Industry association UK Steel has submitted an application for a safeguard tariff rate quota (TRQ) review, claiming a change in circumstances, Kallanish learns.
UK Steel says it is submitting the application on behalf of its members, and there are several factors to justify a TRQ review, which can be requested if there is a change in circumstances.
The first being the reintroduction of US tariffs, including on the UK, which will have direct and indirect impacts on the domestic market, with a significant proportion of trade likely to be diverted to other export markets. This will still be the case even if the UK was able to secure an exemption for its own direct exports to the US. The likelihood of trade diversion is further amplified by the EU amendments to its own safeguards.
Amid the tariffs, there is weak demand in the UK and globally, with domestic demand remaining below pre-pandemic levels. Meanwhile, UK safeguard quotas have been liberalised year after year, first by 5% after their introduction and then by 3% yearly since, UK Steel points out.
“We now have quotas that are 22% larger than what the 2015-2017 import levels would have resulted in and these are due to be liberalised by a further 3% in July 2025,” it notes, adding the current safeguards do not offer adequate protection.
It also adds that certain UK safeguard product categories that have larger residual quotas are additionally exposed to diverted trade. These are categories 4, 7 and 13. These are also categories where the residual quota is dominated by a single importing country crowding out other suppliers.
The association proposes the TRQs should be reduced or at a minimum not be further liberalised in July, with UK Steel saying this is happening by default relative to demand. If liberalisation is necessary, this should be done by a nominal amount, for example 0.1%, like the EU has done, so that safeguards are not undermined. It adds the reversal of the redistribution of Russian and Belarussian quota volumes should also be considered.
Carry-over quotas from each quarter should no longer be available in the next quarter, while individual country caps of 15% should be introduced under residual quotas for categories 4, 7 and 13, it says. This is necessary to prevent the crowding out of other origins.
The application highlights there are no WTO definitions of “developed” and “developing” countries, and therefore these exceptions should be revoked for countries that are not “developing” in a steel context. UK Steel submits that China, India, Turkey, Brazil and Vietnam should not be considered developing countries for the purposes of steel safeguards.
Carrie Bone UK
