The European Union is developing new regulations to reduce its economic dependence on China, requiring European companies to source critical components from at least three different suppliers. According to reports from Politico and the Financial Times, the European Commission has instructed relevant bodies to draft a more ambitious and effective trade defense policy to protect the bloc's industrial base from external pressures.
Operative Information Center-OMM reports that the proposed measures include setting a 30% to 40% cap on the volume of products a company can procure from a single supplier, specifically targeting the chemical and industrial equipment sectors. These plans are scheduled for internal discussion among Commission members on May 29, followed by further deliberation at the EU Leaders' Summit in Brussels on June 18. The initiative also explores a "capacity surplus tool" to counter market distortions caused by state-supported companies, though officials acknowledge potential conflicts with World Trade Organization (WTO) non-discrimination rules.
This strategic shift comes as Brussels seeks to avoid a repeat of the energy dependency crisis experienced following the Russia-Ukraine conflict. Recent export restrictions imposed by Beijing on rare earth elements and magnets have heightened supply chain concerns across Europe. With the EU's trade deficit with China reaching approximately €360 billion in 2025, officials argue that state-subsidized Chinese exports are placing unsustainable pressure on European steel, automotive, and clean technology sectors, leading to production losses and reduced employment across the continent.
