UK TRA Begins Review of Steel Tariff Rate Quotas Amid Changes in Import Levels
On February 28, 2025, the Trade Remedies Authority in the UK officially announced the initiation of a Tariff Rate Quota review regarding certain steel products. This review will focus on determining whether the current TRQ measures, which were established to protect UK producers from the negative impacts of excessive steel imports, need to be adjusted in response to evolving market conditions.
The TRA is conducting this review on its own initiative under Regulation 35B(2)(b) of the Trade Remedies (Increase in Imports Causing Serious Injury to UK Producers) (EU Exit) Regulations 2019, following changes in import patterns that may affect domestic steel producers. The TRA will particularly examine imports from developing countries, which were previously excluded from the TRQ measures under specific conditions, and whether those exceptions are still valid.
This review process is crucial in ensuring that the UK's steel industry remains competitive, sustainable, and protected from unfair competition, particularly from dumped imports or subsidies that could distort the market.
Scope of the Review: Steel Products Under Consideration
The review will focus on a wide range of steel products that are currently subject to tariff rate quotas. These products include:
1. Non-alloy and other alloy hot-rolled sheet and strip
2. Metallic coated sheet
3. Organic coated sheet
4. Tin mill products
5. Non-alloy and other alloy quarto plates
6. Merchant bars and light sections (including alloy and non-alloy)
7. Rebar
8. Non-alloy and other alloy wire rod
9. Angles, shapes, and sections of iron or non-alloy steel
10. Railway material
11. Gas pipe
12. Hollow section
13. Large welded tube (including categories 25A and 25B)
14. Other welded tube
These steel categories cover a broad spectrum of steel products used across various industries, including construction, automotive, infrastructure, and energy. The review will assess whether adjustments to the TRQs are required to address any imbalances in the UK market, especially considering potential changes in the level of imports from countries that have historically been exempt from tariff measures.
Legal Framework for the TRQ Review Process
Under Regulation 35B(1) of the Trade Remedies Regulations, the TRA is authorized to conduct reviews of existing tariff measures, such as TRQs, to determine if adjustments are needed due to changes in market conditions. Specifically, the TRA has the power to initiate such reviews if there is sufficient evidence suggesting that circumstances have changed since the measures were originally applied.
This includes situations where:
• Imports from developing countries, which were previously excluded from TRQs, may no longer qualify for exemption.
• Import volumes from specific countries have increased significantly, affecting UK producers.
The Regulation 43 of the Trade Remedies Regulations provides the framework for developing country exceptions, which ensures that countries accounting for less than 3% of total UK imports in any given product category are exempt from the application of TRQs. However, if the collective imports from low-volume developing country exporters exceed 9% of the total imports for a particular steel product, the exemption may no longer apply, triggering a reassessment of the TRQ structure.
In this case, the TRA has reviewed trade data indicating that import levels from certain developing countries have changed significantly, which may require the application of the TRQ to these countries.
Period of Investigation
The period of investigation for this review spans January 1, 2024, to December 31, 2024. During this period, the TRA will analyze detailed trade data, including:
• Import volumes from developing countries.
• The market share of these imports in the UK steel market.
• Trends in steel imports over the past year, particularly any significant increases that could disrupt the UK market.
Key Issues to Be Considered During the TRQ Review
In conducting the review, the TRA will consider various factors, including:
1. TRQ Allocation and Volume Appropriateness: Whether the current allocation of tariff rate quotas is aligned with UK market conditions, ensuring that domestic steel producers have fair access to the market while protecting them from excessive imports.
2. Impact on Traditional Trade Flows: The TRA will assess whether any changes to the TRQ measures would disrupt established trade relationships with certain countries, ensuring that traditional suppliers continue to have access to the UK market while maintaining fair competition.
3. Market Conditions and Competitiveness: The TRA will evaluate whether the steel industry in the UK is still facing serious injury from imports and whether the tariff rate quotas are effectively mitigating any adverse effects. The TRA will ensure that any changes to the TRQs promote fair competition and help maintain the competitiveness of UK steel producers.
4. Changes in Import Levels: The TRA will analyze whether the import levels from developing countries have increased significantly, requiring a reconsideration of the TRQ exemptions and adjustments to ensure the UK's steel industry is not undermined.
5. Trade Circumvention and Unfair Trade Practices: The TRA will also examine the potential for circumvention of trade measures and will consider any factors that could lead to unfair competition, such as dumping or subsidized exports from certain countries.
Public Participation in the Review Process
As part of the review process, the TRA invites all interested parties, including steel producers, trade associations, importers, and other stakeholders, to participate. Those wishing to participate must register their interest and submit their comments through the Trade Remedies Service by March 14, 2025. This allows stakeholders to voice their concerns and provide evidence that could influence the final decision.
Parties interested in appearing at hearings or submitting confidential information must follow specific procedures outlined by the TRA. If any confidential information is submitted, it must be accompanied by a non-confidential summary or an explanation as to why a summary cannot be provided.
Next Steps in the TRQ Review Process
The review will progress through several stages:
1. Invitation for Comments: Stakeholders will have the opportunity to register their interest and submit comments by March 14, 2025.
2. Analysis of Data: The TRA will analyze the trade data from the period of investigation (January to December 2024) to assess the impact of changes in import levels.
3. Publication of SIFD: A Statement of Intended Final Determination will be published, outlining the TRA’s preliminary conclusions based on the evidence collected.
4. Review of Comments on SIFD: The TRA will review any comments received on the SIFD and make any necessary revisions.
5. Final Determination: The TRA will make a Final Determination (FD) regarding whether the TRQ measures should be maintained, modified, or removed.
Once the review process is complete, the TRA will submit its recommendations to the Secretary of State for Business and Trade, who will make the final decision on whether to accept or reject the proposed changes to the tariff rate quotas.
Key Takeaways:
• Review of Steel Tariff Rate Quotas initiated by the UK Trade Remedies Authority on February 28, 2025, to assess whether adjustments are needed for certain steel products.
• Focus on Imports from Developing Countries: The review will particularly focus on steel imports from developing countries that were previously exempt from TRQs.
• Products Under Review: Steel products include hot-rolled sheets, rebar, welded tubes, wire rod, and more.
• Period of Investigation: The review will focus on trade data from January 1, 2024, to December 31, 2024.
• Public Participation: Stakeholders have until March 14, 2025, to register interest and submit comments for consideration.
• Final Determination: The TRA will make a Final Determination after considering all comments and evidence, which may lead to changes in the existing TRQ measures.
