EU Steel Measure: How will the EU’s steel import quota be distributed?

The EU’s steel regulation caps the volume of steel which can enter the EU duty-free at 18.3 million tonnes per year. This quota will be distributed amongst trading partners using a fair and objective methodology based on criteria laid down in the steel regulation.

 

The methodology

  • Distinguishes between the EU’s free trade agreement (FTA) and non-FTA partners, ensuring that FTA partners get better treatment in the form of a higher quota volume.
  • Is mindful of diversification and security of supply issues.
  • Acknowledges any agreements in principle reached between the EU and a trading partner at the WTO (Article XXVIII GATT negotiations).

This distribution of quotas to different trading partners is a key step for the implementation of the steel regulation, ensuring predictability for the market and allowing for the regulation to enter into application on 1 July 2026.

 

How does the quota distribution work?

The total quota of 18.3 million tonnes will be distributed according to different criteria set out in the steel regulation. Two are particularly important:

  1. Past trade in steel with the EU
    All countries whose share of EU imports for a particular steel product was at least 5% (during the 2022-2024 reference period) are granted a country-specific quota. Other partners will be able to export duty-free under the remaining residual quota. This system is the same as under the former steel safeguard measure.
  2. Free trade agreement partners 
    Half of the total quota of 18.3 million tonnes (i.e. 9.15 million tonnes) is reserved for the EU’s FTA partners only. Of this, the majority will be allocated to specific FTA partners in proportion to their historic trading volumes, with a smaller part allocated to FTA partners on a first-come, first-served basis.

 

Result

For FTA partners:

  1. Country-specific quotas
    • A relevant share of the total quota amount for country-specific allocations will be distributed to FTA partners who meet the threshold of at least 5% of EU import volumes (based on the 2022-2024 reference period).
    • In addition, once they have exhausted their country-specific quotas, FTA partners will have access to a quota on a fully competitive, first-come, first-served basis.
  2. Residual quotas
    • FTA partners will have access to the residual quota on an MFN basis (competing with non-FTA partners).
    • The remaining quota volumes will be accessible by FTA partners only.
    • In some categories, some FTA partners will have access to a secured quota volume subtracted from the quota accessible to FTA partners under the residual quota.

For non-FTA partners:

  1. Country-specific quotas
    • Non-FTA partners above the 5% import volume threshold will have access to a country-specific quota accessible on an MFN basis.
    • Residual quotas
    • Non-FTA partners will have access to the residual quota on an MFN basis.

Once a trading partner reaches the relevant quota, its exports to the EU will be subject to an out-of-quota duty of 50%.

Source: europa.eu

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