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The European Union have announced plans to match the United States' import duties on steel, effectively doubling taxes on imports to 50% in a decision described as "an existential threat" to the industry in the UK.

Major Challenge for UK Steel Industry

With eighty percent of British exports destined for the EU, this change represents the British steel sector's biggest ever challenge, according to the lobby group representing the industry.

New EU Proposals and Regulations

Through its proposal submitted to the European parliament this week, the EU executive also proposed slashing the existing quota for duty-free imports and requiring international producers to declare where the steel was melted and poured to stop China sneaking products in through third nations.

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

Replacement of Current Framework

The proposals are designed to replace a quota system that has been functioning for the last seven years and which is set to expire in 2026 and is now considered outdated. Inaction could have been "fatal" for the industry, one EU official stated.

Sector Response and Concerns

However, Gareth Stace, from the trade association British Steel, said Brussels increasing duties would create "the most severe challenge the UK steel industry has encountered".

There were calls for the UK authorities to "recognise the urgent need to implement its own measures to defend" the British steel sector – which is still reeling from a twenty-five percent duty from Trump recently – from the threat of vast quantities of global steel redirected from American and EU markets.

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

Union and Political Pressure

Alasdair McDiarmid, assistant general secretary at steelworkers' union the industry union, said the proposed changes represented "a survival risk" to British steel production.

Labor and business representatives urged Keir Starmer to begin talks immediately with the European Union on nation-specific duty-free quotas, pointing out that the UK was now the European Union's No 1 export market.

Industry Background

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

Steel on in both the UK and EU is considered a essential sector, providing elemental components in products ranging from skyscraper structures, wind turbines and railways to household appliances and cutlery.

Adoption and Next Steps

The new measures must be agreed by EU nations and the European parliament, with the EU executive head calling on national governments and European parliament members to move quickly in backing the proposal.

Should approval be granted, the EU will cut its current duty-free quota by forty-seven percent to 18.3 million tons a annually, a level last seen in 2013. It will impose a fifty percent tariff on foreign steel exceeding the limit and oblige countries shipping to the EU to state the production origin to prevent circumvention of the measures.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or duties because of their close trading relationship in the EEA, the European Union has said.

Alongside the proposal, the European Union is seeking a "metals alliance" with the United States to ringfence their national industries 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 value chains.