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Updated 7 October 2022
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This publication is available at https://www.gov.uk/government/publications/trade-remedies-notices-tariff-rate-quotas-on-steel-goods/trade-remedies-notice-202101-safeguard-measure-tariff-rate-quota-on-steel-goods
This notice was removed in error on 4 July 2022, and republished on 7 October 2022. It was originally published on 30 June 2021 with effect from 1 July 2021 to 30 June 2022. It has been superseded by trade remedies notice 2022/01.
This public notice is published by the Secretary of State under regulation 52(4)(a) of the Trade Remedies (Increase in Imports Causing Serious Injury to UK Producers) (EU Exit) Regulations 2019[footnote 1] and makes provision giving effect to the recommendation of the Trade Remedies Authority made in accordance with regulation 51 of those Regulations and entitled Transition review TF0006 – Safeguard measure on certain steel products[footnote 2].
The notice relates to the following goods (“steel goods”):
** The number in square brackets indicates the corresponding category of steel products in Taxation Notice 2020/06: Safeguard measures on certain steel products – application of tariff rate quotas, which had effect from 11 p.m. on 31 December 2020 to 30 June 2021.
The additional amount of duty (“safeguard duty”) applicable to steel goods imported outside of the quota is 25% ad valorem.
The safeguard duty is applicable to the net free-at-the-frontier price of the good (before any other amount of import duty).
The tariff-rate quota set out in this notice has effect from 1 July 2021 to 30 June 2024.
The tariff-rate quota is an extension of the tariff-rate quota imposed by the European Union on behalf of the United Kingdom and other countries or territories that had effect in the United Kingdom from 19 July 2018 to 30 June 2021[footnote 3].
The quota is divided into 12 Quarters over 3 years and specifies for each goods category the amount of steel goods that may be imported free of safeguard duty in any given Quarter.
The right to access the quota is granted by Her Majesty’s Revenue and Customs to importers in the United Kingdom on a first-come, first-served basis.
Importers are asked to cite the relevant order number set out in the Annex when applying to Her Majesty’s Revenue and Customs to access a particular quota.
Any unused quota allocated for steel goods originating in a country or territory remains available in the next Quarter for steels goods originating in that country or territory. Any unused balance may cumulate within the same year but any quota remaining at the end of each year is not available in the next year.
Importers of steel goods originating in a country or territory with an exhausted quota allocation for the year may, only in Quarter 4 of that year, apply for the right to use any remaining quota allocated for steel goods originating in all other countries or territories.
1 July 2021 to 30 June 2022, in tonnes (t), allocated quarterly:
Quarter 1: 1 July 2021 to 30 September 2021
Quarter 2: 1 October 2021 to 31 December 2021
Quarter 3: 1 January 2022 to 31 March 2022
Quarter 4: 1 April 2022 to 30 June 2022
1 July 2022 to 30 June 2023, in tonnes (t), allocated quarterly:
Quarter 1: 1 July 2022 to 30 September 2022
Quarter 2: 1 October 2022 to 31 December 2022
Quarter 3: 1 January 2023 to 31 March 2023
Quarter 4: 1 April 2023 to 30 June 2023
1 July 2023 to 30 June 2024, in tonnes (t), allocated quarterly:
Quarter 1: 1 July 2023 to 30 September 2023
Quarter 2: 1 October 2023 to 31 December 2023
Quarter 3: 1 January 2024 to 31 March 2024
Quarter 4: 1 April 2024 to 30 June 2024
All steel goods originating in a signatory country or territory specified below are excluded from:
(a) the quota amount allocated for all other countries or territories; and
(b) the application of the safeguard duty.
