Snapshot of Current Tariff Actions and Negotiations

In the past several weeks the Trump Administration has taken multiple actions on tariffs, based on several different legal authorities.  The landscape is shifting almost continuously, and more changes are likely coming.

A number of the tariff actions are linked to the results of bilateral negotiations that involve commitments to investment and other actions, although in some cases the details of those agreements and commitments do not appear to be settled.

COUNTRY-WIDE TARIFF ACTIONS

“Reciprocal” Tariffs

On April 2, 2025, varying “reciprocal” tariff rates were announced for different countries, based on an emergency declared under the International Emergency Economic Powers Act (“IEEPA”).  Almost immediately thereafter, those rates were “paused” until August 1 in favor of a 10% baseline tariff on virtually all countries. On July 31, President Trump signed an Executive Order modifying the rates originally announced on April 2, which took effect on August 7.

The modified reciprocal tariff rates for particular countries are listed in Annex I.  Goods of a country not identified in Annex I (other than China, Canada and Mexico) are subject to a 10% reciprocal tariff.

The reciprocal tariffs continue to include exclusions for certain products, including certain electronics components, that were identified in Annex II of Executive Order 14257.

Although the new tariff rates took effect on August 7, there is an in-transit exception that applies so long as the goods are loaded onto a vessel at the port of loading and in transit on the final mode of transit by 12:01am ET on August 7, and arrive at port in the U.S. by October 5, 2025.

The Executive Order also includes a provision stating that a 40% tariff would apply in addition to the applicable rate for the country of origin of the transshipped product where there are transshipments.  Reportedly, the Administration will put in place rules of origin for indirect shipments and is considering broadening the definition of “transshipment”.

The EO provides that the Secretary of Commerce and U.S. Trade Representative will monitor steps taken by trading partners and make recommendations to the President to make recommendations for adjustments to actions or additional actions based on steps taken (or not taken) by trading partners to address trade deficits.  This suggests that the rates may be adjusted upward or downward depending on developments.

“Fentanyl” Tariffs

Canada, Mexico and China have been subject to different tariff regimes imposed under separate executive orders citing illegal immigration and imports of fentanyl as emergencies.  After several adjustments, China’s “fentanyl” tariff was set at 20% (which is added to the prior duties imposed under Section 301 during the first Trump Administration and adjusted during the Biden Administration).  The “fentanyl” tariffs for Canada and Mexico originally were set at 25% (with certain exceptions), but products that have sufficient North American content to qualify for duty-free treatment under the United States-Mexico-Canada Agreement (USMCA) are exempt from the fentanyl tariffs and remain duty-free.

On July 31, in a separate Executive Order, President Trump increased the tariff for Canadian products not qualifying for the USMCA to 35%.  The situation for Mexico was paused for another 90 days and remains the same as previously.

On August 11, President Trump issued another Executive Order maintaining the status quo for China for another 90 days.

Brazil

On July 30, President Trump issued another Executive Order under IEEPA imposing a 40% tariff on imports from Brazil in reaction to “policies and actions harming U.S. companies, the free speech rights of U.S. persons, U.S. foreign policy, and the U.S. economy.”  This tariff applies in addition to the 10% reciprocal tariff separately imposed on Brazil.

PRODUCT-SPECIFIC TARIFF ACTIONS

The tariffs imposed on broad categories of Chinese products under Section 301 during the first Trump Administration — later renewed and in some aspects increased by the Biden Administration — continue in effect.  Prior Section 232 national security tariffs on steel and aluminum have been increased to 50% and are being applied to an increasing range of “derivative” products containing steel and aluminum.  Section 232 tariffs on automobiles and automobile parts have also been implemented.

On July 30, the Trump Administration announced the imposition of a Section 232 tariff of 50%, effective on August 1, on the copper content of semi-finished copper and intensive copper derivative products.  Section 232 investigations of timber and lumber, semiconductor and semiconductor manufacturing equipment, pharmaceuticals and pharmaceutical ingredients, trucks, commercial aircraft and jet engines, polysilicon, and unmanned aircraft systems remain pending.

BILATERAL NEGOTIATIONS

Prior to July 31, 2025, the Trump Administration announced bilateral agreements with a number of countries including the European Union (EU), Japan, Vietnam, Indonesia, South Korea, Pakistan, Thailand, Cambodia, the Philippines, and the UK.

The announced agreements address tariffs, market access for U.S. exports (including tariff, non-tariff barriers, and purchases), economic security issues, commitments to make investments in the United States (in case of the EU and Japan) and labor issues (in the case of Indonesia).

We describe the key aspects of the agreements with the EU and Japan below.

