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EU-US STEEL AND ALUMINIUM TRADE

In 2018, the Trump administration in the United States imposed additional tariffs on imports of certain steel and aluminium products, the so-
called US Section 232 measures, on the basis that steel and aluminium coming from the EU were a national security threat to the US In response
to the US measures, the EU, as allowed by World Trade Organization rules, imposed tariffs on certain US imports to the EU, such as bourbon and
motorbikes. The aim of these EU rebalancing measures is to create an additional incentive for the US to lift its unjustified measures.

UNILATERAL MEASURES WILL NOT END GLOBAL OVERCAPACITY

The US Section 232 measures have not succeeded in resolving global steel and aluminium production overcapacity, which hurt both the EU and
US Instead, they harmed both the EU and the US economies:

US domestic steel prices have increased 160% since August 2020 with severe consequences for steel users.

US domestic steel prices are now 68% higher than the global market price. This means that even with the additional 25% import tariff it is
cheaper for US companies to import these goods.

US manufacturers depend on steel and aluminium from outside the US: they have asked the US government 225,000 times to exempt their
imports from the US 232 tariffs.

The tariffs had no positive effect on global overcapacity: Chinese steel overcapacity has increased since the introduction of the US 232 steel
and aluminium measures.

TOWARDS EFFECTIVE SOLUTIONS

The EU and the US are engaged in discussions to find solutions for a permanent removal of the US 232 steel and aluminium measures against
the EU as soon as possible. The EU and the U.S will also collaborate to address the problem of global steel and aluminium overcapacity caused
largely by third parties.

To ensure a constructive environment for this work, EU and US leaders agreed to avoid changes that negatively affect bilateral trade.
Therefore, the EU has suspended for six months the application of the second tranche of its rebalancing measures from 1 June to 30
November 2021.

At the EU-US Summit of 15 June 2021, the two sides committed to:

y Engage in discussions to allow the resolution of existing differences on measures regarding steel and aluminium before the end of
the year, determined to resolve tensions arising from the US application of tariffs on imports from the EU under US Section 232
y Work together to address excess capacity and ensure the long-term viability of our steel and aluminium industries.
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