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The European Union revealed plans to match the United States' import duties on steel, increasing to double taxes on foreign steel to fifty percent in a decision described as "a critical danger" to the industry in the UK.

Unprecedented Crisis for UK Steel Exports

Given that 80% of British exports destined for the European Union, this change poses the British steel sector's largest challenge, as stated by the lobby group representing the industry.

European Commission Proposals and Rules

In its plan submitted to the EU legislature this week, the EU executive also proposed reducing the current allowance for duty-free imports and obliging foreign suppliers to declare the origin of steel production to stop China sneaking products in through third nations.

EU steel sector stood at the brink of failure – these measures safeguard it so that it can invest, reduce emissions, and regain competitiveness.

Replacement of Existing System

The proposals are designed to supersede a quota system that has been in operation for the past seven years and which is due to expire in 2026 and is now seen as ineffective. Inaction could have been "fatal" for the industry, a European official stated.

Sector Response and Warnings

However, Gareth Stace, from the trade association British Steel, said EU increasing duties would create "the most severe challenge the British steel sector has encountered".

There were calls for the UK authorities to "recognise the urgent need to put in place its own measures to defend" the UK steel industry – which is still reeling from a 25% tariff from Trump earlier this year – from the threat of millions of tonnes of world steel redirected from American and EU markets.

This flood of imports "could be fatal for many of our remaining steel companies.

Union and Government Calls

Union leaders, representative at labor union the industry union, said the new measures represented "an existential threat" to UK steel.

Labor and business representatives called on Keir Starmer to begin talks immediately with the EU on nation-specific duty-free quotas, pointing out that the UK was now the European Union's No 1 trading partner.

Industry Background

Sector representatives in the EU have also been warning for several months that their own industry faces being "wiped out" through the new 50% tariffs on exports to the US along with rising energy prices and low-cost Chinese imports.

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

Implementation and Future Actions

These proposals must be agreed by member states and the European parliament, with the European Commission president calling on member states and MEPs to act fast in backing the proposal.

If the plan is ratified, the EU will cut its current duty-free quota by forty-seven percent to 18.3 million tons a year, a level last seen in 2013. It will apply a 50% duty on imports exceeding the limit and require countries shipping to the EU to declare the production origin to prevent circumvention of the sanctions.

Exemptions and Global Partnerships

Norway, Iceland, and Liechtenstein will be exempt from import limits or tariffs because of their strong economic ties in the European Economic Area, the EU has said.

Alongside the proposal, the European Union is seeking a "steel partnership" with the US to protect their national industries from overcapacity.

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