Competitiveness Check – May 30 Edition

The Quick Take

Trade talks between the United States and the EU are set to go ahead despite ongoing turmoil. Read Penny Naas’ insights into President Donald Trump’s latest tariff-related threats against the bloc here. Meanwhile, the US Court of International Trade rebuked Trump’s “liberation day” tariff program, further complicating negotiations. 

Top 5 Transatlantic Trade-Related Developments 

• May 21: The European Commission published its new single market strategy to boost competitiveness and counteract the impact of US tariffs. 
  The strategy incorporates recommendations made in the reports by former Italian Prime Minister Mario Draghi on competitiveness and former Italian Prime Minister Enrico Letta on the future of the single market. 
  The strategy sets out actions to reduce existing barriers to intra-EU trade and investments and to help small- and medium-sized enterprises scale up and operate across the bloc. The strategy also proposes limiting several reporting requirements.
• May 22: The House of Representatives passed the One Big Beautiful Bill Act on a narrow 215-214 vote. The bill would enact Trump’s taxation and spending priorities. It includes an updated version of proposed Section 899, a provision that targets corporations, individuals, and governments of countries that impose discriminatory or extraterritorial taxes on US citizens or corporations by subjecting them to increased US tax rates. The bill is now awaiting Senate approval.
• May 23-25: Trump threatened on his social media platform, Truth Social, that he would impose a 50% tariff on all imports from the EU from June 1. After a phone call with European Commission President Ursula von der Leyen, Trump agreed to delay imposing a 50% tariff on European goods until July 9.
• May 28: US Secretary of State Marco Rubio announced a new visa restriction policy that applies to foreign nationals who are deemed to be censoring Americans. The new policy could target officials regulating US tech companies.
• May 28-29: The US Court of International Trade, a specialized federal court based in New York, ruled illegal Trump’s use of the International Emergency Economic Powers Act (IEEPA) to impose sweeping tariffs on imports from nearly every country.
  The IEEPA, enacted in 1977, grants the president authority to regulate commerce during a national emergency without congressional approval. The court determined that the economic concerns cited by the White House did not provide Trump with unilateral authority to impose broad tariffs. Additionally, the court blocked a separate set of levies the Trump administration had placed in early 2025 on imports from China, Mexico, and Canada, which were justified as measures to curb the flow of drugs and illegal immigration into the United States. The court’s ruling did not extend to tariffs on cars, steel, and aluminum, which fall under a different legal framework. The government filed a notice of appeal shortly after the judgment came down. The Court of Appeals for the Federal Circuit granted the Trump administration’s request to temporarily pause the ruling. 

Figure of the Fortnight

65%: The percentage of US imports from the EU classified as intra-firm trade in 2021. Intra-firm trade also accounted for 39% of US exports to the EU and the United Kingdom in 2021. 

Quote Unquote

“[European Commission President Ursula von der Leyen] just called me, as you know, and she asked for an extension to the June 1 date. She said she wants to get down to serious negotiations because—I’ve told you specifically, and I told anybody that would listen—they have to do that. We had a very nice call, and I agreed to move it. … July 9 would be the date. That was the date she requested. … She said we will rapidly get together and see if we can work something out.” 

- Trump talking to reporters in Morristown, New Jersey, on May 25. 

“Good call with [US President Donald Trump]. The EU and US share the world’s most consequential and close trade relationship. Europe is ready to advance talks swiftly and decisively. To reach a good deal, we would need the time until July 9.” 

- Von der Leyen in a post on X (formerly Twitter) on May 25.