Metals & mining (AO) | Decoding the new TRQ framework

Research evidence excerpt

Metals & mining (AO) | Decoding the new TRQ framework

he objective of bringing EU steel import penetration back to its 2013 level of

around 13%, while quota allocations by product category are based on each country's import market share over the 2022-2024

reference period.

As previously discussed, half of the total quota volume is allocated to countries benefiting from an EU Free Trade Agreement

(FTA), while the remaining half is reserved for countries trading under Most Favoured Nation (MFN) rules.

FTA partners clearly benefit from a more favourable framework. An FTA exporter may first use its country-specific quota, then

access the dedicated FTA residual quota and, once that quota is exhausted, access the MFN residual quota before becoming

subject to the 50% safeguard tariff.

Country-specific quotas are generally granted to exporters representing more than 5% of EU imports within a given product

category. Countries below this threshold normally only have access to the residual "Other Countries" quota. However, several FTA

partners benefit from dedicated country-specific quotas despite accounting for less than 5% of imports, further reinforcing the

preferential treatment afforded to FTA countries.

By contrast, MFN exporters face a more restrictive framework. After exhausting their country-specific quota (where applicable),

they may only access the MFN residual quota before becoming subject to safeguard duties.

A complex but well-designed allocation system

While the new allocation mechanism remains highly complex, Salzgitter believes it should significantly strengthen the

effectiveness of EU trade protection.

First, the larger number of country-specific quotas should materially reduce import flexibility. Major exporters will increasingly be