The European Union’s Anti-Coercion Instrument: A Structural Shift in the Transatlantic Trade Regime

Abstract

This dissertation examines the European Union’s Anti-Coercion Instrument (Regulation (EU) 2023/2675) as evidence of a structural shift in the transatlantic trade regime. It asks to what extent the instrument signifies a shift from a rules-based order towards a power-based one, in response to the breakdown of multilateral trade governance between 2000 and 2026. Adopting a theory-testing single-case design, the study traces the decline of embedded liberalism and the paralysis of the World Trade Organization’s Appellate Body. It situates the instrument within the literatures on weaponised interdependence and geoeconomics, and tests its strategic logic against the European automotive sector, the site where the European Union’s dependence on the United States market is deepest. The analysis introduces the concept of a credibility trap, drawn from deterrence theory and the study of economic statecraft, to explain why the same asymmetric dependence that makes coercion painful also constrains credible retaliation. It concludes that the Anti-Coercion Instrument represents a real but incomplete structural shift: it institutionalises the European Union’s recognition that trade has become a domain of power and equips it with the architecture of a geoeconomic actor, yet its effectiveness remains limited by the very asymmetries it was designed to counter. Europe, on this reading, is no longer defenceless, but remains structurally outgunned.