The European Commission has notified the WTO of the result of its latest review of the EU safeguard system. Some limited changes to the system will be implemented effective 1 July, Kallanish learns from an official release.
The biggest change relates to the liberalisation rate of tariff-rate quotas (TRQs). As of July, these will increase by 4%, against a previous liberalisation rate set at 3%. “The Commission considered that, at this point in time (after four years of measure), a slightly higher level of liberalisation year-on-year should be envisaged in order to encourage the domestic industry to continue its adjustments, while being mindful not to undermine the effectiveness of the measure,” the note says.
Additionally, the Commission has taken the decision to cancel country-specific quotas for both heavy plate and angles, shapes and sections. As a result, these sub-categories will only have one quota available, for all countries.
“In these two product categories, Ukraine has historically been an important exporter (representing around 33% of total quotas in each of these categories) and it has consistently used its quotas at rather high levels. However, the Commission observed that since the military aggression of Russia against Ukraine, there have been virtually no imports of these two categories from Ukraine into the Union. This suggests that Ukraine is currently unable to produce and/or export these products in any meaningful volumes to the Union market,” the Commission explains.
“Under these circumstances, and having analysed the quota use by other exporting countries subject to the measure, the Commission considered that there would be a risk of potential shortage of supply for Union users in these categories if it did not take any action,” the note adds.
During the review, the Commission also looked into the list of developing countries exempted from the measures. The list of such countries has been updated. The most important change will be the inclusion of countries such as Vietnam in a number of TRQs for products including HDG (see separate story).
Finally, some changes will also be implemented to the utilisation of residual quotas during the last quarter of the year, Kallanish notes.
“In addition, the European Union also assessed whether any of the changes to the US Section 232 measure had any effect to the EU safeguard measure requiring an adjustment. The European Union concluded that the changes to the US Section 232 measure did not justify any adjustment to the EU Safeguard measure. Therefore, because no adjustments are proposed in this respect, the detailed reasoning on this section will be included in the legal act that is currently subject to EU’s internal decision-making and which will be published before 1 July 2022,” the note concludes.
Emanuele Norsa Italy