The European Commission (EC) has confirmed it is to suspend a planned increase of tariffs on a range of imports from the US expected to come into force next month.
Additional costs were set to be brought in on products including bourbon whiskey and Harley-Davidson motorcycles imported from the US from June 1st, as the latest stage in the EU's response to US-imposed tariffs on EU metal imports.
However, in a joint statement, both sides have shelved further measures and agreed to talks aiming to bring an end to the situation.
EC executive vice-president Valdis Dombrovskis, US trade representative Katherine Tai and US secretary of commerce Gina Raimondo announced discussions to address excess capacity in the global steel and aluminum markets and develop joint solutions to preserve these industries.
Mr Dombrovskis said: "We are creating the space to resolve these issues before the end of the year."
The dispute dates back to 2018, when then-president Donald Trump imposed new duties on European steel and aluminum imports, which were said to be necessary in order to protect US national security.
Mr Dombrovskis added: "The EU is not a national security threat to the US. But the distortions created by global excess capacity - driven largely by third parties - pose a serious threat to the market-oriented EU and US steel and aluminum industries and the workers in those industries."
He also said he is pleased to see that efforts to reach out to the Biden administration and reset transatlantic relations after a turbulent few years are bearing fruit.
Industry groups in the US reacted positively to the development, with Chris Swonger, president of the Distilled Spirits Council, saying: "This news couldn’t come soon enough. Distillers across the United States are breathing a huge sigh of relief after bracing for a 50 percent tariff on American whiskeys in just a matter of days."
He added that had they gone into effect, the increased tariffs would have forced many smaller craft distillers out of the lucrative EU market.
