BRUSSELS — The European Commission announced on Friday, January 23, 2026, that it will propose a six-month extension to the suspension of a massive 93 billion euro ($109 billion) retaliatory trade package against the United States. The decision marks a significant de-escalation in a high-stakes standoff that had brought the world’s two largest trading partners to the precipice of an all-out trade war.
The move follows a sudden diplomatic breakthrough regarding President Donald Trump’s recent threats to impose tariffs on European allies as leverage for the United States to acquire Greenland.
The “Greenland Gamble” and the EU Response
The retaliatory package, originally designed in 2025 during the “Turnberry” trade negotiations, was set to reactivate on February 7, 2026. Tensions spiked last week after President Trump threatened a 10% tariff—rising to 25% by June—on eight European nations (Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands, and Finland) that opposed his Arctic ambitions.
In response, Brussels dusted off its most potent economic weapons:
- The €93B Package: Targeted tariffs of 25% on iconic American exports, including Boeing aircraft, Harley-Davidson motorcycles, Levi’s jeans, and Lucky Strike cigarettes.
- The Anti-Coercion Instrument (ACI): A “nuclear option” that allows the EU to restrict U.S. companies’ access to the European single market, public tenders, and commercial licenses.
A Return to “Predictability”
The cooling of tensions arrived on Wednesday when President Trump signaled a “climbdown,” stating that a new framework for expanded military access to Greenland had been negotiated with Denmark and NATO, effectively shelving the immediate tariff threat.
“With the removal of the tariff threat by the U.S., we can now return to the important business of implementing the joint EU-U.S. statement,” said Commission spokesman Olof Gill. He clarified that while the countermeasures remain suspended, the EU retains the legal right to “unsuspend” them should the geopolitical climate shift again.
| Metric | Trade Package Details | Status |
| Total Value | €93 Billion ($109.2B) | Suspended |
| Expiration Date | Originally February 7, 2026 | Extended to August 2026 |
| Primary Targets | Aircraft, Chemicals, Medical Devices | On Standby |
| Key Instrument | Anti-Coercion Instrument (ACI) | Unused; Active |
The Path Ahead for the US-EU Trade Deal
The suspension provides much-needed breathing room for the ratification of the presidential trade agreement negotiated last summer between President Trump and Commission President Ursula von der Leyen.
The European Parliament had formally frozen the ratification process earlier this week in protest of the Greenland threats. Following the Commission’s announcement, Parliament President Roberta Metsola indicated that lawmakers are likely to resume work on the deal as early as Monday, January 26.
Despite the relief in Brussels, EU leaders remain “extremely vigilant.” French President Emmanuel Macron and European Council Chief António Costa warned that while diplomacy is the preference, the bloc’s “trade bazooka” is loaded and ready should the “dangerous downward spiral” of threats return to the Atlantic.
