European Act on critical raw materials – EU reply to global challenges
On 23rd May 2024 Regulation (EU) 2024/1252 of the European Parliament and of the Council establishing a framework for ensuring a secure and sustainable supply of critical raw materials (the “Regulation”) entered into force.
Rationale and main objectives
Some raw materials are considered to be critical due to their high economic importance, the key role they have to play in realising the green and digital transition, and their exposure to high supply risk. The demand for critical raw materials is expected to grow rapidly and the EU relies heavily on imports, often from a single third country. Recent global crises have underlined the EU strategic dependencies.
The Regulation is a comprehensive response to these challenges. It establishes a framework to ensure the EU’s access to a secure, resilient and sustainable supply of critical raw materials.
Strategic and critical raw materials
The Regulation identifies a group of strategic raw materials (listed in Annex 1) and critical raw materials (listed in Annex 2). (See table below)
The list of strategic raw materials includes materials which are (i) of high strategic importance for the functioning of the internal market; (ii) are characterised by a potentially significant gap between global supply and projected demand; and (iii) for which an increase in production is relatively difficult.
The list of critical raw materials includes all strategic raw materials as well as any other raw materials of high importance for the overall EU economy and for which there is a high risk of supply disruption likely to distort competition and fragment the internal market.
Increasing EU’s self-reliance – goals for 2030
In order to reduce dependency on third countries to access critical raw materials, the Regulation sets the following objectives for 2030:
- the EU’s extraction capacity is capable of producing at least 10% of the its annual consumption of strategic raw materials;
- the EU’s processing capacity is capable of producing at least 40% of the its annual consumption of strategic raw materials;
- the EU’s recycling capacity is capable of producing at least 25% of the its annual consumption of strategic raw materials;
- no third country accounts for more than 65% of the EU’s annual consumption of a given strategic raw material.
Strategic Projects
The Regulation introduces a new class of “Strategic Projects” that contribute to ensuring a secure supply of strategic raw materials.
A Strategic Project may involve activities related to the extraction, processing or recycling of strategic raw materials. It can be implemented both in the EU and in a third country. The decision to recognise a project as strategic is made by the Commission.
Most important benefits of considering a project as a Strategic Project:
- priority status – granting the status of the highest national significance possible; the project shall be treated accordingly in the permit-granting process;
- shorter permit-granting process – the permit-granting process shall not exceed i) 27 months (projects involving extraction) or ii) 15 months (projects involving processing or recycling);
- single point of contact – only one point of contact for the project promoter in the permit-granting process shall exist, which shall facilitate and coordinate the entire process;
- accelerated implementation and access to financing – the Commission and a concerned Member State shall take measures to facilitate timely and effective implementation of the project and its access to financing.
National exploration programmes
By 24 May 2025, each Member State shall draw up a national programme for general exploration targeted at critical raw materials and carrier minerals of critical raw materials.
Mitigating supply risks
To ensure supply chain resilience, the Regulation creates critical raw materials supply chain monitoring and stress-testing, coordinates strategic stocks and sets risk preparedness obligation on large companies producing strategic technologies.
Improving sustainability and circularity
The Regulation introduces solutions intended to improve the circularity and sustainability of critical raw materials in the EU markets:
- national programmes on circularity – Member States shall adopt and implement national programmes on circularity;
- recovery of critical raw materials from extractive waste – operators obliged to draw up waste management plans shall prepare studies regarding the potential recovery of critical raw materials from extractive waste and the Member States shall adopt and implement measures (including establishing databases) to promote the recovery of critical raw materials from extractive waste;
- recyclability of permanent magnets – devices that contain or may contain permanent magnets must be adequately labelled and placed on the market with additional information (including on chemical composition and recycled content);
- recognised certification schemes – the Commission has been obliged to recognise certification schemes related to the sustainability of critical raw materials;
- environmental footprint – the Commission is empowered to adopt delegated acts to establish rules for the calculation and verification of the environmental footprint of different critical raw materials; if such rules are adopted for a given critical raw material, an entity placing it on the market must make an environmental footprint declaration available.
European Critical Raw Materials Board
The Regulation establishes the European Critical Raw Materials Board, which shall provide advice to the Commission and shall carry out the tasks set out in the Regulation, including the assessment of applications regarding strategic projects.
The Board shall be composed of representatives from all Member States and the Commission.
Strategic raw materials and critical raw materials
| Raw material |
Strategic |
Critical |
| Antimony |
|
✔ |
| Arsenic |
|
✔ |
| Bauxite/alumina/aluminium |
✔ |
✔ |
| Baryte |
|
✔ |
| Beryllium |
|
✔ |
| Bismuth |
✔ |
✔ |
| Boron |
metallurgy grade only |
✔ |
| Cobalt |
✔ |
✔ |
| Coking coal |
|
✔ |
| Copper |
✔ |
✔ |
| Feldspar |
|
✔ |
| Fluorspar |
|
✔ |
| Gallium |
✔ |
✔ |
| Germanium |
✔ |
✔ |
| Hafnium |
|
✔ |
| Helium |
|
✔ |
| Heavy rare earth elements |
for permanent magnets only (Nd, Pr, Tb, Dy, Gd, Sm, and Ce) |
✔ |
| Light rare earth elements |
✔ |
|
| Lithium |
battery grade only |
✔ |
| Magnesium |
magnesium metal |
✔ |
| Manganese |
battery grade only |
✔ |
| Graphite |
battery grade only |
✔ |
| Nickel |
battery grade only |
battery grade only |
| Niobium |
|
✔ |
| Phosphate rock |
|
✔ |
| Phosphorus |
|
✔ |
| Platinum group metals |
✔ |
✔ |
| Scandium |
|
✔ |
| Silicon metal |
✔ |
✔ |
| Strontium |
|
✔ |
| Tantalum |
|
✔ |
| Titanium metal |
✔ |
✔ |
| Tungsten |
✔ |
✔ |
| Vanadium |
|
✔ |
