EU Restarts US Trade Deal After Greenland Spat

European Union lawmakers are restarting work on a trade deal with the United States after halting the process in protest of President Donald Trump’s comments about acquiring Greenland and his related threats of new tariffs.

The European Parliament's trade committee is now set to resume its efforts to implement the agreement, which aims to lower many EU import duties on American goods.

Why the Trade Deal Was Paused

The deal, originally struck with Trump in July, also includes maintaining zero duties on U.S. lobsters, a provision agreed upon in 2020. However, a key vote was suspended last month after Trump threatened new tariffs against European countries that opposed his goal of annexing Greenland, a semi-autonomous territory of Denmark.

The tariff threat was withdrawn after several days, but the pause in negotiations highlighted the tense political backdrop. A significant delay from the European side could have provoked a reaction from the U.S. president, who recently threatened to raise tariffs on South Korean exports over what he described as a failure to implement its side of a trade agreement.

New Safeguards and Next Steps

Work on the trade deal will now resume, with the committee potentially voting on February 24, according to Social Democrat lawmaker Bernd Lange, who chairs the trade committee.

To protect against future volatility, Lange confirmed that EU lawmakers would support new conditions to the agreement, including:

• A Suspension Clause: This would allow the EU to suspend the deal if the United States threatens the security or territorial integrity of any member state. It would also apply in the case of new U.S. tariff threats.

• A Sunset Clause: Lawmakers also agreed to add a clause that would set an expiration date for the deal, although the exact time frame has not yet been determined.

Following the committee vote, the proposals must be approved by the full European Parliament and EU governments. This process involves negotiating a common text, which means final approval is likely still one to two months away.

Lingering Concerns Over a 'Lopsided' Agreement

Even before the recent political friction, many EU lawmakers had expressed concerns that the trade deal was unbalanced. Critics point out that the agreement requires the EU to cut most of its import duties while the U.S. largely maintains a broad tariff rate of 15%. Despite these reservations, lawmakers had previously appeared willing to accept the deal with certain conditions attached.