Cross Border Trade Updates

U.S. Trade Policy and Tariff Actions

• Commerce Department issues technical correction to Section 232 Proclamation: On 27 April, the Bureau of Industry and Security (BIS) issued a technical correction to the April 2 Section 232 Proclamation. The correction fixes the UK preferential rate, which had been incorrectly applied to certain derivative articles at the standard rate (50%) rather than the reduced UK rate of 15-25%. The correction also clarifies that products with no covered metal content are entirely outside the scope of the Section 232 tariffs. Both corrections apply retroactively to entries on or after 6 April 2026.‍
• EU rejects U.S. proposal to resolve EU concerns on Section 232 tariffs: On 30 April, reporting indicated that France and German, among other EU member states, rejected a U.S. proposal to resolve the outstanding Section 232 tariff dispute on steel and aluminum derivative products. As per the U.S.-EU Turnberry Agreement, EU origin imports into the U.S. are subject to a 15% ceiling rate on most products. However, the latest Section 232 tariff action applies up to 50% tariffs on the full value of steel, aluminum, and copper products. A lower 25% tariff is applied on certain derivative products. The ongoing dispute further delays the implementation of the U.S.-EU reciprocal trade agreement, which includes provisions which would eliminate all industrial tariffs for imports into the EU (including food processing and packaging machinery). The U.S. and EU have agreed to continue technical discussion on this issue. If the situation remains unresolved, the U.S. and EU have threatened additional measures, without providing details.‍
• Status of U.S. bilateral negotiations and discussions: During the period when IEEPA tariffs were in effect, the Trump Administration negotiated or announced trade agreements with nineteen countries. Countries with announced US reciprocal framework trade deals of relevance to PMMI members include the EU, Switzerland, Japan, UK, Taiwan, South Korea, and India. Given the Supreme Court decision that IEEPA tariffs are deemed illegal, the IEEPA-related provisions of agreements are nullified. As of 24 February, all US trading partners are subject to the Section 122 10% tariff regardless of whether a deal was negotiated. Latest updates on negotiations during the week of 28 April - 4 May include:‍
  
  • China: On 30 April, Chinese Vice Premier He Lifeng held a video call with Treasury Secretary Bessent and USTR Greer. Both sides agreed to continue working toward the planned Trump-Xi summit scheduled for 14-15 May.

We will continue to monitor how bilateral trade negotiations and agreements may be impacted and countries' responses.

Trade Policy Actions by Other Countries

• EU-Mercosur Interim Trade Agreement begins provisional implementation as of 1 May: As previously reported, the EU and Mercosur member countries (Brazil, Argentina, Paraguay, and Uruguay) began the provisional implementation of the EU-Mercosur Interim Trade Agreement (iTA) on 1 May 2026. As such, the below preferential market access opportunities are available for machinery:

• EU exports to Mercosur: The 2-20% standard/MFN tariff on EU-origin food processing and packaging machinery of 8422 and 8438 imported into Mercosur member countries will be eliminated over 11-16 equal annual reductions.
• Mercosur exports to the EU: The 1.7% standard MFN tariff on food processing and packaging machinery of 8422 and 8438 manufactured in Mercosur member countries and exported to the EU is eliminated immediately.

Please note that there is ongoing litigation at the Court of Justice of the European Union (CJEU), brough by the European Parliament and certain EU member states who opposed the provisional implementation of the iTA. An opinion by the CJEU is not expected until 2027 and the provisional implementation of the iTA is effective as litigation continues to develop.