8
Acknowledged
With the UK now outside the Customs Union, the risk of future EU tariffs on...
Conclusion
With the UK now outside the Customs Union, the risk of future EU tariffs on British steel remains. The Government did not identify the issue of steel tariffs as a priority in its public communications on the “reset”, and it is not at all clear what, if anything, it proposed to the EU to address this matter comprehensively as part of the first UK-EU summit. Nonetheless, it is disappointing that, despite the positive momentum in the relationship, and the importance of a thriving metals sector to Europe’s shared defence industrial base, the European Commission has not proposed to exclude the UK from its proposals for the EU’s post-2026 steel tariff regime. We regret that the Lancaster House summit did not produce a long-term deal on steel tariffs. These developments point to the lack of adequate UK-EU political structures to address shared strategic challenges, in this case unfair Chinese industrial practices, collaboratively. (Conclusion, Paragraph 39)
Government Response Summary
The government acknowledges the importance of steel to both the UK and the EU, highlights measures taken to protect the industries, and commits to finding a bilateral solution with the EU to protect UK-EU steel trade.
Government Response
Acknowledged
Government Response
Acknowledged
HM Government
Acknowledged
Steel remains a vital sector for both the UK and EU, which is why the need to protect historic levels of trade was recognised by both parties at the UK-EU summit, particularly in regard to category 17 steel. Since the summit, both the UK and EU have announced measures to provide effective protection to their industries. The EU announced its future steel trade measures in October 2025, which will reduce tariff-free imports by 47% and increase the out of quota tariff by 50%. These measures are expected to come into effect on 1 July 2026, replacing the EU’s current safeguard measures. The EU is currently taking forward discussions with key trading partners under Article XXVIII GATT procedure regarding this change to the EU’s WTO tariffs, to offer third countries country specific allocations. EEA countries (Norway, Iceland, Lichtenstein) will not be subject to tariff quotas or duties, due to their integration into the single market. We continue to engage with the EU at all levels, including at the WTO about their future measures. Under the EU’s future steel trade measures, UK steel exports will continue to enter the EU tariff free, subject to and in line with the UK’s quota. Throughout discussions we have been clear with the EU that the UK’s sector is not a source of global overcapacity, or the challenges that the EU seeks to address through its measures. We also have appropriate channels to discuss our joint strategic challenges on global overcapacity, through multilateral fora such as the Global Forum on Steel Excess Capacity. The UK and EU have also established a high-level exchange to discuss issues of strategic interest and held this first meeting on 2 February. The UK has also announced that from 1 July 2026, overall quota levels for steel imports will be significantly reduced by 60% compared to current arrangements, and steel coming into the UK above these levels will be subject to a 50% tariff. This is a vital measure to protect steel production due to global overcapacity, and in turn our critical national infrastructure and defence. We are committed to finding a bilateral solution with the EU on our respective measures, which protects vital UK-EU steel trade and both our industries. Discussions ahead of the 2025 Summit on steel were focused on specific categories of steel, with an overall commitment to protect historic levels of trade. Our future and respective measures are about responding to global overcapacity and ensuring protections for our respective industries. I would emphasise that both the UK’s own Steel Strategy and the EU’s draft EU steel measure confirms the intention that Northern Ireland and the specific arrangements to support the movement of steel should be taken into account as we move forward. Our overall objective with the EU remains to find a durable, mutually agreeable solution as part of our respective negotiations.
Source
Committee
Foreign Affairs Committee
Addressee Bodies
Foreign and Commonwealth Office
Timeline
Recommendation age
0.2 yrs
Report published
04 Mar 2026