In light of current UK sanctions on Russian and Belarus imports, the TRA launched a Tariff Rate Quota (TRQ) examination of steel imports covered under the UK’s safeguard trade remedy mechanism.
The TRA considered whether these countries’ quotas should be reallocated in order to avoid a steel deficit in the UK.
The TRA recommendation was accepted by the Secretary of State for International Trade, and the HMRC notice outlining the modifications was published on Thursday, June 30. Tariff rate quotas (TRQs) will change on July 1, 2022.
Avoiding a shortage of key steel supply to the United Kingdom
As with every safeguard mechanism, the United Kingdom has established limits for various nations or areas to import a fixed amount of steel tariff-free into the United Kingdom.
When their quota is depleted, they must pay a higher tariff rate.
Russia and Belarus accounted for around 22% of the UK’s rebar supply.
TRA has proposed reallocating Russia and Belarus quotas to other nations and areas such as Ukraine, the EU, Turkey, and Taiwan.
“We have adjusted to changes in the international steel market following Russia’s invasion of Ukraine,” stated TRA Chief Executive Oliver Griffiths. Reallocating quotas presently held by Russia and Belarus will enable more access to duty-free steel for UK enterprises in the construction, engineering, and automotive sectors.”
What this means for steel imports and consumers in the UK
The re-allocation has an impact on two product groups. Non-alloy and other alloy hot rolled sheets and strips in category 1 are utilized in yellow goods, construction, tube-making, and downstream steel product manufacture.
Category 13 (rebars) is used in building, the automobile sector, engineering, and the manufacture of white goods.
Depending on the nation of origin, new tariff rates may apply to steel imports in certain categories.
Changes to the steel safety measure on a larger scale
In a statement issued this week, the government announced that it intends to keep steel safeguard tariffs on 15 categories of steel imports for another two years, until 2024.
being directed by the Secretary of State for International Trade, the Trade Remedies Authority completed its review of the legislation. The TRA’s final Report of Findings is publicly available.
In addition, the TRA has completed two further TRQ reviews linked to the steel safeguard measure.
These evaluate: whether developing-country imports reach 3% of total UK imports, the threshold for developing-country inclusion under the safeguard measure.
HMRC data updates for a narrow number of steel product categories
The TRA’s recommendations on all three TRQ reviews have been incorporated into the final TRQ allocations for the safeguard measure and have been verified in the taxation notice that goes into effect on July 1.
Historical context
The UK organization that evaluates whether trade remedies measures on imports are required is the Trade Remedies Authority.
Until the UK exited the EU, the EU Commission conducted trade remedy investigations on its behalf.
Safeguard measures are one of three types of trade remedies permitted under World Trade Organization (WTO) rules, along with anti-dumping measures that counter goods being ‘dumped’ into countries at prices lower than their normal price in their country of origin and countervailing measures against countervailable subsidies.
When the UK left the EU, forty-four EU trade remedies measures that were of relevance to UK producers were carried over into UK law, and the TRA must review each one to see if it is appropriate for UK purposes.
The TRA examined a safety measure on some steel goods as part of this procedure, submitting its proposal in June 2021. The TRA proposed that measures be extended for some steel goods while being withdrawn for others.
The TRA was then urged to reconsider its ruling. The Secretary of State for International Trade ‘called in’ the reconsideration. Under her supervision, the TRA finished the reassessment.
TRQs are a component of the World Trade Organization (WTO) framework. They stipulate how much of a product can be imported from a country before tariffs are applied.
The UK’s trade remedies system adheres to WTO standards and is intended to protect UK industries from unfair trade practices or unanticipated increases in imports.
The UK has the authority to review its Tariff Rate Quotas on imports subject to safeguard measures to ensure that they remain relevant and beneficial. This is not included in the reconsideration procedure.