European Commission discloses draft duties on China-made battery electric vehicle imports
The European Commission (EC) unveiled on Tuesday its draft decision on definitive countervailing duties on battery electric vehicle (BEV) imports from China, Kallanish reports.
Carmakers received the proposed additional tariffs they will be subject to, and now have 10 days to provide comments. Interested parties can also request hearings with the EC “as soon as possible.”
The decision follows an anti-subsidy investigation officially started on 4 October 2023. Temporary duties, on top of the existing 10% import tariff, entered into force on 5 July 2024. If approved in an upcoming vote by member states, definitive countervailing duties will be imposed on 5 November for a five-year period.
Based on “substantiated comments” received from carmakers on the provisional measures, the EC has slightly adjusted the proposed rates downwards. They range from 17% to 36.3%, instead of the original maximum rate of 38.1%.
However, US EV maker Tesla has received a much lower rate than peers. This “individual duty rate” of 9% was granted as an exporter from China. This means Tesla’s BEV models shipped from its Shanghai gigafactory will only be subject to a total of 19% import duties “at this stage.”
In comparison, BYD vehicles are subject to 27%. Other cooperating companies, which the EC has not publicly disclosed, will face total tariffs of 31.3%. “Non-cooperating” companies such as SAIC, the parent company of MG Motors, are facing the harshest combined rate of 46.3%.
China Chamber of Commerce to the EU (CCCEU) expressed its “strong dissatisfaction and firm opposition to the EC’s protectionist approach.” The group argues the development of the European EV industry, along with the EC’s own report, “shows that there is no sufficient evidence to demonstrate that China’s BEVs cause substantial material injury in the EU market.”
“The EC’s unfair use of trade tools to hinder free trade in electric vehicles, along with this protectionist approach, will ultimately weaken the resilience of the European electric vehicle industry, disrupt the level playing field, and undermine the EU’s own green transition,” it adds.
The move will also exacerbate trade tensions between China and the EU, but the EC doesn’t see it impacting the ongoing procedures in the World Trade Organisation (WTO). Beijing says the EU has not followed WTO trade rules and has initiated a dispute consultation.
EC notifies Vietnam of HRC dumping complaint
The European Commission said it has notified Vietnam that it has received a complaint for the initiation of an anti-dumping investigation into imports of hot-rolled coils (HRC).
The commission did not identify who filed the complaint against Vietnam.
Should a probe be launched, the commission may decide to pick a sample of exporters to investigate because of the large number of producers from Vietnam.
Market participants have expected an EU investigation into Vietnamese HRC imports since volumes started picking up. Last year Vietnamese imports of HRC into the EU rose to 1.13mn t, from 400,000t in 2022. Vietnam has frequently been the lowest-priced supplier on the market, targeting primarily large buyers and pure commodity grade coils. Since the launch of the Argus HRC cif Italy origin differentials earlier this year, Vietnam has traded at a discount.
There is talk that an investigation into Vietnamese hot-dip galvanised (HDG) could be launched too, and a probe into HRC imports from major ‘other countries’ such as Taiwan, Japan and Egypt..
Vietnam itself has this week launched a dumping investigation on imports of HRC from China and India and previously into HDG from China.
By Lora Stoyanova
European Commission launches decarbonisation technology viability assessment centre
The European Commission has launched the Innovation Centre for Industrial Transformation and Emissions (INCITE), which will assess whether breakthrough decarbonisation technologies are cost-effective, energy and resource efficient, and ready for use at industrial scale.
Seville-based INCITE will be a key tool in the implementation of the revised Industrial Emissions Directive, the Commission says. It will cover all sectors under the Industrial Emissions Directive, with an initial focus on energy-intensive industries such as steel, cement and chemicals, Kallanish notes.
INCITE’s technical assessments and findings will be accessible to industry, finance institutions, technology providers, permitting authorities and research and technology organisations.
The technical information it provides will help investment decisions in innovative technologies needed to advance Europe’s transition towards a cleaner, climate-neutral, more circular and competitive economy by 2050.
