Posts Industry industrial policy 1001 13 March 2026
The Industrial Accelerator Act ultimately takes a broader approach to the Made in Europe policy
In early March, the European Commission presented the long-awaited Industrial Accelerator Act (IAA). Its publication was postponed several times due to significant differences in the views of the bloc’s member states regarding the scope of application of the «Made in Europe» scheme. Steelmakers also sought to be part of it, but ultimately did not get all the provisions they wanted. At the same time, the presented framework reassured many EU partners.
Framework of the proposal
The Industrial Accelerator Act aims to increase demand for low-carbon technologies and products manufactured in Europe. It aims to increase the share of industrial production in the bloc’s GDP to 20% by 2035, compared to 14% currently.
The IAA introduces targeted and proportionate requirements for the «Made in Europe» program and low-carbon requirements for public procurement and state aid schemes. They will apply to specific strategic sectors, including steel, cement, aluminum, automotive, and zero-emission technologies.
Products supplied by partners with whom the bloc has concluded a free trade agreement or customs union, or who are parties to the WTO Agreement on Government Procurement and where there are corresponding EU commitments, will be considered as originating in the European Union. With regard to other measures, such as government schemes and auctions, partners may be included in the scope of the IAA if they have a free trade agreement or customs union with the EU.
The Industrial Accelerator Act is intended to ensure equal treatment of countries that grant EU companies reciprocal access to their markets. As noted by European Commissioner for Industrial Strategy Stéphane Séjourné, many of the bloc’s partners practice national preferences (for example, the US and Canada). According to him, there are plans to use a delegated act to exclude those who do not play by the rules or pose a risk to Europe’s economic security.
The IAA also sets a number of conditions for large investments (over €100 million) in strategic sectors for third countries where one country has a global market share of more than 40% in the relevant sector. In particular, this concerns technology transfer, compliance with local content requirements, and ensuring a minimum employment level for Europeans of 50%. The participation of foreign companies is limited to 49% of capital.
Public procurement by EU member states accounts for approximately 14% of the bloc’s GDP and amounts to an estimated €2 billion in annual expenditure on goods, works, and services.
Impact on the EU steel market
The provisions proposed in the IAA aim to create guaranteed market demand for cleaner steel. For example, low carbon emission requirements are introduced for steel products used in automotive and construction.
It is envisaged that:
- From January 1, 2029, for public contracts relating to buildings, infrastructure, or cars, at least 25% of the total steel used must be low-carbon.
- Member State schemes (e.g., subsidies for building renovation) updated or introduced after 2029 must ensure that at least 25% of the steel used in the project or product receiving support is low-carbon steel.
Green steel in the document presented by the European Commission is not subject to the mandatory requirement of EU origin. The IAA also provides for only voluntary labeling of such steel products.
Decarbonization projects in the steel industry are classified as strategic, which gives them access to a special set of tools to speed up environmental assessments.
European steel associations remained dissatisfied with the Industrial Accelerator Act, insisting on clearer and stricter requirements for steel. First and foremost, they criticize the lack of a criterion that low-carbon steel for public procurement be produced within the bloc.
This issue was highlighted in particular by the European Steel Association (EUROFER) and the German Steel Association (WV Stahl).
«If the Commission proposal becomes reality in its current form, low-emission imported steel will be able to meet the same quotas as steel produced in the EU. This undermines the investment security of our industry and weakens Europe’s position as a business location – and this at a time when industrial strength is becoming a security policy necessity,» said Kerstin Maria Rippel, CEO of WV Stahl.
IAA Antonio Gozzi, president of Italy’s Federacciai, called it another missed opportunity to strengthen the competitiveness of the European steel industry. He considers the lack of «Made in Europe» criteria for steel, which are provided for other materials such as aluminum and cement, to be one of the main critical aspects of the document.
Federacciai also criticized the uncertainties regarding the classification of low-carbon steel and the lack of clear explanation about the methodology for its labeling.
