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EU officials declared plans to match Donald Trump's import duties on steel, effectively doubling taxes on foreign steel to 50% in a action condemned as "a survival risk" to the sector in the UK.

Major Challenge for UK Steel Industry

With 80% of British exports going to the European Union, this change poses the British steel sector's largest crisis, as stated by the lobby group speaking for the sector.

New EU Measures and Regulations

In its plan submitted to the EU legislature this week, the European Commission additionally suggested reducing the current allowance for duty-free imports and obliging foreign suppliers to disclose where the steel was melted and poured to stop China diverting exports through third nations.

The European steel industry stood at the brink of failure – we are protecting it so that investments can be made, decarbonise, and regain competitiveness.

Replacement of Existing System

The proposals are intended to replace a quota system that has been in operation for the last seven years and which is set to expire in 2026 and is now considered outdated. To do nothing could have been "disastrous" for the industry, one EU official said.

Industry Reaction and Concerns

Nevertheless, Gareth Stace, from the industry body British Steel, said EU doubling its tariffs would create "the most severe challenge the British steel sector has ever faced".

He called on the government to "acknowledge the urgent need to put in place its own measures to defend" the UK steel industry – which is affected by a twenty-five percent tariff from the US earlier this year – from the risk of vast quantities of global steel diverted away from US and European markets.

This surge in foreign steel "might prove terminal for numerous steel companies.

Labor and Government Calls

Alasdair McDiarmid, representative at steelworkers' union Community, stated the proposed changes posed "an existential threat" to UK steel.

Unions and industry leaders urged Keir Starmer to begin talks urgently with the European Union on country-specific tariff exemptions, noting that the United Kingdom was now the EU's primary export market.

Industry Background

Sector representatives in the EU have also been warning for months that the European steel sector faces being "wiped out" through the new 50% tariffs on American market shipments along with rising energy prices and cheap Chinese competition.

The steel industry on both sides of the Channel is described as a essential sector, providing basic materials in products ranging from skyscraper structures, wind turbines and railways to household appliances and cutlery.

Adoption and Future Actions

These proposals must be agreed by member states and the European parliament, with the European Commission president urging member states and European parliament members to move quickly in backing the proposal.

Should approval be granted, the EU will cut its existing tariff-free allowance by 47% to 18.3 million tons a year, a level previously recorded in 2013. It will impose a 50% tariff on foreign steel exceeding the limit and require countries shipping to the EU to state the production origin to prevent circumvention of the sanctions.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or tariffs due to their strong economic ties in the European Economic Area, the European Union has said.

Alongside the proposal, the European Union is pursuing a "steel partnership" with the US to protect their respective economies from excess production.

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