Virginijus Sinkevičius, Commissioner for Environment, Oceans and Fisheries, notes: “INCITE is a pioneering initiative that will accelerate the uptake of cutting-edge technologies and drive a greener, more competitive industry in the EU. As a major tool to deliver our European Green Deal and the new Industrial Emissions Directive, INCITE will unlock the full potential of innovation, reduce investment risks, and promote sustainable growth.”
Adam Smith Poland
EC implements 15pc cap on HRC other countries quota
The European Commission is implementing a 15pc cap on any individual country selling hot-rolled coil into the quarterly other countries quota of its steel safeguard.
This effectively caps any country selling into the other countries at 141,849t/quarter for the rest of this year: the other countries quota for July-September and October-December will be 945,664t.
If no grace period is granted, sources suggest this could lead to significant duties being incurred on 1 July, as many countries will have more than 15pc of the other countries volume in transit to the EU.
The commission decided against any other individual country quotas on HRC, the notification said.
The commission has been carrying out its review of the steel safeguard for months now. Market sources had anticipated Vietnam would get its own quota, while in recent months there have been suggestions Japan actively asked for its own quota.
The liberalisation rate has also been reduced from 4pc to 1pc.
The commission also notified the WTO the safeguard would be extended for two years, meaning there will be a brief six-month overlap between the safeguard and the imposition of the financial component of the carbon border adjustment mechanism (CBAM).
“The commission also established the surge of imports from certain new origins was related to growing overcapacity in certain regions as well as to the significant pressure exerted by a strong increase in Chinese exports to certain markets,” it said in the notification. China has been exporting record volumes of HRC this year, with significant tonnage going into nearby markets, such as Vietnam.
The changes to the safeguard are subject to approval by member states, and the commission will hold consultations from 29 May until June 10 on the proposal.
European Commission approves Nippon-US Steel acquisition
The European Commission has approved the acquisition of US Steel by Nippon Steel Corporation, it says in a note seen by Kallanish.
The Commission concluded the transaction would not raise competition concerns, given the companies’ limited market positions resulting from the proposed transaction. The notified transaction was examined under the simplified merger review procedure.
US Steel owns the 4.5 million tonnes/year crude steel capacity blast furnace-based steelworks in Kosice, which has been touted to transition to electric arc furnace steelmaking. Although the investment has received Slovakian government backing, the plant’s new owner will also need to provide capital for the project’s financing requirement to be covered.
In the US, the Nippon acquisition has hit a political stumbling block, with President Joe Biden and the US Steel union both opposing the deal.
The Japanese steelmaker said last week the transaction will be delayed to the third or fourth quarter. Nippon and US Steel have each received a request for additional information and documentary materials from the US Department of Justice in connection with the DOJ’s review of the proposed acquisition.
Adam Smith Poland
EU Safeguard Measure is to be reviewed for a possible extension
The European Commission officially announced today that the EU Safeguard Measure is to be reviewed for a possible extension. This is backed by 14 member states who had already requested a review from the EC in January 2024.
The European Commission officially announced today, Friday, February 9, 2024, that the EU Safeguard Measure on certain steel products, which was due to expire in mid-2024, is to be reviewed for a possible extension at the insistence of 14 EU member states.
In addition, the measure is most likely to be extended to the longest possible and WTO-compliant period of 8 years.
US Section 232 tariffs have come to stay
Since the US Section 232 tariffs of the Trump Administration from 2018 are still in force and it is not to be expected that they could be repealed in the foreseeable future, the EC has now also recognized: “…that there are no elements suggesting that the US will be removing the Section 232 measures on steel”.
The introduction of the US punitive tariffs triggered a backlash from the European Union and led to the existing EU Safeguard Measures against steel imports to Europe in 2019.
German steel regions had called for EU Safeguard extension
Last Wednesday, we reported on the German steel regions’ call for the German government in Berlin to support a continuation of the Safeguard measure and that it is therefore only a matter of time before the EC takes action.
Source: steelnews.biz
