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EU officials declared they will mirror the United States' import duties on steel, effectively doubling taxes on imports to 50% in a decision described as "an existential threat" to the sector in the UK.

Major Challenge for UK Steel Exports

Given that 80% of UK steel shipments destined for the EU, this policy shift poses the UK steel industry's most severe challenge, as stated by the lobby group representing the sector.

New EU Proposals and Regulations

In its plan presented to the European parliament on Tuesday, the EU executive also proposed reducing the existing quota for tariff-exempt steel and requiring international producers to state where the steel was melted and poured to prevent China diverting exports through third nations.

The European steel industry was on the verge of collapse – we are protecting it so that investments can be made, decarbonise, and become competitive again.

Replacement of Existing System

These measures are intended to supersede a import framework that has been functioning for the past seven years and which is due to expire in 2026 and is now seen as outdated. To do nothing could have been "fatal" for the sector, one EU official stated.

Sector Response and Warnings

However, industry representatives, head of the industry body UK Steel, said EU increasing duties would create "the most severe challenge the British steel sector has encountered".

He called on the UK authorities to "acknowledge the critical necessity to implement its own measures to defend" the UK steel industry – which is affected by a 25% tariff imposed by the US recently – from the threat of vast quantities of world steel redirected from American and EU markets.

This surge in foreign steel "could be terminal for many of our remaining steel companies.

Labor and Political Calls

Union leaders, assistant general secretary at labor union the industry union, said the new measures posed "an existential threat" to UK steel.

Labor and business representatives called on the UK government to begin talks immediately with the EU on nation-specific duty-free quotas, pointing out that the UK was now the European Union's No 1 trading partner.

Broader Context

Sector representatives in the European Union have also been warning for months that the European steel sector confronts being "wiped out" through the increased duties on exports to the US along with rising energy prices and cheap Chinese competition.

The steel industry on both sides of the Channel is considered a essential sector, supplying elemental components in everything from skyscraper structures, wind turbines and railways to dishwashers and cutlery.

Implementation and Future Actions

The new measures require approval by member states and the EU legislature, with the EU executive head urging member states and European parliament members to act fast in support of the initiative.

If the plan is ratified, the EU will reduce its current duty-free quota by forty-seven percent to 18.3m tonnes a annually, a volume previously recorded in 2013. It will apply a fifty percent tariff on foreign steel beyond the quota and require countries shipping to the EU to state the production origin to avoid bypassing of the measures.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or tariffs due to their strong economic ties in the European Economic Area, the EU has confirmed.

In addition to these measures, the European Union is seeking a "steel partnership" with the US to ringfence their national industries from excess production.

The European Union needs to act now, and decisively, prior to operations cease in significant portions of the European steel sector and its value chains.