Changes from report parliamentary committee draft to plenary report

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

▸9 unchanged paragraphs

on the proposal for a regulation of the European Parliament and of the Council addressing the negative trade-related effects of global overcapacity on the Union steel market

(COM(2025)0726 – C100245/2025 – 2025/0726(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2025)0726),

– having regard to Article 294(2) and Article 207(2) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C100245/2025),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to Rules 60 of its Rules of Procedure,

– having regard to the opinion of the Committee on Industry, Research and Energy,

Changed– having regard to the report of the Committee on International Trade (A100000/2025),(A10-0012/2026),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Change 1

AddedRecital 1: (1) The steel sector that is the corner stone of its ecosystem, which includes derivative steel products in downstream sectors (e.g. automotive, building, metal packaging and components, machinery, technology industries and others) is central to the Union’s economy, economic security, competitiveness and security. The Union should reinforce its action in this strategic sector, which is vital for quality job creation and employment, the transition to a climate-neutral economy and the development of defence capabilities, through sustained investment in the steel sector’s viability and long-term resilience.

AddedRecital 1 a (new): (1a) Steel-producing industrial towns and regions play an important role for workers, communities and competitiveness. Those towns and regions are where raw materials have been extracted and transformed and technical skills passed down over generations. Those towns and regions hold the knowledge, the equipment, and the social cohesion needed to make a transition real and just.

AddedRecital 2: (2) Steel industries, workers, industrial towns and regions across countries, including the Union, are suffering the negative impact derived from increasing global structural excess capacity. Global structural excess capacity in steel production poses a serious threat to the steel sector, by creating conditions of unfair competition and deterring investment crucial for the green transition. Global structural excess capacity is a trend that is not affecting only the steel sector but also many other industrial sectors and threatening their long-term viability. That global challenge affects the Union’s domestic market and markets of other countries either directly, through imports from countries with excess capacity, or indirectly, as a result of the ‘push-out’ effect, or in both ways. The effective resolution of global overcapacity requires enhanced joint efforts of the Union and its like-minded partners which do not contribute to global overcapacity. The Union will step up its efforts in leading the international work and also coordinating with like-minded countries including in the framework of the Global Forum on Steel Excess Capacity, on addressing the root causes of global overcapacity and implementing solutions strengthening transparency of the global steel market and taking into consideration modern production and supply techniques, including through the application of the “melted and poured” principle as well as monitoring of imports and exports. The Union and the like-…

AddedRecital 2 a (new): (2a) Overcapacity is most effectively addressed through coordinated multilateral action as it constitutes a global problem requiring a global solution. In the absence of meaningful progress at that level, the Union should adopt a targeted and flexible measure.

AddedRecital 2 b (new): (2b) Europe has a longstanding tradition of steel production, with steelworkers playing a key role in the foundation of Union manufacturing. Those highly skilled, quality jobs that provide decent pay, strong labour protections and high health and safety standards are essential to sustaining the steel sector’s competitiveness and high social value.

AddedRecital 6: (6) In November 2024, Union leaders adopted the Budapest Declaration2 highlighting the urgent need and determination to make the Union more competitive through a new European competitiveness deal. Furthermore, leaders declared their commitment to ensuring an industrial renewal and decarbonisation allowing the Union to remain an industrial and technological powerhouse that fosters quality jobs. Union leaders also recognised the need for increasing defence readiness and capabilities, in particular by strengthening defence technological and industrial base accordingly. To that end, leaders committed to develop an industrial policy for the Union to ensure the growth of tomorrow’s key technologies, while paying particular attention to traditional industries in transition.

AddedRecital 7: (7) Industrial competitiveness is a core priority for the Union steel sector to survive and to contribute to sustainable growth, long-term prosperity and resilience. For that strategic sector to be competitive, the Union needs to use decarbonisation and a combination of industrial, economic and trade policies. Such policies should include a preserved Union production capacity, technological leadership and skilled employment in key sectors within the Union in order to prevent relocation of strategic industries to regions with lower environmental and social standards and unfair subsidy mechanisms.

AddedRecital 7 a (new): (7a) Overcapacity, combined with different levels of commitment to the climate goals by third countries, affects the Union steel industry in the context of its transition towards carbon-neutral production. Therefore, for the decarbonisation path of the steel sector in the Union to be viable, the level of the tariff rate quotas should be reviewed as necessary. This could serve as an impetus for creating the right conditions for the Union steel industry to decarbonise and move away from “business-as-usual”. In the framework of that review, the Commission should also report on the use of public subsidies by Union producers with a view to achieving Union climate targets, on the total volumes of Union low emission steel production and on the exposure of Union producers to unfair competition.

