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The European Union have announced they will adopt the United States' import duties on steel, increasing to double taxes on foreign steel to fifty percent in a decision described as "a survival risk" to the industry in Britain.

Major Challenge for UK Steel Exports

With eighty percent of British exports destined for the EU, this policy shift creates the British steel sector's biggest ever crisis, as stated by the lobby group speaking for the sector.

New EU Proposals and Regulations

Through its proposal presented to the EU legislature this week, the European Commission also proposed cutting the current allowance for duty-free imports and requiring international producers to state where the steel was melted and poured to prevent China sneaking products in through third nations.

The European steel industry faced potential collapse – these measures safeguard it so that investments can be made, decarbonise, and regain competitiveness.

Overhaul of Existing System

The proposals are intended 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 seen as not fit for purpose. Inaction could have been "catastrophic" for the sector, a European official stated.

Industry Reaction and Warnings

However, industry representatives, head of the trade association British Steel, said EU doubling its tariffs would pose "the biggest crisis the British steel sector has ever faced".

There were calls for the UK authorities to "acknowledge the critical necessity to put in place domestic protections to defend" the British steel sector – which is affected by a 25% duty imposed by the US recently – from the risk of vast quantities of global steel redirected from American and EU markets.

This flood of imports "might prove terminal for numerous steel companies.

Union and Political Calls

Alasdair McDiarmid, assistant general secretary at steelworkers' union Community, stated the proposed changes posed "a survival risk" to British steel production.

Labor and business representatives called on Keir Starmer to begin talks urgently with the EU on country-specific tariff exemptions, noting that the UK was now the EU's primary export market.

Industry Background

Sector representatives in the EU have repeatedly cautioned for months that the European steel sector confronts being "wiped out" through the new 50% tariffs on American market shipments combined with high energy costs and low-cost Chinese imports.

Steel on both sides of the Channel is described as a foundational industry, providing elemental components in everything from building frameworks, wind turbines and railways to dishwashers and cutlery.

Implementation and Future Actions

These proposals require approval by member states and the European parliament, with the EU executive head calling on member states and MEPs to move quickly in backing the proposal.

If the plan is ratified, the EU will cut its current duty-free quota by 47% to 18.3 million tons a annually, a volume last seen in 2013. It will apply a fifty percent duty 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 Global Partnerships

Norway, Iceland, and Liechtenstein will be exempt from import limits or tariffs due to their close trading relationship in the European Economic Area, the European Union has confirmed.

Alongside the proposal, the EU is seeking a "steel partnership" with the US to protect their respective economies from overcapacity.

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