International MEPs: understanding the EU's proposal to protect steel
The European Commission has unveiled sweeping reforms designed to protect the European steel industry from global overcapacity, paving the way for one of the most significant changes in EU trade policy over the past decade.
The proposed replacement of existing protective measures in the EU for steel imports will lead to a revision of duty-free quotas, a revision of the distribution by country and stricter trade controls. However, since no technical details have been released yet, most of the impact on the market remains open to interpretation.
In this analytical article, MEPs explore how the new system can redistribute quotas among key exporters, identifying potential winners and losers based on available data and the allocation logic used in previous protective measures.
The plan to restore the EU's protective measures
On October 7, the European Commission unveiled its long-awaited proposal to replace the existing EU regime of protective measures for steel imports.
According to this proposal, the duty-free quota for steel imports will be reduced by about 47%, from about 33 million tons to 18 million tons. The tariff rate on imports exceeding this quota will double from 25% to 50%.
The proposal would also put an end to the practice of shifting unused quotas to the next quarter, require importers to disclose the origin of steel in "smelting and casting" declarations, and empower the Commission to extend the measures to new products in future reviews.
If approved, the measures are expected to enter into force on July 1, 2026 and remain in effect until 2031, with a planned revision in mid-2027.
As the Commission has not yet published detailed implementation regulations or country allocation, key questions remain unanswered. These include exporting countries that will receive quotas for specific countries that will be subject to residual (all other) quotas, and developing countries that may be exempt under WTO rules.
Confirmed details of the allocation of quotas for steel imports to the EU
The European Commission confirmed that its proposal provides for a two-tier approach to imposing restrictions on steel imports into the EU. This is done in order to balance long-term data with current import trends.
The total amount of EU tariff quotas (TRQ) for each category of steel products will be based on the bloc's import volumes in 2013. The Commission chose this year as a reference year because it preceded the global steel overcapacity crisis.