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European Parliament and European Council reach political agreement on Critical Raw Materials Act

The European Parliament and the European Council reached a political agreement on Monday (13 November) on the Critical Raw Materials Act (CRMA), which has been “welcomed” by the European Commission.

Keeping the “overall objectives of the original proposal,” the new agreement has added aluminium and synthetic graphite to the list of strategic and critical materials, “reinforced” the benchmark of recycling and “clarified” the permitting procedure for Strategic Projects. It has also introduced new a requirement for relevant companies to perform a supply-chain risk assessment, the European Council said in a press release.

The new rules are expected to increase domestic capacities for critical raw materials along the supply chain, complementing initiatives to diversify their supply through international partnerships supported by the EU’s Global Gateway facility.

“Today’s agreement lays the foundation of Europe’s strategic autonomy. Our dependency on raw materials is the Achilles’ heel of our competitiveness, but with the Critical Raw Material Act we can turn this weakness into strength. We can create a truly European extracting sector; we can turn our waste into a resource; we can build closer ties to third countries and we can secure the life-line of our industry in a truly sustainable way,” said Teresa Ribera Rodríguez, acting Spanish third Vice-President of the government and Minister for the Ecological Transition and the demographic challenge.

The agreed benchmarks specify that the EU should have the capacity to extract 10 per cent, process 40 per cent, and recycle 25 per cent of its annual consumption of strategic raw materials by 2030. In terms of recycling, the deal also ensures that we will progressively take into account waste to determine recycling objectives.

The agreement also includes the objective to mitigate demand through resource efficiency and technological progress. The EU should also diversify its imports of strategic raw materials, so that it does not rely on a single source of supply for more than 65 per cent of its consumption, the European Commission said in a press release.

“Delighted that co-legislators agreed on this important proposal in record time. The Critical Raw Materials Act ensures that Europe can take its future in its hands. With this Act, we can rely on secure, diversified and sustainable critical raw material value chains in Europe. This is the basis to succeed in the Green and Digital transition,” Věra Jourová, Vice-President of the European Commission.

In terms of the “Strategic Projects,” the European Commission with member states plans to identify such projects along the value chain that will benefit from more streamlined, faster and more efficient permitting procedures as well as facilitated access to finance. The agreement has also extended the scope of Strategic Projects to those allowing the production of materials that substitute strategic raw materials.

Moreover, as part of the new monitoring of critical raw materials supply chains, under the revised agreement large companies would be obligated to perform risk assessments of their supply chains. It also “foresees” the coordination of strategic raw materials stocks among member states, the European Commission said in the press release.

The political agreement is now subject to formal approval by both co-legislators. The Critical Raw Materials Act was originally announced by EU Commission’s President von der Leyen in her 2022 State of the Union speech, where she called to address the EU’s dependency on critical raw materials.

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