PUBLISHED
April 17, 2026
AUTHORS
Roberto Cicellini
Fabio Mariano
Donata De Franco
Luigi Risorto
Elisa D’Alessandro
Denise Trombetta
TOPICS
Industrial ManufacturingSustainabilityIndustrial Accelerator Act: challenges and opportunities for reindustrialisation and decarbonisation in Europe
Industrial Accelerator Act: challenges and opportunities for reindustrialisation and decarbonisation in Europe
PUBLISHED
April 17, 2026
AUTHORS
Roberto Cicellini
Fabio Mariano
Donata De Franco
Luigi Risorto
Elisa D’Alessandro
Denise Trombetta
TOPICS
Industrial ManufacturingSustainabilityEuropean manufacturing accounts for 14.3% of EU GDP, down from 17.4% in 2000. In the automotive sector over 100,000 job cuts were announced in 2024-25. And 80% of global battery and solar photovoltaic manufacturing capacity sits in China. These are the figures from the Explanatory Memorandum attached to the European Commission's proposal of 4 March 2026, published alongside the Industrial Accelerator Act. Taken together, they paint a clear picture of where European industry stands. A picture that demands concrete action — and demands it quickly.
The path to the Industrial Accelerator Act
Anyone who has followed the European competitiveness debate over the past eighteen months will not be surprised by the IAA's content. The sequence was clear: the Draghi Report (September 2024), the Competitiveness Compass (January 2025), the Clean Industrial Deal (February 2025). Each step raised the stakes further, culminating in the current IAA proposal — the clearest signal yet of where European industrial policy is heading: rebuilding industrial capacity as a strategic imperative, while reducing dependencies on third-country suppliers. The target is to bring manufacturing back to 20% of EU GDP by 2035 — a threshold Europe has not reached since 1991 — and to create approximately 150,000 new jobs across key industrial sectors. An ambitious agenda, one that will require a genuine break from the patterns of the past.
The Industrial Accelerator Act framework
The draft Regulation presented by the European Commission operates across four main pillars.
The first leverages public procurement and state support schemes to introduce EU-origin and low-carbon requirements for strategic products and components. The aim is to significantly boost demand for clean technologies (e.g. battery storage systems, solar photovoltaic and wind technologies, electric vehiclesand automotive components, etc.) that meet "Made in EU" criteria, alongside low-carbon requirements for steel, cement and aluminium. The focus is placed both on the place of production and on manufacturing methods, with mandatory EU-origin thresholds for specified product shares and key components, and low-carbon content requirements aligned with delegated acts under the EU ETS, CBAM, the Construction Products Regulation and the Ecodesign for Sustainable Products Regulation.
The second pillar aims to streamline permitting and authorisation procedures through the creation of Single Access Points and the use of the European Business Wallet, establishing a unified, digital, and simplified process for managing authorisation workflows under a "one-project-one-submission" logic.
The third component introduces Industrial Acceleration Areas in each Member State — designated geographic zones benefiting from pre-approved environmental assessments, with streamlined permitting (area-wide permit and tacit approval). The intent is to give investors greater certainty when deploying decarbonisation projects within these areas, with faster and simplified approval processes.
The fourth pillar governs foreign investments exceeding €100 million in strategic sectors — including batteries, electric vehicles, solar PV and critical raw materials — made by investors from non-EU countries that control more than 40% of global manufacturing capacity in the relevant sector. Such investments will be subject to binding conditions designed to maximise the value generated for the EU economy: majority control of new legal entities by EU investors; retention of technological know-how and intellectual property within the EU,; a minimum EU workforce share of 50%; obligations regarding EU supplier engagement; and minimum annual R&D investment in-country.
This is not a framework of principles. It is a proposal built on concrete, specific foundations, sector-level thresholds, procedural simplifications and phased implementation steps aimed at rebuilding the competitiveness and strategic independence of European industry.
What changes from 2029 onwards
From 2029, the expected date of application for lead market provisions in public procurement and support schemes, mandatory minimum quotas of low-carbon and Made-in-EU products will come into force. Companies that are not adequately prepared will risk exclusion from tenders.
