EU Parliament pauses US trade deal after Trump links tariffs to Greenland

The European Parliament has halted progress on a landmark EU–US trade agreement after US President Donald Trump announced fresh tariffs on European countries, tying the measures to his renewed push for control over Greenland.

The move casts uncertainty over a transatlantic truce reached last year, which was aimed at stabilising trade relations between the two sides after years of tariff disputes.

July trade truce under strain

The EU–US agreement, signed in July by Trump and European Commission president Ursula von der Leyen, sought to cap US tariffs on European goods at 15 per cent while the European Union committed to eliminating duties on American exports.

The deal was expected to ease trade tensions and pave the way for deeper economic cooperation. However, recent developments have put its ratification on hold.

Fresh tariffs over Greenland

Trump announced an additional 10 per cent tariff on European countries that recently sent troops as part of a limited deployment to Greenland, an autonomous territory of Denmark. He said the tariff would rise to 25 per cent from June 1 and remain in force until an agreement was reached for what he described as the “complete and total purchase” of Greenland.

Also Read: Trump slaps 10 pc tariff on 8 European countries for opposing US control of Greenland

The announcement triggered sharp political reactions in Europe, where Greenland remains a sensitive geopolitical issue tied to Danish sovereignty.

Approval process paused

Manfred Weber, leader of the European People’s Party (EPP), said the European Parliament could not proceed with approving the trade deal under the current circumstances. In a post on X, Weber said zero-tariff treatment for US products would have to be paused.

"The EPP is in favour of the EU–US trade deal, but given Donald Trump’s threats regarding Greenland, approval is not possible at this stage. The 0% tariffs on US products must be put on hold," he wrote.

Siegfried Murean, a member of the European Parliament involved in the negotiations, said the agreement had been close to ratification before relations deteriorated. He noted that the July deal had been designed to reduce EU tariffs on US imports to zero, but said the changing political context meant approval would have to wait.

Calls for EU retaliation grow

Some lawmakers urged the European Union to prepare countermeasures in response to the US tariffs. The debate has also revived attention on the EU’s Anti-Coercion Instrument (ACI), a mechanism designed as a deterrent against economic pressure from third countries.

Although it has never been invoked, the ACI allows the EU to respond to coercive trade actions through measures such as tariffs, targeted restrictions on investments, limits on market access, or curbs on participation in public procurement within the bloc.

Also Read: Trump threatens to take Greenland ‘the hard way’, wants to stop Russia, China

According to a report in The Economic Times, Danish lawmaker Per Clausen of the Left has urged a tougher stance, gathering support from fellow MEPs for a letter calling on Parliament leaders to freeze the trade deal for as long as the US continues to press territorial claims over Greenland.

Clausen said proceeding with the agreement under current circumstances would send the wrong signal, arguing that the EU must be prepared to use the tools at its disposal if pressure from Washington persists.