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The European Union have announced plans to adopt Donald Trump's steel tariffs, effectively doubling levies on foreign steel to 50% in a decision described as "a critical danger" to the sector in Britain.

Unprecedented Crisis for British Steel Exports

With 80% of UK steel shipments going to the EU, this policy shift represents the British steel sector's largest crisis, as stated by the industry association representing the industry.

European Commission Proposals and Rules

In its plan presented to the EU legislature on Tuesday, the European Commission also proposed slashing the existing quota for duty-free imports and requiring international producers to declare the origin of steel production to prevent China sneaking products in through other countries.

EU steel sector was on the verge of collapse – we are protecting it so that it can invest, decarbonise, and become competitive again.

Overhaul of Current Framework

The proposals are designed to replace a quota system that has been in operation for the last seven years and which is due to expire in 2026 and is now seen as outdated. Inaction could have been "catastrophic" for the sector, one EU official stated.

Sector Reaction and Warnings

Nevertheless, Gareth Stace, head of the trade association UK Steel, said EU doubling its tariffs would pose "the most severe challenge the British steel sector has encountered".

He called on the government to "acknowledge the urgent need to implement its own measures to defend" the UK steel industry – which is affected by a 25% tariff from the US earlier this year – from the risk of millions of tonnes of global steel redirected from American and EU markets.

This surge in foreign steel "might prove terminal for numerous steel companies.

Union and Government Pressure

Union leaders, representative at labor union the industry union, stated the new measures represented "an existential threat" to British steel production.

Labor and business representatives called on Keir Starmer to begin talks urgently with the European Union on country-specific tariff exemptions, noting that the UK was now the European Union's No 1 export market.

Industry Background

Sector representatives in the European Union have repeatedly cautioned for months that the European steel sector faces being "eliminated" through the increased duties on American market shipments combined with rising energy prices and low-cost Chinese imports.

Steel on in both the UK and EU is described as a essential sector, providing basic materials in products ranging from building frameworks, renewable energy equipment and railways to household appliances and kitchenware.

Implementation and Future Actions

These proposals require approval by member states and the European parliament, with the EU executive head calling on member states and European parliament members to move quickly in support of the initiative.

Should approval be granted, the EU will reduce its current duty-free quota by 47% to 18.3 million tons a year, a volume previously recorded in 2013. It will impose a fifty percent tariff on foreign steel exceeding the limit and oblige countries exporting into the bloc to declare where the steel was melted and poured to prevent circumvention of the measures.

Exemptions and International Cooperation

These European nations will be exempt from import limits or tariffs due to their close trading relationship in the European Economic Area, the EU has confirmed.

In addition to these measures, the EU is seeking a "metals alliance" with the United States to ringfence their respective economies from overcapacity.

The European Union must take immediate action, and decisively, prior to operations cease in large parts of the EU steel industry and its value chains.