The EU plans to suspend approval of a major United States trade deal agreed to in July, signalling a sharp escalation in trans-Atlantic tensions. According to reporting by the BBC, sources close to the parliament’s international trade committee indicate the suspension will be announced in Strasbourg, France, on Wednesday.
The decision comes as President Donald Trump intensifies his efforts to acquire Greenland, having threatened new tariffs over the weekend. The U.S.-EU standoff has “rattled financial markets,” causing shares to fall in both Europe and the United States, where the Dow Jones Industrial Average slid more than 1.7%, and the S&P 500 dropped more than 2%.
The trade agreement, struck at Trump’s Turnberry golf course in Scotland, was designed to lower U.S. levies on European goods to 15% in exchange for European investment. However, approval of the deal has stalled. Manfred Weber, an influential German member of the European Parliament, stated on Saturday that “approval is not possible at this stage.”
The EU-US trade deal suspension may further raise hostilities
Bernd Lange, chair of the parliament’s international trade committee, echoed this sentiment. “There is no alternative but to suspend work on the two Turnberry legislative proposals until the U.S. decides to re-engage on a path of cooperation rather than confrontation,” Lange said. He added that by using tariffs as a coercive instrument, the U.S. “undermines the stability and predictability of EU–U.S. trade relations.”
📢Now official: EU-US deal is on hold until further notice!
Our negotiating team just decided to suspend work of @ep_trade on the legal implementation of Turnberry deal.
Our sovereignty and territorial integrity are at stake. Business as usual impossible #Greenland #tariffs— Bernd Lange (@berndlange) January 21, 2026
French President Emmanuel Macron provided a counterweight to the U.S. administration’s stance, urging the EU to consider retaliatory options, including an anti-coercion instrument dubbed a “trade bazooka.” Macron called Washington’s “endless accumulation” of new tariffs “fundamentally unacceptable, even more so when they are used as leverage against territorial sovereignty.”
The suspension of the deal raises the possibility of renewed trade hostilities. A reprieve on previous EU retaliatory levies is set to end on Feb. 6. Unless the EU extends the reprieve or approves the deal, EU levies on approximately US$109 billion of American goods could come into force on Feb. 7.
The US warned the EU not to retaliate
U.S. officials warned against retaliation. According to the reporting, U.S. Treasury Secretary Scott Bessent urged European leaders to “take a deep breath” and “do not retaliate,” while U.S. Trade Representative Jamieson Greer warned that “crazy things happen” when countries do not follow U.S. advice.
Meanwhile, Canadian Prime Minister Mark Carney also criticized the current geopolitical climate in a speech in Davos.
Carney warned that negotiating bilaterally with a “hegemon” forces nations to negotiate from weakness, describing it not as sovereignty but as “the performance of sovereignty while accepting subordination.”