The European Commission has launched a new mechanism designed to assist European companies grappling with current disruptions in the supply of critical raw materials, particularly rare earth elements and related products originating from China. According to a letter from the Commission obtained by “Handelsblatt”, the initiative aims to facilitate improved access for businesses facing urgent needs.
The new process involves companies with particularly pressing supply concerns registering their requests through a dedicated tool. The Commission will then compile regular lists of these prioritized license applications and forward them to relevant Chinese authorities through bilateral channels. To protect sensitive information, only the license application number will be shared with China, with all other requested data remaining confidential within the Commission.
While the initiative has been met with cautious optimism from European and German business leaders, representatives have emphasized that it doesn’t represent a complete resolution to the ongoing challenges. Jens Eskelund, Head of the EU Chamber in Beijing, stated that the new IT tool will help prioritize the most critical cases, aiming to mitigate a potential crisis. However, he added that European companies are still operating in a reactive mode, as delays in export licenses and customs procedures continue to exert significant impact on production. The EU Chamber continues to advocate for a long-term and sustainable solution to the situation.
Since April, Beijing has implemented tightened export controls on specific rare earth elements and related products. This has resulted in delays or outright lack of access to these essential resources for German and European companies, with some businesses already forced to temporarily halt production.