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The European Union have announced plans to adopt Donald Trump's steel tariffs, effectively doubling taxes on imports to 50% in a action condemned as "an existential threat" to the sector in the UK.

Major Challenge for UK Steel Industry

With eighty percent of British exports going to the European Union, this policy shift creates the British steel sector's most severe crisis, according to the lobby group representing the industry.

European Commission Proposals and Regulations

Through its proposal presented to the EU legislature on Tuesday, the European Commission also proposed reducing the existing quota for duty-free imports and requiring foreign suppliers to declare the origin of steel production to prevent China diverting exports through other countries.

EU steel sector was on the verge of collapse – these measures safeguard it so that investments can be made, decarbonise, and regain competitiveness.

Overhaul of Current Framework

The proposals are intended to replace a quota system that has been functioning for the past seven years and which is set to expire in 2026 and is now seen as not fit for purpose. To do nothing could have been "disastrous" for the sector, one EU official stated.

Industry Reaction and Concerns

Nevertheless, Gareth Stace, head of the trade association British Steel, stated Brussels increasing duties would create "the biggest crisis the British steel sector has encountered".

He called on the UK authorities to "recognise the critical necessity to put in place its own measures to protect" the UK steel industry – which is still reeling from a twenty-five percent duty from the US earlier this year – from the threat of vast quantities of world steel diverted away from American and EU markets.

This surge in foreign steel "could be terminal for numerous steel companies.

Labor and Political Pressure

Union leaders, representative at steelworkers' union Community, said the new measures represented "an existential threat" to British steel production.

Unions and industry leaders called on Keir Starmer to begin talks urgently with the European Union on nation-specific tariff exemptions, noting that the United Kingdom was now the European Union's No 1 trading partner.

Broader Context

Sector representatives in the European Union have repeatedly cautioned for several months that their own industry faces being "wiped out" through the new 50% tariffs on American market shipments along with high energy costs and cheap Chinese competition.

Steel on in both the UK and EU is considered a foundational industry, supplying elemental components in products ranging from skyscraper structures, wind turbines and railways to dishwashers and kitchenware.

Adoption and Future Actions

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

Should approval be granted, the European Union will reduce its existing tariff-free allowance by 47% to 18.3 million tons a annually, a level previously recorded in 2013. It will apply a fifty percent tariff on imports exceeding the limit and oblige nations exporting into the bloc to state where the steel was melted and poured to prevent circumvention of the measures.

Exemptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or duties because of 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 national industries from excess production.

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