, and confirm exemptions for steel, aluminum, and copper. Importers should pay close attention to the updated structure, as it alters how duties are assessed and refunded.

Core Tariff Framework

The original August framework had locked in a 15 percent general tariff on most EU goods, with the EU pledging to remove duties on U.S. industrial products and expand access for American agriculture. The September update does not alter the 15 percent baseline but clarifies the mechanics. Under the reciprocal tariff rules, if an EU product already carries a normal Column 1 duty of 15 percent or more, no additional tariff is imposed. If the duty is below 15 percent, the rate is brought up to a combined 15 percent. This ensures a floor rather than a blanket surcharge.

Automobiles and Auto Parts

The August framework had left the auto sector in limbo, with U.S. duties on EU passenger vehicles stuck at 27.5 percent until Europe acted to cut tariffs on U.S. vehicles. The September 29 guidance resets this approach. Automobiles and auto parts are now directly governed by Section 232 tariff provisions:

• If a vehicle or part already carries a Column 1 duty of 15 percent or more, no additional duty is applied.
• If the duty is less than 15 percent, the combined rate is adjusted upward to 15 percent.

This change applies retroactively to August 1, 2025, meaning importers can seek refunds or corrections on entries made since that date. CBP has specified the new Chapter 99 provisions (9903.94.50 through 9903.94.53) that importers must use when filing or amending entries.

Steel, Aluminum, and Copper

Products of EU members that are within scope of 232 proclamations on steel, aluminum, and copper continue to be exempt from reciprocal tariffs. These commodities remain subject to their own Section 232 duty structures but will not face a second layer of reciprocal tariffs on top. This avoids “stacking” and provides predictability for industries heavily dependent on these metals.

Reciprocal Tariff Exemptions

One of the more significant new elements is the formal exemption of certain products from the reciprocal tariff system. Effective September 1, 2025, these include:

• Unavailable natural resources, such as cork, entered under 9903.02.74.
• Essential oils (non-citrus) when used for religious purposes, under 9903.02.75. Documentation must confirm religious use.
• Non-patented pharmaceuticals and their precursors for pharmaceutical applications, under 9903.02.77. Importers must maintain proof that these products are not covered by U.S. patents.

In addition, civil aircraft and related parts, provided they qualify under the WTO Civil Aircraft Agreement, are no longer subject to additional reciprocal or Section 232 tariffs. These now fall under heading 9903.02.76.

What Importers Need to Know

For importers, the main takeaways are:

• The 15 percent general tariff remains the baseline, but reciprocal tariff rules are now tied directly to Column 1 rates.
• Autos and auto parts are governed by clear Section 232-based formulas, with retroactive relief available back to August 1.
• Steel, aluminum, and copper retain their Section 232 treatment without reciprocal tariff stacking.
• Certain natural resources, pharmaceuticals, and religious-use essential oils are now carved out of the reciprocal tariff system altogether.

The September 29 guidance introduces a more structured and administratively precise tariff regime. Companies trading with the EU should carefully review their classifications, ensure they are filing with the correct Chapter 99 provisions, and explore refund opportunities where applicable.

Contributor: Rebecca Anderson

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