Carola Hermoso, CEO of Spain’s UNESID, described the definition of EU steel origin included in the proposal as excessively weak. In her opinion, treating products from third countries with which the bloc has free trade agreements as equivalent to those originating in the bloc distorts the very concept of European origin and significantly reduces the real impact on strengthening Europe’s industrial base.
Thyssenkrupp Steel believes that the IAA promotes imports more than the use of European steel. This supports investment outside Europe rather than within it, according to a statement sent to Kallanish.
«Over the past year, we have seen a consistent policy by the European Commission to strengthen the role of industry in the economies of EU countries. Trade restrictions, the introduction of CBAM, policies that encourage the purchase of local products, discussions on changes to the ETS system, attempts to regulate electricity prices for industry. This consistency lays the foundation for optimism among all EU market players – a strong economy and a premium EU market are beneficial to everyone. However, the main question remains unanswered: where are the programs and policies that will stimulate demand for steel in mechanical engineering, infrastructure, and construction? Without supporting demand and creating new growth mechanisms, all these new regulations will not produce systemic results,» said Stanislav Zinchenko, CEO of GMK Center.
Partners’ reaction
On March 6, China’s Ministry of Commerce expressed serious concern about the IAA, which imposes restrictions on foreign investment in areas such as batteries, electric vehicles, solar photovoltaic systems, and critical raw materials.
A spokesperson for the ministry said that China would closely monitor the relevant legislative process in the EU and assess its impact on its own country. Beijing will resolutely defend the rights and interests of Chinese companies. China has stated that the bloc’s use of industrial development and green transition goals is tantamount to protectionism.
However, the criteria that will determine products equivalent to those produced in the EU have reassured many of the bloc’s trading partners.
Turkey believes that the «Made in Europe» policy could strengthen the Turkish steel and automotive sectors. It is expected that the country will be considered within the Customs Union under the IAA. Veysel Yayan, Secretary General of the Turkish Steel Producers Association (TCUD), noted that the national steel sector already operates in accordance with EU standards for production processes, quality standards, and technical regulations. He sees prospects for Turkish steel thanks to the opportunity to fill gaps in the market that may arise if other exporters are not included in the scheme.
Ugur Dalbeler, chairman of worldsteel and vice president of the Turkish Steel Exporters Association, believes that the country’s recognition as a reliable partner within the «Made in Europe» program for various goods is a good sign for its position in future negotiations with the bloc on steel trade. Turkey is currently subject to EU safeguard quotas.
The British manufacturers’ organization Make UK has emphasized that the European proposal contains provisions that allow for derogations from the rules for certain third-country tenderers in procurement systems. Under the current draft, the UK would automatically be subject to this derogation.
William Bain, head of trade policy at the British Chambers of Commerce (BCC), said fears that British companies would be excluded from EU supply chains due to the IAA had not materialized. Future legislation under the «Made in Europe» policy, including requirements for car assembly, still poses a risk to British industry.
After the IAA presentation, the South Korean government convened a special meeting with industrial companies representing the automotive and steel sectors and battery manufacturers to assess its impact.
The Korea International Trade Association has stated that South Korea is included in the list of partner countries with the EU under the free trade agreement in terms of product origin. They expressed concern about the EU’s requirements for electric vehicles to receive subsidies, as this violates the principle of reciprocity—the country has a different practice in place.
The EC’s proposals have been met with both approval and criticism not only from steel market participants but also from other sectors. For example, the Hydrogen Council industry group believes that the IAA does not send a strong enough signal of demand to unlock the necessary investment in the hydrogen industry.
A number of associations related to the automotive industry point to the need to remove loopholes that can be used to circumvent requirements (in particular, to receive EU subsidies, 70% of electric vehicle parts must be manufactured in the bloc, with the exception of batteries, for which minimum thresholds are provided). BusinessEurope has announced its intention to impartially consider the introduction of European preferences in public procurement and state aid in line with other EU regulations.
The IAA still needs to be agreed with member states and the European Parliament before it becomes law. These proposals are still subject to change.