AddedRecital 8: (8) Energy intensive industries are focal sectors requiring urgent intervention to support them to decarbonise, electrify, take up circularity, which would help to promote job creation in the Union and confront high energy costs, unfair global competition, and complex regulations, harming their competitiveness. It is essential to enable those industries to remain globally competitive and to continue producing in the Union while a continuous support for energy-intensive industries should be subject to social and environmental conditionalities, such as preserving production sites and jobs. Strengthening energy security, enabling access to affordable energy, reducing input costs, and simplifying regulatory burdens are critical to preventing industrial delocalisation and to preserving value chains within the Union. As steel production accounts for around 5 % of the Union’s greenhouse gas emissions, accelerating the deployment of low-and near-zero-emission technologies, including hydrogen-based and electrified steelmaking, and strengthening circularity through the recovery and processing of high-quality recycled ferrous scrap, will be essential to reducing emissions and enhancing resource efficiency.

AddedRecital 9: (9) The Union remains committed to a fast and urgent implementation of the Steel and Metals Action Plan3, as steel represents a metal of strategic importance for the Union’s defence capability. Especially in a context marked by increasing global instability and heightened security pressures, stable and resilient supply chains of critical metals, like steel, and a strong and competitive domestic production base are essential for defence and aerospace, for achieving economic resilience and for avoiding unwanted dependencies on third country suppliers.

AddedRecital 9 a (new): (9a) Steel is also foundational for many other industries such as Union’s clean-tech, transport, building and energy infrastructure industries. Preserving a competitive and technologically advanced steel base in the Union is therefore vital to the Union’s industrial sovereignty and its strategic autonomy.

AddedRecital 10: (10) In order to support the Union’s strategic industries and competitiveness, Union trade measures should not hamper Union steel production capacity. The Union has already adopted several trade defence measures in the metals sectors, including in the iron and steel sectors, against unfair global competition. Nevertheless, the industry is increasingly negatively impacted by global structural excess capacities and by global distortions, including non-market policies and unfair trade practices in certain countries that artificially support their domestic industries or circumvent Union trade defence measures and sanctions. The Union is the only major steelmaking region seeing a decrease in capacity. However, these efforts are being completely offset by continuous large capacity additions across other regions, completely detached from evolution of domestic and global demand. Global overcapacity is expected to increase from the current 602 million tonnes (equivalent to five times the Union demand) to 721 million tonnes by 2027. Hence any safeguard measure on the steel market should be conceived with a long-term perspective, since, contrary to previous periods when the Union steel sector has experienced overcapacity, the current situation is structural and unlikely to be resolved in the short or medium-term.

AddedRecital 11: (11) In addition, the recent evolution of third country trade-restrictive measures is further increasing import pressure, both in terms of volumes and prices, on Union producers. Such pressure is expected only to increase further and to lead to a further decline in Union production, plant closures and job losses.

AddedRecital 11 a (new): (11a) The rules-based multilateral trading system, with the WTO at its core, continues to be fundamental for ensuring stability, predictability and fairness in global trade. This Regulation should therefore be implemented in full compliance with the Union’s obligations under the WTO. This Regulation aims to address trade distortions caused by global excess capacity and should be understood as an instrument for restoring conditions for more open and rules-based trade in the future.

AddedRecital 12: (12) As a result, the Union steel industry is in a dire situation with the unprecedented loss of the production capacity amounting to more than 30 million tons since 2018, historically low-capacity utilisation rate reaching 67% in 2024, and around 30000 jobs lost since 2018, with several thousand more job losses announced in 2024. The Union steel industry recorded losses in 2024. The burden of that decline has fallen heavily on the industrial towns and regions where steelmaking is rooted.

AddedRecital 13: (13) Given the fast-worsening situation of the domestic steel industry and the unsatisfactory progress so far in finding a collective solution addressing global structural overcapacity, it is necessary to urgently adopt a new measure replacing Implementing Regulation (EU) 2019/159. On 18 July 2025, the Commission launched a call for evidence and a targeted consultation to seek the views from stakeholders on various aspects of the new measure, including its form, level, geographical scope and duration, as well as other specific features such as rules of origin. The process ran until 18 August 2025 and over five hundred responses were received: 143 submissions to the call for evidence and 373 replies to the targeted consultation questionnaire. A detailed summary of the feedback received is available in the Staff Working Document accompanying this legislative proposal. Due to the urgency of the matter, the Commission decided not to conduct an impact assessment but affirmed its commitment to presenting an evaluation of its consequences after the date of entry into force of this Regulation.

