Economy January 23, 2026

EU Extends Suspension of Trade Retaliation Measures Against the US by Six Months

European Commission signals continued thaw in trade tensions amid changed US tariff threats

By Hana Yamamoto
EU Extends Suspension of Trade Retaliation Measures Against the US by Six Months

The European Commission has decided to extend the suspension of a €93 billion package of trade retaliatory measures against the United States for an additional six months beyond the current expiration date in early February. This decision follows a de-escalation of tariff threats from the US, enabling both parties to focus on implementing a prior joint trade agreement.

Key Points

  • The European Commission plans to prolong the suspension of €93 billion worth of retaliatory trade sanctions against the US for six more months, beyond the February 7 deadline.
  • The suspended trade measures were established amid EU-US trade negotiations and paused following a joint trade agreement in August 2025.
  • US withdrawal of threatened tariffs against several European countries has opened the door for progressing with the joint trade statement implementation.

The European Commission announced on Friday its intention to propose a six-month extension to the suspension of retaliatory trade measures against the United States, valued at €93 billion (approximately $109.19 billion). This suspension currently is set to expire on February 7, but the Commission aims to prolong it, allowing more time for diplomatic progress.

These trade sanctions were initially crafted during the first half of the previous year amid EU-US trade negotiations. Following the joint trade statement reached by both sides in August 2025, these measures were put on hold for six months as a gesture to foster cooperation.

Recently, this package of countermeasures resurfaced in attention after US President Donald Trump threatened to impose fresh tariffs on eight European countries amid Washington's strategic efforts regarding Greenland. If such tariffs had been enacted, the EU’s retaliatory measures would have served as a direct response.

Speaking on behalf of the Commission, spokesman Olof Gill remarked, "With the removal of the tariff threat by the US, we can now return to the important business of implementing the joint EU-US statement." He further clarified that although the measures remain suspended for six more months, they retain the possibility of reactivation if circumstances warrant.

Gill stressed, "Just to make absolutely clear -- the measures would remain suspended, but if we need them at any point in the future, they can be unsuspended." This indicates flexibility in the EU's approach to trade defense mechanisms depending on future developments.

Overall, this extension reflects a cautious but optimistic stance in trade relations between the EU and US, emphasizing the preference to maintain dialogue and implementation of previously agreed terms over immediate sanction deployment.

Risks

  • There remains a risk that the EU could reactivate the suspended trade measures if the US imposes tariffs again, generating volatility in sectors dependent on transatlantic trade.
  • Trade tensions could resurface if diplomatic efforts falter, affecting markets linked to international commerce between the EU and US.
  • Uncertainty persists around US trade policy given past tariff threats, possibly impacting sectors sensitive to tariffs such as manufacturing and agriculture.

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