EU refuses to roll back green rules despite US trade pressure

The European Union has drawn a line under its green and digital rulebooks, telling member states it will not dismantle legislation on supply chain due diligence, climate transition plans or platform regulation as the price of a transatlantic tariff deal. The message, delivered by the Commission's top trade official Sabine Weyand in a restricted ambassadorial meeting on Wednesday, marks the clearest public signal yet that Brussels is prepared to absorb US tariff pressure rather than rewrite laws it considers settled.

The US paper and what it demands

The trigger was a negotiating document drafted by the Trump administration and handed to Brussels after the July handshake agreement between Ursula von der Leyen and Donald Trump at the US president's Turnberry golf resort in Scotland. According to diplomats briefed on the contents, the paper brands the EU's Corporate Sustainability Due Diligence Directive and Corporate Sustainability Reporting Directive "serious and unwarranted regulatory over-reach" that "imposes significant economic and regulatory burdens on US companies." It seeks a commitment that Brussels will drop requirements for American firms to produce climate transition plans and to address environmental and human rights violations in their supply chains.

The Financial Times first reported the language of the US paper on Wednesday. The Commission's response, relayed by Weyand to the Political and Security Committee in a no-phones, restricted-format session, was blunt: the executive will not use the US document as a basis for negotiations. "We have always said, we are not negotiating on these issues," one Commission official told reporters afterwards. An envoy from a member state characterised the American broadside as a classic negotiating tactic: "They have their red lines and we have ours."

From Turnberry to the negotiating table

The July Turnberry meeting produced a joint statement that both sides hailed as a framework for resolving tariff disputes and deepening the transatlantic trade relationship, worth trillions of dollars in annual flows. The statement spoke of regulatory cooperation and mutual recognition but did not, according to EU officials, envisage legislative rollback. The US paper delivered weeks later represents a hardening of the American position, backed by business groups that see the EU's sustainability and digital rulebooks as extraterritorial overreach.

National capitals have not been given access to the US negotiating paper, a measure of the sensitivity surrounding the talks. The restricted format of Wednesday's meeting, reserved for the most classified discussions, underscores that the Commission is managing this as a core strategic issue rather than a routine trade irritant. Olof Gill, the Commission's deputy chief spokesperson, refused at Thursday's daily briefing even to confirm receipt of the US position paper. "We are focused on the faithful implementation of the EU-US joint statement, which we believe is essential to preserving our unmatched transatlantic trade," he said. "We are not rolling back on any of our laws."

The deregulation overture and its limits

There is nuance beneath the flat refusal. In the framework agreement published in August, the EU committed to addressing US concerns about the Corporate Sustainability Due Diligence Directive as part of a broader deregulation drive aimed at simplifying rules and boosting competitiveness. Officials describe this as an overture to Washington, a willingness to streamline reporting thresholds, clarify guidance and reduce administrative burden for smaller companies. But the distinction between simplification and repeal is where the transatlantic fight now sits.

American officials, supported by corporate lobbyists, are treating the simplification agenda as an opening to push for the legislation to be dropped entirely. The Commission's internal view, according to one official, is that the US has launched a "new impetus" to exploit the deregulation rhetoric. Brussels calculates that conceding on substance would not only undermine the Green Deal architecture but invite further demands on digital regulation, where the Digital Markets Act and Digital Services Act already target predominantly American platforms.

Digital rules in the crosshairs

The pressure extends well beyond green legislation. The Trump administration has consistently attacked the EU's digital rulebooks, arguing they unfairly punish US tech giants. Henna Virkkunen, the Commission executive vice-president responsible for digital policy, addressed the issue directly in an interview on Wednesday. "It's important to stay calm, even if there are different kinds of attacks against this legislation," she said. "We are fully enforcing the rules all the time, and everybody can be ensured on that."

Virkkunen's language, "different kinds of attacks", reflects a growing perception in Brussels that the US is pursuing a coordinated strategy across trade, tech and climate policy. The Commission has opened non-compliance investigations against Apple, Meta and Alphabet under the Digital Markets Act this year, drawing sharp criticism from Washington. The EU's stance is that enforcement is a legal obligation, not a bargaining chip.

Internal cohesion and the competitiveness agenda

The EU's ability to hold the line depends on member state unity. The competitiveness agenda championed by former European Central Bank president Mario Draghi in his September report has given some capitals, notably Berlin and Paris, an incentive to streamline regulation domestically. But there is a sharp distinction between simplifying implementation and accepting external diktat. The restricted briefing was designed to ensure capitals hear the Commission's assessment directly, without leaks that could be spun as European weakness.

Diplomats from several member states said the mood in the room was supportive of Weyand's line. One northern European envoy noted that the US demand to drop supply chain due diligence would also disadvantage European companies that have already invested in compliance. "You cannot ask us to unlevel the playing field for firms that did the work," the envoy said. The Commission's calculation is that a unified front, backed by the legal certainty of existing legislation, is a stronger negotiating position than pre-emptive concession.

The European Council test

The next political checkpoint is the European Council summit later this month, where leaders will discuss how to "reassert Europe's interests, values and regulatory autonomy," according to a draft agenda seen by reporters. The phrasing is deliberate: it frames the dispute not as a trade spat but as a defence of the EU's legislative sovereignty. The summit will not produce a formal decision on the US talks, that remains the Commission's competence, but it will signal whether national leaders back the executive's refusal to negotiate on legislation.