EU responds to Trump's tariff threat for first time: European Parliament freezes ratification process of US-EU trade agreement

**Source**: Wall Street CN

**By**: Li Dan

While the European Parliament’s delay in ratifying the trade deal will not directly invalidate it, the move has sent a strong signal of dissatisfaction to the White House. U.S. Trade Representative Greer stated that the U.S.-EU trade agreement has failed to resolve many of America’s grievances, adding that Trump’s tariff threats are an appropriate use of tariffs and that the administration may be preparing for negotiations related to Greenland. Danish Prime Minister Mette Frederiksen said her country will not negotiate on matters of sovereignty and is ready for a trade war.

According to CCTV News, on Tuesday the 20th local time, the European Parliament announced the suspension of the ratification process for the trade agreement reached with the United States last July. This is seen as the EU’s first response to the latest pressure tactics by U.S. President Donald Trump.

This move marks a sharp deterioration in transatlantic relations. As reported by CCTV, on Saturday the 17th U.S. Eastern Time, Trump announced on social media that he would impose a 10% tariff on goods imported into the U.S. from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands, and Finland starting February 1st. He claimed the tariff rate would be raised to 25% starting June 1st until the relevant parties reach an agreement on the U.S. “complete and total purchase of Greenland”.

The European Parliament’s decision has heightened the risk of a full-scale trade war between the two sides. Recent reports indicate that the EU is weighing a series of retaliatory measures against the U.S., including imposing tariffs on €93 billion worth of American goods and activating its most powerful yet unused weapon—the Anti-Coercion Instrument (ACI). EU leaders are scheduled to hold an emergency summit in Brussels this Thursday evening to discuss a response strategy.

### European Parliament Suspends Ratification, Sends Strong Signal of Dissatisfaction

Reports on Tuesday noted that major political groups in the European Parliament have agreed to postpone the ratification of the U.S.-EU trade deal. While the delay will not directly nullify the agreement, it serves as a potent message of discontent to the White House.

Trump previously announced plans to impose tariffs on six EU countries, including economic powerhouses France and Germany, citing their lack of support for the U.S. bid to acquire Greenland. The European Parliament had originally planned to vote in the coming weeks on eliminating tariffs on U.S. industrial goods as part of the trade deal.

Valerie Hayer, Chair of the Renew Europe Group in the European Parliament, described the suspension as an “extremely powerful lever”, adding that she does not believe U.S. businesses would agree to abandon the European market.

The U.S.-EU trade agreement was reached in July 2025 between European Commission President Ursula von der Leyen and Trump. Though partially implemented, it still requires ratification by the European Parliament.

Under the terms of the deal, the U.S. imposes a 15% tariff on most EU goods, while the EU has committed to eliminating tariffs on U.S. industrial products and some agricultural goods. Von der Leyen negotiated the agreement in hopes of avoiding a full-scale trade war with Trump.

Longtime critics of the deal within the European Parliament argue it is overly favorable to the U.S. Further fueling European resentment, after the July agreement was signed, the U.S. expanded its 50% tariffs on steel and aluminum products to hundreds of additional EU goods.

Manfred Weber, Chair of the European People’s Party, stated on social media last Saturday that ratifying the deal is impossible at this stage given Trump’s threats over Greenland. Bernd Lange, long-serving Chair of the European Parliament’s Committee on International Trade, commented, “All partners to a trade agreement must respect the sovereignty of every nation.”

### U.S.-EU Standoff Intensifies

According to CCTV News, U.S. Trade Representative Greer said on Tuesday, January 20th that Trump may be preparing for negotiations on Greenland and that the tariff threats over the issue are an appropriate use of tariffs.

Greer claimed that the EU has not taken any action to implement the trade agreement with the U.S., and that the deal has failed to address many American grievances regarding Europe’s agricultural and regulatory policies.

Separately, according to CCTV News, on Tuesday local time, Josep Borrell, the EU’s High Representative for Foreign Affairs and Security Policy, told the European Parliament that tariffs will only make both Europe and the U.S. poorer and undermine shared prosperity. He emphasized that the EU’s response must be calm, firm, and united.

Borrell stressed that no country has the right to seize territory belonging to another nation. He stated that Greenland belongs to its people, and no threats or tariffs can change that fact.

As reported by Xinhua News Agency, Danish Prime Minister Mette Frederiksen told parliament during a question session on Tuesday that Denmark will not negotiate on issues of sovereignty or borders regarding Greenland and is prepared for a trade war. Frederiksen warned that a trade war would lead to job losses on both sides of the Atlantic. She noted that if anyone provokes a trade war with Europe, the EU will of course respond.

### EU Mulls Multiple Retaliatory Measures

According to a CCTV News report on Monday, multiple EU countries are considering imposing tariffs on €93 billion worth of U.S. goods imported into the bloc or restricting U.S. companies’ access to the EU market. A senior EU diplomat revealed that if no agreement is reached between the EU and the U.S., the retaliatory tariffs will take effect automatically starting February 6th.

Media reports on Tuesday indicated that the retaliatory tariff plan was agreed upon at the height of U.S.-EU trade tensions last year but was ultimately suspended until February 6th to avoid a full-scale trade war. The tariff list will target U.S. industrial products, including Boeing aircraft, American-made automobiles, and bourbon whiskey.

Media reports on Saturday also noted that the EU is considering activating the Anti-Coercion Instrument (ACI)—the bloc’s most powerful retaliatory trade tool. The ACI has never been used by the EU to date and was designed primarily as a deterrent to counter deliberate coercive actions by third countries that use trade measures to pressure the EU or its member states.

These measures may include tariffs, new taxes on tech companies, or targeted restrictions on EU investments. They could also involve limiting access to certain segments of the EU market or barring companies from bidding on European public contracts.

### Risk Warning and Disclaimer

The market is risky, and investment requires caution. This article does not constitute personal investment advice and does not take into account the specific investment objectives, financial situations, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are consistent with their own specific circumstances. Any investment made based on this article is at the investor’s own risk.