Signatory countries or territories:
Antigua and Barbuda
Barbados
Belize
Bahamas
Botswana
Côte d’Ivoire
Dominica
Dominican Republic
Eswatini
Grenada
Guyana
Jamaica
Kenya
Lesotho
Mozambique
Namibia
St Kitts and Nevis
St Lucia
St Vincent and the Grenadines
South Africa
Trinidad and Tobago
Except for steel goods in a goods category originating in a developing country or territory annotated with that goods category, any steel goods originating in a developing country or territory specified below are excluded from:
(a) the quota amount allocated for all other countries or territories; and
(b) the application of the safeguard duty.
Key: * denotes a quota amount for the goods category is allocated for the country or territory;
~ denotes the quota amount for the goods category allocated to all other countries or territories is available for the country or territory.
Developing countries or territories:
Afghanistan
Albania
Angola
Antigua and Barbuda
Argentina
Armenia
Bahrain
Bangladesh
Barbados
Belize
Benin
Bolivia
Botswana
Brazil (Cat. B~)
Brunei
Burkina Faso
Burundi
Cape Verde
Cambodia
Cameroon
Central African Republic
Chad
Chile
China (Cats.: C; K)
Colombia
Congo
Costa Rica
Côte d’Ivoire
Cuba
Democratic Republic of the Congo
Djibouti
Dominica
Dominican Republic
Ecuador
Egypt
El Salvador
Eswatini
Fiji
Gabon
The Gambia
Georgia
Ghana
Grenada
Guatemala
Guinea
Guinea-Bissau
Guyana
Haiti
Honduras
Hong Kong
India (Cats.: B; C~; G; K~)
Indonesia (Cat.: I*)
Jamaica
Jordan
Kazakhstan
Kenya
Kuwait
Kyrgyzstan
Laos
Lesotho
Liberia
Macao
Madagascar
Malawi
Malaysia (Cat.: I*)
Maldives
Mali
Mauritania
Mauritius
Mexico
Moldova
Mongolia
Montenegro
Morocco
Mozambique
Myanmar (Burma)
Namibia
Nepal
Nicaragua
Niger
Nigeria
North Macedonia
Oman
Pakistan
Panama
Papua New Guinea
Paraguay
Peru
Philippines
Qatar
Rwanda
St Kitts and Nevis
St Lucia
St Vincent and the Grenadines
Samoa
Saudi Arabia (Cats.: I*; J~)
Senegal
Seychelles
Sierra Leone
Solomon Islands
South Africa
Sri Lanka
Suriname
Tajikistan
Tanzania
Thailand
Togo
Tonga
Trinidad and Tobago
Tunisia
Turkey (Cats: A; C~; E; G; H; J; K)
Uganda
Ukraine (Cats.: B~; E*)
United Arab Emirates (Cats.: G; H~; K)
Uruguay
Vanuatu
Venezuela
Vietnam (Cat. B*)
Yemen
Zambia
Zimbabwe
In accordance with regulation 49(4) of the Trade Remedies (Increase in Imports Causing Serious Injury to UK Producers) (EU Exit) Regulations 2019 (“the Regulations”) the Trade Remedies Authority (“the TRA”) has conducted a transition review and considered whether goods belonging to each specified category of steel products were, during the same investigation period considered by the European Commission in connection with the EU tariff rate quotas, imported into the United Kingdom in increased quantities. Where the TRA determined that goods were imported in increased quantities, and where those increases were considered significant in accordance with regulation 5, a further consideration in accordance with regulation 49(4)(a)-(d) of the Regulations was made on whether;
the importation of those goods in increased quantities would be likely to recur if they were no longer subject to a tariff rate quota
there would be serious injury to United Kingdom producers of the like goods and directly competitive goods if goods belonging to that category were no longer subject to a tariff rate quota
the continuation of a tariff rate quota is necessary to facilitate the adjustment of the United Kingdom producers of the like goods and directly competitive goods to the importation of goods belonging to that category; and
whether alternative tariff rate quotas or the application of a safeguarding amount to goods belonging to that category would better meet the aim of preventing serious injury to the United Kingdom producers of the like goods and directly competitive goods
In accordance with regulation 49(5) of the Regulations, the TRA review further considered whether it is appropriate to increase the amount of any of the tariff rate quotas; vary (or provide for) the allocation of any of the tariff rate quotas; reduce the additional amount of import duty; reduce or extend the period for which goods are subject to the tariff rate quotas; vary the pace of liberalisation; and vary (or provide for) the terms on which a part or the whole of any of the tariff rate quotas is allocated or may be utilised.
