The European Commission is set to present its Industrial Accelerator Act on 4 March, opening a new phase in the EU’s attempt to rebuild industrial capacity while cutting exposure to low-cost imports, particularly from China.
The proposal would introduce local-content and low-carbon conditions for public procurement and subsidy schemes in a range of strategic sectors, including steel, cement, wind turbines and electric vehicles.
The measure sits within the broader framework of the Commission’s Clean Industrial Deal, which has placed industrial competitiveness alongside decarbonisation at the centre of EU economic policy. The Commission has already said that the industrial decarbonisation accelerator act is intended to boost demand for EU-made clean products through sustainability, resilience and “made in Europe” criteria in public and private procurement. It has also signalled a separate review of the public procurement framework in 2026 for strategic sectors.
“Made in Europe” set to reshape EU industrial support and procurement
The new act would apply to public tenders and state-backed support for the production of aluminium, cement and steel, as well as clean technologies such as wind turbines and electric vehicles. In practice, this would mean that companies seeking access to certain forms of public support would need to demonstrate that a defined share of value, components or production is based in Europe, while also meeting low-carbon criteria.
The Commission’s stated industrial objective is to lift manufacturing to 20 per cent of EU output by 2035, from about 14 per cent today. Brussels sees this as necessary not only for jobs and growth, but also for strategic resilience. European manufacturers in heavy industry and clean technology have faced a combination of high energy costs, weak domestic demand, and intense competition from cheaper imports, above all from China. The act is therefore designed as an attempt to use public money and regulatory leverage to create more predictable demand for goods made in Europe.
One of the central political questions is what, exactly, will count as “Made in Europe”. France has argued for a relatively narrow definition focused on the EU27 and single market countries such as Norway, Iceland and Liechtenstein, while some other member states favour a broader interpretation that could include partners such as the United Kingdom. Draft texts have also reportedly referred to the possible inclusion of countries with which the EU has public procurement commitments, provided reciprocity is guaranteed.
That debate is especially sensitive in the automotive sector. Proposed rules for electric vehicles could require 70 per cent of non-battery parts costs to come from within the EU in order to qualify for subsidies. Such an approach would directly affect supply chains stretching into Britain, Turkey and Morocco, all of which are closely linked to European car production. Carmakers and supplier groups have warned that a strict localisation requirement could complicate investment decisions and create new frictions within an industry already under pressure from Chinese competition and the transition to electrification.
The proposal has also exposed divisions within the EU itself. Supporters argue that Europe is merely adopting tools already used by major competitors, including the United States, China, Brazil and India, all of which use various forms of local-content or domestic preference rules. From that perspective, the act is presented as an overdue industrial response to a world in which public spending is increasingly tied to strategic production goals. Critics, however, argue that the EU risks moving further towards protectionism and may invite retaliation from trading partners or complicate existing trade relationships.
Industry groups appear divided as well. Some business representatives believe the Commission has already diluted parts of the proposal during internal negotiations. One cited example was a reduction in the share of low-carbon steel required for companies to qualify for subsidies, reportedly cut from an initial plan of around 70 per cent to 25 per cent. That change suggests Brussels is still trying to balance industrial ambition with what companies consider commercially achievable.
The legislative path will be lengthy. Once tabled by the Commission, the Industrial Accelerator Act will need approval from both the European Parliament and member states, leaving considerable room for amendment. Yet whatever form the final law takes, the direction of travel is now clear. Brussels is seeking to use procurement, subsidies and industrial policy more directly to shape where strategic goods are made, who benefits from public spending, and how far the bloc is prepared to go in shielding its manufacturing base from external competition.
