Following the US announcement to rescind the tariffs exemption on steel and aluminium coming from the EU, the EU Member States unanimously supported the EU Commission proposal for countermeasures, which entered into force on Friday 22 June. The full list of products can be found on the Commission's website
What does it means for the Cosmetics Industry?
A tariff of 25% on the following cosmetics coming from the US has been introduced on 22 June:
- 3304 20 00 - Eye make-up preparation
- 3304 30 00 - Manicure and pedicure preparation
- 3304 91 00 - Make-up or skin care products incl. baby powders whether or not compressed
The EU and US have announced that they will continue negotiations which could lead over time to changes in the scope of the US and EU measures.
The EU decision to impose high tariffs on make-up products coming from the US will have a significant impact on EU cosmetic companies, including some UK companies. CTPA has shared with Government officials its concerns on the consequences the EU retaliation lists will have on our sector and, in particular, SMEs. Companies will be affected at different levels. For example, either because they own US brands exporting to the UK or because the company outsources manufacturing to US subcontractors. In addition, there are examples of US companies or brands that are actually manufacturing within the EU and where those products are subsequently re-imported into the EU; in this case a tariff could well damage EU manufacturing interests. The EU cosmetics sector has significant reliance on US imports because of the international integration of supply chains for a global industry; it is difficult to see how this measure will protect the EU industry as such imports cannot be easily replaced. This is particularly true with the make-up category, because of the number of different shades involved.
Over the past months CTPA has been proactive and has engaged at various levels including the EU Commission via Cosmetics Europe and in the UK with the Department for Business, Energy and Industrial Strategy (BEIS) and the Department for International Trade (DIT). The industry's collective actions have already resulted in lip products and some raw materials (mostly fragrance) being removed from the priority list. We will continue to collaborate with relevant stakeholders in case the negotiations evolve and/or the opportunity arises for the EU lists to be amended.