This review has also considered, in accordance with regulation 50(5) of the Regulations, whether the TRA is satisfied that the application of the measure meets the United Kingdom’s economic interest test. This consideration has been made where the TRA’s final determination is that the tariff rate quotas applied to goods should be varied.
The Statement of Intended Preliminary Decision (“the SIPD”) was published on 19 May 2021 and, due to the very tight timeline to which this transition review is subject, was followed by a period of 7 days for the reception of submissions in relation to it. Again, due to the tight timeline, the TRA was unable to grant extensions for submissions. The determinations of the TRA were made following the consideration of comments received during this period, pursuant to regulation 29(2) of the Regulations.
The TRA reviewed 19 product categories, which contained 253 different product codes in total. The total number of product codes in the TRA’s determinations reduced by 17 codes to 236 as a result of a scope change which combined 2 categories. The TRA is recommending that the measure is revoked on 130 product codes and extended on 106 product codes. This represents revocation of all codes in 9 product categories and extension of the application of the measure on 10 product categories with 2 of those categories amended (i.e. some codes are revoked).
In accordance with regulation 51 of the Regulations, and as a result of the determinations made pursuant to regulation 50 of the Regulations, the TRA made the following recommendations to the Secretary of State for International Trade.
The TRA recommended in accordance with regulations 51(1), (3)(c) and (8) of the Regulations that the application of the tariff rate quota be revoked, where goods belonging to a specified category of steel products were either not being produced by United Kingdom producers or not being imported into the United Kingdom in increased quantities during the period of investigation.
The TRA also recommended in accordance with regulations 51(1), (3)(c) and (8) of the Regulations that the application of the tariff rate quota be revoked, where goods belonging to a specified category of steel products were not being imported into the United Kingdom in increased quantities deemed to be significant, or are not causing serious injury to the United Kingdom domestic industry, as detailed in the table below.
The TRA recommended in accordance with regulations 51(1), (3)(c), (4) and (8) of the Regulations that the application of the tariff rate quota be revoked, where goods belonging to a specified category of steel products were determined not to meet the Economic Interest Test.
The TRA further recommended in accordance with regulations 51(1), (3)(a), (4), (6), (7) and (8) of the Regulations that the application of the tariff rate quota be varied, where goods belonging to a specified category of steel products were being imported into the United Kingdom in increased quantities deemed significant, as their application met the Economic Interest Test and they continue to be necessary to facilitate adjustment of United Kingdom producers to the importation of those goods and there is evidence that United Kingdom producers are adjusting to the importation of those goods. The variation of the measure was recommended to be on the following terms:
goods belonging to each of these categories of steel products are subject to a tariff rate quota and an out-of-quota safeguarding duty of 25%
the measure is extended for a period of 3 years
the liberalisation rate for the measure is set at 3% for each year that the measure is in place, thereby ensuring that the pace of liberalisation is maintained
goods originating from developing countries members of the WTO that are low volume exporters as defined in regulation 46(6)-(7) of the Regulations are excepted from the application of the tariff rate quotas pursuant to regulation 43 of the Regulations, and some FTA partners are excluded from the scope of this transition review pursuant to regulation 44 of the Regulations
In the injury analysis conducted by the TRA as part of the transition review, a significant increase in imports was found for all product categories apart from product categories 6 and 28. The likelihood of a reoccurrence of imports in increased quantities was found for all product categories if the safeguard measure was revoked. For the assessment on the likelihood of recurrence of serious injury, the TRA found that there is a likelihood that serious injury would recur if the safeguard measure was revoked for all product categories, except 7. Therefore, product categories 6, 7 and 28 were removed from the recommended measure and were not assessed in the economic interest test.
