Mandate: - Resolution of the Council renewing and revising the Mandate of the Steel Committee, approved by the Council on 29 October 2018 at its 1383rd session [C(2018)134 and C/M(2018)20, item 215]
- Resolution of the Council renewing the Steel Programme by the Council on 8 November 2023 at its 1473rd session [C(2023)135 and C/M(2023)14, item 221]
DRAFT REVISED RESOLUTION OF THE COUNCIL RENEWING THE STEEL PROGRAMME
“THE COUNCIL”,
HAVING REGARD to the Convention on the Organisation for Economic Co-operation and Development of 14 December 1960;
HAVING REGARD to the Rules of Procedure of the Organisation;
HAVING REGARD to the Financial Regulations of the Organisation;
HAVING REGARD to the Resolution of the Council on Partnerships in OECD Bodies [C(2012)100/REV2/FINAL];
HAVING REGARD to the Communiqué approved by the Council meeting at Ministerial Level on 15 June 1978 and, in particular, Annex II thereof [C(78)96(Final)];
HAVING REGARD to the Resolution of the Council establishing a Steel Committee [C(78)171(Final)], as amended by documents C/M(79)22(Final), Item 231 (b) and C/M(83)6(Final), Item 51 (b), [C(2013)87 & CORR1 and C/M(2013)19, Item 197], with the last renewal and revisions adopted in 2018 [C(2018)134 and C/M(2018)20] ;
CONSIDERING the significant changes in the structure of the global steel industry over the past few years;
CONSIDERING the increasing share of emerging economies in world steel consumption and production, which requires structural adjustment in many economies;
CONSIDERING that trends in global economic growth can generate difficult conditions for steelmakers in many economies, and the need for the steel industry to adapt accordingly;
CONSIDERING the susceptibility of the steel industry to government support and protectionist measures, particularly during periods of weak economic growth;
CONSIDERING continued government interventions in the steel industries of some countries that contribute to excess capacity and distort conditions of competition at the global level;
CONSIDERING the important role of steel in the overall discussions on trade policy and protectionism due to the strategic nature of the industry;
CONSIDERING policy concerns regarding non-tariff measures that result in trade distortions and trade frictions, the presence of state-owned steel enterprises and the need for increased transparency regarding their financing and behaviour, and the increasing number of restrictions on the export of steelmaking raw materials;
CONSIDERING growing global attention on issues of decarbonisation and the growing importance of the low carbon transition for the global steel industry;
HAVING REGARD to the proposed Resolution of the Council Renewing the Steel Programme [C(2023)135];
DECIDES:
A. The Steel Programme is renewed with the following revised mandate for the Steel Committee:
I.Objectives
1.The Steel Committee provides a unique forum for governments and industry to come together to discuss multilateral problems in the global steel industry and policy solutions to them. The overall objective of the Committee is to foster close co-operation between governments to ensure that markets for steel remain as open and free of distortion as possible and that the industry helps contribute to global efforts to reduce climate impacts. In this way it contributes to the wider OECD strategic objective of promoting sustainable economic growth, financial stability, and structural adjustment consistent with the low-carbon transition.
2.The intermediate objectives of the Steel Committee shall be to:
i)Support swift, concrete and effective actions worldwide to address excess capacity and its root cause: market-distorting subsidies and other types of support by governments and related entities that contribute thereto;
ii)Ensure that trade in steel will remain as unrestricted and free of distortion as possible. Restrictive actions should be avoided and, where necessary, strictly limited in scope and time, and in conformity with WTO rules;[1]
iii)Reduce barriers to trade of steel products and related materials, on both the import and export side, including non-tariff barriers;
iv)Act promptly to cope with crisis situations in close consultation with interested trading partners and in conformity with agreed principles;
v)Facilitate needed structural adaptations that will diminish pressures for trade actions and promote rational allocation of productive resources with the aim of achieving fully competitive enterprises;
vi)Ensure that measures affecting the steel industry are consistent to the extent possible with general economic policies and take into account interactions with both upstream and downstream related industries, including clean energy, recycling and steel- consuming industries, as well as workers;
vii)Avoid encouraging market distorting investments while recognising development and decarbonisation needs;
viii)Avoid the provision of preferential treatment to state-owned steel enterprises and ensure that such enterprises act in accordance with market principles and principles of competitive neutrality;
ix)Facilitate plurilateral and multilateral co-operation consistent with the need to address excess capacity, maintain competition, to anticipate and, to the extent possible, prevent problems.
x)Provide information and analysis to support governments in meeting their global climate objectives, while recognising the importance of a just transition.
