Guidance

Transition review of EU steel safeguard measures

Updated 25 October 2024

Primary legislation in the Taxation (Cross-border Trade) Act 2018 (the Taxation Act)

Section 13 of the Taxation Act and its Schedule 5 make provision for us to undertake an investigation into whether it is appropriate to apply a safeguard measure.

Secondary legislation in the Trade Remedies (Increase in Imports Causing Serious Injury to UK Producers) (EU Exit) Regulations 2019 (the Safeguard Regs)

Part 9 of the Safeguard Regs enables the EU steel safeguard remedies (tariff rate quotas) that are in existence when the UK leaves the EU to take effect as if they were new UK tariff rate quotas. It provides for a transition review to be carried out to determine whether the tariff rate quotas should be maintained, varied, replaced or revoked for each of the products.

Parts 2-5 of the Safeguard Regs make provisions for determining whether goods are being imported in increased quantities, whether this increase has caused, is causing or is threatening to cause serious injury to UK producers of like goods and directly competitive goods, how to determine an adequate amount to prevent or remove serious injury and how to conduct an investigation. The transition review will apply procedures set out in these parts of the Regulations as appropriate.

Introduction to the safeguard transition review of EU steel safeguard measures

As part of its work to assess whether existing EU trade remedy measures are suitable for the UK market, the UK needs to conduct a transition review of the steel safeguard measure currently in application by the EU.

This measure takes the form of a tariff rate quota (TRQ) – this is a type of duty in which goods up to a specified quantity are subject to a lower import duty than goods outside the quota for a specified period, and once the quota has been exceeded, a higher import duty will be applied.

The safeguard transition review process

Initiating the review

Transition reviews are not applied for by interested parties. The Secretary of State for International Trade will publish a Notice of Determination which will include the UK aligned tariff rate quotas. The notice will describe which categories of products are subject to a tariff rate quota, at what level and for how long. We will then be able to initiate the transition review and we will publish Notice of Initiation on our public file at the Trade Remedies Service.

What we will consider

The transition review will consider whether the goods subject to the EU steel safeguard measure were imported into the UK in increased quantities during the same investigation period considered by the European Commission (that is, the years 2013-2017).

If we identify an increase in imports of the goods subject to the review, we will consider the following questions:

1. If the goods were no longer subject to a tariff rate quota, would the increase in imports be likely to recur?
2. If goods were no longer subject to a tariff rate quota, would there be serious injury to UK producers of like goods and directly competitive goods?
3. Is it necessary to continue the tariff rate quota in order to help UK producers of the like and directly competitive goods adjust to the imports?
4. Would it be better to impose an alternative tariff rate quota or apply a safeguard amount (that is, an additional amount of import duty) on the goods concerned to prevent serious injury to UK producers?

We may also consider whether it is appropriate to:

• increase the amount of the tariff rate quota
• vary the allocation of the tariff rate quota
• reduce the additional rate of the safeguard amount
• reduce or extend the period for which the measure applies to the goods
• vary the pace of liberalisation (the pace at which the duty becomes less restrictive over the period of the measure)
• vary the terms on which part or the whole of the tariff rate quota is allocated or utilised

We will also consider whether the period during which the quota is applied may be extended or reduced. To help us do this, we may request and use data about the goods subject to review during the Most Recent Period (MRP), which for this transition review we have defined as the period from 1 January 2018 until the end of the most recent TRQ quarter before initiation of the review. Please note that this MRP only applies to our transition review into the EU steel safeguard measure and not to any of our other reviews or cases.

How you can contribute to the review

Once we publish our Notice of Initiation, interested parties and contributors can contact us within an agreed period to register their interest in the review. They will need to register through our online Trade Remedies Service.

As an interested party or contributor, you can submit information for us to consider in the case. We may also approach you to ask for information. This may include accounting records, company-specific data and pricing practices as well as many other types of information.

To help us gather this information, we will issue questionnaires to registered interested parties and contributors. We will consider all information received from them, provided that it is objective and can be verified.

We may also visit premises in the UK to obtain information, verify information supplied to us or to help with the development of our investigation. When we do this, we will contact the organisation we intend to visit beforehand, to agree a suitable time, explain why the visit is necessary and what it is likely to cover.

Determining the appropriate action to recommend for the measure

Once we have gathered all the necessary evidence and completed our analysis, we will decide what action to recommend for the measure.

Our review may conclude that the application of the tariff rate quota to goods should be:

• maintained unvaried
• varied
• replaced with a safeguard amount (an additional amount of import duty)
• revoked

If we recommend maintaining a measure in any form, the Economic Interest Test (EIT) must be met. You can find out more about this in our guidance on the EIT.

If we conclude that a tariff rate quota on goods should be varied, this may include:

• increasing the amount of a tariff rate quota
• varying (or providing for) the allocation of a tariff rate quota;
• reducing the additional rate of import duty
• reducing or extending the period for which a tariff rate quota applies to goods
• varying the pace of liberalisation
• vary the terms on which part or the whole of the tariff rate quota is allocated or utilised

If we recommend a variation to the tariff rate quota, including replacement with a safeguard amount, the change we make should help UK producers of like goods and directly competitive goods to adjust to the increased imports.

If we recommend that the quota is varied, in addition the pace of liberalisation should be maintained or increased. Also, if we recommend that the period of the tariff rate quota should be extended, we need to demonstrate that the tariff rate quota will continue to be necessary to prevent serious injury to the UK producers and that we have evidence of the UK producers adjusting to the imports.

Reporting our conclusions

Our statement of intended final determination

Once we have completed our analysis, we will publish our Statement of Intended Final Determination on the Trade Remedies Service. This will set out our intended final determination, a summary of the facts we have considered during our review and how we have used these facts to reach our determination.

In this statement, we will specify a period during which we will consider comments from interested parties, contributors or anyone who has supplied information to us during the review. We will then consider these comments before making our final determination.

Making our final determination

In our final determination, we will make a recommendation whether to maintain, vary, replace or revoke the measure. Our recommendation goes to the Secretary of State, who may accept it or reject it if they consider that the recommended outcome is not in the public interest.