In the significance assessment, the TRA found that the scrap metal industry, coal industry and importers of steel products are relatively small in terms of both numbers of employees and Gross Value Added (GVA). The TRA also found that the United Kingdom steel sector is economically significant with higher employment figures in comparison to the upstream industry and importers. Due to the prevalence of steel as an input, the downstream industries are an order of magnitude bigger than the steel industry by all metrics.
From assessing the impacts of the proposed extended safeguard measure, the TRA found that the measure would significantly benefit the United Kingdom steel and scrap metal industries. The TRA found that importers of steel into the United Kingdom could incur some costs. The size of these costs would depend on the extent to which imports exceed the quota amounts with the extension of the safeguard measure. While the impact on individual downstream businesses and consumers is expected to be fairly small, owing to the large numbers affected, total costs for downstream sectors and consumers may be significant overall but risks to employment as considered low. There is evidence to suggest that price increases might be greater for products like railway material, stainless wire rod and organic coated sheets than others. Additional evidence following the publication of the SIPD, raised concerns about the impact of the measure on category 15, due to the impact on the downstream industry.
The TRA found no evidence of major geographic effects for upstream industries because the significance of steel to the coal sector is fairly small, and because there was a lack of data for the scrap metal industry. For the United Kingdom steel industry, the TRA found evidence that there could be significant benefits of extending the safeguard measure in certain deprived areas such as Port Talbot, due to the presence of the steel industry as a major employer and the threats to employment in the industry if the measure was revoked. The TRA does not consider it likely that there would be any significant geographic impacts for importers due to low employee numbers. The downstream industries are concentrated in a variety of areas, however due to the low impact on individual companies, the TRA does not expect there to be significant regional impacts. There is no evidence to suggest any particular groups will be impacted.
The analysis of the competitive environment highlights variation in market shares across the product categories. On consequences for the competitive environment, there are likely to be positive and negative impacts from the proposed extended measure. The quotas are set at a level that maintains traditional trade flows, meaning most imports will be unconstrained and competition would not be affected up to the quota amounts. However, once the quota amounts are reached, the level of competition in the steel market will be inhibited.
On other factors, the TRA received evidence in response to the SIPD that extending the measure on category 15 would hinder the growth of downstream industries. The only known United Kingdom producer of this category is supportive of the measure being revoked on this category and also has a very high share of known consumption (over 80%) that the TRA considers to be relevant under the economic interest test.
The Secretary of State for International Trade guidance to the TRA on the economic interest test states that there is no starting presumption that a safeguard measure is in the economic interest of the United Kingdom, and that a measure is not in the economic interest of the United Kingdom, if the negative impacts are disproportionate to the positive impacts.
The key positive impacts of extending the measure, as compared to revoking the measure, that the TRA has identified as part of the review include:
Benefits to the United Kingdom steel industry from removing the likelihood of serious injury, in light of global overcapacity and the risk of trade diversion due to continuation of the measure in other major markets. The steel industry is economically significant with a GVA of over £2.2 billion and employment of around 33,000, some of which is concentrated in economically deprived areas like Neath Port Talbot and North Lincolnshire.
Benefits to upstream suppliers of scrap metal that rely on demand from the steel industry and would suffer if there were serious injury to United Kingdom steel producers.
Some positive impacts on the competitive environment arising from United Kingdom producers being able to remain viable as suppliers to the United Kingdom market, preserving the ability and incentives to compete in the longer term and offering locally sourced steel preferred by some customers.
On the other hand, the key negative impacts include:
Negative impact on importers, resulting from the application of tariff rate quotas on goods they import, which will likely reduce their ability to compete with United Kingdom producers. The evidence suggests that importers are a lot less economically significant than United Kingdom steel producers with a smaller GVA and turnover and employing relatively few people both overall and in any particular area.
