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The European Union declared plans to mirror the United States' import duties on steel, effectively doubling taxes on foreign steel to 50% in a action condemned as "a survival risk" to the industry in the UK.

Unprecedented Crisis for British Steel Exports

With eighty percent of UK steel shipments going to the EU, this change creates the UK steel industry's largest challenge, as stated by the industry association representing the sector.

European Commission Proposals and Regulations

Through its proposal presented to the EU legislature on Tuesday, the European Commission also proposed cutting the current allowance for tariff-exempt steel and obliging international producers to disclose where the steel was melted and poured to stop China diverting exports through third nations.

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

Overhaul of Current Framework

The proposals are intended to supersede a quota system that has been functioning for the last seven years and which is set to expire in 2026 and is now considered not fit for purpose. To do nothing could have been "fatal" for the sector, one EU official stated.

Sector Response and Warnings

Nevertheless, Gareth Stace, head of the trade association UK Steel, said Brussels doubling its tariffs would pose "the most severe challenge the UK steel industry has encountered".

He called on the UK authorities to "acknowledge the urgent need to put in place its own measures to protect" the British steel sector – which is affected by a twenty-five percent duty imposed by the US recently – from the threat of millions of tonnes of world steel redirected from US and European markets.

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

Labor and Government Calls

Union leaders, representative at steelworkers' union the industry union, said the proposed changes represented "a survival risk" to UK steel.

Labor and business representatives urged Keir Starmer to begin talks immediately with the European Union on country-specific duty-free quotas, noting that the United Kingdom was now the EU's No 1 trading partner.

Industry Background

Sector representatives in the EU have repeatedly cautioned for several months that their own industry faces being "eliminated" through the new 50% tariffs on American market shipments along with rising energy prices and low-cost Chinese imports.

Steel on in both the UK and EU is described as a foundational industry, supplying elemental components in products ranging 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 national governments and European parliament members to move quickly in support of the proposal.

Should approval be granted, the EU will reduce its existing tariff-free allowance by 47% to 18.3m tonnes a year, a level last seen in 2013. It will impose a 50% tariff on foreign steel exceeding the limit and oblige nations shipping to the bloc to declare where the steel was melted and poured to prevent circumvention of the sanctions.

Exceptions and Global Partnerships

These European nations will not be subject to import limits or tariffs due to their strong economic ties in the European Economic Area, the EU has said.

Alongside the proposal, the EU is pursuing a "steel partnership" with the United States to ringfence their national industries from overcapacity.

The European Union needs to act now, and decisively, before all lights go out in significant portions of the European steel sector and its value chains.