On July 1, the European Union’s new steel market protection mechanism entered into full force.
The implementing regulation published on June 30 allocates country-specific tariff-rate quotas (TRQs) to Ukraine across nine product categories, amounting to 1,049,960 tons annually.
Interpipe, a leading manufacturer of seamless steel pipes and railway products, believes that the quota allocation for Ukraine seamless pipe sector is affected by a significant statistical error. In addition, based on the company’s own calculations the quota does not reflect the preferential treatment for Ukraine envisaged by the regulation adopted by the European Parliament on May 19.
In seamless tubes, Ukraine was allocated an annual quota of 80,670 tons. However, throughout the consultation process, the Ukrainian authorities repeatedly informed the European Commission that this figure is based on a data error: a substantial share of Ukrainian exports to the EU during 2022–2024, as confirmed by Eurostat, was not fully reflected in the underlying calculations. As a result, Ukraine’s quota for this category is at least 30% lower than it would have been if the correct data had been used.
Beyond this technical issue, Interpipe believes that the implementing regulation does not give full effect to the preferential treatment for Ukraine, an EU candidate country facing an exceptional and immediate security situation as envisaged by the regulation. Specifically, in calculating the MFN portion of the quotas, Ukraine was treated in the same manner as major global exporters, including countries with documented non-market excess capacity. Likewise, the same methodology was applied to Ukraine as to all other FTA partners, without the differentiation expressly provided for in the regulation.
Commenting on the EU’s quota allocation, Luca Zanotti, CEO at Interpipe, said: “Interpipe considers the current level of steel quotas a severe blow to Ukraine and Ukrainian steel industry which continues to operate in frontline regions under wartime conditions. The allocation also fails to take into account the significant social and economic consequences it will have for thousands of employees, their families, and the communities that depend on Ukraine’s steel industry. The purpose of the regulation is to address the problem of global non-market excess steel capacity. In this respect, Ukraine is clearly not part of the problem”.
As a CEO of a war struggling Interpipe I expect the European Commission to correct the application of the data for Ukraine in the seamless pipe category before the end of the third quarter of 2026 which is the only fair way to rectify the mistakes that took place. (Interpipe)