A Critical Raw Materials Act to Boost Europe’s Autonomy

On 16th March 2023, the European Commission released a Proposal for a regulation to establish a framework for ensuring a secure and sustainable supply of critical raw materials (CRMs).

The proposal aims to help equip the EU with the capacities that will be needed to meet its targets for producing renewable energy, for developing strategic manufacturing technologies, such as semiconductors, and to reach climate neutrality objectives.

The proposed Regulation leverages the strengths and opportunities of the Single Market and the EU’s external partnerships to diversify and enhance the resilience of EU critical raw material supply chains. It also improves the EU capacity to monitor and mitigate risks of disruptions and enhances circularity and sustainability.

The Critical Raw Materials Act will equip the EU with the tools to ensure the EU’s access to a secure and sustainable supply of critical raw materials, mainly through:

Setting clear priorities for action: the Act identifies a list of strategic raw materials, and sets clear benchmarks for domestic capacities along the strategic raw material supply chain and to diversify EU supply by 2030:
- At least 10% of the EU’s annual consumption for extraction.
- At least 40% of the EU’s annual consumption for processing.
- At least 15% of the EU’s annual consumption for recycling.
- Not more than 65% of the Union’s annual consumption of each strategic raw material at any relevant stage of processing from a single third country.

Creating secure and resilient EU critical raw materials supply chains: the Act will reduce the administrative burden and simplify permitting procedures for critical raw materials projects in the EU.
Ensuring that the EU can mitigate supply risks: to ensure resilience of the supply chains, the Act provides for the monitoring of critical raw materials supply chains, and the coordination of strategic raw materials stocks among Member States.
Investing in research, innovation and skills.
Protecting the environment by improving circularity and sustainability of critical raw materials.
Diversifying the Union's raw material imports, the Act plans also to:
- Establish a Critical Raw Materials “Club” for all interested countries to strengthen global supply chains.
- Reinforce trade agreements to secure and diversify trade in critical raw materials.
- Expand the EU's network of strategic partnerships with a value chain approach and a strong sustainability dimension.
- Deploying projects along the raw materials value chain and supporting connectivity through the Global Gateway for soft and hard infrastructure.

In conclusion, the CRMA is a crucial step towards addressing the challenges associated with the supply of critical raw materials.

By introducing due diligence requirements, promoting recycling, and supporting research and innovation, the EU aims to secure its access to these vital resources while ensuring that they are sourced and used in a way that respects human rights and the environment.

How CSR Europe can support your company

If your company would like to understanding, analysing and complying with the requirements set by policymakers on reporting, due diligence, tax transparency and so on, as well as meet the expectations of stakeholders, CSR Europe has developed the EU Alignment Service.

Companies that want to fill existing gaps in their strategy and processes can request the EU Alignment Service. The service aim is to analyse the expectations set by European legislators vis-á-vis the performance of your company.

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