II.Committee Functions
3.In order to seek solutions to the problems experienced by the steel industry and achieve the objectives set out in the mandate, the Steel Committee will:
i)Continuously follow national, regional and world supply and demand conditions in steel and closely related industries, including steel-consuming industries and raw material industries, with a view to identifying potential problems and implications and making assessments and forecasts (including long-term steel demand) available to all interested parties. To broaden assessments of steel demand; attention will also be given to value chains involving steel and their inter-linkages in the economy, and with decarbonisation as well as the greenhouse gas (GHG) emissions in the sector;
ii)Continuously follow the evolution of national, regional and world steel industries with regard to employment, profits, investments, capacity, input costs, energy efficiency, decarbonisation, productivity, innovation needs and digitalisation trends, the availability of raw materials, and other aspects of viability and competitiveness. Decarbonisation and environmental issues will be monitored through perspectives such as environmental performance, economic opportunities in the transition to low-emission production technologies, and compliance costs and their impacts;
iii)Develop common perspectives regarding emerging problems or concerns in the steel sector and establish, where appropriate, plurilateral and/or multilateral objectives or guidelines for government policies;
iv)Regularly review and assess government policies and actions in the steel sector in the light of the current situation, agreed multilateral objectives and guidelines and the World Trade Organisation (WTO), and other relevant international agreements;
v)
Identify deficiencies and gaps in existing data needed by the Committee with a view to improving national inputs to the Committee and cross-national comparability of data;
vi)Make full use of its Bureau to ensure a proper functioning in operation and substance of the Steel Committee.
III.Participation and commitments
4.Membership in the Steel Committee is open to:
• all OECD Members, which may participate in the Steel Programme by addressing a notification to the Secretary-General to this effect;
• interested non-Members, which have been granted Associate Status in the Steel Committee.
Together, OECD Members and non-Member Associates should be referred to as “Steel Committee members”.
5.Steel Committee members agree to the following guidelines:
i)To work together to address excess capacity in a swift, concrete and effective fashion;
ii)To abstain from destructive competition in official support of export credit; they agree that their policies in the field of export credits for steel plant and equipment will be fully consistent with the Arrangement on Guidelines for Officially Supported Export Credits and contribute to the avoidance of competitive subsidisation of such exports;
iii)To refrain from domestic policies to sustain steel firms during crisis periods shift the burden of adjustment to other countries and thus increase the likelihood of restrictive trade actions by other countries (e.g. by artificially stimulating exports or by artificially displacing imports). Further, as a general rule, domestic measures should not prevent marginal facilities from closing in those instances where the facilities cannot become commercially viable within a reasonable period of time;
iv)To make every effort to provide effective programmes to assist steel workers affected by structural adjustments to find alternative employment. To this end, they will periodically exchange information on the effectiveness of policies and programmes to assist steel workers and communities;
v)To report promptly any action to restrict trade in steel-making materials and allow for consultation with affected parties;
IV.Budget of the Programme
6.The expenditure of the Steel Programme shall be charged against the appropriations authorised for it under Part II of the Budget of the Organisation.
7.A Steel Committee member would fall into arrears on 1 January of the year following the year of the call for payment of the assessed contribution if the contribution remains unpaid at that date. If a Steel Committee member’s contribution remained unpaid, a proposal would be considered to suspend its participation, unless it paid the outstanding contribution. Settlement of the outstanding debt by the concerned Steel Committee member in arrears will reverse the suspension. If, in the third year following the year of call for payment, a Steel Committee member’s contribution remained unpaid, a proposal would be considered to exclude it from the Steel Programme unless it paid the outstanding contribution. The decision of exclusion shall be adopted by the Council. This decision shall be notified to the Steel Committee member.
8.Appropriations of no more than EUR 10 000 for which no commitment has been entered into before the end of the Financial Year for which they were appropriated, as well as any surplus income, shall be automatically carried forward to the Budget of the Steel Programme for the ensuing year by decision of the Secretary-General, notwithstanding the provisions of Regulation 10 of the Financial Regulations of the Organisation.
9.The annual assessed contribution of a new Steel Committee member shall be added to the Budget of the Steel Committee. If a new Steel Committee member joins during a financial period, its contribution calculated on a prorata temporis basis shall become a supplementary Budget.
10.Should a Steel Committee member withdraw from the Steel Programme, the total amount of the Steel Programme Budget to be financed by the assessed contributions shall be reduced by the full amount of this withdrawing Steel Committee member’s assessed contributions. In order to ensure sufficient sustainability and allow for appropriate planning measures, withdrawals from the Steel Programme shall only take effect on 31 December of the year following that in which the written notice of withdrawal was received by the Secretary-General.
V.Co-ordination Arrangements
11.In the course of its work, the Steel Committee will:
i)Maintain close working relationships with other relevant OECD bodies, in particular those working in the areas of trade and trade policies, state ownership, industry and innovation, employment and the environment, as well as relevant entities of the OECD family, in particular the International Energy Agency (IEA), and other relevant international organisations and fora that are working on excess capacity and other relevant issues pertaining to the steel sector, including the World Trade Organization (WTO) and the United Framework Convention on Climate Change (UNFCCC), in order to ensure coherence and complement the work that is carried out by the Steel Committee;
ii)Engage actively with Partners that have significant steel activity;
iii)Consult with the steel industry, including national and regional steel associations and trade unions and workers’ representatives, where appropriate.
B. The Resolution Renewing the Steel Programme shall remain in force until 31 December 2028.