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Kallanish Kallanish

Knowledge matters Knowledge matters

April, 21st 2019

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FEB 11
10:22

EC increases automotive HDG safeguard quota

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The European Commission has amended the hot-dip galvanized tariff-free quota from its first proposal on permanent safeguard measures presented to the World Trade Organisation.

The first proposal, released at the beginning of January 2019, confirmed permanent safeguard measures and made stricter the existing quotas system. The measures were then implemented at the end of January. In the final document 50% of approved HDG quotas were moved from section 4a –related to structural HDG regulated by anti-dumping – to section 4b – specifically grouping HDG for automotive use, not included in the anti-dumping system.

According to Kallanish calculations, the biggest change was registered for South Korean HDG. In the final version of the measures the country was awarded some 121,000 tonnes more of tariff-free quota for the 4b group during the period February-June 2019. India also saw its 4b quota increase by 58,000t during the same period, while China’s automotive grade HDG quota only moved up 7,000t compared to the first draft.

On an annual level the 4b group has been allocated overall some 600,000t more quotas than in the first proposal at the WTO, Kallanish notes.

The new permanent safeguard measures allocate quotas to 28 different steel product groups; only HDG in group 4a and 4b registered a change between the first proposal and the final version.

A European trading source speculates the change could have happened following the fierce complaint lodged by European automotive carmakers association ACEA after the first draft was published.