On December 15 local time, European Commission Executive Vice-President and Commissioner for Trade and Economic Security, Maroš Šefčovič, stated in an interview with Bloomberg Television that China has begun issuing longer-term rare earth licenses, enabling European companies to access critical mineral resources essential for industries such as clean technology, automotive manufacturing, and defense contracting.
"We have initial reports from the industry that they are obtaining these general licenses, but we need more detailed information to assess the entire process," he said.
EU officials believe that licenses valid for one year will help alleviate bottlenecks in the application process, which had threatened the normal operations of German automakers and other critical industries.
"The idea received positive feedback, and it seems we have secured the first batch of general licenses. The Chinese side also appears to have accepted our argument that the procedures established in April were overly cumbersome," Šefčovič added.
In a report published that day, Bloomberg noted that the European Commission, the EU's executive body responsible for trade negotiations, has intensified efforts in recent years to seek general licenses for rare earths. Once issued, such licenses would allow companies to repeatedly export rare earths to pre-approved buyers over a certain period.
Šefčovič explained that under the previous procedures, companies had to submit materials, including photographs and detailed information about supply chains, that even national regulatory authorities did not require.
The general license system is one solution the European Commission believes can address this issue. Šefčovič noted that since April this year, the Chinese side has approved approximately 70% of license applications, up from the earlier estimate of 50%.
Previously, China established an export licensing system to regulate the shipment of certain critical minerals, including rare earths. As China controls nearly the entire production of rare earths, this move has caused concern among industries in Europe, the United States, and other regions.
In late October this year, China and the United States held economic and trade consultations in Kuala Lumpur and a summit meeting in Busan, with rare earths being a focal topic.
Following the meetings, a spokesperson for China’s Ministry of Commerce responded to media inquiries about the joint arrangements from the China-U.S. Kuala Lumpur economic and trade consultations. The spokesperson stated that China would suspend the export control measures announced on October 9 for one year and would refine specific plans. The White House also released a document outlining the outcomes of the discussions.
However, according to Hong Kong’s South China Morning Post, after the White House released its document on November 1, the EU assessed that China’s suspension of rare earth and other critical mineral export controls, as announced by the U.S., did not cover EU industries.
Bloomberg reported that while the agreement eased pressure on the global rare earth supply, the licensing system China introduced and implemented in April this year remains in effect.
A report released earlier this year by the National University of Singapore pointed out that China’s dominance in certain heavy rare earth materials is "almost absolute." These elements are crucial for future industries such as robotics, automation, advanced defense, electric vehicles, and green energy technologies.
Against this backdrop, the EU has frequently engaged with Chinese representatives to clarify the situation.
According to a notice on the Ministry of Commerce website, from October 31 to November 1, Jiang Qianliang, Director-General of the Bureau of Security and Control under the Ministry of Commerce, met with Guillaume Radegonde, Deputy Director-General of the Directorate-General for Trade of the European Commission, in Brussels for an "upgraded" China-EU export control dialogue and consultation. The two sides conducted in-depth and constructive discussions on concerns in the export control field and agreed to maintain communication and exchanges to promote the stability and smooth flow of China-EU industrial and supply chains.
At a press conference on November 3 local time, the European Commission confirmed that, although the EU believes China’s suspension of the expanded export restrictions from October covers "global" industries, it is still negotiating details with China regarding related matters. The following day, on November 4, the European Commission stated that EU and Chinese officials had discussed general licenses, seeking China’s relaxation of rare earth exports to the EU.
China has made its position clear on the rare earth issue. On October 21, during a video meeting with Šefčovič, China’s Minister of Commerce, Wang Wentao, stated that China’s recent measures regarding rare earth export controls are part of the normal process of improving China’s export control system in accordance with laws and regulations, reflecting China’s role as a major country in maintaining world peace and stability. China is committed to safeguarding the security and stability of global industrial and supply chains and has been providing facilitation for EU companies in the approval process.
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