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Custom : 90 day suspension on the higher reciprocal tariffs

Michaela MerzLeave a comment

President Trump has announced a 90-day suspension on the higher reciprocal tariffs, while keeping a base rate of 10% for all countries. However, US tariffs on Chinese goods have been increased to 125%.

Following a vote between European Officials on April 9th, the final list of retaliatory measures was approved with a three-stage staggered implementation, consisting of €3.9 billion of goods on 15 April, €13.5 billion of goods from mid-May and €3.5 billion of goods in December. Following the last-minute announcement by President Trump of the 90 days pause, it is to be determined how the EU will proceed with their retaliatory measures.

Given these developments, it buys a little bit of time to get a view on the impact of customs and trade matters and take appropriate actions. This remains a fast moving situation even if the next 90 days might provide somewhat of a relief. While a lot of uncertainty remains, there is a certain degree of certainty in that the 10% tariffs will not go away and at the same time some worst case scenario planning can be done based on President Trump’s announcements from Liberation Day (as well as those following in respect of China). This certainty provides opportunity to take a number of no-regret actions which provides better clarity on the mitigation and strategic options available:

  • Calculate your potential tariff exposure and assess the impacts of new tariffs on the supply chain;
  • Consider short term / quick win mitigation options such as customs reliefs and certain business model adjustment strategies;
  • Consider any short term restructuring options which will limit tariff exposure;
  • Analyze and consider medium to long term strategy to allow to scenario plan for various options related to tariffs and potential long-term supply chain restructuring;
  • Consider wider business impacts beyond tariffs (corporate tax, TP, supply chain, corporate affairs, investor relationships, M&A pipeline, working capital, customer and supplier relationships).

We will keep you posted on further developments.

In the meantime feel free to reach out directly to our Customs and Trade Team:

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