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On May 8, 2025, the United States and the United Kingdom announced a new “trade agreement”. The Fact Sheet issued by the White House, can be found here. The Office of the United States Trade Representative has released the Agreements in Principle, which indicate that the terms of trade agreement are still a work in progress and the terms are not all final. Some of the initial terms of the Agreements are provided below:

  • Tariffs: The U.S. and UK will reduce their applied tariff rates on a range of originating goods following a reasonable period of negotiation. According to the Fact Sheet, the 10% reciprocal tariff on goods from the U.K. remains in effect.
  • Automobiles and Auto Parts: The Section 232 tariff on automobiles will be reduced from 25% to 10% for the first 100,000 UK origin automotive imports each year. Any additional vehicles imported each year will be subject to the existing 25% tariff. The U.S. will create a similar arrangement for covering parts for such automobiles.
  • Beef and Ethanol: The UK will grant increased market access for U.S. ethanol and beef. The UK will create a preferential duty-free quota of 13,000 mt for U.S. beef. In return, the U.S. will reallocate to the UK 13,000 mt of its existing “Other Countries” tariff rate quota (TRQ) for beef. Additionally, the UK will offer a preferential duty-free TRQ of 1.4 billion liters of U.S. ethanol. The U.S. and the UK also agreed to work together to enhance industrial and agricultural market access. 
  • Steel and Aluminum: The agreement establishes a new trading union for steel and aluminum and the countries will negotiate alternative arrangements to the Section 232 tariffs on steel and aluminum. The UK will work to meet U.S. requirements on the security of the supply chains of steel and aluminum products intended for export to the United States and on the nature of ownership of relevant production facilities. The United States, in turn, will construct a quota at most favored nation (MFN) rates for UK steel and aluminum and certain derivative steel and aluminum products.
  • Pharmaceuticals: Depending on the outcome of the ongoing Section 232 investigation of pharmaceuticals and pharmaceutical ingredients and compliance with supply chain and security requirements, the U.S. and the U.K. will negotiate significantly preferential treatment outcomes on pharmaceuticals and pharmaceutical ingredients.