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European magnificence teams together with L’Oréal, the world’s largest, have lobbied the EU to take away American cosmetics from the bloc’s record of potential commerce retaliation targets, warning that the transfer may set off reprisals towards one of many area’s largest sectors.
Nicolas Hieronimus, L’Oréal’s chief government, stated he and an alliance of 15 different magnificence chiefs had warned EU officers this week that the inclusion of cosmetics in countermeasures towards US tariffs may result in a harmful response.
“My solely ask to the folks I’ve met [in Brussels] is to say: have a look at the stability of commerce and don’t put a crimson flag on a class the place we’ve got extra to lose than to win,” Hieronimus advised the Monetary Occasions.
The EU introduced retaliation measures towards Donald Trump’s tariffs on metal and aluminium imports final week, which included a 99-page record of US items that might be topic to tariffs from mid-April, together with perfumes, shampoos, skincare merchandise and make-up.
The record, which covers some €26bn price of products, is a part of a two-stage plan that additionally contains the reinstatement of measures launched throughout Trump’s first time period, together with levies on bourbon whiskey and Harley-Davidson bikes, initially on account of come into pressure on April 1.
The fee, which has the authority to resolve commerce coverage for the 27-country bloc, on Thursday delayed that spherical of tariffs to April 13, in an try to make “extra time for discussions” with Washington. Paula Pinho, the fee’s chief spokesperson, stated on Friday the transfer would additionally “ensure that we’ve got an inventory [of measures] which displays in a balanced, proportionate method the [EU’s] enterprise and client pursuits”.
The choice to delay adopted pleas from France and the nation’s necessary alcohol trade to keep away from Trump’s threatened retaliation of 200 per cent tariffs on EU alcohol imports, in response to two EU officers briefed on the discussions.
Hieronimus stated L’Oréal and an alliance of chief executives of teams together with Germany’s Beiersdorf and Switzerland’s Givaudan met with EU officers in Brussels this week to warn towards a possible “tit-for-tat” response to levies on magnificence merchandise.
“In case you’re going to place a class within the tariff battle, you’d higher ensure that this class is a internet importer reasonably than internet exporter . . . If there’s this tit-for-tat factor on magnificence, it’s going to penalise Europe way more than American companies and firms,” he stated.
“We defined a number of occasions [to European officials] that it’s a mistake” to incorporate magnificence and cosmetics, stated Vincent Warnery, chief government of Beiersdorf, which owns manufacturers together with Nivea and Coppertone, likening it to “capturing ourselves within the foot”.
“We’ll elevate costs within the US, if wanted,” he added, “which can damage customers within the US and Canada and also will damage our market share . . . So depart us out of it, take pleasure in what we carry to the economic system, and don’t begin a hearth the place there isn’t any want.”
Their feedback got here as German magnificence retailer Douglas warned this week that commerce tensions had already accelerated a slowdown in European demand for high-end cosmetics, sending its shares down 22 per cent on Friday.
Europe is a serious exporter of magnificence and private care merchandise, using practically 2mn folks straight throughout the bloc, in response to analysis from Oxford Economics, and contributed some €180bn to the EU’s financial output in 2023, in addition to €71bn in tax revenues.
The US is likely one of the largest markets for teams like L’Oréal. Though the Paris-based firm manufactures a lot of its merchandise within the international locations the place it sells them, an ongoing commerce battle may result in some elevated prices being handed on to customers, and disrupt the trade’s advanced provide chains.
The group of magnificence executives was additionally in Brussels to talk to EU officers to advocate for modifications to the City Wastewater Therapy Directive, which got here into pressure in January, and which the wonder trade feels unduly targets it.
They’re additionally involved a few potential ban on ethanol in cosmetics merchandise, and have sought to boost consciousness on the EU stage about how a lot reformulations to adjust to altering regulatory requirements eat into their innovation budgets.
Hieronimus stated a few third of his researchers’ time and funds was spent on reformulating to adjust to regulation. “I’m not saying all regulation is dangerous . . . We’re decided to make the modifications when it’s crucial. However generally you discover some absurdities.”
