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COMMISSION  OF THE  EUROPEAN  COMMUNITIES 
COM (83)  22? final. 
Brussels,  20 April  1983. 
REPORT FROM THE COMMISSION TO THE COUNCIL 
on the extension  of Annex I to the  ECSC Treaty 
COM (83)  227 final. 

REPORT 
on the extension of Annex I to the  ECSC  Treaty 
I. SUBJECT 
In its communication C0MC82) 850 final of 9 December 1982, the 
Commission  proposed  that  the Council should include the following 
two products in Annex I to the  ECSC  Treaty: 
- cold-rolled sheet, in coil or cut lengths,  with  a thickness 
of 3  mm or more; 
cold-rolled strip produced by slitting cold-rolled sheet, 
in coils,  with  a width  of 500  mm maximum. 
On 21 February 1983, pursuant to Article 81 of the  ECSC  Treaty, the 
Council  uninamously approved the extension of Annex I to  that  Treaty 
to include the first of these products. The proposal relating to the 
second  product did not receive unanimous Council approval. The  Com­
mission  had already stated - at the Council meeting of 25 January 1983 -
that it would in due course submit an amended proposal which would exclude 
producers  other than those already covered by the  ECSC  Treaty. 
It also announced in the above-mentioned communication  that  it would 
examine the advisability of including the following products in Annex I 
and that  it would submit a report on the results of this study to the 
Counci  I: 
stainless cold-drawn bars, 
forged bars and sections from high-speed and tool steels, 
- drawn bars and sections from high-speed and tool steels, 
- drawn  wire,-
cold-rolled strip produced by slitting cold-rolled  coils, 
standard cold-rolled strip. 
.11 

- 2 -
The present report summarizes the results of the study, which was 
based  on a series of consultations  with  the manufacturers of these 
products. 
II. THE SITUATION IN  RESPECT  OF THE VARIOUS  PRODUCTS 
1. Cold-rolled strip produced by slitting cold-rolled coils  
(so-called slit  strip)  and standard cold-rolled strip 
Slit strip is produced by slitting cold-rolled coils  (*). "Standard 
cold-rolled strip" is hoop and strip cold-rolled on a special mill, 
the initial  product being, as a rule, hot-rolled hoop and strip and, 
in recent times, also strip obtained by slitting hot-rolled  coils. 
The two products  (slit  strip and standard cold-rolled  strip)  are 
very similar and can be used in some  cases  instead of hot-rolled 
hoop and strip  (.**),  a product covered by the  ECSC  Treaty. 
The producers of cold-rolled coils  (500  mm or more in  width)  hardly 
slit tonnages in ordinary qualities. This is generally done by 
Service  Centres and by small and medium-sized independent cold 
rolling mills,  where  these exist. "Standard cold-rolled strip" is 
manufactured by both  ECSC  producers and independent cold-rolling 
mills. The  latter,  which are mostly found in Germany and  Italy, 
mainly produce standard strip in tonnage qualities. German, Belgian 
and Italian  manufacturers of standard cold-rolled strip or slit 
strip in tonnage qualities, who are not  ECSC  producers  were  opposed 
to the inclusion of these products in the Annex. 
The Commission also examined the possibility of including standard 
cold-rolled strip and slit strip in stainless qualities. 
(*) Coils  means rolled products in the form of rolls of any thickness 
J with  a minimum  width  of 500 mm  (ECSC  product). 
(**)Hot-rolled  hoop and strip means hot-rolled product in straight 
strips or coil having sheared and unsheared edges and a maximum 
width  and thickness of 500  mm and 6  mm respectively  (ECSC  product). 
./3 

- 3 -
Standard  cold-rolled strip  is manufactured  in stainless qualities  by only 
a few non-ECSC  undertakings,  generally  very small  ones (*). Like the ECSC 
producers, these independent manufacturers  were in favour of including this 
product in these qualities  in Annex I to the ECSC  Treaty. 
Slit strip is generally  only manufactured  in stainless qualities  by ECSC 
producers  and a few  specialized  Service Centres.  These  enterprises  recom­
mended the inclusion  of stainless  slit strip in the ECSC  Treaty. 
2. Drawn  wire 
Drawn wire is manufactured  by both ECSC and  independent producers. Only  the 
independent manufacturers  and ECSC  producers  in France,  (where  the latter 
account for a  greater proportion  of the  total number of  producers)called  for 
the inclusion  of drawn wire in the ECSC  Treaty.  ECSC producers  in the UK 
supported  this request, although independent undertakings  did not  express 
an opinion. Manufacturers (both independent  and ECSC  producers)  in Belgium, 
the Netherlands  and Luxemburg,  as well as in Germany and  Italy (which  have 
a high proportion  of independent producers)  were opposed  to the  inclusion  of 
drawn wire in the ECSC  Treaty. 
3. Drawn and  forged bars  and sections from high-speed  and tool steels 
At the the  request  of the  producers concerned,  the Commission  confined its 
examination  of the  advisability  of including  drawn  and forged bars  and 
sections  (**) in the ECSC  Treaty  to high-speed  and tool qualities,  since 
(*) There  are fewer than  ten independent  cold-rolling mills  producing 
stainless qualities  in Belgium,  Germany, UK,  Italy and France. 
(**) Although  drawn and forged bars  and sections  differ  from hot-
rolled bars and sections  as regards  the manufacturing procedure, 
which involves  a further  processing step,  and in  qualities,  they 
are virtually identical  in appearance.  The fact that the ECSC 
products  are subject  to Article  60 of the  Treaty,  whereas  there 
are no pricing restrictions  on the  other goods could  lead many 
producers  to avoid applying  the measures  laid down in the  Treaty, 
particularly  those  relating  to prices. 