For energy-intensive industries such as chemicals, steel, cement, aluminium, the IAA is both a challenge and a concrete opportunity to accelerate decarbonisation investments. Those that have already built structured transition roadmaps will find themselves aligned with the low-carbon thresholds that will govern access to public tenders and support schemes. Everyone else, if they want to remain competitive, will need to start designing their near-term strategy around the regulatory direction the IAA sets out.
For European net-zero technology manufacturers, the IAA effectively creates guaranteed EU demand. The "Made in EU" requirement and the associated component thresholds are simultaneously an opportunity and an immediate source of pressure. Companies that depend on Asian-sourced components (a dependency well documented in the Impact Assessment Report accompanying the proposal) and those wishing to continue working with public authorities or accessing public subsidies will need to at least partially renegotiate supply arrangements, consider internalisation, or develop European manufacturing partnerships. Practices that today often translate into competitive advantages in public tenders are set, under the IAA, to become binding requirements.
For infrastructure funds and long-cycle investors, the IAA introduces a degree of regulatory predictability that has been largely absent. The new foreign investment regime will demand closer attention to due diligence on deals in batteries, EVs and critical raw materials in the interest of maximising value creation for the EU economy.
The execution challenge
The risk of the IAA is not in its ambition. The challenge is in delivery. The draft Regulation adds another layer to an already dense regulatory environment , and treating it simply as such would be a mistake. The implementation of the IAA's core principles will need to be phased and targeted to be workable within the realities of industrial production. Companies already working through the operational implications such as supply chain, procurement and decarbonisation roadmaps will be starting with an advantage measured in years.
The debate is still open
The main countries of the European Union have supported the measure from the outset, driven by a shared vision of supporting energy-intensive industries in the decarbonization process and supporting their own companies in the green technology sectors through the “Made in EU” requirement. However, different views remain on how the regulation should be applied, and these could lead to substantial changes.
France is the leading advocate of the IAA in its current form: it highlights its significance as a doctrinal turning point for European industrial policy and pushes for a restrictive application of the “Made in EU” criteria. It should be limited to products manufactured within the European Union or the European Economic Area and exclude products manufactured in countries other than the abovementioned ones, with a customs union or free trade agreement with the EU (e.g. United Kingdom and Switzerland).
While formally highlighting its support for the Commission's proposal and its importance for protecting strategic sectors and promoting national and European value chains, Italy issued a warning about the need to accelerate the implementation of the Industrial Accelerator Act and the introduction of the Made in Europe and Low Carbon requirements before 2029, as a more rapid and concrete response to the current systemic crisis.
Other countries are taking more moderate positions. Germany supports a less restrictive “Made in EU” criteria than the French approach and warns about the effects of the IAA on foreign investment and on rising prices.
Among the most critical positions are those of some countries in Northern Europe. These countries warned about the risk that the IAA could introduce an additional layer of regulatory complexity, weaken access opportunities to cutting-edge technologies from non-EU countries and undermine the principle of “open trade” on which the single market is based.
The Commission's public consultation closes on 6 May 2026. The legislative process will then move through Parliament and the Council of the European Union, with the aim of reaching a negotiated text agreed across all Member States and final adoption of the Regulation. There is still room to shape the outcome, but the strategic window is already open and the companies that move now will be the onesbest placed to occupy it.
Getting ahead of it
The question worth asking right now is not what the IAA says. It is what it means for your specific position. Operational implications vary significantly depending on sector, position in the value chain, exposure to public procurement and the structure of investments already underway. For some companies, this will mean assessing whether their products are genuinely compliant with low-carbon criteria or building a path to get there. For others, it will mean stress-testing whether their supply chain can realistically meet EU-origin requirements, ESG traceability standards and minimum content thresholds consistent with the new regulatory direction. For others still, the priority will be to understand how to leverage public funding and incentive mechanisms quickly enough to accelerate the transition and pursue decarbonisation roadmaps aligned with broader climate targets.
In every case, the point is not to wait for the final text. It is to understand, now, where action is needed. The regulatory framework is still being written. Competitive positions are not.