Under the Commission's Industrial Accelerator Act proposal of 4 March 2026, an electric vehicle bought with public money must be assembled in the EU with at least 70% of its non-battery component value of Union origin, decided part by part by EU customs rules. In an illustrative drone-motor bill of materials, EU-sourced parts are 53% of the value, 64% if the magnets come from an EU plant, and the motor itself can still count as fully EU-origin. The act is not law yet.
Under the European Commission's Industrial Accelerator Act proposal of 4 March 2026, an electric vehicle bought through public procurement must be assembled in the EU, and at least 70% of the ex-works price of its components, excluding the battery, must be of Union origin [2]. Origin is decided component by component under the EU's customs rules, not by where you bought a part [3] [7]. We ran the numbers on an illustrative bill of materials for a typical drone motor: parts from EU suppliers are 53% of its series cost, 64% if the magnets came from an EU plant, yet the finished motor can still count as a fully EU-origin component. The act is not law yet, and the Council is still split on which countries count [6].
Key facts
- The Commission tabled the Industrial Accelerator Act as COM(2026)100 on 4 March 2026 [1].
- Electric vehicles in public procurement: EU assembly and at least 70% of non-battery component value of Union origin; later at least 50% for e-powertrain components and 50% for main electronic systems [2].
- Origin follows the EU's non-preferential rules in the Union Customs Code: "wholly obtained" goods or the "last substantial transformation" [3] [7].
- Buyers may drop the requirement if it raises costs by more than 25% in procurement, or 30% in support schemes [3].
- The Council Presidency asked member states to choose between EU27 only and wider scopes; COREPER I discusses it on 7 October 2026 [6].
- In the worked example below, one line (the magnets) moves the EU-supplied share of a motor from 53% to 64%.
What does the Industrial Accelerator Act actually require?
The act is aimed at public money: procurement, auctions and support schemes. Its stated ambition is to raise manufacturing from 14.3% of EU GDP in 2024 to 20% by 2035 [4] [5]. It sets "Union origin" or low-carbon requirements for several product groups [2] [3]:
- Electric vehicles bought with public money: EU assembly and 70% of non-battery component value; later, 50% of e-powertrain value and 50% of main electronics value, plus battery components [2].
- Battery energy storage, solar PV inverters and cells, hydronic heat pumps: named products or key components must be of Union origin, phased in over one to three years after entry into force [3].
- Steel and aluminium: at least 25% low-carbon in procurement from 2029 [2].
Two definitions matter for suppliers. "E-powertrain components" means power electronics, electric motors and e-axles and their components, rotors and stators [3]. "Main electronic systems" covers driver-assistance hardware such as lidars, radars, cameras and ECUs, plus central computers and chassis electronics [3]. If you make or source those parts, buyers will ask for your origin data.
Is it law yet?
No. Parliament gave the file jointly to its industry, internal market and trade committees, and a joint report was expected in September 2026 [5]. In the Council, the Presidency's 30 July options paper says member states' positions "differ" [6]. Options run from EU27 only to EU27 plus free-trade and procurement partners, with or without an ownership test [6]. Member states gave views on 17 September, and COREPER I discusses a paper on 7 October 2026 [6]. Expect the thresholds, country list and dates to move.
Car-parts suppliers want it tougher: CLEPA warns the concept could become "symbolic rather than impactful" [8]. SMEunited wants eligibility based on where goods are made, not who owns the company, and supplier declarations reused rather than new paperwork [9].
What counts as "Union origin"?
The proposal says origin is determined under the Union Customs Code [3]. In practice [7]:
- A good made entirely in one country is "wholly obtained" there.
- A good made in two or more countries originates where it underwent its last substantial transformation.
- "Minimal operations" never confer origin, and Annex 22-01 of the customs rules sets product-specific tests for some tariff headings.
Then the proposal widens the circle: in public procurement, content from countries with an EU free trade agreement, a customs union or the WTO Government Procurement Agreement would be "deemed to be of Union origin", unless the Commission excludes a country [3]. That is the point the Council is fighting over [6]. If you need certainty for one product, customs can issue Binding Origin Information, which binds all EU customs authorities and is normally valid for three years [10].
A worked example: how "European" is a drone motor?
This is an illustrative calculation for a typical product: a 3115-size 900KV brushless outrunner for heavy-lift drones. The values are indicative per-unit series prices for a 1,000-unit series, and the supplier countries are a plausible sourcing mix for a motor wound in Portugal. We use the motor as an e-powertrain component, the category the proposal's later 50% test covers [2] [3].
| BOM line | Series price (€) | Supplier country in the example | Origin assumed |
|---|---|---|---|
| Base, 6061 aluminium, CNC | 1.46 | Portugal | EU |
| Bell cover, 7075 aluminium, CNC | 2.04 | Portugal | EU |
| Steel back-iron ring | 0.42 | Portugal | EU |
| Shaft, 52100 steel, hardened and ground | 0.63 | Portugal | EU |
| Stator stack, laser-cut 0.2 mm electrical steel | 1.75 | Germany | EU |
| 14 NdFeB arc magnets | 1.30 | Netherlands (specialist supplier) | Not EU: sintering country unknown |
| Bearings, winding wire, leads, fasteners, adhesive | 4.25 | Online catalogues | Not EU: origin not recorded |
| Total | 11.85 |
The results:
- EU-supplied share, strict: €6.30 of €11.85 = 53%.
