BRUSSELS — America’s ambassador to the EU called on the European Parliament to back the trade deal struck with President Donald Trump, arguing it would unlock deeper transtlantic cooperation on energy, tech and AI. Speaking to POLITICO on Monday, Andrew Puzder cautioned that it would be a mistake to allow a further delay of the deal reached last July at Trump’s Turnberry golf resort in Scotland, but has still to be implemented on by the EU side. “All of the signals are good, but you never know. We’re hopeful, but we want to be careful and make sure that we don’t take anything for granted,” Puzder said in an interview at the U.S. mission in Brussels.  “It’s in the best interest of the European Union and the United States that it passes,” he added. “Some people might think that politically, it might give them an advantage to vote against. I hope that’s not the case. But economically, it’d be malpractice not to vote for this in the EU.” Puzder highlighted the importance of the EU’s commitment to spend $750 billion on U.S. energy under the Turnberry deal.  “Europe’s going to need that energy,” he said. “So we need to cut back on the regulatory restrictions to our shipping them the energy and also the regulatory restrictions that make that energy more expensive once it gets here.” IT’S BEEN LONG ENOUGH Puzder, a former fast food executive nominated by Trump, started the role last September and made an early impression in Brussels with his plain speaking. He told POLITICO in December that the EU should stop trying to be the world’s regulator and get on instead with being one of its innovators.  His latest remarks came amid mounting U.S. frustration over the EU’s slow pace in keeping its side of the bargain, under which it would scrap import duties on U.S. industrial goods. The enabling legislation is now up for a plenary vote in the European Parliament on Thursday. If it passes, talks between EU lawmakers, governments and the Commission would then begin on finally implementing the tariff changes. “We’re anxious to get this through the process. We understood they had to go through a process, but it’s been long enough. And hopefully we’ll get through it on Thursday and we can both move on to more economically beneficial endeavors,” Puzder stressed.  Trade lawmakers backed amendments at the committee stage to strengthen the EU’s protections in case Washington doesn’t respect its side of the deal.  They for instance introduced a suspension clause if Trump threatens the EU’s territorial sovereignty, as he did earlier this year when he pushed to annex Greenland. MEPs also added another provision that foresees that the deal would expire in March 2028.  Puzder declined to speculate on whether the deal could unravel altogether if the U.S. president were to launch any renewed threats.  “I hate to prejudge where this is going to go,” he said. “What everybody’s been saying on both sides is a deal is a deal. We had a deal; hopefully we still have a deal.” The ambassador stressed there had been a “very good two-way communication” between Trump’s team of Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick, and the European Commission, as well as with Bernd Lange, who chairs the European Parliament’s Trade Committee.   “I’ve also had a number of meetings with Bernd Lange and members of parliament on these issues. So the communication has been very good and very open throughout this process,” Puzder said.

LONDON — Trade Secretary Peter Kyle is expected to announce the U.K.’s steel strategy at Tata Steel UK’s mill in Port Talbot on Thursday. The strategy will set out new protections for Britain’s steel sector, slashing quotas on imports of many products from overseas while raising duties outside those caps to 50 percent, two people familiar with the announcement told POLITICO. “The tariff will be doubled to 50 percent in line with what the Europeans have done, the Canadians have done, the Americans have done,” a senior business representative familiar with the plans said. There will “be some exemptions” for products British steelmakers don’t make, they added. British officials have told both U.K. steel producers and downstream importers, who use steel in everything from construction to automotive manufacturing, to expect a 50 percent duty outside of new quotas in a move “likely to be similar to the EU,” said a second industry figure. Both industry figures were granted anonymity as they were not authorized to speak publicly. Last October, the EU announced plans to reduce its quotas on foreign steel imports by almost half and levy a 50 percent tariff on goods exceeding the cap. The move is part of an overhaul of so-called safeguard protections that expire in both the EU and U.K., under World Trade Organization rules, at the end of June. The U.K.’s strategy setting out the future of the sector has been repeatedly delayed. On Thursday, Kyle will set out a new scheme of trade protections to replace the so-called steel safeguards scheme. A Tata Steel UK executive told lawmakers in early February that the government “had eight weeks to save the British steel industry” by shielding it with new protectionist measures from a glut of cheap imports from countries like China. Steel importers, however, are unlikely to get the full gamut of exemptions under the scheme they had hoped for, said the second industry figure, noting they’re “prepared for the worst.” The government will “jeopardize downstream manufacturers if they make the import restrictions too prohibitive,” they said. “There will be some exemptions, but not as many as they hoped for,” said the senior business representative. “This government has been crystal clear in committing to a bright and sustainable future for steelmaking and steel jobs in the U.K., and we will publish a steel strategy shortly setting out how we can achieve a sustainable future for the sector,” said a government spokesperson.

