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The European Union have announced plans to adopt the United States' import duties on steel, increasing to double taxes on foreign steel to 50% in a decision condemned as "a survival risk" to the industry in the UK.

Unprecedented Crisis for UK Steel Exports

With eighty percent of UK steel shipments going to the European Union, this change poses the UK steel industry's most severe crisis, according to the industry association representing the industry.

New EU Proposals and Regulations

In its plan submitted to the European parliament on Tuesday, the EU executive additionally suggested reducing the current allowance for tariff-exempt steel and requiring foreign suppliers to state where the steel was melted and poured to prevent Chinese producers diverting exports through other countries.

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 Existing System

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

Industry Reaction and Concerns

Nevertheless, Gareth Stace, from the trade association UK Steel, stated Brussels doubling its tariffs would pose "the most severe challenge the British steel sector has ever faced".

He called on the UK authorities to "acknowledge the urgent need to put in place its own measures to protect" the UK steel industry – which is affected by a 25% duty imposed by the US earlier this year – from the risk of millions of tonnes of global steel diverted away from American and EU markets.

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

Union and Political Pressure

Union leaders, representative at steelworkers' union the industry union, said the new measures posed "an existential threat" to UK steel.

Unions and industry leaders called on the UK government to start negotiations immediately with the European Union on nation-specific duty-free quotas, pointing out that the United Kingdom was now the EU's primary trading partner.

Broader Context

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

Steel on in both the UK and EU is described as a foundational industry, providing elemental components in products ranging from skyscraper structures, renewable energy equipment and transport infrastructure to dishwashers and cutlery.

Adoption and Future Actions

The new measures must be agreed by EU nations and the EU legislature, with the European Commission president urging member states and MEPs to move quickly in support of the initiative.

Should approval be granted, the EU will cut its current duty-free quota by 47% to 18.3 million tons a year, a level previously recorded in 2013. It will apply a fifty percent duty on imports beyond the quota and require countries exporting into the bloc to declare where the steel was melted and poured to prevent circumvention of the sanctions.

Exemptions and International Cooperation

These European nations will be exempt from tariff quotas or tariffs due to their close trading relationship in the EEA, the European Union has confirmed.

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

EU needs to act now, and decisively, prior to all lights go out in significant portions of the EU steel industry and its value chains.