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EU officials have announced plans to mirror the United States' steel tariffs, effectively doubling taxes on foreign steel to fifty percent in a move condemned as "a critical danger" to the sector in the UK.

Major Challenge for UK Steel Industry

Given that eighty percent of UK steel shipments destined for the EU, this change represents the British steel sector's biggest ever crisis, according to the industry association speaking for the industry.

New EU Measures and Regulations

Through its proposal submitted to the EU legislature this week, the EU executive also proposed cutting the current allowance for duty-free imports and obliging foreign suppliers to disclose the origin of steel production to prevent China sneaking products in through other countries.

The European steel industry stood at the brink of failure – these measures safeguard it so that it can invest, decarbonise, and regain competitiveness.

Overhaul of Existing System

These measures are designed to supersede a quota system that has been functioning for the past seven years and which is set to expire in 2026 and is now considered outdated. To do nothing could have been "disastrous" for the sector, one EU official stated.

Industry Response and Concerns

Nevertheless, Gareth Stace, from the trade association UK Steel, said EU increasing duties would create "the most severe challenge the British steel sector has encountered".

There were calls for the government to "recognise the critical necessity to put in place domestic protections to defend" the British steel sector – which is affected by a 25% duty from Trump earlier this year – from the threat of millions of tonnes of global steel diverted away from US and European markets.

This flood of imports "could be fatal for numerous steel companies.

Union and Political Pressure

Alasdair McDiarmid, assistant general secretary at steelworkers' union the industry union, stated the new measures posed "an existential threat" to British steel production.

Labor and business representatives called on the UK government to start negotiations urgently with the European Union on nation-specific duty-free quotas, pointing out that the United Kingdom was now the European Union's No 1 trading partner.

Broader Context

Sector representatives in the European Union have repeatedly cautioned for several months that the European steel sector confronts being "wiped out" through the increased duties on American market shipments combined with rising energy prices and cheap Chinese competition.

The steel industry on both sides of the Channel is considered a foundational industry, supplying basic materials in everything from skyscraper structures, wind turbines and transport infrastructure to household appliances and kitchenware.

Adoption and Future Actions

These proposals require approval by EU nations and the European parliament, with the European Commission president calling on member states and MEPs to move quickly in support of the initiative.

If the plan is ratified, the EU will reduce its current duty-free quota by forty-seven percent to 18.3 million tons a annually, a level previously recorded in 2013. It will apply a 50% tariff on foreign steel beyond the quota and oblige nations exporting into the EU to declare where the steel was melted and poured to avoid bypassing of the sanctions.

Exemptions and Global Partnerships

Norway, Iceland, and Liechtenstein will be exempt from tariff quotas or duties because of their strong economic ties in the EEA, the European Union has said.

Alongside the proposal, the EU is pursuing a "steel partnership" with the US to ringfence their national industries from excess production.

EU needs to act now, and firmly, prior to operations cease in large parts of the EU steel industry and its value chains.