On 28 August 2025, the European Commission issued its Proposal for a Regulation of the European Parliament and of the Council on the adjustment of customs duties on the import of certain goods originating in the United States of America and opening of tariff quotas for imports of certain goods originating in the United States of America(COM(2025) 471 final). This regulation implements the EU’s commitments under the EU–US Joint Statement of 21 August 2025, establishing tariff elimination for industrial goods and preferential access for selected agricultural and seafood products. Importantly, Article 5 of the regulation specifies that, until preferential rules of origin are agreed, the general Union Customs Code will apply. This reliance on “wholly obtained” and “substantial transformation” standards offers legal certainty but also makes clear that more tailored provisions will follow.
The choice to begin with existing EU origin rules reflects the urgency of stabilizing transatlantic trade flows while the broader framework of the deal is still under negotiation. By immediately suspending tariffs on all U.S. industrial goods, the regulation ensures continuity for businesses. At the same time, it explicitly acknowledges that this is only a transitional step. Preferential rules of origin, negotiated jointly with the United States, will eventually replace the current baseline and link tariff benefits to stricter industrial criteria.
This staged approach confirms the analysis presented in the earlier “tariff shifts” article (“Joint Statement on U.S.–EU Trade Agreement: Rules of Origin to be ‘Melted and Poured’ into the Framework”). That article highlighted that the Joint Statement envisioned rules of origin not simply as technical customs tools but as industrial policy instruments. The new regulation supplies the legal mechanism for tariff relief, while the Joint Statement establishes the political mandate for stricter rules to reinforce regional supply chains. Together, they demonstrate that rules of origin will be a cornerstone of the evolving trade partnership.
The implications for the steel and automotive sectors are particularly significant. The Joint Statement framework, as discussed in the tariff shifts article, suggested that steel would likely need to meet “melted and poured” requirements similar to those found in the USMCA, which obliges at least 70% of steel and aluminum in vehicles to be regionally sourced. Although the EU regulation does not yet introduce such provisions, by liberalizing tariffs on all industrial goods—including cars and auto parts—it sets the foundation for preferential access to be conditioned on these stricter origin rules. This strategy directly addresses concerns about global overcapacity and supply chain vulnerabilities.
Taken together, the 28 August 2025 EU regulation and the 21 August 2025 Joint Statement trace a clear trajectory: immediate tariff suspension today, stricter origin requirements tomorrow. As emphasized in the tariff shifts article, the USMCA provides the likely template, especially regarding the “melted and poured” steel rule and regional aluminum sourcing. The evolution from framework to regulation shows that rules of origin are becoming the linchpin of EU–US trade integration—ensuring that tariff shifts secure not just freer trade, but also stronger, more resilient transatlantic industries.