Just three weeks after the Supreme Court handed President Donald Trump a stinging defeat over the sweeping tariffs he imposed last year, the legal battle over his first move to replace those import taxes is heating up. Democratic attorneys general and governors from 24 states and a libertarian group representing two small businesses filed their first legal briefs Friday asking a federal trade court to strike down the 10 percent tariffs Trump imposed on most U.S. trading partners in February. Trump promised to hike those tariffs to 15 percent, but hasn’t yet done so. Legal experts told POLITICO that Trump’s backup tariffs are probably on stronger legal footing than the “Liberation Day” taxes the high court struck down. Despite that, his challengers are exuding bravado about their chances. “We are 100 percent confident that we will be successful in the Court of International Trade,” New York Attorney General Letitia James told reporters last week. Trump is also projecting confidence, repeatedly claiming that the same Supreme Court went ahead and blessed his use of other authorities, like the so-called Section 122 tariffs he’s turned to as a short-term fix. That is not true. While the three justices who dissented from last month’s decision did cite Section 122 as one of the tools Trump could use to rebuild his tariff scheme, the court’s six-justice majority explicitly declined to embrace that position. “We do not speculate on hypothetical cases not before us,” Chief Justice John Roberts wrote. While Trump called his new approach “time tested,” that authority has never been invoked before and the high court has not given its blessing to Trump using that specific law in the current circumstances. Here’s a look at the key issues in the legal fight over Trump’s replacement tariffs: A NEW RATIONALE The Supreme Court resolved the earlier Trump tariff case by finding that the statute Trump invoked, the International Economic Emergency Powers Act, conferred no power on any president to impose tariffs. With that off the table, the court did not have to examine whether the global emergency Trump asserted existed. The new challenges could face a bigger hurdle because their arguments will require judges to second guess Trump’s conclusion that the U.S. faces a “large and serious balance-of-payments deficit.” “The bottom line here is: How much deference does the president get in determining … this sort of predicate condition — that there’s a large and serious payments problem?” said Matthew Seligman, a lawyer representing importers seeking refunds of the previous tariffs. “How much deference does the president get in his determination in deciding how large is large and how serious is serious?” “I think [it] will probably be the court’s instinct to defer to the president’s determination that, whatever it is ‘balance of payments’ means, that the requisite facts on the ground exist,” Duke University law professor Timothy Meyer said. DEFINING ‘BALANCE OF PAYMENTS’ The text of the law Trump invoked for his latest round of tariffs, Section 122 of the Trade Act of 1974, makes eight references to “balance of payments” issues. Yet, it offers no definition of the term. Some experts contend the phrase refers to a specific problem the U.S. faced in the years leading up to the law’s enactment, involving the U.S. government buying or selling foreign currency to adjust or maintain exchange rates. “A balance of payments deficit is a term of art incorporating into law a settled meaning from international financial accounting,” the blue states’ lawsuit says. “A trade deficit does not qualify, either as a matter of economics or of law, as a balance of payments deficit.” “The president has tried to pull a fast one by switching the term balance of payments to mean balance of trade, in other words, a trade deficit. But those two things aren’t the same thing,” said Jeffrey Schwab of the Liberty Justice Center. However, other experts say the lack of a definition may indicate that different lawmakers had different views of what “balance of payments” meant and what problem they were trying to fix. “They had a broader set of problems in mind … .They weren’t seemingly talking about just official payments,” said Brad Setser, a Treasury Department official under President Barack Obama and an adviser to the U.S. Trade Representative under President Joe Biden. One awkward aspect for the White House: during the pitched battle over the “Liberation Day” tariffs, the administration’s lawyers suggested that Section 122 wasn’t a viable option to address the trade deficit. “Trade deficits … are conceptually distinct from balance-of-payments deficits,” Justice Department attorneys told the Court of Appeals for the Federal Circuit last June. TRUMP’S CARVE-OUTS The law Trump invoked for the replacement tariffs says they should be “of broad and uniform application,” but the president’s approach seems far from that standard. Attached to the proclamation he issued are 88 pages of exemptions and exceptions. The fine print waives the new tariffs for Mexico and Canada and some goods coming from Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua. Trump also carved out a slew of product categories where consumers regularly complain about higher prices, including many foods, cars and prescription drugs. “The exemptions and exceptions the President has made are in direct violation of the text of Section 122, which requires generally uniform treatment the President is declining to observe,” Liberty Justice Center argues in the lawsuit filed on behalf of two importers, Burlap and Barrel and Basic Fun! But the law does contain wiggle room to exclude some products or single out countries in some circumstances. Trump’s proclamation seeks to invoke those exceptions, although many dispute whether his assertions about the current state of global trade and “the needs of the United States economy” are actually true or are just parroting the language in the statute. It’s unclear whether judges will accept Trump’s claims at face value and whether they have time to dig into such factual disputes on the accelerated timetable the challengers have demanded. Another uncertainty is whether a court that strikes down the carve-outs would throw out the tariffs altogether or do what Trump’s proclamation urges in such a scenario: wipe out the exemption and keep the broader tariffs. CAN THE COURTS BEAT THE CLOCK? The law Trump used to deploy the new tariffs limits his move to 150 days, roughly five months. While that may weaken Trump’s hand in negotiations with trading partners and force him to look to other tools to sustain his tariff policies, the short fuse means that the courts are unlikely to deliver a final verdict on the legality of the president’s action before it expires on July 24. In the challenges to Trump’s earlier tariffs, lower courts ruled against the policies but allowed the administration to keep collecting the duties while the fight played out. If the pattern holds, it could take months for the lower courts to consider the issues and a year or more if the Supreme Court decides to weigh in. To actually halt the tariffs, opponents will likely have to persuade the trade court or the Federal Circuit to refuse to issue the stays that the White House won the last time around. The Court of International Trade has set arguments on the pending suits, including a request for a preliminary injunction, for April 10. But some expect these cases to take longer to decide than the last time. “I would expect, at every level, that the time to write an opinion would be longer than it was in the IEEPA case because the issues are just more complicated,” Meyer said. WOULD TRUMP DOUBLE DIP? Some trade experts have speculated that, if the courts don’t stop the new tariffs by the time they are set to expire in July, Trump could attempt to re-issue them for another 150 days, perhaps with a few tweaks to make them a bit different than during the first phase. The statute doesn’t directly prohibit re-upping, but does say it’s up to Congress to extend such tariffs beyond the 150-day period. “It’s arguably a little ambiguous, if he wanted to re-declare a balance of payments emergency right after,” said Stanford Law Professor Alan Sykes. “Certainly the statutory language, to me, implies that the Congress did not want to leave that loophole in place. If I were the judge, I would say that that’s not permissible.”

