The European Union has created a dedicated line of communication with Chinese authorities to keep supplies of rare earth materials moving to European manufacturers, according to Trade and Economic Security Commissioner Maroš Šefčovič.
Speaking on Wednesday, 5 November, in Kuwait at the 2025 GCC–EU Business Forum, Šefčovič said Brussels and Beijing had agreed to prioritise export licence applications from European companies and to review them jointly through a new “special channel”. The arrangement is intended to minimise delays arising from China’s export controls on rare earths introduced earlier this year.
Rare earth elements are essential inputs for permanent magnets used in electric vehicles, wind turbines, industrial robotics and various electronics. Tighter Chinese licensing procedures prompted concern in Europe over potential disruptions, given China’s dominant role in processing and exports.
Šefčovič said he had raised the matter directly with China’s Commerce Minister, Wang Wentao, on several occasions. He warned that poorly managed procedures could have a “very negative impact on production and manufacturing in the EU”. He outlined that the channel will allow officials on both sides to identify and fast-track applications linked to critical European value chains.
Since the controls took effect, European firms have filed about 2,000 applications with the Chinese authorities, with just over half approved to date. Brussels is pressing for faster processing of the remainder and monitoring bottlenecks in specific product categories, including rare-earth oxides, metals and magnet alloys.
The EU executive is coupling engagement with Beijing with measures to diversify supply. Šefčovič cited efforts to build upstream extraction and mid-stream processing within Europe, including rare-earth and magnet production in Estonia.
Concerns over supply intensified earlier this year when China’s licensing regime came into force and was later expanded in October, before easing after arrangements with European and US authorities clarified procedures for some product groups.
On Tuesday, the European Commission said EU and Chinese officials had discussed possible general licences to streamline exports, similar to arrangements the United States says it has secured from China.
Industry groups in Europe have warned that even short delays in magnet feedstock can affect assembly lines for electric vehicles and renewable energy equipment. Permanent magnet manufacturing depends on a steady flow of neodymium, praseodymium, dysprosium and terbium, among other inputs. While substitution and recycling programmes are advancing, they are not yet sufficient to offset large swings in primary supply.
The “special channel” is an administrative mechanism rather than a formal change to China’s export rules. European officials aim for clearer points of contact and case-handling protocols to reduce uncertainty for companies placing orders and managing inventories. The Commission plans to track approval rates and processing times to gauge performance.
For the EU, the approach reflects a dual track: immediate engagement to stabilise trade, coupled with investment to build alternative capacity. The Critical Raw Materials Act provides the framework for strengthening European value chains, diversifying imports and improving risk monitoring and recycling, including for permanent magnets.
Member states are supporting projects for refining and separation plants and considering strategic stockpiles for selected materials. Estonia’s emerging magnet and rare-earth processing capabilities are cited as a near-term addition, with further projects in the bloc progressing through permitting and financing.
Šefčovič’s remarks highlight the Commission’s focus on maintaining inputs for Europe’s green and digital industries. Electric vehicle output and offshore wind deployment are central to EU industrial and climate plans and depend on high-performance permanent magnets that are difficult to replicate without rare earth elements.
The Commission did not provide a timetable for resolving most outstanding applications. Officials indicated that the channel would remain while China’s licensing regime requires case-by-case approvals, and that Brussels would keep pressing for broader facilitation measures, including general licences.
While the mechanism may ease immediate pressures, longer-term resilience will depend on diversifying supply, expanding recycling and developing magnet manufacturing capacity within the single market. Recent progress includes Europe’s first large-scale NdFeB magnet plant in Narva, Estonia, with further capacity under development.
China’s export control stance remains an important variable for global supply chains, with additional restrictions announced in October that increased scrutiny of magnet-related exports and technologies. Continued EU-China engagement is intended to keep trade channels predictable while European projects scale up.
