On June 16, 2025, President Trump issued an Executive Order titled "Implementing the General Terms of the United States of America-United Kingdom Economic Prosperity Deal" ("the E.O."). The E.O. implements several changes to tariffs on UK imports based on "General Terms" agreed to by the U.S. and UK that were previously announced on May 8, 2025.1
The E.O. highlights certain benefits of the new trade deal including increased access to British markets for U.S. exporters or beef, ethanol, and other agricultural products and the reduction of non-tariff barriers for US exports. It reiterates that the U.S. is committed to negotiating favorable treatment of pharmaceutical and pharmaceutical ingredient imports from the UK, dependent on the result of an ongoing investigation into pharmaceutical imports under Section 232 of the Trade Expansion Act and the UK's compliance with supply chain security standards. Notably, the E.O. also references the parties' commitment, made as part of the original General Terms, to adopt a structured approach to negotiations related to addressing U.S. national security concerns related to sectors that may be subject to future Section 232 investigations.
The E.O. also states that the U.S. and UK will establish bilateral tariff-free trade for certain aerospace products in order to strengthen aircraft and aerospace supply chains. The following points provide more detail on the key terms of the E.O.
- Tariff Rate-Quota for Automobiles & Amended Tariffs
on Automobile Parts
- The E.O. establishes an annual tariff-rate quota for automobile imports from the UK. Pursuant to the quota, a combined 10% tariff will apply to the first 100,000 automobiles imported from the UK. Imports in excess of the quota will remain subject to the 25% tariff rate imposed by Proclamation 10908. This quota will come into effect a week after this order's publication in the Federal Register, and it will be adjusted to reflect the term's operational date of May 8 for calendar year 2025.
- Automobile parts from the UK, originally subject to a 25% tariff rate, will now be subject to a 10% tariff as long as they are for use in UK-origin automobiles.
- Reducing Tariffs on Aerospace Sector
- The E.O. states that tariff rates imposed under Executive Order 14257 (i.e. reciprocal tariffs), and tariffs on aluminum and steel imports under Proclamations 9704 and 9705, as amended, will no longer be applied to imports of UK-origin aerospace products that fall under the World Trade Organization Agreement on Trade in Civil Aircraft.
- Potential Future Amendments to Tariffs on Aluminum and
Steel Imports
- While a specific tariff scheme for UK-origin aluminum and steel imports has not been officially established, the E.O .directs the Secretary of Commerce, in consultation with the United States Trade Representative ("USTR"), to develop a tariff-rate quota for steel, aluminum, and their derivative articles. Once the tariff-rate quota is implemented, UK-origin imports of steel and aluminum products in excess of the quota will remain subject to the tariffs on all steel and aluminum imports implemented by Proclamations 9704 and 9705, as amended.
While the E.O. implements key details of the U.S.-UK trade agreement, it is important to note that several tariff-related aspects are yet to be finalized, including the tariff-rate quota for steel and aluminum articles and as well as the implementation of additional tariffs on certain goods subject to future Section 232 investigations. Thus, importers should keep a close watch for additional updates, particularly from CBP via the Cargo Systems Messaging Service ("CSMS"), to remain aware of developing tariff impacts.
Footnote
1. See White House Fact Sheet here.
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