- If the magnets came from an EU plant, such as the Narva line in Estonia [12]: €7.60 = 64%.
- If the catalogue lines came from EU or free-trade partners and the partner scope survives the Council [6]: €10.55 = 89%.
The magnets are the swing line. The EU gets 98% of its rare-earth magnets from China [11], and a Dutch supplier does not make a magnet Dutch: its origin is where it was sintered and shaped [7].
Now the part most suppliers miss. The vehicle rule counts each component as either of Union origin or not [2]. If the motor is wound and assembled in Portugal and that counts as its last substantial transformation, the whole €11.85 motor could count as Union origin for the vehicle maker, even though only 53% of its input value is EU-sourced. Whether it does depends on the rule for its tariff heading in Annex 22-01 [7], which is exactly what a Binding Origin Information request settles [10].
Assumptions: indicative series prices, not quotes; the "other" line groups the small catalogue parts; stator origin assumed German because cutting and bonding happen there; no customs ruling has been requested.
What should suppliers in Portugal prepare now?
Procurement bodies would ask suppliers for "a self-declaration, or an equivalent document" [3]. That declaration is only as good as your part data, and our free spec to shortlist analysis is one way to start it, showing which parts can be made in Portugal or the EU:
- Record origin per part number, with the supplier's written statement and date. Ask where a part was made, not where it shipped from.
- Record ex-works value per line, so you can recompute when the rules change.
- Find the swing lines: the one or two non-EU lines that move your share most, and one EU maker for each. In most products they are magnets, motors and electronics, as we show in what Portuguese producers cannot make and rare-earth magnets after 10 November.
The escape clauses are not a plan: buyers may skip the requirement above a 25% cost difference in procurement or 30% in support schemes [3], and CLEPA wants them tightened [8].
What to do next
- Take your top product and fill in the table above for it: every line, ex-works price, supplier's written country of origin. Compute EU-only and EU-plus-partners.
- For the component you sell, check the Annex 22-01 rule for its tariff heading and, if the answer decides a tender, apply for Binding Origin Information [10].
- If you want the data in one place: a GETMILK technical data package holds origin, materials and certificates per part, from €150 per part, ready for a self-declaration. If you sell only into private markets and nobody asks for origin, you can wait for the final text.
References
- European Commission, DG GROW. Industrial Accelerator Act: COM(2026)100 and accompanying documents (4 March 2026)
- European Commission. Annexes to the proposal for a Regulation establishing a framework of measures for the acceleration of industrial capacity and decarbonisation in strategic sectors, COM(2026) 100 final (4 March 2026)
- European Commission. Proposal for a Regulation establishing a framework of measures for the acceleration of industrial capacity and decarbonisation in strategic sectors (Industrial Accelerator Act), COM(2026) 100 final (4 March 2026)
- European Commission. The Industrial Accelerator Act: factsheet (March 2026)
- European Parliament. Industrial Accelerator Act, Legislative Train Schedule (updated 1 August 2026)
- Council of the EU, Presidency. Industrial Accelerator Act: Union Origin Options Paper, WK 11081/2026 (30 July 2026)
- European Commission, DG TAXUD. Non-preferential rules of origin (accessed 28 September 2026)
- CLEPA, European Association of Automotive Suppliers. Position paper: Industrial Accelerator Act (April 2026)
- SMEunited. SME priorities on the Industrial Accelerator Act (15 July 2026)
- European Commission, DG TAXUD. Binding origin information (BOI) (accessed 28 September 2026)
- European Parliamentary Research Service. China's rare-earth export restrictions (At a glance) (24 November 2025)
- Neo Performance Materials. Neo Performance Materials opens state-of-the-art permanent magnet facility in Europe (22 September 2025)
Questions people ask
- What percentage of EU content does a product need under the Industrial Accelerator Act?
- It depends on the product. For electric vehicles in public procurement the proposal requires EU assembly and at least 70% of the ex-works price of non-battery components of Union origin, later with separate 50% tests for e-powertrain components and main electronic systems. For solar PV and heat pumps it names whole products or key components that must originate in the EU.
- Is the Industrial Accelerator Act in force?
- No. As of September 2026 it is a proposal (procedure 2026/0068(COD)). Parliament's committees were preparing a joint report and the Council's COREPER I was due to discuss which countries' content counts on 7 October 2026. Thresholds and the country list can still change.
- Is a component 'Union origin' if half its parts are imported?
- It can be. The vehicle test counts each component as either originating in the Union or not. A component's origin follows the customs rule of last substantial transformation, not the share of EU content inside it. Check whether Annex 22-01 of the customs rules sets a specific rule for your tariff heading.
- How can I get legal certainty on the origin of my part?
- Apply to your customs authority for Binding Origin Information. A BOI decision binds the holder and all EU customs authorities and is normally valid for three years, for the goods and production process it describes.