Framework agreement EU and US: What lies ahead for businesses?

A direction, but few details

Following the oral agreement in July, a joint statement was issued on 21 August. This statement was intended to clarify the arrangements between the European Union and the United States. The full content of the agreement remains unclear. Schippers explains: “It is merely a three-page framework agreement, with the details yet to be elaborated and translated into legislation.” He continues: “It will take months, if not years, to finalise the trade deal and guide it through the legislative process. Many aspects could still change in the meantime. The fact that the European Union wishes to maintain momentum is evident from the European Commission’s proposal of 28 August 2025 to lower import tariffs on US goods.”

Import duties and production in the United States

One of the provisions is that the United States will levy a 15% import duty on most EU products. Asked whether companies should relocate production to the United States to reduce costs, Schippers responds: “Expanding production capacity or establishing new facilities in the United States has the advantage that finished products no longer need to be imported and thus avoid the 15% import duties.” While this may appear an attractive alternative, he limits: “Intermediate goods often still need to be imported, and if these originate from the EU, companies will still be affected by this arrangement. Furthermore, it is questionable whether such an investment in production outweighs the payment of duties, particularly given the high production costs in the United States and the unpredictable nature of Trump’s policies, which may change again tomorrow.”

Schippers also highlights further considerations: “There are ongoing legal proceedings against certain additional tariffs imposed by Trump. On Friday 29 August the United States Court of Appeals for the Federal Circuit ruled that Trump should not have introduced the tariffs. However, the additional duties will remain in force until the Supreme Court has delivered a final judgment.”

Agility in an unpredictable climate

Schippers argues that the volatile nature of US trade policy requires companies to reorganise. He notes that customs functions are often understaffed and largely operational. Schippers elaborates: “The current geopolitical climate demands organisational agility. A company, therefore, benefits from a strategic customs function positioned close to its decision-makers, enabling swift responses to sudden political shifts.”

Regionalisation and the future of supply chains

Recent trade developments also influence supply chain strategies. “I certainly believe companies are reconsidering the design of their supply chains. For instance, the ‘China Plus One’ strategy has been in place for years, with businesses sourcing not only from China but also from other countries to remain flexible and less dependent,” says Schippers. Shortening supply chains and focusing on regionalisation can help businesses respond more quickly to sudden changes in global trade, making them less vulnerable to import duties.

Nevertheless, not all businesses are actively pursuing this. Schippers observes: “Although I have encountered such developments, not all companies engage with them decisively. These decisions are costly, time-consuming, and often establish a long-term trajectory. In other words, such adjustments are rarely temporary, particularly in a climate of sudden political shifts. I therefore expect larger-scale changes only once greater stability has been achieved. The agreement between the United States and the European Union could contribute to such stability.”