【By Observer Net, Yuan Jiaqi】
According to Reuters on April 4, on Wednesday local time, the European Commission officially announced the "Industrial Accelerator Act" (IAA), which aims to enhance the competitiveness of EU manufacturing in the process of decarbonization by setting local content requirements, while reducing reliance on cheap Chinese imports.
This bill, which has sparked widespread controversy both within and outside the EU since its inception, will set low-carbon standards and an "EU-made" threshold for public procurement and public support programs. It will cover strategic industries such as aluminum, cement, steel, as well as wind turbines, electrolyzers, and electric vehicles, and may be expanded to other energy-intensive sectors such as chemicals.
EU officials previously revealed that although the new regulations will not directly name China, given the scale of Chinese investment in Europe, the legislative focus is obvious.
According to a press release published by the European Commission on the same day, the IAA also adds additional conditions for major investments exceeding 100 million euros in the EU's green strategic industries: if a third country accounts for more than 40% of global capacity in the relevant field, related investment projects must complete technology and knowledge transfer, meet local production requirements, and ensure that at least 50% of employees are from the EU.
"Politico" Europe disclosed the draft, stating that the above investment restrictions mainly target China, covering areas such as batteries and energy storage, electric vehicles and components, solar photovoltaic, as well as the mining, processing, and recycling of critical raw materials.
On April 18, 2025, the Shanghai Express, the first dedicated new energy vehicle train of the China-EU Railway, departed for Duisburg, Germany. Oriental IC
Reuters pointed out that the EU's move aims to avoid the model where Chinese companies in Europe use imported components to assemble products with only a small number of local employees.
The report also mentioned that the EU executive has drawn up a list of partners, with countries such as the UK, Canada, and the US included, which have signed free trade agreements with the EU or joined the WTO Agreement on Government Procurement, while China is not on the list.
At the same news conference, Stefano Corso, the executive vice president of the European Commission who led the push for the bill, did not hide his stance against China. He claimed, "If we do nothing, it is clear that soon 100% of clean technology products will be produced in China... In the next few years, our cement and steel industries could all be moved abroad."
However, analysts believe that due to significant differences in interests among EU member states, it is difficult to form a unified stance toward China, and whether this investment review mechanism will ultimately take effect remains uncertain.
Notably, Corso had written an article supporting the "Made in Europe" strategy in early February, claiming to have received over 1,100 signatures from EU business leaders. However, media noticed that European car manufacturers were notably absent from the list of signatories.
JMP Securities pointed out that EU automakers still have a high degree of dependence on China in parts, especially batteries. Too strict local content rules could increase production costs, weaken industry competitiveness, and even affect the EU's carbon dioxide emission reduction goals.
The China-EU Chamber of Commerce has previously strongly criticized the IAA draft, accusing it of seriously undermining the confidence of leading Chinese companies in investing in Europe. The chamber stated that in addition to sending negative political signals, many proposed measures in the bill have serious operational defects, such as mandatory local cooperation requirements that are not commercially or technically feasible in most cases.
As an important component of the EU's series of policies to enhance international competitiveness, the IAA plans to prioritize "European-made" products in public procurement, support domestic industries through the EU's public procurement market of over 2 trillion euros annually, and layout emerging growth areas, while setting access conditions for foreign investment in strategic industries.
According to the European Commission's press release, the goal of the bill is to increase the share of manufacturing in the EU's GDP from the current 14% to 20% by 2035, curb the loss of about 600,000 jobs in the automotive industry over the next 5 to 10 years, and preserve or create about 150,000 jobs in other industries. The covered industries account for 15% of the EU's manufacturing, and the strict rules will be implemented in steps over three years.
According to reports, the IAA was originally planned to be launched in 2025 but has been postponed multiple times due to ongoing controversies. The bill has also caused concerns in the US, the UK, and others, who believe it strengthens the "European-made" threshold, increases corporate costs, and constitutes a new trade barrier. There are also serious divisions among EU member states.
France clearly supports strengthening the "Europe-first" approach in public procurement and subsidies, viewing it as a key measure to reshape the industrial base; Sweden, the Czech Republic, and others worry that localization requirements would raise costs, reduce investment attractiveness, and even undermine the principle of the EU single market. Germany also emphasized that such measures should only be used as a "last resort".
The industry's attitude is similarly divided, with the automotive sector being particularly cautious. Mercedes-Benz management warned that emphasizing localization too much could lead to supply chain fragmentation, exacerbate inflationary pressures, and actually shrink the global market space for European companies.
Even within the European Commission, there are divisions: Corso, who is in charge of industrial affairs, advocates implementing strict "EU-made" rules, while Commissioner Valdis Dombrovskis, who is in charge of trade, prefers a more open approach and advocates including EU trading partners in subsidy scope.
Disputes over rule design continue to exist, and the European Commission has repeatedly delayed the proposal, adjusting its content until this week. One major point of contention is which third countries can be considered "trusted partners" and thus enjoy treatment equivalent to EU products.
The report said that the European Commission will assess whether partners provide equivalent market access to EU companies and remove those that do not meet the standards.
Corso argued, "Many of our partners implement their own national priority policies. Therefore, before they enter our market, we expect to enter theirs. We will exclude countries that do not follow the rules or pose a risk to our economic security."
After submitting the proposal, the European Commission needs to negotiate with the European Parliament and EU member states to determine the final text, and the content of the bill may still be significantly adjusted.
Due to the extensive modifications made at the last stage, including the exclusion of the entire technology industry from the scope, critics believe the bill is far from mature, and when it is submitted to the EU Council and European parliament for deliberation, it may face the risk of being significantly revised.
Additionally, Germany has led a group of 10 EU countries to form the "Friends of Industry" alliance (Friends of Industry), advocating for relaxed regulation and promoting more open trade. German Economy Minister Kathrin Röse harshly criticized the IAA, saying it would create a "regulatory desert no one can understand."
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Original: toutiao.com/article/7613573051317469706/
Statement: This article represents the views of the author alone.