U.S.–EU Agreement

The agreement provides for a 15% tariff inclusive of the most-favored nation (MFN) tariff rate (in other words, the tariff will be 15% for all products that have a lower than 15% MFN rate and an additional 0% for products that have at least a 15% MFN rate) on EU products, including those that are subject to certain Section 232 investigations including autos and auto parts (which are currently subject to a 25% tariff), pharmaceuticals, and semiconductors.  According to President von der Leyen, the two sides agreed to eliminate tariffs entirely on certain “strategic” products, including aircraft and aerospace parts, certain chemicals, some generic pharmaceuticals, semiconductor manufacturing equipment, selected agricultural products, and critical raw materials; however, those exemptions have not been implemented by the United States.

According to the White House, the EU committed to new private sector investments of $600 billion in the United States by 2028.  EU officials have stated that this figure is based on detailed discussions with business associations and private companies about their investment intentions and indicated that the EU does not plan to offer incentives to ensure that this target is met.

In addition, the EU agreed to purchase approximately $750 billion in U.S. energy products—such as oil, gas, and nuclear fuel—over a three-year period, and to increase procurement of U.S. defense-related equipment. Similarly, the EU statement noted that purchases of U.S. energy products (including nuclear fuels, LNG, and oil and gas) will replace Russian gas and oil.

The agreement includes commitments by the EU to reduce both tariff and non-tariff barriers that limit access to the European market for U.S. goods and services. According to Administration sources, the EU will work to eliminate tariffs in “various sectors” and provide “meaningful quotas” for others.  These include certain U.S. agricultural and fishery products.  The agreement also provides that the United States and EU will work to address digital trade barriers including by maintaining zero customs duties on electronic transmissions and the EU agreed not to adopt or maintain network usage fees.  U.S. Secretary of Commerce Lutnick stated that the EU’s digital services taxes and other digital regulations will be the subject of future negotiations.

The agreement contemplates cooperation on other issues to address shared concerns related to nonmarket policies and practices and technology protection.  Specifically, the agreement provides that the United States and EU will work to establish rules of origin “to ensure that the benefits of this agreement flow directly to the United States and the European Union, not to third countries.”  In addition, the agreement provides that the United States and EU agreed to take complementary actions to address non-market policies and practices of other countries (such as in the steel, aluminum, and the critical minerals sectors), and cooperate on export controls, inbound and outbound investment reviews, and duty evasion.

Section 232 tariffs of 50% on European steel, aluminum, and copper will remain in effect, at least for now.  However, the White House fact sheet states that the parties “will discuss securing supply chains for these products.”  This might include a quota-based arrangement and joint actions to address overcapacity.

U.S.-Japan Agreement

The U.S.–Japan agreement establishes a 15% reciprocal tariff on imports into the United States from Japan, which currently is being “stacked” on MFN rates.  There are reports Japan expected that its tariff would be inclusive of MFN rates, similar to the EU model described above.  This 15% base tariff will apply to Japanese exports of automobiles, effectively lowering the current U.S. auto tariff on Japanese cars from 25% to 15%. Like for the EU, the 50% tariff on imports of steel and aluminum remains unchanged.  With respect to pharmaceuticals and semiconductors, according to Japan, Japan will benefit from the same sectoral tariff reductions as other partners, so potentially Japan could receive the same treatment as the EU.

Japan committed to create a $550 billion investment vehicle directed by the United States to fund projects in American industries. This foreign investment pledge – over 10% of Japan’s GDP – will target U.S. strategic sectors like critical minerals, pharmaceuticals and medical equipment, semiconductor manufacturing and research, energy infrastructure, and shipbuilding. President Trump also highlighted that Japan will pursue a major joint venture to import U.S. liquefied natural gas (LNG) from Alaska.

Disagreement remains, however, over the terms for these investments.  According to the White House, the United States would retain 90% of the profits from these Japanese-funded investments. Meanwhile Japan characterized profits from the $550 billion investment as flowing to each country based on their respective contributions.  The exact structure and enforceability of this $550 billion fund also remain uncertain. Japanese officials have described this as a proposed credit facility involving government-affiliated banks, with details to be worked out and possibly counting already-planned investments toward the total.

Japan also agreed to expand import access for various U.S. exports. President Trump stated that Japan will reduce tariffs and increase import quotas on U.S. agricultural products (such as rice, corn, and soybeans), while the framework includes a reported commitment by Japan to purchase 100 Boeing aircraft to bolster aerospace trade. Japanese regulators additionally removed certain non-tariff restrictions on food and agriculture as part of the deal, although the extent of new quotas (for example, on U.S. rice imports) is still being debated domestically in Japan.  Japan also agreed to lift non-tariff barriers that the administration considers have limited U.S. auto exports – for example, accepting U.S. automobile safety standards and other regulatory approvals in Japan.

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With bilateral negotiations continuing and the results of a number of Section 232 investigations still pending, the overall tariff situation will remain unsettled and subject to frequent changes.