On 4 March 2026, the European Commission adopted a legislative proposal to increase demand for low-carbon, European-made technologies and products in the form of the Industrial Accelerator Act (“IAA“) which should boost manufacturing, grow businesses, and create jobs in the EU, while supporting industry’s adoption of cleaner, future-ready technologies (“Proposal“) . The IAA aims to increase value creation in the EU, strengthening industrial base in the EU against the backdrop of growing unfair global competition and increasing dependencies on non-EU suppliers in strategic sectors. The Proposal is available at this link.

The key charasteristics of the Proposal are as follows:

• Policy objective:The Commission presents the Act as a response to the weakening of Europe’s industrial base. Its headline goal is to raise manufacturing’s share of EU GDP from 14.3% in 2024 to 20% by 2035, while preserving and creating around 150,000 jobs and strengthening resilience, decarbonisation and strategic autonomy.
• Sectoral scope:The proposal focuses on energy-intensive industries, automotive, and net-zero technologies. Annex I expressly covers paper, coke and refined petroleum products, chemicals, rubber and plastics, other non-metallic minerals, and basic metals, as well as motor vehicles and net-zero technologies under the Net Zero Industry Act (“NZIA“).
• Permitting reform:The core procedural idea regarding permitting is “one project, one digital procedure.” Member States will be obliged to establish a single access point, a single application covering all permits, and a coordinating authority responsible for the comprehensive decision. Within 45 days, the authority must confirm completeness or request missing information.
• Digital architecture:The single access points are meant to use the European Business Wallet, enabling automated data exchange, re-use of documents already held by public authorities, higher cybersecurity standards, and better deadline tracking for applicants.
• Energy-intensive industry decarbonisation:The Proposal extends the NZIA-style strategic project logic to decarbonisation projects in energy-intensive industries, linking them to faster treatment and to the parallel EU work on speeding up environmental assessments.
• Public procurement for industrial materials:For procurement launched from 1 January 2029, minimum requirements would apply to certain products from energy-intensive industries: at least 25% low-carbon steel, 5% low-carbon and Union-origin concrete/mortar, and 25% low-carbon and Union-origin aluminium in relevant buildings, infrastructure and some civil vehicles.
• Public support schemes:Similar requirements would also apply to public support. Member States would need to use these requirements for at least 45% of the national budget of the relevant support schemes for energy-intensive products and for 100% of the relevant support budget covered by the vehicle rules.
• Exceptions:Contracting authorities may depart from the procurement requirements where there is only one available supplier, an overriding public-interest reason, or disproportionate cost / technical incompatibility. The proposal says cost differences above 25% may be presumed disproportionate in procurement; for public support, an increase above 30% in the cost of the final product or technology is treated as disproportionate.
• Origin rules and third countries:“Union origin” is tied to EU customs rules. In procurement, equivalent treatment may extend to countries covered by a Free Trade Agreement (“FTA“), customs union or relevant obligations pursuant to Agreement on Government Procurement (GPA); in other public interventions, the text refers to FTAs and customs unions. The Commission would still be able to exclude third countries where reciprocity is lacking or dependencies threaten EU security of supply.
• Electric vehicles and corporate fleets:For new PEVs, OVC-HEVs and FCVs in procurement from six months after entry into force, the proposal requires assembly in the Union, at least 70% Union-origin content for non-battery vehicle components, specified EU-origin battery components, and from year 3 also at least 50% Union-origin shares for e-powertrain and major electronic systems. Comparable rules would apply to public support for corporate cars and vans, with an additional manufacturer-level compliance route based on 85% compliant registrations in the previous year.
• Net-zero technologies via NZIA amendments:The proposal also amends the NZIA. It would impose mandatory sustainability requirements in public procurement for certain commonly procured net-zero technologies and phased Union-origin requirements in auctions and support schemes for battery storage, solar PV, hydrogen electrolysers, wind, some heat pumps and, later, some nuclear projects.
• Industrial Manufacturing Acceleration Areas:Each Member State would have to designate at least one such area within 12 months after entry into force. The designation should favour locations with lower environmental conflict, outside Natura 2000, while taking account of climate risks, infrastructure, and brownfield or already industrialised land where possible. For each area, Member States would issue an aggregated baseline permit covering the permits commonly needed for industrial activities in that zone, although some permits remain project-specific, including certain installation-specific permits and grid connection permits. The proposal also foresees enabling measures for finance, infrastructure, supply chains and skills, and the recitals expressly mention tacit approval at intermediate stages and priority treatment of connection requests.
• Foreign direct investment:A separate chapter covers selected foreign direct investment (“FDI“) above EUR 100 million in batteries, EVs, solar PV and critical raw materials where more than 40% of global manufacturing capacity in the sector is held by the investor’s third country. Such investments would require prior approval, especially where the investment reaches at least 30% of shares, voting rights or equivalent control.
• Value-added test for FDI:From 12 months after entry into force, Member States could approve only investments meeting at least 4 out of 6 conditions. These include a 49% control cap, a joint venture model with Union partners, intellectual property / know-how licensing benefiting the Union target, at least 1% of annual revenue spent on Research&Development in the Union, at least 50% Union workers, and a strategy to strengthen EU value chains including an effort to source at least 30% of inputs from the Union.
• FDI review mechanics:The Commission may issue a written opinion within 30 days. National investment authorities decide, but if they diverge from the Commission’s opinion, an additional two-month period applies. The Commission may also take over the assessment itself, notably for investments above EUR 1 billion or those with major cross-border implications. Penalties for false or missing information can reach up to 5% of average daily turnover, or 5% of investment value for a natural person investor.
• Expected effects:According to the impact assessment, public procurement and compliance costs for administrations would rise, with annual administrative costs increasing by up to about EUR 8.92 million EU-wide and procurement costs expected to increase across Member States. At the same time, the Commission expects stronger competitiveness for EU energy-intensive industries, solar, batteries and vehicle components, lower dependencies, and improved economic security, while acknowledging possible trade tensions.
• Review and legislative status:The proposal foresees evaluation after 3 years and an explicit review after 5 years. Because this is still only a Commission proposal, the final text may change materially during negotiations in the Council and the European Parliament

The Proposal will be negotiated by the European Parliament and the Council of the European Union before its adoption and entry into force.