On October 7, the European Commission presented its proposal for a new regulation introducing stringent trade measures on steel entering the EU market. The measure is intended to replace the current steel safeguard, which expires mid-2026 and cannot be renewed, with the aim of having the new system operational on July 1, 2026. Below are the three key things you need to know about the Commission’s proposal.

(1) Lower tariff-free import volumes, higher out-of-quota duty. The current safeguard would be replaced by a tariff-rate-quota (TRQ) regime. Specified volumes of in-scope steel may enter the EU duty-free; any imports beyond those quotas would face a substantial import duty. Under the Commission’s proposal, the duty-free allowance would be significantly reduced compared to today’s safeguard (almost halved), while the out-of-quota duty would rise from 25% to 50%. The 50% import duty rate would apply “in addition to other duties” on in-scope products. TRQs would be administered quarterly with no carry-over of unused volumes.

(2) Country of “melt and pour”. Today’s safeguard is enforced by customs origin. The proposal would require importers to document and evidence (for instance through mill certificates) the country of “melt and pour”, i.e., the country where the raw steel or iron was first produced in liquid form within a steelmaking or iron making furnace and subsequently cast into its first solid state. The objective of this change is to prevent circumvention: today, overcapacity in certain markets gets diverted to other countries for further processing, ultimately resulting in the steel still landing on the EU market.

(3) Adjustments, country allocations, and bilateral safeguards. Under the proposed system, the European Commission has discretion to set and adjust country allocations, to adapt TRQs to respond to market conditions, to specify melt-and-pour rules, and to deploy bilateral safeguards for partner countries that already have a free trade agreement with the EU.

The proposal is subject to the ordinary EU legislative procedure, meaning that the Parliament and the Council act as co-legislators and will agree and decide on how the Commission proposal is amended and ultimately adopted. In other words, amendments are likely before adoption. Given the need to avoid a gap after the current safeguard expires, the institutions are expected to move at pace, with a view to adoption in time for an application as of July 1, 2026.