The European Parliament suspended ratification of a major trade agreement with the United States on Monday, following last week’s Supreme Court decision that invalidated the majority of President Donald Trump’s emergency tariffs.
Lawmakers convened for urgent discussions in Brussels before announcing the freeze.
“Nobody knows what will happen … and it’s unclear if there will be additional measures or how the United States will really guarantee” its end of the agreement, said Bernd Lange, who chairs the parliament’s trade committee.
The American position has become “so uncertain,” according to parliamentary officials.
EU trade spokesman Olof Gill stated earlier on Monday that Washington must provide clarity on its intentions, noting that responses from the Trump administration have failed to address the bloc’s concerns adequately.
Mr Trump responded to the developments with threats on Truth Social, warning that nations attempting to “play games” with what he termed the “ridiculous supreme court decision” would face substantially higher import duties.
“BUYER BEWARE!!!” the President wrote.
Markets reacted sharply to the combination of uncertainty and presidential threats.
European Parliament halts US trade deal ratification after Supreme Court blocks Trump tariffs
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GETTY
The Dow Jones Industrial Average shed more than 710 points, representing a decline exceeding 1.4 per cent.
The S&P 500 dropped one per cent whilst the Nasdaq fell 1.3 per cent, with American indices hitting their session lows.
European markets also suffered losses, with the pan-European Stoxx 600 sliding 0.2 per cent.
Major indices in Germany, Norway, Switzerland, Belgium and Sweden all finished in negative territory.
Donald Trump’s Truth Social post
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Truth Social
The agreement, finalised last July between Trump and European Commission President Ursula von der Leyen, was designed to remove what the White House described as trade barriers across multiple sectors for American exporters.
The administration characterised the deal as a “generational modernisation of the transatlantic alliance.”
Ms Von der Leyen said the arrangement offered “stability and predictability, for citizens and businesses on both sides of the Atlantic.”
Under its terms, most American tariffs on EU imports would be capped at 15 per cent, with duties eliminated entirely on aircraft components, generic pharmaceuticals, semiconductor equipment, certain agricultural goods and critical raw materials unavailable domestically in the US.
This marks the second time lawmakers have paused the ratification process.
In mid-January, the parliament initially halted proceedings after President Trump threatened additional tariffs against eight European nations over his ambitions regarding Greenland.
Indian trade negotiators have scrapped a scheduled visit to Washington for discussions on a pending bilateral agreement, according to multiple reports.
The Indian Commerce Ministry declined to comment on the cancellation.
China announced overnight that it is examining the court’s ruling and seeking additional information from American officials.
Donald Trump has been urged to abandon tariffs
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GETTY
Beijing also urged the United States to completely abandon its tariff regime.
Following Friday’s Supreme Court decision, Mr Trump signed an executive order establishing a 10 per cent worldwide tariff under separate legal authority unaffected by the ruling.
By Saturday, he announced plans to increase this rate to 15 per cent, though the White House has yet to publish an updated executive order.
Customs and Border Protection confirmed that duties under the invalidated tariffs will cease being collected from Tuesday.