Changes from report parliamentary committee draft to plenary report

EXPLANATORY STATEMENT

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ChangedWith regard to the substance of the proposal, the Rapporteur welcomes that it is a step in the right direction from the existing safeguard measure. The Single Market should remain open for rules-based trade and the Rapporteur therefore strongly supports that tariff free quotas continue to allow for a market based approach while the overcapacity and the subsequent diverted trade be handled with a clear duty level beyond the quotas. For the calculation of the tariff-free quota, the Rapporteur finds that using 2013 as the reference year - before overcapacity severely impacted Europe - represents a balanced and WTO-consistent benchmark. To allow flexibility in the system the carryover of unused quarterly quotas should be enabled. The Rapporteur stresses the importance of the 'Melt and Pour' requirement which will enhance product traceability, ensure the genuine origin of steel inputs, and reduce the risk of circumvention through transhipment or minimal processing.

The proposed steel measure needs regular evaluation and allow for adjustment in order to ensure that it efficiently contributes to increased production in highly competitive companies and goes hand in hand with efforts to ringfence export markets and cooperation in fighting global overcapacity together with likeminded trading partners. It cannot be a tool to hold uncompetitive industry alive while pushing the problem further down the value chain. A competitive steel production also, importantly, ensures that the EU does not build up an unhealthy dependency. The Rapporteur looks favourably to regular assessments of the scope and believes they could occur on a more frequent basis. An annual reporting is in line with this type of trade instruments and allows the co-legislators to understand how the implementation of the different dimensions of the instrument evolves.

In a time when the multilateral trading system is under sustained pressure, the Rapporteur particularly welcomes that the proposed regulation has been designed to remain fully compliant with WTO obligations. The Rapporteur will follow with close attention the negotiations to be conducted with affected trading partners, in particular those with whom the Union has concluded—or is in the process of concluding—Free Trade Agreements, in order to ensure legal clarity, predictability, and the continued integrity of the EU’s trade defence architecture.

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ChangedThe Rapporteur also believes that the specific situation of EU candidate country Ukraine should be duly taken into account. Consequently, this legislation needs to be in line with the Union’s commitment to support Ukraine’s economy during the ongoing war of aggression as well as in consistency with the political agreement on Regulation 2025/1153 (COD), a non-application of Article 1 should be confirmed. Similarly, the Regulation should address any potential loopholes that could permit the direct or indirect importation of goods originating from Russia, further financing the continued Russian hostile activities and undermining of European peace and stability.(COD).

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AddedSimilarly, the Regulation should address any potential loopholes that could permit the direct or indirect importation of goods originating from Russia, further financing the continued Russian hostile activities and undermining of European peace and stability.

While allowing the co-legislators to fulfil their work, the magnitude of challenges faced by the steel sector and the urgency of providing legal and economic certainty, the Rapporteur believes that the democratic process should advance without delay so that the regulation can enter into force on time.