The EC has introduced significant strengthening of protective measures on steel imports

On October 7, the European Commission (EC) presented a proposal to protect the EU steel industry from the unfair impact of global overcapacity. This is stated in the institution’s announcement.

The EC proposes:

• to limit duty-free imports to 18.3 million tons per year, which is a 47% reduction compared to the 2024 steel quotas;
• to double the duty rate on out-of-quota products to 50% (compared to 25% under the current safeguard measure);
• to strengthen the traceability of steel markets by introducing melting and casting requirements to prevent circumvention.

This proposal will replace the current steel safeguard measures, which expire in June 2026.

It should be noted that the proposed measure is fully consistent with WTO requirements. Once it has received a mandate from the European Council, the EC intends to engage promptly with the EU’s trading partners affected by this tariff change within the World Trade Organization to offer them country-specific quotas.

Under the Agreement on the European Economic Area, exports from Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or duties.

“Separately, the interests of a candidate country facing an exceptional and immediate security situation, such as Ukraine, should also be taken into account when deciding on the allocation of quotas, without undermining the effectiveness of this measure,” the statement said.

The European Commission’s proposal is subject to the usual EU legislative procedure, and the final version of the regulation must be agreed upon by the European Parliament and the European Council.

The EC noted that since 2027, the EU steel industry has lost about 65 million tons of capacity. Last year, the capacity utilization rate reached 67% (healthy indicators are around 80%). In 2024, the sector recorded record losses.

This decision has already been welcomed by representatives of the European metallurgical industry.

The European Steel Association (EUROFER) noted that the provisions presented by the EC meet the needs of the sector and are a real lifeline for steel producers and workers in the sector. Therefore, the European Parliament and the European Council must urgently adopt them to ensure that they come into force at the beginning of 2026.

Gert Van Poelwoerde, CEO of ArcelorMittal Europe, said that the company and European steel producers had been heard.

“We continue to advocate for the rapid implementation of these new measures proposed today, given the seriousness of the situation facing the European steel industry,” he said.

Van Poelwoerde added that the company also expects an announcement from the EC on the revision of the CBAM by the end of the year.

The German steel industry considers the EC’s proposals for a new trade instrument in the steel sector to be an important step towards ensuring fair competition. This is stated in a statement by the German Steel Industry Association (WVStahl).

“This mechanism does not close the European market. Instead, it creates a fair balance: half of the previous import volumes remain duty-free,” explained Gunnar Groebler, president of WVStahl.

However, the EU’s proposal has already caused concern among the bloc’s trading partners. The UK is demanding urgent clarification on the steel import quotas announced by the EC, while South Korea believes that this will negatively affect its steel exports.

As noted by GMK Center chief analyst Andriy Tarasenko, the key question remains unclear: from what period are these restrictions expected to be introduced? There is a lot of speculation in the market, but this is likely only possible from July 2026, he notes.

«The submitted draft must be discussed in the European Parliament, so amendments are possible. This could take from several weeks to several months. Then the European Commission will adopt the necessary subordinate legislation, namely, it will distribute quotas among countries. And this issue also creates uncertainty. The proposed import quotas are 43% lower than the estimated volume of finished steel products imported into the EU in 2025. We believe that starting in the third quarter of next year, imports may decline even further (by about 50%), as the increase in duties creates additional risks for supplies from the most attractive sources,» he noted.

Andriy Tarasenko added: Ukrainian steel products were exempted from protective measures in the EU by a European Parliament regulation just three months ago, in June 2025. The purpose of this decision is to support the country’s economy during the difficult times of war.

“We believe that the European Commission’s goals have not changed and that Ukraine will be exempted from the quota system,” the analyst said.

It should be recalled that the reduction of EU quotas poses a greater threat to the British steel industry than US tariffs. The new restrictions could cut Britain off from its largest steel market and exacerbate the crisis in the industry.