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Title page 1

Contents 1

Executive summary 1

1. Introduction 2

2. What does the IAA propose? 2

2.1. What does 'Made in EU' mean? 3

2.2. Conditions applied to clean-technology support schemes 4

2.3. Public procurement of clean energy-intensive products becomes mandatory 4

2.4. A stricter approach to electric vehicles? 5

2.5. Conditions on incoming FDI 6

3. Context: are the IAA proposals unusual? 6

3.1. EU local-content requirements 6

3.2. International context 8

3.3. The planned IAA low-carbon requirements for steel, aluminium and cement are overdue 8

3.4. FDI screening: a recent EU competence 9

4. Assessment: trade-offs and weaknesses in the proposed IAA 10

4.1. Green industrial policy must balance three objectives 10

4.2. The IAA is justified by economic security concerns but lacks proportionality 11

4.3. Overprotection of specific sectors puts broader economic health at risk 11

4.4. The industrialisation target is unhelpful déjà vu 13

4.5. Europe must remain open about green trade/exchange with the world 14

5. Fixing the IAA: policy recommendations 15

References 17

Annex: key provisions of the proposed IAA 19

Tables 3

Table 1. Proposed measures in the IAA 3

Table 2. Investment and subsidies in clean technologies in the EU (2016-2026) 9

Figures 9

Figure 1. European battery cell manufacturing capacity by company, region of HQ and operational status (as of Q1 2026) 9

Figure 2. Manufacturing, value added (% of GDP) 14