Al-Armouti News Bulletin - August 2025

EUROPEAN UNION (EU) 

For the Second Year in a Row: The EU Commission is Inquiring into an Emirati Company Under the Foreign Subsidies Regulation  

The European Commission (EC) is investigating ADNOC’s (nationalized Emirati Oil & Gas company) takeover of Covestro (formerly Bayer). The EC alleges that this acquisition is to the detriment of the EU’s internal market, arguing it may not have been possible without the UAE granting ADNOC subsidies, thereby distorting fair competition within the European internal market. 

Under the Foreign Subsidies Regulation (FSR) such subsidies are prohibited, unless ADNOC meets certain requirements or commits to specific undertakings.

The EC is expected to rule on whether this acquisition is compliant with the FSR, and if this deal should come to an end or continue to exist by 2 December 2025.

EU-US Trade Deal: Are We Back to Power-Based Trade?

In a historic landmark the European Union (EU) and the United States (US) have agreed on an economic partnership, which took effect on 7 August 2025. It is still highly debated how the newly imposed tariffs will affect the EU’s economy.

There is a notable divergence in interpretation between the US and the EU statements. The US perceives the White House Fact Sheet as a set of binding commitments, in contrast to the EU’s interpretation that the statement reflects non-binding intentions conditioned on further developments. For example, in the EU’s statement there is no obligation to purchase liquified oil and gas. However, in the US’ statement it is worded in a way that appears to mandate the EU to purchase those commodities. Even the amount of the duties imposed on certain imports is highly controversial, the EU views them as a ceiling, while the US suggests that there is no cap. There is still a lack of clarity on key aspects of the deal, which will need to be negotiated and settled in the near future.

SAUDI ARABIA

Imports of Certain Indian Steel Pipes are Subject to an Anti-Dumping Investigation in Saudi Arabia

On 23 July 2025 the General Authority of Foreign Trade (GAFT) has opened an anti-dumping probe against ductile iron pipes under HS code 730300000001. This follows a petition lodged by Saudi manufacturers on behalf of the domestic industry alleging that exports of the subject product originating in India are causing material injury to the domestic market.

JORDAN

Did Jordan Receive Preferential Treatment From the US?

The Trump administration has adjusted the tariffs imposed on Jordan back in April which were 20% and now lowered to 15%. The revised tariffs took effect on 7 August 2025.

Jordan Takes Lead in the Region in Customs Digitalization

Keeping Jordan at the forefront of modernizing customs procedures is a key pillar of its Economic Modernization Vision. Jordan Customs Department (JCD) is expanding upon the ASYCUDA programme, by launching ASYHUB Maritime. This platform harmonizes, facilitates, and connects customs authorities and expedites maritime customs and trade operations, from documentation and exchange of data to risk mitigation.

EGYPT

Egyptian Steel Industry is Subject to a Lower Anti-Dumping Rate

The EU Commission (EC) has imposed a definitive anti-dumping duty on hot-rolled coil (HRC) steel originating in Egypt. The definitive duty rate has been adjusted from 12.8 to 11.7%, which is lower than the provisional duty imposed back in April. Ezz steel raised concerns over the amount imposed, arguing it should have received a lesser duty rate or even a 0% rate, given its minimal exports to the EU. However, the EC still finds the duty rate levied justifiable, as imports from Egypt are harming the EU market. Duties will not be collected retroactively, as the criteria for retroactive application haven’t been met.

UNITED ARAB EMIRATES (UAE)

Sugar-Sweetened Beverages in the UAE Will Be Subject to a New Tiered Excise Tax

In support of reducing sugar intake and promoting healthier dietary habits, the Federal Tax Authority (FTA) has announced that a new legislation adjusting the excise tax on sugar-sweetened drinks will be issued in the first quarter of 2026.  The flat 50% duty rate, regardless of the amount of added sugar, will no longer be applicable. There will be a direct relationship between the amount of added sugar per litre and the tax to be levied, meaning the higher the sugar level, the higher the duties. Manufacturers of the subject drinks are given sufficient time to comply with the new tax framework.

All GCC Countries Unify Their Tariff Codes

To ensure regional and global harmonization in customs procedures, all GCC countries have recently replaced their 8-digit tariff system with a 12-digit system as of January 2025. Most recently the United Arab Emirates (UAE) adopted the12-digit level to align with its GCC counterparts. The updated tariff system improves the accuracy of goods classification, streamlines customs processes, and enhances trade flow and trade liberalization at both regional and international levels.

Businesses and stakeholders in the UAE are advised to start adjusting their internal systems to accommodate the new integrated system and review existing classifications to prevent disruptions during the transition period.  The change took effect on 1 August 2025. To facilitate the transition, the 8-digit system will stay in force for 6 months.

It is worth noting that Dubai Customs has offered support services to help stakeholders reclassify their goods under the new system. By the end of this transitional period businesses are expected to have fully adapted to the updated system.

Free Trade Agreements and Economic partnerships are On the Rise in the UAE

The UAE continues to enhance its trade relations with several countries. Recently the United Arab Emirates (UAE) and Azerbaijan signed and a Comprehensive Economic Partnership Agreement (CEPA) to boost trade, investment flows in vital sectors especially in the energy sector, by expanding UAE’s investments in oil, gas and renewables through state-owned companies.

WORLD

Unprecedented Tariffs Facing Several Countries

A wave of new tariffs has been slapped on imports from multiple countries across the globe. The rates imposed on some countries are shockingly high, and for countries like India and China further hikes are still being considered. In the Middle East, Iraq and Syria have been subjected to steep tariffs of 35% and 41% respectively. In Europe, Switzerland has been faced with 39%. GCC countries and Egypt have received the most preferential rates of 10%. Brazil has been hit with the highest tariff in the world of 50% (40% and 10% reciprocal tariff). The new rates officially took effect on 7 August 2025. Yet, even after coming into force, Trump’s threats to raise tariffs further are still ongoing.