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EU officials declared plans to adopt the United States' import duties on steel, increasing to double taxes on foreign steel to 50% in a action described as "a survival risk" to the sector in Britain.

Unprecedented Crisis for British Steel Industry

Given that 80% of UK steel shipments destined for the European Union, this change represents the UK steel industry's biggest ever crisis, according to the industry association representing the sector.

New EU Proposals and Rules

Through its proposal presented to the EU legislature on Tuesday, the European Commission additionally suggested slashing the existing quota for duty-free imports and requiring foreign suppliers to state the origin of steel production to stop China diverting exports through other countries.

The European steel industry faced potential collapse – these measures safeguard it so that it can invest, decarbonise, and become competitive again.

Replacement of Existing System

These measures are intended to replace a quota system that has been in operation for the last seven years and which is due to expire in 2026 and is now considered ineffective. To do nothing could have been "catastrophic" for the sector, a European official stated.

Sector Reaction and Concerns

However, industry representatives, head of the trade association British Steel, said Brussels doubling its tariffs would create "the most severe challenge the UK steel industry has encountered".

He called on the government to "acknowledge the critical necessity to put in place its own measures to protect" the UK steel industry – which is affected by a twenty-five percent duty from the US recently – from the threat of millions of tonnes of global steel redirected from American and EU markets.

This surge in foreign steel "could be fatal for numerous steel companies.

Labor and Government Calls

Union leaders, assistant general secretary at labor union the industry union, said the proposed changes posed "a survival risk" to British steel production.

Unions and industry leaders called on Keir Starmer to start negotiations immediately with the European Union on country-specific duty-free quotas, pointing out that the UK was now the EU's primary export market.

Broader Context

Industry leaders in the European Union have also been warning for months that the European steel sector confronts being "wiped out" through the new 50% tariffs on American market shipments along with high energy costs and cheap Chinese competition.

The steel industry on in both the UK and EU is considered a foundational industry, supplying basic materials in products ranging from building frameworks, wind turbines and transport infrastructure to household appliances and cutlery.

Adoption and Next Steps

These proposals must be agreed by member states and the EU legislature, with the European Commission president urging national governments and MEPs to move quickly in support of the proposal.

Should approval be granted, the EU will reduce its existing tariff-free allowance by forty-seven percent to 18.3m tonnes a year, a volume last seen in 2013. It will apply a 50% tariff on foreign steel exceeding the limit and require nations exporting into the bloc to declare the production origin to prevent circumvention of the measures.

Exemptions and International Cooperation

Norway, Iceland, and Liechtenstein will be exempt from import limits or tariffs because of their strong economic ties in the European Economic Area, the EU has said.

In addition to these measures, the EU is pursuing a "steel partnership" with the US to ringfence their respective economies from overcapacity.

The European Union must take immediate action, and decisively, prior to all lights go out in large parts of the EU steel industry and its supply networks.