BRUSSELS — The EU will respond “firmly and proportionately” to any breach of its trade deal with the U.S. reached last year, European Commission spokesperson Olof Gill said Thursday. Gill was responding to probes into unfair trade practices launched by the U.S. overnight against the EU and other countries. The broad-spectrum investigations could result in the imposition of new tariffs, raising concerns in Brussels that this would breach the terms of the deal struck at President Donald Trump’s Turnberry golf resort in Scotland. “We have not received any indication that the U.S. administration intends to deviate from those commitments,” Gill told a press conference. He added that the Commission would reach out to its U.S. counterparts to clarify how the investigations would affect the Turnberry deal. U.S. Trade Representative Jamieson Greer said on Wednesday that his department was looking into whether countries’ policies are fueling excess manufacturing capacity — producing far more goods than demand supports — which officials say can flood global markets and squeeze U.S. manufacturers. The so-called Section 301 probes come after the U.S. Supreme Court last month struck down Trump’s original wide-ranging tariffs. The White House subsequently imposed blanket 10 percent tariffs in the interim as it works to enact new duties. Treasury Secretary Scott Bessent this week gave private assurances to EU trade chief Maroš Šefčovič that the U.S. intends to stick to the transatlantic trade deal, which sets a tariff ceiling of no higher than 15 percent on most EU exports.

THE GOLDEN TRIANGLE: CAN 3 TOP OFFICIALS SAVE THE BRITISH ESTABLISHMENT FROM ITSELF? They run Keir Starmer’s office, the king’s business, and the civil service. In moments of crisis when the politicians can’t cope, they run Britain, too.  By TIM ROSS in London Illustration by Natália Delgado/ POLITICO In the heart of historic Westminster, where kings and queens have been crowned in the same way for 1,000 years and 57 prime ministers have come and gone, the most venerable pillars of the British establishment are under unusual strain.  The swirling international scandal over sex offender Jeffrey Epstein’s network of wealth and influence detonated violently in the heart of the U.K. government, rocking both the center of power in Number 10 Downing Street and the British royal family.  Prime Minister Keir Starmer is clinging onto his job amid dire polling, wretched election results and an outcry over his decision to appoint Epstein’s friend Peter Mandelson as ambassador to Washington. The scandal already forced his closest aide to resign.  And King Charles III is trying to prevent his disgraced brother Andrew Mountbatten-Windsor’s friendship with Epstein from trashing the British monarchy itself. Behind the scenes, three dutiful civil servants now find themselves in pivotal roles, trying to guide the prime minister, the king, and hundreds of thousands of public officials through an unprecedented storm. Together, this trio forms what is known as the “golden triangle” at the top of the British state — and if they can’t keep the establishment afloat, no one can.  The three are: Dan York-Smith, Starmer’s principal private secretary, who runs the PM’s Downing Street office; Clive Alderton, the king’s principal private secretary, who is the main link between the monarch and the government; and Antonia Romeo, who recently took up her post as Cabinet secretary — the most powerful civil servant in the country.  Each of these jobs is intense at the best of times. With fresh Epstein revelations expected to compound the pressure from the Middle East war, they’re all likely about to get even harder.  Peter Mandelson has promised to cooperate with the police and vowed to clear his name. | Jordan Pettitt/PA Images via Getty Images In the coming days, the government is preparing to publish a vast trove of internal documents detailing all the private conversations and messages between officials, diplomats and ministers that led up to Mandelson’s appointment as ambassador to Washington, in December 2024. After that, at some point, every internal file relating to Mountbatten-Windsor’s appointment as a U.K. trade envoy more than 20 years ago will also be put into the public domain.  “The most challenging thing will be the release of information — and what that reveals,” said Alex Thomas, a former senior government official and now executive director of the Institute for Government think tank in London. “That’s the moment of jeopardy for the government, for the royal family, and for the civil service.”  At stake, potentially, is the credibility of the British establishment. Mandelson and Mountbatten-Windsor have each separately been arrested on suspicion of misconduct in public office.  If either were to be charged and put on trial, the resulting publicity could be hugely damaging for the monarchy and the government. Mandelson has promised to cooperate with the police and vowed to clear his name. He has previously said he was wrong to have continued his association with Epstein, who died in 2019, and apologized “unequivocally” to Epstein’s victims. Mountbatten-Windsor has not commented on his arrest but has previously denied any wrongdoing. “Much of the stability in our political system comes from a strong civil service and a strong monarchy,” said Cameron Brown, a former special adviser in the previous Conservative government. “If people lose faith in either institution, then god knows what will happen.”  YORK-SMITH: ONE CRISIS… It’s a good job, then, that each one of the three members of the golden triangle has been blooded in crises, and survived — even if their bosses at the time did not.  York-Smith rose to seniority in the Treasury as the top official in charge of writing the government’s annual budget, an exercise in balancing highly contentious and competing demands, and then keeping them secret until they are announced.  While his background in fiscal policy will no doubt have helped make York-Smith an attractive hire for Starmer, who has sought to prioritize tackling the cost of living, what may ultimately prove more valuable is the official’s experience in one of the worst self-inflicted economic crises to hit the British government in recent memory: Liz Truss’s infamous “mini-budget” of 2022.  “Dan played a key role in the stabilization phase,” said Brown, a special advisor in the Treasury at the time. “He was quite frank about what we needed to do.” That meant scrapping key parts of Truss’s tax-cutting program, which had sent the markets into meltdown and forced her to fire her chancellor, Kwasi Kwarteng. His replacement as the U.K.’s top finance minister, Jeremy Hunt, listened closely to York-Smith and other officials and took their advice, Brown said.  That was typical for York-Smith, whose natural authority, intelligence and composure gave him influence.  “I always found him to be exceptionally calm, cool-headed, personable and ultimately an intelligent guy. He’s more than capable and is very good at identifying problems — not just policy problems but his view of the political problems as well,” Brown said.  