President Donald Trump is threatening new tariffs against the European Union after European Commission President Ursula von der Leyen proposed making Canada the EU’s first “associate member.”

The proposal calls for closer Canada-EU cooperation in areas including trade, defense, energy, technology and critical minerals. The proposed associate-member status does not currently exist under EU treaties and would require further negotiations and approval by EU member states.

Trump said that if he considered the move a “hostile act,” the United States could impose very serious tariffs on Europe or halt trade on certain goods. He also criticized Canada as a “terrible trade partner” and called the proposal “laughable.”

Canadian Prime Minister Mark Carney spoke Thursday at the European Parliament in Strasbourg and welcomed closer ties with Europe, while emphasizing that Canada was not seeking to create a new bloc to rival the United States and China.

The discussions come as Canada seeks to expand its economic and strategic relationships beyond the United States. Details of any potential EU-Canada arrangement remain under discussion.