Serbia’s steel industry is facing more restrictive access to the European Union market as Brussels strengthens trade safeguards, tightens import controls and increases protection for strategic industries. The changes affecting the Smederevo steelworks, owned by China’s HBIS Group, highlight the commercial challenges facing Serbian manufacturers operating outside the EU’s institutional framework.
According to MAT, the EU significantly reduced the duty-free quota for Serbian steel from July 2026, cutting it from approximately 820,000 tonnes to 410,000 tonnes annually. The revised allowance represents around one-fifth of the Smederevo plant’s production. Exports exceeding the quota are now subject to a 50% tariff, double the previous rate of 25%. The higher duty makes shipments beyond the permitted volume economically unviable in many cases.
EU Tightens Steel Origin Requirements
Alongside the quota reduction and higher tariffs, Brussels has introduced stricter requirements for documenting the origin of steel. Exporters must provide information establishing where the material was first melted and poured.
The measure is intended to prevent producers from using third countries to route Chinese or other steel into the EU while circumventing trade restrictions. For HBIS’s Chinese-owned Smederevo facility, compliance involves more than additional documentation, as ownership, supply-chain arrangements and access to European customers are increasingly interconnected.
Regulatory Changes Increase Costs for Non-EU Producers
The restrictions reflect a broader shift in European industrial policy, which combines decarbonisation measures, protection of strategic manufacturing sectors and stronger trade-defence instruments.
Although companies from outside the bloc retain access to the EU market, they face increasingly demanding conditions. CBAM, product standards, rules of origin and trade safeguards are among the mechanisms through which regulatory differences between Serbia and the EU can translate into additional commercial costs. Serbia must therefore determine how its heavy industry will operate within a European market where industrial policy and trade relations are becoming more closely linked.
Lower-carbon steel production, traceable raw materials and more diversified export markets are among the measures that could help Serbian manufacturers respond to the changing requirements. EU accession is another possible route, although membership would also entail additional obligations. The situation at Smederevo demonstrates the implications of Serbia’s position as an economy closely connected to the EU market but outside the institutions responsible for setting its industrial and trade rules.