ROMEO: BREAKING SOME EGGS There was an unusually stormy and public debate about whether Romeo was the right person to take over as Cabinet secretary. But Starmer went ahead and appointed her last month, in the hope that a dynamic new leader would kickstart the civil service machine to deliver on his aims — and rescue his flagging premiership.  “The U.K. is in a mess — there’s a lot going on, and it kind of needs someone who’s going to get the bloody job done,” one former colleague of Romeo’s said, speaking on condition of anonymity, like others, to discuss sensitive matters. “Breaking a few eggs might not be a bad thing.”  Romeo has grappled with major political crises in her previous roles, too.  In her time as the top official in the Ministry of Justice (MoJ), she had to deal with bullying allegations against the minister in charge, Justice Secretary Dominic Raab, in the previous Tory government.  Keir Starmer appointed Romeo last month, in the hope that a dynamic new leader would kickstart the civil service machine to deliver on his aims — and rescue his flagging premiership. | Kin Cheung/Getty Images Romeo’s allies point to her determination to stand up for more junior officials who felt badly treated under Raab. She kept a crucial record of conversations in which she had warned Raab about his behavior, which ultimately contributed to an inquiry finding the minister guilty of “aggressive” and “intimidating” behavior toward officials, prompting him to resign. Romeo also had to handle a prison crisis, when the country’s jails were so full that ministers released about 3,000 prisoners early in September and October 2024 to avoid running out of places. “Antonia has always done incredibly demanding and challenging jobs — from overseeing national security at the Home Office to dealing with the prison crisis at MoJ,” one government official said. “So while this is in at the deep end — alongside the war in Iran and rapidly re-wiring the state — this is what she does.”  ALDERTON: THE KING’S MAN Romeo also has experience of working with Buckingham Palace, which is a key relationship for the Cabinet secretary. In her previous role as clerk of the Crown in Chancery, she compiled the official state record of Charles’s coronation in 2023, known as the coronation roll. It’s a tradition dating back over 700 years.  Then there is the adviser to the king. Alderton is the monarch’s closest and most influential aide, a former ambassador who has been by Charles’ side since 2015. Those who know him describe him as the kind of classic British official who will always offer you a cup of tea and has perfected the art of chatting amiably for hours without saying much of substance. In other words, he is studiously loyal and determinedly safe.  Media reports identified him as Prince Harry’s nemesis, referred to as “the wasp.” Harry’s supporters are reported to blame Alderton for the rift between the king and his son. What is certainly true is that it will have fallen to Alderton to help Charles navigate that painful relationship and the fallout from Harry’s decision to step back from his royal duties and live overseas. Alderton is the monarch’s closest and most influential aide, a former ambassador who has been by Charles’ side since 2015. | Aaron Chown/Getty Images These three top officials — Alderton, Romeo and York-Smith — do not comprise a formal group but are in contact whenever necessary, senior officials said. In a real crisis, or when preparing for one, they will speak to each other continuously.  For example, when a hung parliament was expected ahead of the 2015 general election, the then Cabinet Secretary Jeremy Heywood booked office space inside the Cabinet Office for the late queen Elizabeth’s private secretary, Christopher Geidt, so he could be permanently available to discuss constitutional questions during coalition talks between the political parties. (In the end the Conservatives won a clear majority and no talks were needed.)  Heywood also consulted with the palace in June 2017, when Theresa May suffered a humiliating election failure in which she lost her party’s majority. He had to tell her she should stay on as prime minister and seek to form a majority of MPs in Parliament who would back her government, as she was still leader of the largest party, even though her Conservatives had lost seats.  Thomas, from the Institute for Government, remembers working alongside Heywood at that intense time in 2017, helping prepare the first cabinet meeting and trying to work out an appropriate seating plan when emotions were running high. “Part of that value of the permanent civil service is you can have someone, when the politics has collapsed around you, who can come in and say: ‘This is the defensible, correct thing to do,’” Thomas said. “In the end it’s about keeping your head, if you’re cabinet secretary.”  PROTECTING ‘THE SYSTEM’ The three officials’ objectives vary and there is sometimes room for tension, especially when the personal desires of the royals clash with the political requirements of the government. York-Smith focuses on the day-to-day business of running Downing Street as smoothly as possible. Alderton, meanwhile, prioritizes the monarch’s interests, which may be more personal — the royal family is still a family — as well as constitutional.  Romeo takes a view on longer-term government strategy, delivering for the prime minister, and preserving constitutional conventions — which require the civil service she runs to make sure the king is never dragged into party politics.  “That relationship between the Cabinet secretary, the prime minister’s PPS and Buckingham Palace is critical and I’m sure there’s a constant line of communication between the three power-brokers,” said Brown, who was a political adviser rather than a permanent civil servant. “It’s not something they ever want to show to politicians: It’s a steady constant that keeps the cogs of government going … Much of the civil service is designed to keep the system operating and to preserve the status quo and to prevent embarrassment to the system itself — and their loyalty is to the system.” Whatever the advice of officials, the big decisions remain for the elected politicians to take. And that means the prime minister, who is, constitutionally, the monarch’s first and most senior adviser. According to Thomas, the “golden triangle” name risks inflating the significance of the group. “These are people doing difficult jobs and trying to get through the day,” he said.  “But that’s not to downplay the importance of any of those jobs, or the relationship working well,” said Thomas. “There are very rare but important moments when it’s not so much for those three people to decide what to do, but it is for them almost to be the keepers of the legitimate process of getting from A to B.”  When times are good and the government, royal family and prime minister are secure in their positions, the members of the golden triangle offer their advice and leave it to their leaders to decide. But in the hardest moments, they must be ready to step up, on behalf of the long-established way in which things in Britain are done. So far, at least, that has been enough to keep the system alive. Esther Webber contributed reporting.

