The tool, which was drawn up during Trump’s first term and subsequently used as a deterrent against China, allows the EU’s executive arm to impose restrictions on trade in services if it determines that a country is using tariffs on goods to force changes in policy.

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The European Union wants to engage swiftly with the United States over President Donald Trump's planned tariffs, trade chief Maros Sefcovic said on Tuesday, while his boss Ursula von der Leyen forecast negotiations with Washington would be tough.

US President Donald Trump said he will “definitely” place new tariffs on the European Union, reiterating complaints about the US trade deficit with the bloc and what he sees as insufficient EU imports of American cars and agricultural products.

Donald Trump is considering plans to impose a 10 per cent tariff on the EU, The Telegraph understands. The move would pour fuel on a blooming global trade war, which began at the weekend when the US president slapped sweeping levies on goods imported from Mexico, Canada and China.

The European Union (EU) said it will “respond firmly” if President Trump signs tariffs that could impact its member countries. A spokesperson for the union said that the 27-member group was not

The European Union is preparing for a transatlantic trade fight, but US President Donald Trump’s decision to delay broad tariffs on Mexico and Canada this week has bolstered confidence in the bloc that it will be able to negotiate an acceptable outcome.