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The European Union have announced plans to mirror Donald Trump's import duties on steel, effectively doubling levies on foreign steel to fifty percent in a action described as "an existential threat" to the sector in the UK.

Unprecedented Crisis for British Steel Industry

Given that 80% of British exports going to the European Union, this change creates the British steel sector's largest crisis, as stated by the industry association speaking for the industry.

New EU Measures and Rules

Through its proposal presented to the European parliament this week, the EU executive also proposed cutting the existing quota for tariff-exempt steel and obliging foreign suppliers to declare the origin of steel production to stop China sneaking products in through third nations.

EU steel sector was on the verge of collapse – we are protecting it so that investments can be made, reduce emissions, and regain competitiveness.

Replacement of Current Framework

The proposals are designed to supersede a quota system that has been in operation for the past seven years and which is set to expire in 2026 and is now seen as not fit for purpose. To do nothing could have been "catastrophic" for the sector, one EU official stated.

Industry Response and Concerns

Nevertheless, Gareth Stace, from the industry body UK Steel, said Brussels doubling its tariffs would pose "the most severe challenge the UK steel industry has encountered".

There were calls for the UK authorities to "acknowledge the urgent need to implement its own measures to protect" the UK steel industry – which is still reeling from a 25% duty imposed by Trump earlier this year – from the risk of vast quantities of world steel diverted away from American and EU markets.

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

Union and Political Pressure

Union leaders, representative at labor union the industry union, stated the new measures posed "a survival risk" to UK steel.

Unions and industry leaders urged the UK government to begin talks urgently with the EU on nation-specific duty-free quotas, pointing out that the United Kingdom was now the EU's No 1 trading partner.

Broader Context

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

The steel industry on in both the UK and EU is described as a foundational industry, providing basic materials in everything from skyscraper structures, renewable energy equipment and transport infrastructure to household appliances and cutlery.

Adoption and Next Steps

These proposals require approval by EU nations and the European parliament, with the EU executive head urging national governments and MEPs to act fast in support of the proposal.

Should approval be granted, the EU will cut its current duty-free quota by forty-seven percent to 18.3m tonnes a year, a volume last seen in 2013. It will apply a 50% tariff on imports beyond the quota and oblige countries exporting into the bloc to declare the production origin to avoid bypassing of the measures.

Exceptions and Global Partnerships

These European nations will be exempt from import limits or tariffs because of their strong economic ties in the European Economic Area, the European Union has said.

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

The European Union must take immediate action, and decisively, before operations cease in significant portions of the European steel sector and its supply networks.