On 7 October 2025, the European Commission unveiled a proposal for a Regulation with reference COM(2025)726 introducing a new trade defense regime for steel imports (“Proposal”). These new measures deliver on the commitments set out in the EU Steel and Metal Action Plan of 7 March 2025 and seek to address persistent challenges of overcapacity and unfair trade practices. The measures are a result of a review of the current steel safeguard measures imposed back in January 2019 (extended twice and due to expire on 30 June 2026) as a temporary measure to the Section 232 tariffs introduced by the US in 2018. The Proposal suggests to significantly expand these safeguard measures.
Key elements of the Proposal
The proposed measures in short:
- Limiting tariff-free import volumes to 18.3 million tons a year;
The current annual tariff quotas will be reduced to 18.3 million tons a year. These quotas will be managed quarterly, with no carry-over between periods and allocated by product category. The product categories are defined by EU Combined Nomenclature codes and can be found in Annex I of the Proposal. The tariff quota measures will allow for adjustment of volumes, including for specific product categories.
- Doubling the level of out-of-quota tariff to 50%;
The current 25% ‘out-of-quota tariff’ will be replaced by a 50% out-of-quota tariff under the Proposal. The tariff is based on ‘the level of tariffs in the steel sector in other key markets’ and will come on top to other duties applying upon importation into the EU to products subject to the Proposal.
- Introducing so-called “melt and pour requirements”.
To prevent circumvention of the safeguard measures, the Proposal introduces a request for evidence (such as a mill certificate) of the country of “melt and pour” upon import. The country of “melt and pour” refers to the original location in which raw steel and iron is initially produced in liquid form within a steelmaking or iron-making furnace and subsequently cast into its primary solid state. Identifying the country of “melt and pour” will avoid that steel produced in certain countries will unduly enter the EU market and these requirements will increase transparency in supply chains for steel imports.
Note that imports originating in countries with a free trade agreement with the EU are also subject to these tariff quotas, except for imports from Norway, Iceland and Liechtenstein. Imports from Norway, Iceland and Liechtenstein are exempted from the proposed tariff quotas, due to the level of integration in the EU market. The EU Commission also indicated flexibility for countries facing exceptional security situations, such as Ukraine.
Legislative process and next steps
The Proposal is subject to the ordinary legislative procedure, requiring approval by both the European Parliament and the Council of the EU. Once adopted, the new regime will replace the existing safeguard measures upon their expiry in June 2026. Note that this is a shift from a temporary safeguard to a permanent trade defense instrument, which may raise diplomatic and WTO-related challenges. The Proposal therefore indicates that it intends to open negotiations under Article XXVIII of the General Agreement on Tariffs and Trade, with a view to offer trading partners country-specific allocations.
The proposed changes will have far-reaching implications for steel importers, downstream manufacturers, and third-country exporters. Based on our experience, we recommend that businesses:
- Review their quota management strategies and compliance obligations, particularly in light of potential “melt and pour” requirements and origin verification processes;
- Reassess their supply chains to mitigate the operational and financial impacts of the Proposal on your company’s activities.
In addition, we highly encourage impacted stakeholders to closely monitor the legislative process and consider engaging in consultations, especially with respect to quota allocations and product scope. A well-informed and timely response can make a significant difference. Please do not hesitate to reach out to your Baker McKenzie Trade & Customs team as we would be pleased to support you in navigating these developments.
Baker McKenzie closely monitors the developments and issues regular alerts accordingly – please also check our Import and Trade Remedies Blog and Looking Ahead: Business Impacts of the Trump Administration for regular updates and insight.
