Competition requires level playing field - von der Leyen
EU needs to adapt state aid schemes to new environment
EU and U.S. could establish "critical raw materials club"
BRUSSELS, Dec 4 (Reuters) - The EU will adapt its state
aid rules to prevent an exodus of investment triggered by a new
U.S. green energy subsidy package, the bloc's chief said on
Sunday, while offering cooperation over raw materials to counter
"Competition is good ... but this competition must respect a
level playing field," European Commission President Ursula von
der Leyen said in a speech in the Belgian city of Bruges.
"The (U.S.) Inflation Reduction Act (IRA) should make us
reflect on how we can improve our state aid frameworks and adapt
them to a new global environment," she added.
The 27-country bloc fears that the $430 billion IRA with its
generous tax breaks may lure away EU businesses and disadvantage
European companies, from car manufacturers to makers of green
The topic is one of several on the agenda of the EU-U.S.
Trade and Technology Council meeting on Dec. 5.
Participants include U.S. Secretary of State Antony Blinken,
Commerce Secretary Gina Raimondo and U.S. Trade Representative
Katherine Tai, along with European Commission Executive Vice
Presidents Valdis Dombrovskis and Margrethe Vestager.
Von der Leyen said the EU must take action to rebalance the
playing field where the IRA or other measures created
distortions, while cautioning that a trade war was in neither
"We need to do our homework here in Europe, and at the same
time we have to work with the United States to mitigate the
disadvantages," she noted.
To help European companies in the short term, the EU is
working on boosting RePowerEU, the bloc's plan to end dependence
on Russian fossil fuels by funding the green transition, von der
"However, we also need to think beyond ad-hoc solutions. The
new assertive industrial policy of our competitors needs a
structural answer," she said.
"This means on one hand new and additional funding (for
research, innovation and strategic projects) at the EU level and
... on the other hand a higher level of policy coordination,
like hydrogen, like semiconductors, quantum computing,
artificial intelligence (and) biotechnology."
At the same time, Europe needs to cooperate with the United
States in the face of China working with massive automobile
subsidies while controlling critical raw materials, von der
Leyen noted. This could mean agreeing on joint EU-U.S. standards
for EV charging, for example.
"If Europe and the United States agree on common standards,
we will shape global standards and not leave it to others," she
As regards scarce raw materials for clean tech, "Europe and
the U.S. can build an alternative to this (Chinese) monopoly by
establishing a critical raw materials club," von der Leyen said.
"The idea behind it is simple: It is cooperation with
partners and allies on the sourcing, on the production, and on
the processing that gives us the ability to overcome this
(Reporting by Sabine Siebold and Riham Alkousaa; Editing by
Gareth Jones and David Holmes)