AddedRecital 14: (14) In parallel to the ordinary legislative procedure that this proposal will be subject to, the Union intends to open negotiations under Article XXVIII of the General Agreement on Tariffs and Trade 1994 with a view to modifying certain WTO concessions for the products concerned by this Regulation and ensure that the resulting level of custom duties ensures the resilience of the Union steel industry in a context of structural global overcapacities, growing third country trade measures on the steel sector, and their negative trade-related impact on the Union’s steel industry. The modification of the Union’s commitments should not lead to compensation going beyond volumes of quotas provided for in Annex II to this Regulation, nor concern any products other than those included in Annex II to this Regulation. The Union should notify this Regulation to the WTO also under Article XX GATT because this Regulation is necessary to pursue the decarbonisation of the Union steel sector, and is also necessary to preserve the Union public order.

AddedRecital 14 a (new): (14a) The Commission shall engage in proactive and transparent communication with trade partners to clearly explain the reasons for adopting this Regulation and to identify ways to maintain equal and fair conditions so as not to disrupt the existing spirit of genuine trade cooperation, particularly with existing and future FTA partners affected by this Regulation.

Recital 15: (15) Whereas under Implementing Regulation (EU) 2019/159 the out-of-quota tariff is set at 25%, taking into account the level of tariffs in the steel sector in other key markets, it is appropriate to set the level of out-of-quota tariff to a 50% duty to minimise the risk of trade diversion and to allow an increase in production capacity. This duty would come in addition to other duties applying to the product categories covered by this Regulation.

Change 2

RemovedRecital 16 a (new): (16a) This Regulation should be implemented in full compliance with the Union’s obligations under the WTO. The measure aims to address trade distortions caused by global excess capacity and should be understood as an instrument for restoring conditions for more open and rules-based trade in the future. The Union’s long-term objective is for that instrument to facilitate greater liberalisation once market conditions normalise.

AddedRecital 20 a (new): (20a) To ensure fair and balanced administration of tariff-rate quotas, the concentration of imports by a few major operators and stockpiling practices should be prevented. Stockpiling practices, whereby steel products are stored in ports, customs warehouses or free zones in order to delay their release for free circulation, may result in the rapid exhaustion of tariff quotas under the first-come-first-served system. Such practices risk undermining fair access to quotas for all economic operators and the effectiveness of the safeguard mechanism. The Commission should therefore closely monitor import patterns and storage levels and, where appropriate, consider adjustments to the administration of tariff quotas to ensure fair access for all operators in order to respond swiftly to changes in market conditions while protecting the Union steel industry and downstream industries.

RemovedRecital 20 a (new): (20a) To ensure continuity and to avoid supply disruptions, carry-over of unused quarterly tariff quota volumes to the following quarter should be permitted. This would provide the necessary operational flexibility while maintaining the overall effectiveness of the measure.

Recital 21: (21) To ensure that the measure is effective in tackling the effects of global overcapacity, and in light of the specificities of steel products and the modern production and supply techniques, it is important to identify the country of “melt and pour”. 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. This primary solid state can encompass either a semi-finished product, including but not limited to slabs, billets, or ingots, or a finished steel mill product. Requesting evidence of the country of “melt and pour” will avoid that steel produced in certain countries contributing to global overcapacity unduly enters the Union’s market following further transformation in other countries and will increase transparency in the domestic supply chain for steel imports. That requesting of evidence should be done in such a way that limits administrative burden to the greatest extent possible, and that facilitates the compliance of small and medium-sized enterprises (SMEs).

Recital 21 a (new): (21a) Imports of products for which the steel was melted and poured in the Russian Federation or in Belarus should not be granted access to the Union market and should not benefit from any tariff quota. Accordingly, all such products should be subject to an automatic prohibition at the external borders of the Union.

