President Trump and Prime Minister Starmer have jointly launched the U.S.-UK Economic Prosperity Deal (EPD). This initiative outlines the shared intent of both governments to make trade between the United States and the United Kingdom fairer, simpler, and more substantial. Formal negotiations have begun, with a commitment to expand the agreement over time as sectors mature and mutual priorities evolve.
The United States and the United Kingdom expect the EPD to address three core objectives, based on fairness and reciprocity. It is designed to grow the quality and volume of mutually beneficial trade, remove regulatory and tariff barriers that hinder businesses, and strengthen their Special Relationship through a durable economic partnership. Both governments have emphasized their intention to increase market access in a way that supports good, high-paying jobs and long-term growth.
A main component of the agreement is its commitment to reducing tariffs on a preferential basis. The United Kingdom will eliminate the 20 percent tariff on U.S. beef and establish a duty-free quota of 13,000 metric tons. It will also offer a duty-free tariff rate quota of 1.4 billion liters for U.S. ethanol. In return, the United States will provide modified tariff treatment for key UK imports, including automotive products. Under the deal, UK car manufacturers will be permitted to export up to 100,000 vehicles annually to the U.S. at a preferential 10 percent tariff rate; exports exceeding that threshold will be subject to the standard 25 percent rate.
Regarding steel and aluminum trade, the United Kingdom has committed to meeting U.S. supply chain security requirements and ownership transparency standards. In anticipation of UK compliance, the United States will establish a tariff quota for UK steel, aluminum, and certain derivative products at Most-Favored-Nation rates. This effort will form the basis of a new, forward-looking framework for trade in these strategic sectors, aligned with shared national security interests and potential future Section 232 determinations.
The agreement also considers enhanced cooperation on pharmaceutical trade. Preferential treatment will be extended in this area, pending the results of ongoing U.S. investigations and UK actions to meet evolving supply chain security benchmarks. Both countries are committed to applying clear rules of origin to safeguard the integrity of the agreement and prevent tariff circumvention.
Beyond tariffs, the EPD addresses a range of non-tariff barriers. The two governments will collaborate to enhance agricultural market access, recognize each other's standards and conformity assessment procedures, and expand mutual recognition agreements in industrial sectors. Future discussions will focus on domestic regulation of services and work toward harmonization of international standards in key industries.
The agreement also sets forth a foundation for expanding digital trade. Negotiations will include digital services, including financial services, as well as commitments to paperless trade, digital customs procedures, and pre-arrival processing. These provisions are expected to streamline the movement of goods and data between the two countries.
In terms of economic security, the United States and the United Kingdom will coordinate closely to address the non-market trade policies of third countries. Both sides also intend to strengthen cooperation on investment screening, export controls, and vendor security for information and communications technologies. In procurement, the UK’s newly established National Security Unit for Procurement and the Procurement Act 2023 establish a framework that ensures continued, reciprocal, and non-discriminatory access for U.S. firms in the UK public procurement market.
Additional negotiations will address strengthening customs cooperation to prevent tariff evasion and illegal transshipment from countries subject to anti-dumping or countervailing duties. The two governments will also identify and promote mutually beneficial trade and investment opportunities in critical sectors. This will involve leveraging government policies, licenses, and private-sector participation to facilitate transactions that contribute to greater economic integration and strategic preparedness.
Discussions are ongoing regarding high-standard commitments in areas such as intellectual property protection, labor rights (including measures to combat forced labor), and environmental sustainability. The agreement will consider the interests of UK territories for which the United Kingdom is responsible for in international relations.
Both countries recognize that the EPD is built on mutual trust and a shared commitment to a fair, reciprocal, and resilient trade relationship. Provisions for consultation and potential amendment are included to ensure the agreement remains responsive to future developments. Either party may withdraw from the arrangement by providing written notice, and the parties will address procedures for review and termination during the course of negotiations.
For additional details, see the official announcements: