European Parliament to vote on proposal for a critical raw materials centre and fund

The European Parliament is scheduled to vote on 20 October 2026 on a report proposing the establishment of a European Critical Raw Materials Centre and an initial EU contribution of €2 billion to a dedicated fund. The measures aim to reduce European industries’ vulnerability to supply disruptions through joint purchasing, emergency stockpiles and investment support.

In brief The plenary vote is scheduled for 20 October and would establish Parliament’s position in negotiations with the Council of the EU. The proposed centre would organise joint purchasing, manage European stockpiles and analyse supply risks. The dedicated fund would receive an initial EU contribution of €2 billion and could attract additional capital. The InvestEU and EIB financial targets are separate from this fund and do not represent amounts already spent. Supported projects would cover the entire industrial chain, from exploration and extraction to processing, recycling and the replacement of certain materials.

The report was adopted on 8 October by the European Parliament’s Committee on Industry, Research and Energy (ITRE), with 64 votes in favour, one against and 17 abstentions. Rapporteur Mohammed Chahim, a Dutch MEP and member of the Socialists and Democrats group, proposes introducing the centre into legislation on critical raw materials. The plenary vote concerns Parliament’s position for negotiations, ahead of the final adoption of the amendments.

Supply is essential for the production of batteries, chips, energy equipment and defence systems. In the RESourceEU plan presented in December 2025, the European Commission described the concentration of production and processing outside the EU as a vulnerability for European industry. Trade restrictions and delivery disruptions can affect production continuity and access to the materials required.

What the European centre would do

The text proposes an EU body with legal personality and operational powers. It would identify vulnerabilities for each raw material, monitor market developments and connect producers, processors, recyclers and industrial users. Its analyses would guide purchasing, stockpiling and support for projects addressing concrete shortages in supply chains.

At the request of participating companies, the centre could negotiate and conclude purchase agreements with suppliers on their behalf. Participation in joint purchasing would be voluntary. The report also provides for the possibility of purchases on behalf of at least two Member States, following an assessment of the operation’s necessity and proportionality.

The centre would purchase and manage European stockpiles for crisis situations and could support the establishment of private stocks that contribute to security of supply. The report treats these reserves as complementary tools to supplier diversification and the development of extraction, processing and recycling capacities.

How the proposed fund would work

The European Critical Raw Materials Fund would have an initial EU contribution of €2 billion, drawn from the future European Competitiveness Fund. Under proposed Article 43aa(9) of the report, the contribution would be used in instalments, in accordance with the applicable investment strategy and budgetary procedure. The fund would seek to attract additional capital from Member States, private investors and the European Investment Bank Group.

Support could take the form of equity investments, loans, guarantees and other risk-sharing instruments. Targeted projects would cover the exploration, extraction, processing, refining, production, recycling and replacement of certain raw materials with alternatives. The Commission would establish the eligibility criteria, investment rules and implementation conditions, while the centre would assess, select, finance and monitor eligible operations.

The contribution to the fund is separate from the centre’s annual operating budget. The report regulates the institution’s revenues and expenditure separately, including staffing and infrastructure, and provides for reporting on committed and paid contributions, additional capital attracted and the fund’s performance.

InvestEU and EIB targets have different bases

The RESourceEU plan of 3 December 2025 separately provided for the mobilisation of approximately €2 billion in additional investment through InvestEU in 2026–2027. The same document referred to European Investment Bank financing of up to €2 billion annually for projects in the sector, through loans and other financial instruments. The bank’s initial statement in March 2025 announced estimated financing of €2 billion for that year.

The investments a mechanism seeks to mobilise, bank financing and the budgetary contribution proposed for the new fund cover different periods and use different calculation methods. The same operation may benefit from several instruments. The figures do not, by simply being added together, provide a total of new money or amounts actually paid.

The Council of the EU has a negotiating mandate approved on 4 March 2026. Once Parliament’s position is established, the institutions must negotiate the final form of the amendments. The establishment of the centre and financing of the fund remain proposals in this process; the vote scheduled for 20 October does not automatically open a funding scheme for applicants.