WTO panel rejects most of Turkey’s challenges of the EU’s steel safeguard

The panel importantly clarifies WTO rules on safeguards, thus confirming the availability of the safeguards instrument to protect a domestic industry when it is seriously injured or so threatened by increased imports.

The panel found the EU steel safeguard WTO-compatible on most of the points which Turkey had questioned, while it also found, on three points, that the EU safeguard measure lacked sufficient justification. In this regard, the EU will implement the ruling after its official adoption in the WTO.

Next steps

The WTO panel report is the final verdict and must be adopted in the WTO within the next 60 days, so as to become binding.  Thereafter, the EU will state its intentions on how to implement the WTO ruling and how much time it requests for that purpose. 

Background

This dispute (DS595) was submitted by Turkey against the EU in March 2020. Together with the EU’s dispute on Turkey’s pharmaceutical localisation requirements (DS583), it was covered by the appeal arbitration agreement between the EU and Turkey concluded on 22 March 2022. The EU and Turkey have made sure that, despite the paralysis of the Appellate Body, these disputes can continue to benefit from a fully functioning dispute settlement system in the WTO. In this case, however, neither party chose to appeal the panel report. 

On substance, this dispute concerns the EU steel safeguard measure imposed by the EU in February 2019. The measure was the result of an investigation that showed that imports into the EU had increased due to the effects of unforeseen developments, such as global overcapacity trends, and a proliferation of trade restrictive measures in steel worldwide, threatening to cause serious injury to the EU steel producers. This measure was also adopted in the context where the US had imposed, in March 2018, a 25% duty on steel imports under the so-called Section 232 measures, thus creating a serious risk of trade diversion of steel into the EU market. The measure was originally imposed for a period of three years, and it was subsequently extended until, in principle, 30 June 2024.

For more information

WTO Panel Report

EU-Turkey agreed appeal arbitration procedures

EU submissions and other documents of the case

Dispute Settlement in a Nutshell