Change 3

RemovedRecital 25 a (new): (25a) In line with the Union’s commitment to support Ukraine’s economy during the ongoing war of aggression and with Regulation (EU) 2025/1153 of the European Parliament and of the Council1a, imports originating in Ukraine should be fully exempted for as long as that country is facing an exceptional and immediate security situation. / 1a Regulation (EU) 2025/1153 of the European Parliament and of the Council of 5 June 2025 suspending certain provisions of Regulation (EU) 2015/478 as regards imports of Ukrainian products into the Union (OJ L, 2025/1153, 5.6.2025, ELI: http://data.europa.eu/eli/reg/2025/1153/oj).

AddedRecital 24: (24) In order to ensure that the level of quotas opened in relation to imports into the Union is adapted to changing circumstances in the markets of the products covered by this Regulation as well as to provide technical specifications for the implementation of the melt and pour requirement, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission to supplement this Regulation by laying down the detailed rules for identifying the country in which the steel used in the production of the product is melted and poured and to amend Annex II to this Regulation. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making8 . Furthermore, it is of importance that affected industries and industrial towns and regions are heard in the preparatory work. In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts.

RemovedRecital 26: (26) The Commission should assess at the latest within one year from the date of entry into force of this Regulation the necessity to adjust the scope of products covered by this Regulation and if deemed necessary, it should consider making a legislative proposal to add or remove steel products, including products that are made of or contain a significant amount of steel. In order to ensure the effectiveness of this Regulation, it is essential for the assessment to evaluate carefully whether the problems this Regulation seeks to address are being solved and not inadvertently displaced further along the value chain.

AddedRecital 25 a (new): (25a) In line with Regulation (EU) 2025/1153 of the European Parliament and of the Counci1a and with the Union’s commitment to support Ukraine’s economy during Russia’s ongoing war of aggression against Ukraine, and in view of Ukraine’s strategic role in the Union’s steel supply chain, the Commission should ensure that the design and implementation of quota allocations fully reflect Ukraine’s candidate status and its vital importance for the stability of the Union steel market, while preserving the effectiveness and integrity of this Regulation. / 1a Regulation (EU) 2025/1153 of the European Parliament and of the Council of 5 June 2025 suspending certain provisions of Regulation (EU) 2015/478 as regards imports of Ukrainian products into the Union (OJ L, 2025/1153, 5.6.2025, ELI: http://data.europa.eu/eli/reg/2025/1153/oj).

AddedRecital 25 b (new): (25b) Given that several third countries have adopted trade-restrictive measures directly affecting Union exports of steel products, the Commission should reflect those trade-restrictive measures.

AddedRecital 26: 26. The Union steel processing industry, composed of thousands of SMEs that transform steel into specialised, high-value goods, is of vital importance to the entire Union steel sector. Like the Union's primary steel producers, the Union's downstream steel industry is increasingly exposed to cheap imports from third countries, where exporting producers benefit from illegal state subsidies, lower environmental standards and artificially suppressed energy or input costs. Recognising the urgency of that situation, the Commission should determine within 6 months after the adoption of this Regulation, the necessity to adjust the scope of products covered by this Regulation and if deemed necessary, it should put forward a legislative proposal at the latest after 1 year after the adoption of this Regulation to add steel products, including products that are made of or contain a significant amount of steel. In order to ensure the effectiveness of this Regulation, it is essential for the assessment to evaluate carefully whether the issues this Regulation seeks to address are being solved and not inadvertently displaced further along the value chain. That assessment should take into account, inter alia, foundries, the potential impact of evolving global trade measures that may redirect trade flows towards the Union, and the situation of downstream sectors whose competitiveness, including that of SMEs and foundries, may be negatively impacted. Following that initial assessment, the Commi…

Recital 26 a (new): (26a) The Commission should draw up an annual report on the implementation of this Regulation and submit it to the European Parliament and to the Council. That annual report should, inter alia, contain information on the use and evolution of quotas and the category and amount of import that fall under the 50 % duty. The annual report should be made public.

Change 4

ChangedRecital 27: (27) Before the end of the second year from the date of entry into force of31 thisDecember Regulation,2028, and every twothree years thereafter, the Commission should evaluate the evolution of the key parameters that justified the adoption of this Regulation, including the evolution and trends of global overcapacity, as well as its effects on the steel market and the downstream value chains. The Commission should also review the situation of third country trade restrictive measures on steel and the implications and effects they may have, or be likely to have, in terms of risk of trade diversion into the Union market. In addition, the Commission should also analyse the situation concerning the existence of non-market policies and practices in third countries and their impact on the Union steel market. The Commission should also assess the evolution of overall Union competitiveness and the economic performance of the Union steel industry, including price levels and capacity uptake,utilisation, as well as the decarbonisation path of the steel sector in the Union and the evolution of its decarbonisation projects,targets. To that end, the Commission should conduct a structured impact assessment, in dialogue with the entire steel ecosystem, including the downstream segment. Those evaluations should include feedback from multilateral discussions, inter alia the OECD Steel Committee and the Global Forum on Steel Excess Capacity,

Change 5

RemovedArticle 1 bis – paragraph 1: Article 1 shall not apply to products originating in Norway, Iceland, Liechtenstein, and shall not apply to a candidate country for as long as that country is facing an exceptional and immediate security situation.

