On Wednesday, April 2, US President Donald Trump declared that he had issued a presidential order imposing new tariffs on a wide range of countries on imports of virtually all goods into the United States. The tariffs are paid by companies importing foreign-made goods into the US.
A general tariff with a baseline of 10% will enter into force on April 5. In addition, import of goods from certain countries will be subject to tariffs at a higher level; the higher levels will enter into force on April 9. For goods manufactured in Sweden, as in the rest of the EU, the tariffs will be an additional 10 percentage points, totaling a tariff level of 20%. For foreign-made cars, there will be a 25% tariff. Goods exempted from the tariffs include but are not limited to copper, semiconductors, and pharmaceuticals.
For goods where at least 20% of the value of the goods originates in the US, the US-originating portion of the goods is exempt from tariffs.
The President of the European Commission, Ursula von der Leyen, has announced that countermeasures are being prepared in response to the tariffs imposed by the US. Negotiations between the EU and the US on possible exemptions to the tariffs are ongoing, and the scope of the announced countermeasures depends on the outcome of the negotiations. The Presidential Order issued includes an option for President Trump to increase tariff rates, or expand the scope of tariffs against those trading partners that retaliate against the import tariffs.
How does this affect you?
The final tariffs that the EU will face will depend on the negotiations between the EU and the US, as well as on any countermeasures that the EU may impose in response to the US import tariffs. Even if this uncertainty is taken into account, you as a business owner should act proactively and ensure which tariff classification your products fall under. The possibilities for you to act on existing customer and supplier contracts will be determined by the terms of each contract. Conditions regarding the volatility of the new tariff rates will also be a key risk elements to consider prior to the conclusion of new contracts.
CMS Wistrand continuously monitors developments in the changing trade situation. If you have any questions about how the tariffs will affect your business, the scope you may act within in existing agreements, or what you should consider before signing new agreements, you are welcome to contact us.
