Skip to main content
November 9th

EU and UK Russian sanctions on iron and steel products

On September 30th, 2023, the European Union (EU) and the United Kingdom (UK) imposed further import restrictions on Russian steel and iron products. Both sets of regulations share a common goal, specifically, to negatively impact Russian exports of commodities key to the Russian economy.
The EU and the UK have previously banned the import of iron and steel products from Russia, or which originated in Russia. However, these latest restrictions also ban the import of iron and steel products that have been “processed” in countries other than Russia (third countries) but incorporated Russian-origin iron or steel inputs from certain lists. Both the EU and the UK bans contain limited exceptions that postpone the application of these measures to certain products with specific Harmonized Tariff System (HTS) codes, also known as Combined Nomenclature (CN) codes.

Impacted products

EU
The restrictive measure under Article 3g(1)(d) or the regulation applies only to iron and steel products as listed in Annex XVII when processed in a third country that incorporate iron and steel inputs originating in Russia as listed in Annex XVII. This corresponds to tariff headings 7206-7229 within Chapter 72, and the full Chapter 73.
The prohibition to import or purchase enters into application for the EU as follows:
  • As of September 30, 2023, for products of Annex XVII containing products other than those of CN codes 7207.11, 7207.12.10 or 7224.90
  • As of April 1, 2024, for products of Annex XVII containing products of CN code 7207.11
  • As of October 1, 2024, for products of Annex XVII containing products of CN codes 7207.12.10 or 7224.90
As products of CN codes 7207.11, 7207.12.10 and 7224.90 are semifinished products, this implies that as of September 30 and before April 1, 2024 for products using the inputs of CN code 7207.11 and before October 1, 2024 for products using the inputs of CN codes 7207.12.10 or 7224.90, the Russian Federation may appear in the Mill Test Certificate (MTC) as the name of the country corresponding to the heat number (country of the ladle of melting). However, the Russian Federation should not appear as the country where the other processing operations have been carried out (i.e., hot rolling, cold rolling, etc.) in order to allow the import, transfer, or purchase of the product.
After April 1, 2024 for products using inputs of CN code 7207.11 and after October 1, 2024 for products using inputs of CN codes 7207.12.10 or 7224.90, as well as from September 30, 2023 for products using all other iron or steel inputs of Annex XVII, the Russian Federation should not appear in the MTC as the name of the country corresponding to the heat number (country of the ladle of melting) and should not appear either as the country where the other processing operations have been carried out.
UK
For the purpose of the UK sanction, a relevant ‘iron and steel product’ is defined as anything specified in Schedule 3B of the Russia Sanctions Regulations. The HS codes for the relevant products are also set out at the end of this guidance. This is consistent with the EU, however companies should check both EU and UK lists to verify.
The regulations prohibit the import into the UK of an iron and steel product, when it meets all the following criteria:
  • is listed in Schedule 3B of the Russia Sanctions Regulations.
  • has been “altered, transformed in any way; or subjected to any type of operation or process” in a third country (see Regulation 46IA).
  • incorporates one or more Schedule 3B iron and steel product/products of Russian origin.
There will be no exceptions or transitional period for any goods covered by the measure.

Guidance

Both the EU and UK have issued guidance on the regulation, including information on the additional documents their customs authorities may review to establish evidence of origin. To date, it has been noted that there are inconsistencies not only between the UK and EU on what is deemed acceptable to establish origin, but inconsistencies also exist between EU Member States. With that being said, it is important that companies review the guidance for a clear understanding of what is viewed as acceptable, and also be prepared for variation within different jurisdictions.
  • The regulation places the obligation on the importer to provide the evidence.
  • The regulation applies to all EU Member States, but this does not mean that each country’s controls will be uniform. Companies should be prepared that there will be variations in compliance requirements on imports from third countries to the EU.
  • The UK is a third country for import purposes into the EU. Therefore, if a UK business supplies goods captured under the controls, the EU importer may require a varying degree of evidence to support their origin claim. Failure to provide that proof could prevent goods from importation into the EU.
  • The EU has published guidance for EU Member States on possible “evidence,” however that is subject to national controls. Germany and Austria have published their own guidance to date.
The following documents may be considered sufficient evidence of country of origin for iron and steel inputs:
Semifinished Products: The mill test certificate (MTC) (there is no concrete standardized format). Establishing the name of the facility where the production is taking place, the name of the country corresponding to the heat number (country of the ladle of melting) together with the classification at subheading level (six-digit code) of the product.
Finished Products: The mill test certificate (MTC) or mill test certificates (MTCs) – if all relevant information cannot be summarized in one single MTC or the MTC accompanied with other documents:
  • establishing the name of the country and the name of the facility corresponding to the heat number (country of the ladle of melting) together with the classification at subheading level (six-digit code), and
  • the name of the country and the name of the facility where the following processing operations are carried out, as relevant:
    • Hot-rolling
    • Cold-rolling
    • Hot-dipped metallic coating
    • Electrolytic metal coating
    • Organic coating
    • Welding
    • Piercing/extruding
    • Drawing/Pilgering
    • ERW/SAW/HFI/Laser welding
note
The European Commission also notes that the customs authorities of EU Member States are permitted to establish “other documentation” that can be considered as evidence of origin of the “inputs”. The European Commission noted these documents could include “a statement or declaration by the exporter or manufacturer confirming that, after exercising due diligence, the imported product does not contain any Russian steel or iron”. The European Commission also stressed that each EU Member States’ customs authorities “should assess evidence in a proportionate and reasonable manner”.

Timelines

The UK sanctions came into force on September 30, 2023, for all HS Numbers.
The EU restrictions are being implemented in three phases, depending on the tariff classification of the imported iron/steel goods as noted above. The first phase came into force on September 30, 2023.
Phases two and three will come into force on April 1, 2024, and October 1, 2024.
Neither the UK nor EU have a transitional period associated with the regulation.
With the frequency different jurisdictions are imposing new sanctions on Russia, it is important that businesses exposed to sanctions-related developments in Russia should be closely monitoring regulatory updates and ensuring that robust due diligence practices are in place to ensure compliance.
For more information on how ONESOURCE Global Trade solutions can assist you on meeting EU/UK Russian Sanction regulatory requirements, please contact your Account Manager or Client Services Manager.

This article applies to:

  • Product: ONESOURCE Global Trade