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EU officials have announced plans to match Donald Trump's steel tariffs, increasing to double taxes on foreign steel to 50% in a move condemned as "a critical danger" to the sector in the UK.

Unprecedented Crisis for UK Steel Industry

Given that 80% of UK steel shipments destined for the European Union, this policy shift creates the UK steel industry's largest crisis, as stated by the lobby group speaking for the industry.

European Commission Measures and Regulations

Through its proposal presented to the EU legislature on Tuesday, the European Commission also proposed cutting the current allowance for duty-free imports and requiring foreign suppliers to declare the origin of steel production to stop Chinese producers 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, decarbonise, and regain competitiveness.

Replacement of Current Framework

These measures are designed to supersede a import framework that has been in operation for the past seven years and which is set to expire in 2026 and is now considered outdated. To do nothing could have been "catastrophic" for the sector, one EU official said.

Sector Reaction and Warnings

However, industry representatives, head of the trade association UK Steel, stated EU increasing duties would pose "the biggest crisis the UK steel industry has ever faced".

He called on the government to "recognise the urgent need to put in place its own measures to defend" the British steel sector – which is still reeling from a 25% tariff from the US recently – from the risk of vast quantities of global steel redirected from American and EU markets.

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

Union and Political Pressure

Alasdair McDiarmid, assistant general secretary at labor union Community, stated the proposed changes posed "a survival risk" to UK steel.

Labor and business representatives urged the UK government to begin talks urgently with the EU on country-specific duty-free quotas, pointing out that the United Kingdom was now the European Union's No 1 trading partner.

Broader Context

Industry leaders in the EU have repeatedly cautioned for months that their own industry confronts being "wiped out" through the new 50% tariffs on American market shipments combined with rising energy prices and cheap Chinese competition.

The steel industry on in both the UK and EU is considered a foundational industry, supplying basic materials in products ranging from building frameworks, renewable energy equipment and railways to household appliances and cutlery.

Implementation and Next Steps

The new measures require approval by EU nations and the European parliament, with the European Commission president calling on national governments and MEPs to move quickly in support of the initiative.

If the plan is ratified, the EU will cut its current duty-free quota by forty-seven percent to 18.3 million tons a annually, a level previously recorded in 2013. It will impose a 50% tariff on foreign steel exceeding the limit and require nations exporting into the EU to declare the production origin to avoid bypassing of the sanctions.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to import limits or tariffs due to their close trading relationship in the European Economic Area, the EU has said.

In addition to these measures, the EU is seeking a "metals alliance" with the US to protect their respective economies from excess production.

EU must take immediate action, and firmly, prior to all lights go out in large parts of the EU steel industry and its supply networks.