Green Deal: Four aids for US companies in tariff agreement

Through the extensions and simplifications announced in the "Omnibus" package, Europe has gradually begun to ease the burden of the Green Deal on its companies. However, these companies now risk playing a less equal role with US companies operating on our continent, as a result of the commitments shared by the Brussels and Washington administrations in the joint declaration on tariffs.

While much attention focused on the final tariff rate and the possible and ultimately unsuccessful exemptions (primarily for wine, steel, and aluminum), the parties established in points 10, 11, and 12 of the Joint Statement released last week a certain degree of flexibility for US companies affected by the Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD), the Carbon Border Adjustment Mechanism (CBAM), and the Deforestation Regulation. While the impact of these rules is generally expected to be milder than the initial framework, due to the new von der Leyen presidency's departure from the environmental orthodoxy that inspired them, the possibility of a two-track approach could now represent a competitive disadvantage for European companies.

Let's look in detail at the principles included in the declaration with reference to US companies operating in Europe.

The first, under point 10, concerns the Deforestation Regulation, which requires companies to perform due diligence to ensure that certain raw materials and products sold in or exported from the EU do not result in deforestation or forest degradation. Europe has already postponed its application by one year, to December 30, 2025, for large operators and traders, and to June 30, 2026, for micro and small businesses. The joint statement reads: "Recognizing that the production of the goods in question on US soil poses a negligible risk to global deforestation, the European Union is committed to working to address the concerns of US producers and exporters regarding the EU Deforestation Regulation, in order to avoid an excessive impact on US-EU trade."

Point 11 concerns the CBAM, a mechanism that aims to equalize the carbon price applied in the EU internal market and that applied to imports. This effectively introduces a form of taxation on imports of electricity, cement, fertilizers, pig iron, iron, steel, aluminum, and hydrogen from non-EU countries. In the "Omnibus" package, the European Commission, also at the urging of Italy, which along with other European states had highlighted excessive rigidity, proposed easing the burden on SMEs. Now, in the document shared with Brussels, the US has secured a move further: "Recognizing the United States' concerns regarding the treatment of US small and medium-sized enterprises under the Carbon Border Adjustment Mechanism (CBAM), the European Commission, in addition to the recently agreed increase in the de minimis exception, is committed to working to provide further flexibility in the implementation of the CBAM."