PARIS — In retaliation to U.S. steel and aluminum tariffs, the European Commission adopted on Wednesday rebalancing measures that target a list of products worth 2.8 billion euros, including fashion, beauty goods, footwear and jewelry. The hike in duties levied on certain U.S. imports at the EU boarder, which ranges from 10 to 50 percent, goes into effect on June 22.
“By putting these duties in place the EU is exercising its rights under the World Trade Organization rules,” the European Commission said in a statement.
Its 15-page list of goods include — at a 10 percent increased duty rate — hair lacquers and non-industrial diamonds unworked or simply sawn.
At a 25 percent higher tax level are the likes of cotton, wool, fine animal hair and man-made fiber T-shirts, singlets and other vests; trousers and breeches in cotton denim or cotton; shorts in cotton; eye-makeup, lip-makeup, manicure and pedicure preparations; makeup and skin-care powders, and some specific shoe types. Certain articles and parts of jewelry are to be taxed at a 25 percent higher rate, too.
A 50 percent increased tax will be levied on a variety of items, including trousers and breeches in cotton and cotton-cut corduroy.
“We did not want to be in this position. However, the unilateral and unjustified decision of the U.S. to impose steel and aluminum tariffs in the EU means that we are left with no other choice,” said the EC commissioner for trade Cecilia Malmström in the statement. “The rules of international trade, which we have developed over the years hand-in-hand with our American partners, cannot be violated without a reaction from our side. Our response is measured, proportionate and fully in line with WTO rules. Needless to say, if the U.S. removes its tariffs, our measures will also be removed.”
The WTO had already been notified of the full list of products to be taxed higher. On June 6, after the U.S. application of the full tariffs on EU steel and aluminum products the list was endorsed by the EC college of commissioners. Subsequently, EU member states unanimously supported the approach.
“The EU will rebalance bilateral trade with the U.S. taking as a basis the value of its steel and aluminum exports affected by U.S. measures,” the EC said. “Those are worth 6.4 billion euros. Of this amount, the EU will rebalance on 2.8 billion euros-worth of exports immediately. The remaining rebalancing on trade valued at 3.6 billion euros will take place at a later stage — in three years’ time or after a positive finding in WTO dispute settlement if that should come sooner.”
The EU rebalancing measure, which was outlined earlier in 2018, is part of a three-pronged response to the U.S. steel and aluminum tariffs. The other prongs include the launch on June 1 of legal proceedings against the U.S. in the WTO and a safeguard action to protect the European market from disturbances stemming from the diversion of steel from the U.S.
A safeguards investigation was instigated on March 26, and the commission has nine months to decide whether safeguard procedures are needed. If it’s decided that quick action is necessary, the decision could come by summer.