EditWhat a difference a day makes: 1 July as pivot day for European affairs
Enter into force a new Presidency, a new U.S. agreement, a €3 online import levy, and steel quotas aiming to deliver fair competition
The start of the Irish Presidency of the Council of the EU – 1 July, marks a significant day for European affairs, but it also coincides with several key measures in EU trade policy coming into force. These include the implementation of a long-negotiated trade agreement with the United States, a new customs duty targeting low-value e-commerce shipments, and a comprehensive regulation to shield the EU steel sector from global overcapacity.
Together, these initiatives reflect Brussels’ efforts to uphold commitments, promote fair competition, and protect strategic industries in an increasingly complex international environment.
Advancing EU-U.S. trade relations through pragmatic diplomacy
The centerpiece of today’s developments is the entry into force of the European side of the trade deal struck last year between the European Union and the United States. Signed in July 2025 in Turnberry, Scotland, by U.S. President Donald Trump and European Commission President Ursula von der Leyen, the agreement sets 15 percent tariffs on most EU exports to the American market while eliminating duties on U.S. industrial goods entering the 27-nation bloc. It also grants preferential access for certain American seafood and agricultural products into Europe.
European Commission spokesperson Olof Gill emphasized the importance of honoring commitments, stating: “Promise made, promise delivered.” The texts enacting the EU’s obligations were published in the Official Journal, ensuring the deal takes effect on schedule and meets the 4 July deadline set by the U.S. administration. This implementation follows months of delays caused by various factors, including Trump’s statements on Greenland and legal challenges in the United States. EU member states provided final approval last week, building on earlier parliamentary consent that incorporated important safeguards.
These safeguards empower the European Commission to suspend parts of the agreement if the U.S. fails to meet its commitments, adopts discriminatory measures, or restricts European access to the American market. A specific clause addresses steel and aluminum: if Washington maintains tariffs above 15 percent on these products from the EU by the end of 2026, Brussels retains the right to withdraw related preferences. The main provisions of the regulation will run until 31 December, 2029, with a required comprehensive assessment by mid-2029 to evaluate impacts on trade, revenues, and small businesses before any extension.
The agreement arrives amid renewed transatlantic tensions. Just days ago, President Trump warned of potential 100 percent tariffs on countries imposing digital services taxes on large U.S. tech firms. Despite these frictions, EU officials view the deal’s activation as positive news for relations, underscoring a commitment to constructive dialogue.
Introducing a €3 duty to curb low-value e-commerce flood
In parallel, the EU is rolling out a temporary €3 customs duty on goods purchased online from non-EU countries and shipped directly to European consumers in consignments valued up to €150. Approved by the EU Council in February 2026, this measure addresses the explosive growth of low-value parcels, which has surged from 1.3 billion in 2022 to 5.9 billion in 2025. Approximately 90 percent originate from China, with platforms like Shein and Temu facing scrutiny for competitive pressures on local retailers and compliance issues.
The duty replaces a previous exemption for low-value shipments, aiming to prevent the “desertification” of traditional trade routes and ensure a level playing field. While VAT has long applied, the absence of duties created loopholes. Data shows these imports account for nearly 98 percent of item volume but only 2.1 percent of total import value, with an average item price of just €8.82. Inspections in late 2025 revealed high non-compliance rates: 65 percent for cosmetics, 60 percent for protective equipment, and 63 percent for food supplements, often due to missing labels, inadequate safety documentation, or prohibited substances.
The levy is applied per declared product category rather than per package, meaning multiple identical items incur a single €3 fee, while different categories may attract multiple charges. It targets distance selling, including e-commerce platforms acting as suppliers or intermediaries. Goods under preferential trade arrangements are generally excluded if conditions are met. From November 2026, mandatory product identifiers will further enhance traceability and help intercept unsafe items.
Trade Commissioner Maroš Šefčovič described the system as essential for “fairness for all businesses” and superior consumer protection. National measures in countries like Italy, Romania, and France will be phased out or harmonized to preserve the single market and prevent “border shopping.” The duty remains in place until 1 July, 2028, when the new European Customs Data Hub is expected to become fully operational, promising more efficient processing.
Protecting the steel sector from global overcapacity
The third major initiative is a new regulation designed to safeguard the European steel industry against distortions caused by worldwide production overcapacity. According to the Organisation for Economic Co-operation and Development (OECD), global excess capacity stood at 640 million tonnes in 2025 and may climb to 745 million tonnes by 2028, even as demand grows slowly. Much of this expansion occurs outside the OECD, frequently backed by state support, with Chinese producers receiving notably higher subsidies. Chinese steel exports hit a record 131 million tonnes last year, surpassing total EU production.
The consequences for Europe have been severe: since 2018, the sector has shed over 30 million tonnes of capacity and around 30,000 jobs, with utilization rates dropping to 67 percent in 2024. Without intervention, diverted exports from other restricted markets could further undermine prices, investment, and decarbonization efforts.
Under the new rules, annual duty-free import quotas are cut by 47 percent to 18.3 million tonnes. Volumes exceeding quotas face a 50 percent duty across 26 steel product categories. Half the quota is reserved for free trade agreement partners, with allocations based on historical 2022–2024 flows, supply security needs, and WTO commitments. The Commission has reached agreements in principle with 13 partners, including Turkey, South Korea, India, and the UK. This approach aims to restore capacity utilization toward 80 percent while maintaining predictability and compliance with international obligations.
Commissioner Šefčovič highlighted the balance struck between free trade commitments and industrial needs, noting that many partners will face smaller reductions than the overall average. The measure includes transparent quota distribution and safeguards, positioning it as a practical response to a persistent global challenge.
Sources: FocusEurope.it, Le Monde, Reuters
Caption: Maros Sefcovic, European Commissioner for Trade and Economic Security, Interinstitutional Relations and Transparency, speaks during a press point on EU-China relations in Brussels, Belgium, 29 June 2026, following a meeting with Chinese Commerce Minister Wang Wentao. EPA/OLIVIER MATTHYS
Updated: July 1, 2026 - 09:57
