Jun 16, 2022
UK's steel safeguard is 'WTO-compliant'
2022-07-05
The UK's steel safeguard meets WTO criteria, producers' lobby group UK Steel said today after it emerged that Prime Minister Boris Johnson's ethics adviser, Lord Geidt, resigned after being asked for advice on a "crucial industry".
In reply to Lord Geidt's resignation letter, Johnson said, "You say that you were put in an impossible position regarding my seeking your advice on potential future decisions related to the Trade Remedies Authority (TRA). My intention was to seek your advice on the national interest in protecting a crucial industry, which is protected in other European countries and would suffer material harm if we do not continue to apply such tariffs."
Johnson said the support would "be in line with our own domestic law but might be seen to conflict with our obligations under the WTO".
The TRA said the case that Johnson's letter appeared to refer to was its steel safeguard review. In March this year, the government actually called in the TRA's review of the steel safeguard, meaning secretary of state for international trade Anne-Marie Trevelyan took responsibility for the review and its outcome.
In its initial review, the TRA decided to revoke safeguards on nine products out of 19 in June last year, to the ire of local mills and trade unions. It then reviewed its decision in September following market feedback, before the government took responsibility.
When Trevelyan called in the review, she advised the TRA to conduct analysis of products at an aggregate level, splitting the products into flats, longs and tubes. Surprisingly, stainless did not get a different category, even though it has totally different production processes to carbon steel and no price linkage either.
The TRA provided a report of its findings to the government on 1 June and the government has until the end of this month to decide on the safeguard. The TRA has not made any recommendations to the secretary of state.
Gareth Stace, UK Steel's director general, said it is "essential" that the safeguard is maintained in its entirety. "Failure to do so would risk surges in steel imports resulting in significant damage to UK producers, placing jobs, production and investment at risk," he said.
The EU reconfirmed its own steel safeguard until June 2024, and UK Steel said a WTO ruling found the measures to be "compliant". Legal sources suggest the EU could terminate its safeguard upon its expiry next year. The UK started its own safeguard after its exit from the EU. Many representatives of exporters claimed the measure was not WTO-compliant as there was no separate review to see whether the UK should have its own safeguard post-Brexit.
By Colin Richardson
Source: Argus
