On Wednesday evening in Sofia, EU leaders spent several hours over dinner discussing how to protect the EU's interests, after two recent decisions by USA president Donald Trump: scrapping a nuclear deal with Iran and potentially sanction European companies doing business there and threatening to impose tariffs on steel and aluminium from 1 June.
Earlier, President of the European Commission Jean-Claude Juncker said that: "At this point, we have to replace the United States, which as an worldwide actor has lost vigor, and because of it, in the long term, influence".
But the reach of the USA financial system, the dominance of the U.S. dollar, and the presence in the United States of European companies' operations all weaken the EU's bargaining position.
What Happened: The European Commission will put a blocking statue in place on May 18 to safeguard European companies doing business with Iran from US sanctions, Bloomberg reported May 17. The bloc would also discuss WTO-compatible ways to improve reciprocal market access for industrial products including cars to avoid a trade war. But he made clear bigger matters were at stake.
The transatlantic rift has hijacked the agenda of a summit at which the European Union leaders will meet their Balkan counterparts in a bid to foster closer ties and keep Russian Federation out of their backyard. We are determined to do whatever it takes to save this accord.
The agreement was signed by six world powers, alongside Iran, to curbed Iranian nuclear activities in return for the lifting of UN, US and European Union sanctions.
The European leaders' insistence on the need to adhere to the terms of the 2015 accord stems from their attempt to protect European companies' interests in Iran that are being dealt a severe blow with the pullout.
In addition to the U.S. and Iran, the agreement known as the Joint Comprehensive Plan of Action (JCPOA) was signed by Russia, China, the UK, France, Germany, and the European Union.
He said the latest decisions by Trump are counter-productive. Soren Skou, chief executive of Danish-based A.P. Moller-Maersk, said his firm would have to accept the sanctions.
Last week, the USA sanctioned six people and three companies it said had ties to Iran's elite military force. "I don't know the exact timing details, but I am certain that we're also going to shut down".
"The EU blocking regulation could be of limited effectiveness there, given the worldwide nature of banking system and especially the exposure of large systemic banks to USA financial system and US dollar transactions", financial services commissioner Valdis Dombrovskis told the European Parliament.