The European Commission expects tough negotiations with free trade agreement partners over tariff-rate quota allocations in the proposed new steel safeguard measure, but may provide those partners, as well as those countries agreeing measures to tackle overcapacity, with favourable treatment. There is meanwhile no deadline for these negotiations to conclude.
So explained Léon Delvaux, director of Directorate E at the European Commission’s Directorate-
Some 67% of EU steel imports come from FTA partners, he pointed out. “So it’s clear that, given the objective we have in terms of [import] volume reduction, this will be a very difficult discussion with third countries, and in particular, of course, FTA partners,” Delvaux noted during the session monitored by Kallanish.
The negotiations, carried out according to WTO process, have no deadline and will begin once the Commission receives a mandate from the European Council. Most third countries have already informally contacted the Commission for an explanation of the new measure, he added.
The enforcement of the new safeguard measure will nevertheless not depend on the conclusion of these talks. “I think we believe it’s important that we keep our autonomy and autonomous ability to take measures in this field,” Delvaux noted.
The Commission will also continue discussions with partners in the Global Forum on Steel Excess Capacity, in the hope of a better outcome than has hitherto been the case. The forum’s attempts since its founding in 2018 “to collectively cope with overcapacity have not been fruitful”, he added.
The Parliament’s newly elected rapporteur on the new safeguard measure proposal, Karin Karlsbro, also INTA Committee vice chair, is scheduled to present her report on the matter on 2 December. It will then be open for amendments and a vote by the ITRE Committee by mid-January, after which Parliament will vote on Karlsbro’s final report most likely in February, said INTA Committee chair Bernd Lange.
During the hearing, Karlsbro said the new measure is needed more urgently than by July 2026, when the current safeguard expires.
“Importers are stockpiling cheap steel with lower environmental standards, and our producers are getting further and further away from re-establishing their capacity in production every day that we do not have better measures in place,” she noted.
“We obviously do not want to make things impossible for our industries dependent on availability of steel. But it is certainly also not of European interest to create a new sector dependency on China. On the contrary, it is most certainly of common European interest to secure crucial investments in decarbonising the steel production, as well as to create legal certainty for both those industries in dire need of steel as well as the steel sector itself,” she continued.
She added that the new measure is likely to give a push to collaboration with “like-minded” partner countries on how to tackle overcapacity.
Adam Smith Austria
