politics

May Could Seek U.K. Tariff Deal With Trump, Risking EU Backlash

U.S. President Donald Trump, left, walks with Theresa May, U.K. prime minister, outside of the White House on Jan. 27, 2017.

Photographer: Olivier Douliery/Pool via Bloomberg

The U.K. refused to rule out seeking its own exemption from U.S. steel tariffs, risking a legal dispute with the European Union that could sour Brexit talks.

EU officials are pressing President Donald Trump to exclude the bloc from the border charges he slapped on foreign steel and aluminum this week. The U.K. said on Friday that it’s working with its EU partners on the matter.

But both Prime Minister Theresa May’s office and the Department for International Trade wouldn’t say whether the U.K. could legally accept a tariff exemption that does not apply to the rest of the EU. British officials said they did not want to speculate on how the issue could be resolved.

The U.K. would risk a legal challenge from the EU if it went ahead with its own exemption, because its still a member of the bloc. Such a move would threaten to add further tension to already strained negotiations over the U.K.’s withdrawal from the EU.

For Brexit enthusiasts like Trade Secretary Liam Fox, strengthening the U.K.’s economic relationship with the U.S. is a key advantage of the split.

Fox will travel to Washington next week and “will be making the case on behalf of the U.K. and on behalf of British industry,” May’s spokesman Max Blain told reporters in London on Friday. “It would be a matter for the U.S. to decide on exemptions.”

Read more: EU Says It’s Counting on Exclusion From Trump Metal Tariffs

U.K. steel is used for U.S. military equipment, which Fox said late Thursday makes it “doubly absurd” to be caught in the measure. A key goal of the minister’s trip will be to gather further details of Trump’s proposals, Blain said.

EU officials underlined the need to work in unison.

“Our presumption is that the EU is a whole body and that the U.S. will respect that,” the bloc’s trade chief Cecilia Malmstrom said. “Otherwise that is questioning the whole EU as a project, which is quite dramatic. And our U.K. friends have been crystal clear in working on European unity.”

    Before it's here, it's on the Bloomberg Terminal. LEARN MORE