The ambassadors of the Member States to the EU will be invited, on Wednesday 15 July, to give an initial political assessment of the work begun by the Cyprus and Irish Presidencies of the Council of the EU on the Industrial Accelerator Act (IAA), as presented by the European Commission on 4 March.
More specifically, they will be invited to provide political guidance and answer three main questions: - “In establishing lead markets through ‘Union origin’ and low carbon requirements, how can the IAA minimise the administrative burden placed on public bodies and industry, while promoting European manufacturing, incentivising decarbonisation, and enhancing its resilience?”;
- By applying conditionalities to foreign direct investments from third countries holding dominant positions in emerging strategic manufacturing sectors, “what balance should the regulation seek to find between ensuring that foreign investments in emerging strategic sectors significantly bolster Union production capability and the risk of dampening investment through the creation of additional administrative barriers”;
- “Where can the IAA effectively strengthen enabling conditions for industrial activity clustered in acceleration areas and add most value in facilitating the streamlining of permitting processes and speeding up of approvals processes to enable efficient delivery?”
In a note dated 8 July seen by Agence Europe, the Irish Presidency also explains that the objectives set out in the IAA enjoy broad support, “though many Member States continue to have reservations about its complexity, and the additional burden of regulation on public bodies, manufacturers, and consumers”.
Some Member States have questioned its feasibility and the credibility of the implementation deadlines. Likewise, “there is recognition of the need to reduce the potential for circumvention while avoiding disproportionate enforcement burdens”.
This debate comes as three partial draft compromise texts have so far been submitted to the Member States. On Article 3 of the regulation, namely the arrangements for applying the concept of ‘European preference’, the Member States also had the opportunity to express their requests in a document dated 2 July.
That document confirms that France wants the IAA – currently intended to protect and strengthen the electric automotive industry, heavy industry and the clean technology sector – to be extended to other areas. It states that the regulation should in particular create pilot markets (to foster demand for ‘EU’ products in the EU) in the field of shipbuilding products, railway rolling stock and the chemical industry.
Chemicals. With regard to this industry, the European Commission suggested the possibility of introducing it later into the IAA by delegated act, but Paris wants a precise deadline. “The Commission shall adopt, within one year of the entry into force of this Regulation, delegated acts (…) to supplement this Regulation”, the French government suggests.
The Netherlands is also calling for the inclusion of measures aimed at stimulating “demand-side measures for chemicals (...) on the basis of the recommendations of the Critical Chemicals Alliance. Targeted and sector-specific Union wide demand-side measures can help create lead markets for low-carbon and Union-produced energy-intensive industrial products, supporting decarbonisation while strengthening the Union’s industrial base”. They also want a uniform definition of the term ‘low-carbon’.
“Any expansion of the scope, such as to chemical products, must be based on an impact analysis. For now, scrutiny reservation on the extension of the scope of this chapter to the chemical industry”, Belgium indicates, however, adding that it “is of the opinion that more involvement of Member States is necessary especially given the potential impact of the inclusion of the chemical sector”.
This document also confirms the fairly widespread aversion among the Member States to the European Commission’s ability to proceed by delegated acts to amend the scope of the IAA. For Prague, this means removing the Commission’s power to independently adopt delegated acts concerning: (i) the methodology for calculating the so-called EU content; (ii) demand-side incentive measures for products of the chemical industry.
In a second document, dated 2 July, Germany, for its part, says it has a scrutiny reservation on the rules for public procurement. “Regarding Union origin requirements in public procurement, there is no initial DE position yet. In any case, feasible and low-cost implementation is essential”.
Links to the documents: https://aeur.eu/f/msj ; https://aeur.eu/f/msy (Original version in French by Solenn Paulic)