Scattered among the candy shelves and freezer cabinets in Russian supermarkets across Germany are advertisements promoting a business with a service the government has tried to outlaw: a logistics company specialized in moving packages from the heart of Germany to Russia, in defiance of European Union sanctions. Trade restrictions have been in place since 2014 and were tightened just after the 2022 invasion of Ukraine, when Western nations began to impose far-reaching financial and trade sanctions on Russia. But an investigation by the Axel Springer Global Reporters Network, which includes POLITICO, has identified a clandestine Berlin-based postal system that exploits the special status of postal parcels to transport all kinds of European goods — including banned electronics components — into President Vladimir Putin’s empire. We know every stop and turn in the route because we sent five packages and used digital tracking devices to follow them — through an illicit 1,100-mile journey that undermines the sanctions regime European policymakers consider their strongest tool to generate political pressure on Russian leaders by weakening their country’s economy. LS Logistics said its internal controls make violations of EU sanctions “virtually impossible” but that it was not immune from customers making fraudulent declarations about the goods they ship. “Sanctions enforcement is whack-a-mole,” said David Goldwyn, who worked on sanctions policy as U.S. State Department coordinator for international energy affairs and now chairs the Atlantic Council Global Energy Center’s energy advisory group. “It’s a hard process, and you have to constantly be adapting to how the evaders are adapting.” THE UZBEK LABEL In late December, we packed five square brown parcels with electronic components specifically banned under EU sanctions and addressed the parcels to locations in Moscow and St. Petersburg. When we brought our parcels to the counters of Russian supermarkets in Berlin, we told salespeople the packages included books, scarves and hats. But they never checked inside the packages, which in fact held banned electronic components we rendered unusable before packing. Salespeople charged us 13 euros per kilogram, about $7 per pound, refusing to provide receipts. What makes these cardboard packages even more special is their disguise: The employee does not affix Russian postal stickers to the boxes, but rather those of UzPost, the national postal service of Uzbekistan. The former Soviet republic is not subject to EU sanctions. UzPost maintains close ties to the Russian postal service, according to a person familiar with the entities’ history of cooperation granted anonymity to discuss confidential business practices. Tatyana Kim, the CEO of Russian ecommerce marketplace Wildberries and reputedly her country’s richest woman, recently acquired a large stake in UzPost, according to media reports. “We work with partners, including private postal service providers,” the Uzbek postal service stated in response to our inquiry. “They can use our solutions for deliveries.” In Germany, registered logistics companies are permitted to provide postal services — including pick-up, sorting and delivery — for international postal operators. However, the Federal Network Agency, which is responsible for postal oversight, says the Uzbek postal service is not authorized to perform any of these functions in Germany. (The Federal Network Agency said in a response to our inquiry that it is “currently reviewing” the case and that it would pursue penalties for LS if it is found to be using Uzbek documents without authorization.) After our packages spent one to two days at the supermarkets, we saw them begin to move. Inside each package we had placed a small black GPS device, naming them “Alpha,” “Beta,” “Gamma,” “Delta” and “Epsi.” We could track their movements in real time in an app, watching them closely as they wound through Berlin’s roads to Schönefeld, site of the capital’s international airport. There they stopped, unloaded into a modern warehouse that has been repurposed into a Russian shadow postal service. COLOGNE, TECHNICALLY In 2014, a retired professional gymnast was tasked with launching a subsidiary of Russia’s national postal service, the RusPost GmbH, which would operate with official authorization to collect, process and deliver postal items in Germany, according to a former employee granted anonymity to speak openly about the business. For 18 years, the St. Petersburg-raised Alexey Grigoryev had competed and coached at Germany’s highest levels, winning three national championship titles with the KTV Straubenhardt team and working with an Olympic gold medalist on the high bar. But he had no evident experience in the postal business. RusPost’s German business model collapsed upon the imposition of an expanded sanctions package in the weeks after Russia’s invasion of Ukraine in February 2022. Much like American sanctions on Russia, the European Union blocks sensitive technical materials that could boost the Russian defense sector, while allowing the export of personal effects and quotidian consumer items. “The sanctions are accompanied by far-reaching export bans, particularly on goods relevant to the war, in order to put pressure on the Russian war economy,” according to a statement the Federal Ministry of Economics provided us. In March 2022, while conducting random checks of postal traffic to Moscow, customs officials discovered sanctioned goods (including cash, jewelry and electrical appliances) in numerous RusPost packages. The Berlin public prosecutor’s office launched an investigation of the company, concluding that a former RusPost managing director had deliberately failed to set up effective control mechanisms, in breach of his duties. He was charged with 62 counts of attempting to violate the Foreign Trade and Payments Act over an eight-month period; criminal proceedings are ongoing. The Russian postal network did not quite disappear, however. A new company called LS Logistics Solution GmbH was formed in December 2022, according to corporate filings. LS filled its top jobs, including customs manager and head of