RemovedArticle 2 – paragraph 4: 4. The unused tariff quota volumes in one quarter shall be carried over to the next quarter.

Article 2 – paragraph 4 a (new): 4a. Measures under this Regulation shall be applied in a manner consistent with WTO rules and shall not restrict trade beyond what is strictly necessary to address the negative effects of global overcapacity as a result of unfair market conditions.

Change 6

ChangedArticle 3 – paragraph 2: 2. At the moment of importation, importers shall provide verifiable appropriate evidence to proveproving the country of “melt and pour” of the steel used in the production of the product. Such evidence shall include a mill certificate issued by the original steel producer, identifying the corresponding heat number and containing the technical and production data necessary to trace the origin of steel.

Change 7

RemovedArticle 3 – paragraph 2 a (new): 2a. The following documents, inter alia, shall constitute “appropriate evidence” for the purpose of this Article: / (a) mill certificates; / (b) invoices; / (c) delivery notes; / (d) quality certificates; / (e) long-term declarations from suppliers; / (f) cost accounting and production documents; / (g) customs documents from the exporting country; / (h) commercial correspondence; / (i) production descriptions; or / (j) declarations made by the manufacturer if they relate directly to the consignment in question.

AddedArticle 3 – paragraph 2 a (new): 2a. Imports of products for which the steel was melted and poured in the Russian Federation or in Belarus shall be strictly prohibited from entering the Union market and shall under no circumstances benefit from any tariff quota. All such products shall be subject to an automatic prohibition at the external borders of the Union.

Change 8

ChangedArticle 3 – paragraph 2 b (new): 2b. The Commissioncountry mayof adopt“melt guidelinesand onpour” howshall toapply provideto the appropriate evidencedetermination withof the aimcountry of limitingallocation administrativeof burdenthe andtariff torate facilitatequotas thepursuant complianceto ofArticle SMEs.4.

Change 9

RemovedArticle 3 – paragraph 2 c (new): 2c. Imports of products for which the steel was melted and poured in the Russian Federation or in Belarus shall not be granted access to the Union market and shall not benefit from any tariff quota. All such products shall be subject to an automatic prohibition at the external borders of the Union.

AddedArticle 3 – paragraph 2 c (new): 2c. The Commission may adopt guidelines on how to provide the appropriate evidence with the aim of limiting administrative burden and to facilitate the compliance of SMEs.

RemovedArticle 9 – paragraph 1: 1. By ... [one year from the date of entry into force of this Regulation] the Commission shall assess the necessity of amending the product scope of this Regulation, and may submit a legislative proposal to amend this Regulation. This assessment shall be carried out annually.

AddedArticle 4 – paragraph 1 – subparagraph 1 – point a: a) tariff quota levels equal to the import market share that prevailed in the Union steel market in 2013 prior to the impact of global overcapacity on the Union market;

Change 10

ChangedArticle 94 – paragraph 1 a (new): 1a.– Thesubparagraph Commission1 shall– providepoint anc annuala report(new): on(ca) the implementationlevel of this Regulation to the European Parliament andtariffs toapplied theby Council.a Thatthird reportcountry shallon beUnion madesteel public.products;

Change 11

RemovedArticle 9 – paragraph 2: 2. Before ... [two years from the date entry into force of this Regulation], and every two years thereafter, the Commission shall evaluate the effectiveness of this Regulation. Such evaluation shall have regard to the persistence of the circumstances that justified the adoption of this Regulation and the situation of the Union steel making industry, including price levels and capacity uptake, as well as the downstream value chains. Based on that evaluation, the Commission may submit a legislative proposal to amend or repeal this Regulation.

AddedArticle 4 – paragraph 1 – subparagraph 1 – point c b (new): (cb) whether a third country is compliant with its commitments under free trade agreements concluded with the Union, in respect of ILO Conventions and Multilateral Environmental Agreements;