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While the UK was an EU Member State, and during the transition period, steel imports to the UK were governed by EU steel safeguard measures. The safeguards are a quota on imports of certain steel products to the EU above which a 25% tariff is levied. These were imposed in 2018 in response to the US increasing tariffs on steel and aluminium imports. The EU safeguard measures are intended to protect the EU market from cheap steel diverted from the US. In 2021 they were extended to run to July 2024.

Now that the UK is no longer an EU Member State, the UK has its own independent trade policy and trade remedies.

Trade Remedies Authority’s first recommendation

Initially, a steel safeguard measure covering 19 of the 26 steel product categories put in place by the EU was temporarily maintained by the UK at the end of the transition period. This measure was set to expire on 30 June 2021. It was then for the newly-established independent Trade Remedies Authority (TRA) to recommend to the Government whether the safeguard measure should be extended.

The TRA in June 2021 proposed modifying and extending the safeguard measure on 10 product categories for three years and revoking the measure for the other nine categories of steel imports. Major domestic steel producers and UK Steel, the trade body for the sector, were unhappy with the TRA’s recommendation.

The Government accepted the TRA recommendation to extend the safeguard measure on 10 product categories for three years and made new regulations to temporarily extend the measure on five of the remaining nine product categories for one year. This required emergency legislation to be passed to enable the Government to overrule part of the TRA recommendation.

TRA reconsideration

In September 2021, the TRA launched a reconsideration of its original recommendation, following submissions from industry stakeholders. In March 2022, the Secretary of State for International Trade used newly created powers to call-in the TRA’s reconsideration “due to the strategic importance of the steel sector to the UK.”  The Secretary of State gave directions to the TRA about the terms on which it should conduct its review.

In June 2022, the TRA published the outcome of its reconsideration. It found that, when analysing the evidence on the terms of the Secretary of State’s call-in direction, there was enough evidence to extend the safeguard measure for all 15 remaining product categories. The TRA also proposed amendments to the list of developing countries which are excepted from the safeguard measure.

Government decision to extend the steel safeguard measure

On 29 June 2022, Trade Secretary Anne-Marie Trevelyan announced that, having considered the TRA’s report, she had concluded that there would be “serious injury or the threat of serious injury” to UK steel producers if the safeguard measure on the five additional categories of steel due to expire at the end of June 2022 were not continued.

She announced that the safeguard measure on the five steel categories for which it was due to expire in June 2021, would be extended for a further two years. This means that the safeguard measure will remain in place for all 15 categories of steel until 30 June 2024. Imports outside the quotas of steel in the 15 product categories for which a safeguard measure is in place would face a tariff of 25%.

In her statement, the Secretary of State said that the Government’s decision to extend the safeguard measure on the five product categories departed from WTO obligations but that the national interest required action to be taken.

Reactions to the extension

The Labour Party welcomed and supported the Government’s decision to extend the safeguards but called on the Government to review the framework in which the Trade Remedies Authority operates. Shadow trade minister Nick Thomas-Symonds argued the TRA framework was too heavily weighted towards the interests of importers compared to domestic industry and would be a key factor behind any potential for challenge at the WTO.

The Labour Party and several other Members on both sides of the House raised concerns about underlying structural issues in the steel sector, including energy costs and decarbonisation challenges.

The UK steel industry had been campaigning to ensure that the safeguard measure was extended and welcomed the Government’s decision, saying it showed that the Government was “backing Britain’s steel industry”. Some importers or downstream users of steel argued that specific product categories should be exempt from safeguard quotas because the UK industry does not produce sufficient quantity to meet demand.

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