customer service, with former RusPost employees, according to their LinkedIn profiles. The new company listed as its business address an inconspicuous semi-detached house in a residential area of Cologne, across from a church. When we visited, we found an old white mailbox whose plated sign lists LS Logistics alongside dozens of other companies supposed to be housed there. But none of them seemed to be active. The building was empty during business hours, its mailbox overflowing with discolored brochures and old newspapers. The operational heart of LS is the warehouse complex in Berlin-Schönefeld, just a few minutes from the capital’s airport. The building itself is functional and anonymous: a long, gray industrial structure with several metal rolling doors, some fitted with narrow window slits. Through them, towering stacks of parcels are visible, packed tightly, sorted roughly, stretching deep into the hall. Trucks arrive and depart regularly, from loading bays lit by harsh white floodlights that cut through the otherwise quiet industrial area. Behind the warehouse lies a wide concrete parking lot where a black BMW SUV with a license plate bearing the initials AG is often parked. We saw a man resembling Grigoryev enter the car. The former head of RusPost officially withdrew from the postal business after authorities froze the company’s operations. Unofficially, however, the 50-year-old’s continued presence in Schönefeld suggests otherwise. According to one former RusPost employee, the warehouse near the airport serves as a collection point for parcels from all over Europe. Other logistics companies with Russian management have listed the warehouse as their business address, some of their logos decorating the façade. LS Logistics Solution GmbH has the largest sign of them all. THE A2 GETAWAY According to tracking devices, our packages spent several days in the warehouse before being loaded onto 40-ton trucks covered with grey tarps, among several that leave every day loaded with mail. They were then driven toward the Polish border, through the German city of Frankfurt (Oder). Without any long stops, the 40-ton trucks traversed Poland on the A2 motorway, past Warsaw. Two days after leaving Berlin, they were approaching the eastern edge of the European Union. They arrived at a border checkpoint in Brest, the Belarusian city where more than a hundred years ago Russia signed a peace pact with Germany to withdraw from World War I. Now it marked the last place for European officials to identify contraband leaving for countries they consider adversaries. In 2022, the European Union applied a separate set of sanctions on Belarus because its leader, Alexander Lukashenko, a close ally of Putin, has supported Russia’s presence in Ukraine. Yet despite provisions that should have stopped our packages from leaving Poland, they moved onward into Belarus, their tracking devices apparently undetected. What makes this possible is the special legal status that accompanies international mail. While a formal export declaration is required for the export of regular goods, such as those moving via container ship or rail freight, simplified paperwork helps speed up the departure process for postal items. At Europe’s borders, this distinction becomes crucial, as postal packages are examined largely on risk-based checks rather than comprehensive inspections. “International postal items are subject to the regular provisions of customs supervision both on import and on export and transit and are checked on a risk-oriented basis in accordance with applicable EU and national legislation, including with regard to compliance with sanctions regulations,” the German General Customs Directorate stated in response to our inquiry. Two of our tracking devices briefly lost their signal in Belarus — likely part of a widespread pattern of satellite navigation systems being disrupted across Eastern Europe — but after a journey of around 1,100 miles, they all showed the same destination. Our packages had reached Russia’s largest cities. Ukrainian authorities told us they were not surprised by our investigation. The country’s presidential envoy for sanctions policy, Vladyslav Vlasiuk, said at the Ukrainian embassy in Berlin that his government regularly collects intelligence on such schemes and shares it with international partners. “Nobody is doing enough, if you look at the number of cases,” Vlasiuk said. ONE STEP BEHIND After the arrival of the packages, we confronted all parties involved, including LS Logistics Solution GmbH, the mysterious shipper that helped transport the goods from Europe to Russia. We called Grigoryev several times, but he never answered; efforts to reach him through the company failed as well. An LS executive would not answer our questions about his role. “Our internal control mechanisms are designed in such a way that violations of EU sanctions are virtually impossible,” LS managing director Anjelika Crone wrote to us. “Shipments that do not meet the legal requirements are not processed further. We are not immune to fraudulent misdeclarations, such as those that obviously underlie the ‘test shipments’ you refer to.” Crone said she could not answer further questions due to data protection and contractual confidentiality concerns. This month, Germany took steps to strengthen enforcement of its sanctions regime, expanding the range of violations subject to criminal penalties. The law, passed by the Bundestag in January, amends the country’s Foreign Trade and Payments Act to integrate a European Union directive harmonizing criminal sanctions law across its 27 member states and ensure efficient, uniform enforcement. Germany was one of the 18 countries put on notice by EU officials last May for having failed to follow the 2024 directive. The Federal Ministry for Economic Affairs, which is responsible for implementing the new policy, argued in a statement to the Axel Springer Global Reporters Network that the very ingenuity of the logistics network we unmasked operating within Germany was a testament to the strength of the country’s sanctions regime. “The state-organized Russian procurement systems operate at enormous