In a significant development, the European Union and the United Kingdom have announced new sanctions that will reshape the iron and steel import industry. Starting on September 30, 2023, these sanctions will specifically target iron and steel products processed in third countries that incorporate Russian-origin materials.
This move is designed to close loopholes that previously allowed Russian-origin iron and steel to be indirectly imported into the EU and UK after being processed in other countries. The updated sanctions build upon initial restrictions set in 2022, aiming to prevent the circumvention of direct import bans by targeting the flow of these materials through third-party countries.
For businesses engaged in the importation of specified iron and steel products, the implications are significant. Importers are now required to declare the compliance of their goods upon import and must be prepared to provide evidence of such compliance if requested by customs officials. This evidence may include but is not limited to, Mill Test Certificates (MTCs), which detail the origin and quality of the steel and iron used in the products.
The UK’s approach is clear-cut, with no exceptions or transitional periods allowed since the measure was first published in April 2023. Importers in the UK must be ready to demonstrate compliance with the new prohibitions from day one. The EU, on the other hand, has adopted a staggered implementation period, providing a longer window for compliance with certain products.
The task of establishing the non-Russian origin of iron and steel products is expected to be complex and time-consuming, particularly for goods that have undergone multiple processing stages across various countries. With the enforcement date fast approaching, importers and their suppliers must act swiftly to gather the necessary information to demonstrate compliance.
The sanctions also extend to associated services, including the provision of technical assistance, financial services, and brokering related to the prohibited goods. Businesses must therefore assess their entire supply chain for potential impacts of the new regulations.
In light of these developments, businesses must stay informed about the specific requirements of individual EU member states, as there may be variations in the acceptable types of evidence for demonstrating the origin of iron and steel inputs. For instance, German customs authorities have indicated a willingness to accept a broader range of documentation as proof of non-Russian origin.
As the deadline looms, the message to the industry is clear: proactive measures must be taken to ensure compliance. Importers should work closely with their suppliers to source reliable evidence of origin and avoid disruptions to their supply chains. The new sanctions represent not just a regulatory challenge but also an opportunity for businesses to demonstrate their adaptability and commitment to legal and ethical trade practices.
References:
Crowell “New EU/UK Restrictions on Russian-origin Iron and Steel Products”
The Russia (Sanctions) (EU Exit) Regulations 2019 (Legislation.gov.uk)