Written answers

Wednesday, 24 March 2021

Department of Enterprise, Trade and Employment

Trade Strategy

Photo of Christopher O'SullivanChristopher O'Sullivan (Cork South West, Fianna Fail)
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198. To ask the Minister for Enterprise, Trade and Employment further to Parliamentary Question No. 22 of 3 February 2021, if his attention has been drawn to price fluctuations of as much as 30% for steel products (details supplied); and if he will make a statement on the matter. [15864/21]

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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My reply to the Deputy’s Question of 3rd February related to the application and operation of the European Union's Safeguard Measures on steel, which have been in operation since July 2018 and which were initiated in response to the United States applying a 25% tariff on steel imports originating from 3rd countries, including the European Union.

In this regard, this action by the US resulted in steel originally destined for the US market being diverted to the EU with the associated risk of flooding the EU market with steel products to the detriment of Union industry and producers.  Therefore, in response, in 2018, the European Commission brought forward Safeguard Measures to manage the volume of steel entering the Single Market from 3rd countries. Importantly, as I indicated previously, the Measures currently in place allow for the import of steel from 3rd countries by way of quotas, determined in line with traditional volumes of trade in steel using the 2015-2017 reference period. Steel imports outside of the quota limits are subject to a 25% tariff on landing in the EU. Moreover, since the UK left the EU’s Single Market and Customs Union, there is no longer the free flow of steel between the UK and EU and the Steel Safeguard Measures in conjunction with the terms of the EU-UK TCA (Trade and Cooperation Agreement) apply.  In this regard, Irish importers can continue to import steel from the UK without the additional "Safeguard" tariff of 25% if the volume of imports remains within the EU's quota allocations for the UK.  Imports from the UK to Ireland, or other EU Member States, in excess of these quotas will attract a 25% tariff.  Similarly, imports of steel from other 3rd countries into Ireland would also be subject to a 25% tariff if the exporting country exceeds the available quota. Importantly, however, Irish importers can continue to import steel from the rest of the EU as part of the Single Market where no tariffs or quotas apply.  Thus, supply sourced within the EU should not incur a tariff on moving from the fellow EU Member State to Ireland.

Moreover, as indicated in my earlier reply, two reviews of the Measures by the European Commission found that a significant level of quotas remained unused with quotas available in every product category. This would indicate that the application of the EU's Safeguard Measures does not affect the availability of supply, as quotas are not exhausted before the end of a given period.  The imposition of Safeguard Measures are not designed to unduly restrict trade flows but are instead designed to allow a level of imports proportionate to the needs of the Union market.

These Safeguards are currently under Review by the European Commission on foot of a request from several Member States as the Measures are due to lapse in June unless the Commission formally proposes to the Member States a continuation of the Safeguards.  In parallel, the Commission is engaging with the new US Administration with a view to seeking a discontinuation by the US of the original 2018 imposition of the tariffs on EU steel imports, and this should assist in the EU’s consideration of the need for any prolongation of the current Safeguards.  However, I should note that if the Safeguards Measures were discontinued from June, imports of steel would revert to being governed by the terms of any bilateral FTA between the EU and 3rd Countries including the UK, where Rules of Origin of imports are import considerations.

Finally, I must note that as Minister for Enterprise Trade and Employment I have no function in relation to monitoring or regulating commercial product pricing which is subject to international market forces.

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