{"id":14383,"date":"2025-05-23T10:50:28","date_gmt":"2025-05-23T10:50:28","guid":{"rendered":"https:\/\/vila.es\/?p=14383"},"modified":"2025-05-26T10:54:31","modified_gmt":"2025-05-26T10:54:31","slug":"legal-roadblocks-the-eus-strategic-projects-for-critical-raw-materials","status":"publish","type":"post","link":"https:\/\/vila.es\/en\/european-union\/legal-roadblocks-the-eus-strategic-projects-for-critical-raw-materials\/","title":{"rendered":"LEGAL ROADBLOCKS: THE EU\u2019S STRATEGIC PROJECTS FOR CRITICAL RAW MATERIALS"},"content":{"rendered":"

A recent announcement by the European Commission regarding 47 \u2018Strategic Projects\u2019 (seven of which are in Spain) is the newest step in its plan to boost critical raw material supply in an attempt to reinforce sustainability and defence sectors and move towards the objectives for 2030 as set out in Regulation (EU) 2024\/1252, known as the Critical Raw Materials Ac<\/a><\/span>t (henceforth the \u2018CRMA\u2019). This article will analyse the proposals of both the CRMA and the Strategic Projects plan, and the obligations imposed upon both Member States and companies in the critical raw materials sector along with potential roadblocks regarding permit-granting processes and investment regulation.<\/p>\n

\u2018Critical\u2019 metals, such as, lithium, cobalt and tungsten are essential for battery production, other more sustainable energy sources like solar or wind power, and in the case of tungsten, is an essential metal in the defence sector. For the EU, establishing a stable supply of these \u2018strategic raw materials\u2019 is essential for reaching its green and digital initiatives along with ensuring its own defence, especially pertinent given the increasing geopolitical tensions of late.<\/p>\n

The CRMA puts an emphasis on domestic supply of such materials so as to try to reduce reliance on third countries and as such, sets out ambitious targets to meet 10%, 40%, 25% of the EU\u2019s total demand for extraction, processing and recycling, respectively, as well as limiting supply to the EU to 65% of total annual consumption from a single third country. It hopes that through these initiatives the EU will be able to \u201ccreate secure and resilient supply chains, supply risk preparedness and mitigation and improve sustainability and circularity of these critical raw materials on the EU market.\u201d [1]<\/sup><\/a><\/span><\/p>\n

The CRMA makes an important distinction in Article 1, between \u2018critical raw materials\u2019 and \u2018strategic raw materials\u2019 which are included in the list of critical raw materials, but are identified as \u2018raw materials that score among the highest [according to the criteria set out in the CRMA] in terms of strategic importance, forecasted demand growth and difficulty of increasing production\u2019 (hereby \u2018Strategic Materials\u2019), as it is only this second category of materials that is specifically focussed on with the Strategic Projects.<\/p>\n

Strategic Projects<\/strong><\/p>\n

In an announcement on the 25th of March 2025, the Commission announced 47 so-called \u2018Strategic Projects\u2019 to facilitate the achievement of these benchmarks and the goals set out in the CRMA. These 47 Strategic Projects spread across 13 Member States, cover 14 of the 17 strategic raw materials set forth in the CRMA, including lithium, nickel and copper. Seven of these Strategic Projects are based in Spain, the second highest number of projects per country, only behind France with a total of ten. Of these projects, six involve extraction, two involve processing and one involves recycling of metals such as lithium, platinum group metals and tungsten.<\/p>\n

These projects will benefit from a range of support structures proposed by the Commission in areas such as financing, permits, as well as certain obligations regarding reporting and risk evaluation (which will affect all the critical materials sector more broadly too).<\/p>\n

Support and benefits for Strategic Projects<\/strong><\/p>\n

One of the main advantages for those companies whose projects are deemed \u2018strategic\u2019 is streamlining the permit-granting process. Currently some processes for new mines and new mining projects can take between 5 and 10 years. Under the CRMA these Strategic Projects will be subject to new deadlines for granting permits that will be imposed upon Member States: 27 months for extraction projects and 15 months for processing and recycling projects, with dispute resolution also being an urgent priority. Pursuant to Article 9 of the CRMA, this will be aided by the designation of one or more authorities within the Member State as single points of contact that will handle, facilitate and coordinate the permit-granting process. Each Member State will be able to decide whether its single points of contact will be the authorities responsible for making the decision to grant permits along with whether they will operate on a local, regional or national level.<\/p>\n

Furthermore, with regard to financing such projects, the CRMA establishes a set of advisory opportunities to be provided by the European Critical Raw Materials Board, which shall allow promotors to access broader funding opportunities, for instance from the European Investment Bank Group or other public-private investment funds aimed at supporting the production of critical raw materials.<\/p>\n

Potential Challenges <\/strong><\/p>\n

Whilst this may sound promising, challenges surrounding both permit-granting and financing still remain. For instance, even though these projects are granted \u2018urgent dispute resolution\u2019, growing public resistance to mining will no doubt hinder the initiation of such projects, which will inevitably have a knock-on effect on their financing and attracting private investment. Private investment will also be further challenged by Foreign Direct Investment (FDI) regulations found in Royal Decree 571\/2023 of the 4th<\/sup>of July about foreign investment. In this decree, Strategic Materials are considered part of a \u2018critical infrastructure\u2019[2]<\/sup><\/a><\/span> and therefore, the liberalisation regime [3]<\/sup><\/a><\/span> for foreign investment in that area is suspended. As a result, every investment made will be subject to a previous administrative authorisation process that may impose certain conditions upon it[4]<\/span><\/sup><\/a>.Other Member States like Italy, France and Germany, have similar mechanisms in place for the screening of FDI in their critical materials sector, and as a result, they will have to carefully balance these screening mechanisms with a fundamental need for foreign private investment in the Strategic Projects.<\/p>\n

Reporting and Risk Assessments<\/strong><\/p>\n

In accordance with that set out in Article 8 of the CRMA, all Project Promotors will have to submit a report to the Commission outlining progress in areas such as permit-granting, delays and financing every two years so as to maintain transparency and accountability throughout the process.<\/p>\n

More broadly, \u2018Large Companies\u2019 (i.e. those with more than 500 employees on average and a net worldwide turnover more than EUR150m, according to the parameters set out in Article 24 para. 2) using raw Strategic Materials and operating in sectors such as manufacturing equipment for renewable energy generation, producing hydrogen, transmitting and storing data, certain defence applications, and batteries for energy storage or electric vehicles must carry out a risk assessment of the supply chain of their Strategic Raw Materials, including:<\/p>\n