EU TRQ Proclamation for Steel and Aluminum Also Announces Exclusion Rulemaking
The presidential proclamation on what types of steel and aluminum products, at what quantities, will be spared Section 232 tariffs says that the melted-and-poured requirement for goods under the quotas will limit transshipment and discourage excess steel capacity.
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"The United States and the [European Union] have agreed to expand coordination involving trade remedies and customs matters, monitor bilateral steel and aluminum trade, cooperate on addressing non-market excess capacity, and annually review their arrangement for alternative means and their ongoing cooperation. In addition, the United States and the EU will seek to conclude, by October 31, 2023, negotiations on global steel and aluminum arrangements to restore market-oriented conditions and support the reduction of carbon intensity of steel and aluminum across modes of production," the proclamation said.
American Iron and Steel Institute CEO Kevin Dempsey said his members are "particularly gratified" that the melted-and-poured standard will be part of the tariff rate quota arrangement. “We also welcome the president’s direction to the Secretary of Commerce to initiate a regulatory review of the Section 232 exclusions process that will include a focus on enhanced consultations with U.S. companies and labor organizations. AISI looks forward to working with the administration to seek improvements in the exclusions process to ensure that only those steel products truly not available domestically are exempted from the Section 232 measures," he said.
The Precision Metalforming Association, which represents manufacturers that buy steel and other metals to make their goods, isn't happy about the EU deal that replaces the tariffs with a tariff rate quota. PMA President David Klotz said, "A tariff-rate quota could lead to market manipulation and allow for gaming of the system that could put our members and other small and medium-sized manufacturers at a disadvantage. Our team in Washington, D.C., will continue to advocate for the termination of these unnecessary and damaging trade restrictions on steel and aluminum.”
The proclamation said that by Feb. 10, the Commerce Department must publish a Federal Register notice on Section 232's exclusion process, and those submitting comments will be asked to talk about "the responsiveness of the exclusion process to market demand and enhanced consultation with United States firms and labor organizations." Within 60 days of the close of the comment period, the department will issue a proposed regulation to revise the exclusion process, the proclamation said. The commerce secretary should evaluate whether the standard that exclusions are available when domestic firms can't produce the goods "in a sufficient and reasonably available amount or of a satisfactory quality" is still the right criterion. There will be another comment period on the proposed regulation, and a final rule will be issued within 60 days of the end of that period, the proclamation said.