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The European Union declared plans to match Donald Trump's steel tariffs, increasing to double levies on imports to fifty percent in a action described as "an existential threat" to the sector in the UK.

Major Challenge for British Steel Industry

With eighty percent of British exports going to the European Union, this change poses the UK steel industry's largest challenge, according to the lobby group representing the sector.

European Commission Proposals and Regulations

In its plan submitted to the EU legislature this week, the European Commission additionally suggested cutting the current allowance for duty-free imports and requiring international producers to declare the origin of steel production to stop China diverting exports through other countries.

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

Overhaul of Existing System

These measures are designed to supersede a quota system that has been functioning for the past seven years and which is due to expire in 2026 and is now considered ineffective. To do nothing could have been "fatal" for the sector, a European official stated.

Sector Reaction and Concerns

Nevertheless, Gareth Stace, head of the industry body UK Steel, said EU increasing duties would pose "the biggest crisis the UK steel industry has ever faced".

There were calls for the UK authorities to "recognise the critical necessity to put in place its own measures to protect" the British steel sector – which is still reeling from a 25% tariff from the US earlier this year – from the threat of millions of tonnes of global steel diverted away from US and European markets.

This surge in foreign steel "might prove fatal for many of our remaining steel companies.

Union and Political Calls

Alasdair McDiarmid, representative at labor union the industry union, stated the new measures posed "an existential threat" to British steel production.

Labor and business representatives urged the UK government to start negotiations immediately with the European Union on nation-specific duty-free quotas, pointing out that the UK was now the European Union's primary trading partner.

Industry Background

Industry leaders in the European Union have also been warning for several months that the European steel sector confronts being "eliminated" through the increased duties on exports to the US along with high energy costs and low-cost Chinese imports.

The steel industry on both sides of the Channel is considered a essential sector, supplying basic materials in everything from skyscraper structures, renewable energy equipment and railways to dishwashers and kitchenware.

Adoption and Future Actions

These proposals must be agreed by member states and the EU legislature, with the EU executive head calling on national governments and European parliament members to act fast in support of the initiative.

Should approval be granted, the EU will reduce its current duty-free quota by forty-seven percent to 18.3m tonnes a annually, a volume previously recorded in 2013. It will impose a fifty percent duty on foreign steel beyond the quota and require nations shipping to the bloc to state where the steel was melted and poured to avoid bypassing of the measures.

Exceptions and Global Partnerships

Norway, Iceland, and Liechtenstein will be exempt from import limits or tariffs due to their close trading relationship in the European Economic Area, the EU has said.

Alongside the proposal, the EU is seeking a "steel partnership" with the US to ringfence their national industries from excess production.

The European Union needs to act now, and decisively, prior to operations cease in significant portions of the European steel sector and its value chains.