Increase in costs to downstream industries from the measure being extended as compared to them being revoked, resulting from the application of a 25% out-of-quota safeguarding tariff on import volumes above the quota amount. However, the TRA found that the impact is likely to be smaller (0-19% across categories) and that steel costs are likely to account for a small proportion (under 1%) of turnover, indicating that even a relatively large change in the price of steel products is unlikely to have a significant impact on average businesses in these groups. Taken together, these downstream industries are more economically significant than United Kingdom producers and the aggregate impact on them may be large.
Some negative impacts on the competitive environment, particularly on the number or range of suppliers and their ability and incentives to compete beyond the quota amount. The market share of United Kingdom producers varies considerably across product categories.
Given the large number of countries and regions from which products under all categories are imported into the United Kingdom, the TRA did not consider that the relatively high market share of United Kingdom producers is likely to create significant negative consequences for the competitive environment.
In the SIPD, the TRA concluded that extending the measure for subcategory 25B would not be in the economic interest test of the United Kingdom, due to the small market share of United Kingdom producers, the possibility of increased costs to downstream users under strong demand conditions in the future and the lack of a presumption for safeguard measure being in the economic interest of the United Kingdom. Information submitted following the publication of the SIPD by trade body UK Steel confirms that there is additional production of large welded tubes under subcategory 25B, which significantly increases the market share estimates for United Kingdom producers. Assessing this alongside other available evidence, the TRA therefore considered extending the measure for subcategory 25B to be in the economic interest of the United Kingdom.
In light of the submission relating to category 15 received following the publication of the SIPD, the TRA concluded that, on the basis of the evidence available, extending the measures for category 15 would not be in the economic interest test of the United Kingdom.
For all product categories other than 15 (1, 2, 4, 5, 13, 19, 20, 21, 25A, 25B and 26), the TRA recognised that there are some potentially significant negative impacts as summarised above, but did not consider them to outweigh or be disproportionate to the more significant positive impacts. The main reasons for this were that the available evidence showed that:
extending the measure would prevent the likelihood of serious injury to the economically significant steel sector facing a challenging global market
that injury could include potential adverse impacts on jobs in the steel sector resulting from the measure being revoked, which would be concentrated in economically deprived areas of the United Kingdom
the ability to import within the quota amount without needing to pay the 25% out-of-quota safeguarding amount would limit the increased costs faced by downstream users and importers, and help maintain historical trade flows of steel products
Having considered all of the evidence presented by interested parties, including submissions following publication of the SIPD, and all of the factors listed in the legislation, the TRA has concluded that the economic interest test is met for product categories 1, 2, 4, 5, 13, 19, 20, 21, 25A, 25B and 26, but not for product category 15. It is therefore recommended that this category is removed from the coverage of the extended steel safeguard measure.
Order numbers for importers to access the tariff-rate quota on steel goods
S.I. 2019/449, amended by S.I. 2019/1076, S.I. 2019/1319, S.I. 2020/99, and S.I. 2020/730. ↩
Transition review TF0006 – Safeguard measure on certain steel products (dated 3 June 2021) may be found online at www.trade-remedies.service.gov.uk/public/case/TF0006/. ↩
The tariff-rate quota had effect in the United Kingdom from 19 July 2018 to 11 p.m. on 31 December 2020 by virtue of EUR 2018/1013 (OJ No. L 181, 18.07.2018, p. 39, amended by OJ No. L 286, 14.11.2018, p. 17) and EUR 2019/159 (OJ No. L 31, 01.02.2019, p. 27, amended by OJ No. L 248, 27.09.2019, p. 28, OJ No. L 12, 16.01.2020, p. 13, and OJ No. L 206, 30.06.2020, p. 27) and from 11 p.m. on 31 December 2020 to 30 June 2021 by virtue of Taxation Notice 2020/06: Safeguard measures on certain steel products – application of tariff rate quotas. ↩
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