The European Commission has unveiled a plan to halve tariff-free steel imports and double duties on excess volumes to 50 %, in one of its toughest trade defence moves in years. Aimed primarily at curbing Chinese overcapacity, the proposal seeks to protect Europe’s struggling steelmakers, align EU trade policy with Washington’s, and reinforce the bloc’s pursuit of industrial sovereignty. The measure, however, risks straining relations with the U.K. and raising costs for downstream industries such as automotive and construction.
Brussels, 8 October 2025 – Europe is tightening its trade defences. The European Commission has proposed to drastically reduce steel import quotas and raise tariffs to 50 % on all volumes exceeding the new limit, in a move meant to revive Europe’s steel industry and curb market distortions caused by global overcapacity — chiefly from China.
Under the new framework, the annual tariff-free quota would fall to 18.3 million tonnes, nearly half of current levels. Any imports above that threshold would face the steep new tariff, replacing the existing 25 % safeguard rate. A new “melt-and-pour” rule will also require importers to identify where steel was actually produced to stop circumvention via third countries.
The Commission says the plan is part of its wider strategy to strengthen European industrial sovereignty and coordinate with the United States through a joint “metals alliance” aimed at countering unfair trade practices and reducing strategic dependence.
Safeguarding a Core Industry
The EU’s steel industry, operating at around 67 % of capacity, has struggled to stay competitive amid low-priced imports. Policymakers warn that losing steel production would jeopardize not only manufacturing but also Europe’s green-transition goals, since steel is vital to infrastructure, wind turbines, and electric vehicles.
“Steel is a foundation of Europe’s industrial strength and of the green technologies we need,” said an EU official familiar with the proposal. “Without a viable steel base, there is no autonomous clean-energy transition.”
The Commission frames the tariff hike as a temporary, corrective measure designed to rebalance the market and give domestic producers room to invest in low-carbon steel technologies.
Backlash and Political Friction
The plan has already drawn criticism from the United Kingdom, where 80 % of steel exports go to the EU. London warned that doubling tariffs could “devastate” the sector and cost thousands of jobs. Industry body UK Steel called the measure “an existential threat.”
Automotive and construction firms within the EU are also uneasy, fearing higher input costs and supply disruptions. Trade analysts caution that the move could invite retaliation or disputes before the World Trade Organization, especially if viewed as protectionist.
Europe’s Strategic Calculus
Despite risks, Brussels insists the proposal aligns with the European Green Deal and supports the shift toward low-emission industrial production. By ensuring fair competition and stimulating investment in “green steel,” the EU hopes to secure both its climate and competitiveness goals.
Member states and the European Parliament must now debate and approve the plan. Germany, whose carmakers depend heavily on imported steel, may play a decisive role in shaping the final version.
The Commission wants the new safeguards in place before the current WTO-aligned system expires in mid-2026. For Brussels, the message is clear: protecting Europe’s steel capacity is no longer just about economics — it’s about strategic resilience in an era of global competition.