financial expense to create ever new and more complex diversion routes,” said ministry spokesperson Tim-Niklas Wentzel. “This confirms that the considerable compliance efforts of many companies and the work of the sanctions enforcement authorities in combating circumvention are also having a practical effect. Procurement is becoming increasingly difficult, time-consuming, and expensive for Russia.” According to those who have tried to administer sanctions laws, that argument rings true — but only partly. “It’s probably more fair to say that sanctions had a material impact and increased the cost of bad actors to achieve their goals. But to say that they’re working well is probably overstating the truth of the matter,” said Max Meizlish, formerly an official with the U.S. Treasury’s Office of Foreign Assets Control and now a research fellow at the Foundation for Defense of Democracies. “When there’s evasion, it requires enforcement,” Meizlish went on. “And when you need more enforcement I think it’s hard to make a compelling case that the tool is working as intended.” The Axel Springer Global Reporters Network is a multi-publication initiative publishing scoops, investigations, interviews, op-eds and analysis that reverberate across the world. It connects journalists from Axel Springer brands—including POLITICO, Business Insider, WELT, BILD, and Onet— on major stories for an international audience. Their ambitious reporting stretches across Axel Springer platforms: online, print, TV, and audio. Together, these outlets reach hundreds of millions of people worldwide.

BRUSSELS — President Donald Trump’s threat to impose a trade embargo on Spain has delivered yet another jolt to the European Union, forcing European leaders to rally around Madrid. Trump launched his broadside on Tuesday after Madrid declined to allow U.S. warplanes to use its air bases to attack Iran. Prime Minister Pedro Sánchez stood firm on Wednesday, describing the five-day-old war launched by the U.S. and Israel on Iran as illegal. French President Emmanuel Macron rushed to Sánchez’s side, expressing solidarity against “recent threats of economic coercion” made against Spain. European Council President António Costa doubled down and stressed that “the EU will always ensure that the interests of its Member States are fully protected.” Trump’s latest showdown with an EU country comes weeks after he vowed to annex Greenland — a self-governing Danish territory. That bust-up tested the transatlantic relationship to the limit, and led European lawmakers to hit the brakes on implementing the bilateral trade deal struck last summer at Trump’s golf resort in Scotland. German Chancellor Friedrich Merz — who was present in the Oval Office as Trump launched his tirade — said: “There is no way that Spain will be treated particularly badly” on trade as a member of the EU, and insisted that he wanted to avoid correcting Trump in public.  He was more forthright in comments later to the German press. “Here in Washington, they know that we on the European side have reached a limit in terms of what we are willing to accept,” Merz said. “I have gained the impression that the president and his staff see it that way too.” STEADY HAND During the Greenland standoff, the EU avoided rushing into a forceful response, patting itself on the back for remaining united as it succeeded in defusing the crisis.  Now, the bloc is dealing with a Trump riled up by a U.S. Supreme Court decision last month that overturned his core tariff agenda. Importantly, even though the court struck down his broad “reciprocal” tariffs, his aides argue that it reaffirmed his right to impose an economic embargo against another country. Instead of threatening an Arctic island with a population of less than 60,000, Trump is this time venting his ire at a nation of 50 million with a $1.7 trillion economy.  The EU’s fourth-largest economy is a big buyer of U.S. liquefied natural gas, which covered an estimated 30 percent of its gas needs last year. On the export ledger, Spain sells olives, wines and cosmetics to the U.S. German Chancellor Friedrich Merz said: “There is no way that Spain will be treated particularly badly” on trade as a member of the EU, and insisted that he wanted to avoid correcting Trump in public. | Kay Nietfeld/picture alliance via Getty Images Yet the U.S. accounts for only 4 percent of Spain’s total global exports, according to the Ministry of Economy. It also ran a bilateral trade deficit of €16 billion in 2025, meaning that, in principle, that the U.S. would stand to lose more if commercial relations were completely blocked. FIRST CRACKS  Spanish Foreign Minister José Manuel Albares said he had conveyed his “surprise” to his German counterpart Johann Wadephul that Merz didn’t show solidarity in the face of Trump’s attacks. “A few weeks ago Trump aimed his threats against Denmark and Germany and others over Greenland. Today, it is against Spain. Tomorrow it could be Germany again or any other EU member. It’s more important now than ever to remain united,” said a national official, who was granted anonymity to discuss the sensitive matter.  The European Commission also took the threat seriously, vowing on Wednesday to “ensure that the interests of the European Union are fully protected.”  “We stand in full solidarity with all Member States and all its citizens and, through our common trade policy, stand ready to act if necessary to safeguard EU interests,” said Olof Gill, deputy chief spokesperson of the European Commission.  ALL FOR ONE It’s not immediately clear how Trump could, even if he wanted to, impose a watertight embargo on Spain — since the EU functions as a barrier-free common market of 27 nations it would in practice be quite easy to circumvent it. But, even after his sweeping “reciprocal” tariffs were struck down, he would have the legal means at his disposal to inflict serious measures on Spain — as he did when he jacked up tariffs against Brazil over its jailing of former President Jair Bolsonaro. Spanish Foreign Minister José Manuel Albares said he had conveyed his “surprise” to his German counterpart Johann Wadephul that Merz didn’t show solidarity in the face of Trump’s attacks. | Eduardo Parra/Europa Press via Getty Images Trump could order an investigation under Section 301 of the U.S. Trade Act of 1974, which covers trade trade discrimination. An alternative would be a probe under Section 232 under the Trade Expansion Act of 1962, into imports that threaten national security. “From a legal perspective, yes, it is possible,” said Charles Julien, a partner at White & Case’s international trade practice group. “There are of course limitations.”  “Under Section 301, there’s a possibility for the U.S. Trade Representative to impose a number of measures. These include duties and restrictions. These are the most commonly used. Then there’s the possible withdrawal or suspension of trade agreement concessions,” Julien told POLITICO.  The lawyer stressed that the situation was still “very unclear. There may be other provisions in other U.S. statutes that may be used for that purpose.”  The drawback for Trump is that any measures would have to be preceded by an investigation that could last up to a year. In the meantime, confidence in the U.S. among European lawmakers who are still deliberating over whether to approve the Turnberry accord has hit new lows. Top trade lawmakers in the European Parliament decided on Wednesday, again, to defer a vote to advance enabling legislation under which the EU would fulfill its side of the bargain — chiefly to eliminate tariffs on U.S. industrial goods. “A trade threat against an EU country is worsening the mood in the Parliament,” said Anna Cavazzini, a German Green lawmaker who sits on the trade committee. Milena Wälde, Nette Nöstlinger and Max Griera contributed reporting.

BRUSSELS — The EU will provisionally implement its trade deal with the South American Mercosur bloc, European Commission President Ursula von der Leyen announced Friday, in a move that is likely to trigger a major backlash from European capitals and lawmakers opposed to the deal. The deal, to create a free-trade area spanning 720 million people, is controversial because it hasn’t yet been officially blessed by the European Parliament. Lawmakers voted last month to send it for review by the Court of Justice of the European Union, effectively freezing its final ratification for up to two years. Implementation could harden opposition in the European Parliament, antagonize skeptical countries led by France and Poland, and potentially sink the agreement when it comes to a final consent vote later. The European Commission received the go-head from EU countries in January to implement the deal once Mercosur countries complete their own approvals. Both Argentina and Uruguay ratified the agreement on Thursday. This is a developing story.

BERLIN — German Chancellor Friedrich Merz on Wednesday called for a reset in trade relations with China after meeting Chinese President Xi Jinping in Beijing, citing Germany’s soaring trade deficit with China. “I pointed out that we have had a considerable imbalance in the trade balance for about two years,” Merz said after his meeting with the Chinese leader. “We want to reduce these imbalances, which have arisen primarily from overcapacity in China.” Germany’s trade deficit with China hit €90 billion in 2025 and German business leaders are increasingly blaming what they view as unfair competition from China for the hemorrhaging of jobs in Germany’s manufacturing sector — now running at roughly 10,000 job losses per month. In advance of Merz’s trip, a growing number of German business leaders called on the chancellor to take a harder line on Chinese industrial policies that lead to price advantages for its companies — including subsidies, deliberate dumping and an undervalued currency. Merz seemed to respond to that pressure, calling on China to level the playing field. “Competition between companies must be fair,” he said. “We need transparency, we need reliability, and we also need compliance with jointly established rules.” He also said he aimed to reduce a trade deficit that has quadrupled since 2020. “This dynamic is unhealthy,” Merz said. “We are therefore addressing it and want to find ways to reduce this trade deficit.” At the same time, Merz hailed “the potential that still exists” in relations with China, saying that Chinese leaders had agreed to order up to 120 aircraft from Airbus. Merz is traveling with a delegation of some 30 executives and said other business deals are in the pipeline. Merz said he also asked Chinese leaders to “use their influence” to end Russia’s aggression in Ukraine, including by halting the export of dual-use goods that the Kremlin could use to wage war. “We also know that signals from China are taken very seriously in Moscow,” Merz said. “This applies to words as well as deeds.”

President Donald Trump came to Capitol Hill to deliver his State of the Union speech needing to sell his tariff agenda to a skeptical public. He did so by touting the trade accords he reached with foreign countries, the peace deals he said tariffs helped them reach — and by saying that the money the levies generate could one day replace the current income tax system. “As time goes by, I believe the tariffs paid for by foreign countries will, like in the past, substantially replace the modern day system of income tax taking a great financial burden off the people that I love,” the president said Tuesday night. He decried the Supreme Court’s Friday ruling that struck down his sweeping emergency tariffs as “very unfortunate,” and said that he would soon institute a new tariff regime under federal authorities he said have been “time tested and approved.” While some of the tariff statutes under consideration by the administration have been previously invoked, he is for the first time invoking Section 122 of the Trade Act of 1974 to implement 10 percent global tariffs, a number he said he may soon raise to 15 percent. Trump also said that he would move forward with his tariffs without the help of Congress, even as some members of his own party have voiced opposition to the sweeping nature of the duties he has opposed — and at times voted against them. “Congressional action will not be necessary,” he said.