Global overcapacity is damaging our industry, Ursula von der Leyen has claimed

The European Commission has proposed a 50% tariff on steel imports that exceed a lowered annual quota, in an effort to protect the EU's metals industry from international competition and US tariffs.

Earlier this year, after months of talks, European Commission President Ursula von der Leyen reached a trade deal with US President Donald Trump that many EU officials viewed as lopsided.

While the agreement set a baseline 15% US tariff on most exports from the bloc, steel and aluminum tariffs remained at 50%.

If approved by member states and the European Parliament, the protectionist measures proposed by the commission will nearly halve the existing tariff-free volume and double the tariff on excess volumes from 25% to 50%.

Under the plan, importers would have to prove where steel was melted and poured, and quotas would be reset close to 2013 levels.

"Global overcapacity is damaging our industry," von der Leyen said in a statement published by the commission.

She stressed that a strong steel sector is "vital for the European Union's competitiveness, economic security and strategic autonomy," calling for the European Parliament and Council to quickly pass the proposal.

The EU's domestic steel sector was operating at only 67% capacity last year, and showed record losses, the EC said in its proposal.

The industry slump has been worsened by Trump's tariffs. The US, the bloc's biggest customer, imported around $8.7 billion worth of iron and steel goods last year, according to S&P Global.

EU industry groups have reportedly welcomed the proposal.

However, the new tariffs would hit the UK hard, as about 78% of its steel exports go to the EU, according to trade data.

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UK industry leaders have warned that the new measures could be devastating if implemented, the BBC reported on Tuesday.

(RT.com)