- 4 -
these constitute  a high proportion  of drawn and forged products. 
In all the member  States  the traditional  ECSC manufacturers  of drawn 
products  in these qualities  were in favour of this inclusion  in the 
ECSC Treaty.  There  are about ten manufacturers  of such products  in 
the Community who are not  subject  to the ECSC  Treaty (in  Germany, 
France and Italy).  The only independent producer  in France - who is 
at the same  time the biggest manufacturer  of these products  in high­
speed qualities  - and the German  independent undertakings  were opposed 
to the inclusion  of these products  in the ECSC  Treaty, although  the 
latter qualified their  opposition  by saying that they  would be prepared 
to review  their position  if that was the  only obstacle  to inclusion. 
The producers  adopt a similar position  as regards forged products, 
although  in this case the number of  undertakings  not subject  to the 
ECSC Tre.aty  is greater.  The inclusion  of these products  in the ECSC 
Treaty was opposed  only by the German  independent undertakings which, 
however,  account  for more  than 50% of the  total number of  undertakings 
in this sector  in Germany. 
4. Stainless  cold-drawn bars 
All ECSC producers  of stainless  cold-drawn bars were'in favour  of the 
inclusion  of this product  in the ECSC  Treaty.  On the  other hand, manu­
facturers  of this product  who are not  subject  to the ECSC  Treaty  were 
opposed to its inclusion.  Although there  are not many  independent 
undertakings,  they account  for a  considerable share  of the  market 
(e.g. 70% of the  Italien  market). 

5 
III. OBSERVATIONS ON THE ADAPTATION OF  ANNEX I TO THE 
ECSC TREATY TO TECHNICAL AND  ECONOMIC  DEVELOPMENTS 
During the earlier discussions  on the advisability  of extending" 
Annex I of the ECSC  Treaty, the Commission  constantly stressed 
that it was aware of the balance between the ECSC and EEC  Treaties 
and had no intention of proposing the  inclusion  in the ECSC Treaty 
of products which, for  commercial  reasons that  still hold true, 
had not knowingly been included in the  first place. Nor, in  the 
Commission's  opinion, is it desirable  to amend  the ECSC Treaty 
for purely economic  reasons. 
In the present circumstances,  the Commission  does not therefore 
see any point in proposing  to the Council  the inclusion  in the 
ECSC Treaty of a number of  products suggested  by various delegations 
within the Council which are clearly not steel products as such. 
On the other hand, it seems  only logical that the Council should 
take account, of  factors relating to technical  developments.  There 
are a number of  products which were not originally  included in 
the ECSC Treaty since they  were not then, as they are now, standard 
production.  These are true, steel products which are made, in most 
cases, by traditional  steel nsanufacturers  and are in direct compe­
tition with a number of  products covered  by the ECSC Treaty. The 
permanent  exclusion  of these products  from the Treaty  would give 
rise to discrimination. 
This being  so, should the Council decide  to include these products, 
it would  remain  within  the original  spirit  of the  Treaty. Their 
inclusion  would  lead neither  to any  structural  disruption  nor to a 
distorsion  of the  market in these products,  but would, on the con-
trary, simply refLect  normal  economic  trends. 

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By making  the proposals  set out  below,  the Commission  does not 
consider that  it has  found a permanent  solution  to all present 
or future  problems  relating  to technical  and economic  development. 
In the circumstances,  however,  the Commission  feels that  it would not 
be reasonable  to propose  any more  than is absolutely  necessary  in 
order to restore  the balance  consistent with  the spirit of the  Treaty. 
IV. CONCLUSION 
The Commission  hereby proposes  that the Council include  the following 
new products  in Annex I to the ECSC  Treaty, pursuant  to the  provisions 
of Article  81 : 
strip produced  by slitting  cold-rolled  coils, and hoop and strip 
cold-rolled  on a special  mill (of a  width not exceeding  500 mm) 
in stainless  qualities; 
drawn and forged bars  and sections  in high-speed  and tooL steels.