EU Steel/Aluminum Imports Quota Free of Section 232 Tariffs

EU Steel/Aluminum Imports Quota Free of Section 232 Tariffs

November 23, 2021 0 By administrator
Highlights
  • Effective Jan. 1, 2022, imports of EU steel and aluminum products will be subject to a tariff-rate quota, allowing a certain amount of imports to enter the U.S. free of any Section 232 tariffs

  • U.S. importers and other interested parties should consider reviewing the 54 steel and 16 aluminum product categories to determine eligible products

  • U.S. Section 232 tariffs remain in place for countries with no tariff agreements such as Japan and the United Kingdom

Recently, the United States and the European Union announced an agreement to replace the existing 25 percent tariff on EU steel products and 10 percent tariff on EU aluminum products with a tariff-rate quota (TRQ), which will go into effect on Jan. 1, 2022. In return, the EU will suspend retaliatory tariffs on U.S. goods such as agricultural and food products, consumer goods, and steel and aluminum products, also effective Jan. 1, 2022.   

Under the TRQ arrangement, historically based volumes of EU steel and aluminum products will enter the U.S. without application of Section 232 duties subject to certain conditions. The U.S. will remove Section 232 tariffs on approximately $5.5 billion of EU steel and $1.2 billion of EU aluminum, based on prior annual import volumes of EU products. 

A breakdown of the specific steel and aluminum product categories eligible for the TRQ is available here. Any U.S. importer should consider carefully reviewing these product categories to determine their eligible products.

As part of the U.S.-EU agreement, both sides agreed to:

  1. Settle the disputes at the World Trade Organization related to the Section 232 tariffs
  2. Expand coordination on trade remedy and customs matters
  3. Commit to negotiations on restoring market conditions in the global steel and aluminum markets and address carbon intensity

Moreover, imports of derivative articles of steel and aluminum, as referenced in the 2020 Presidential Proclamation 9980, from the EU will not be subject to Section 232 duties. 

Steel TRQ

For the EU steel TRQ, the aggregate annual import volume is set at 3.3 million metric tons under 54 steel product categories. The import volumes will be allocated on an EU member state basis, using 2015-2017 historical period import volumes. EU steel products that are within the quota amount will enter free of any Section 232 duty, while products that enter above the quota amount will continue to be subject to the 25 percent tariff. 

To be eligible for duty-free treatment under the quota, steel products must be “melted and poured” in the EU, which differs from most trade agreements that use “originating” or “substantially transformed” language as the basis for origin. The steel TRQ will be allocated on a first-come, first-served basis for each of the 54 categories from each EU member state, and the U.S. will provide updated information…

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