The European Commission will propose a law next week that requires that when public funds are used to support key strategic technologies, a minimum share of these products be "made in Europe".
Here's what you need to know.
The "Made in Europe" plan is part of a broader EU effort to help local industries compete with manufacturers in China and other countries where they do not face strict European regulations and higher energy prices.
By prioritizing European-made goods in public procurement, the EU will seek to use the huge financial potential of its members' public procurement - which amounts to more than 2 trillion euros ($2.37 trillion), or 14% of the EU's economic output - to support local industries.
The "Industrial Accelerator Act", to be published on February 26, will set requirements for EU-made content and low carbon emissions for products purchased through public procurement or subject to production subsidies, according to a draft seen by Reuters.
The proposed rules cover "key strategic sectors" including batteries, solar and wind power, hydrogen production and nuclear power plants.
Each technology has specific requirements set in Europe. For example, for solar panels, the inverter and two other key components must be manufactured in Europe after one year, increasing to three key components after another two years.
Electric vehicle manufacturers purchased or leased through public procurement will have to ensure that their vehicles are assembled within the Union and that 70% of their components - measured by value and excluding the battery - are made in Europe.
Aluminium producers benefiting from subsidies will face a minimum of 25% for European-made and low-carbon products, and a minimum of 5% for concrete.
The draft also proposes a voluntary label on the greenhouse gas intensity of steel to make lower-carbon products more visible.
The draft proposal will also set conditions for foreign investments of more than €100 million in strategic sectors where the investor is from a country that controls at least 40% of the global production capacity of that sector.
The criteria include the requirement that the foreign investor cannot own a majority stake in an EU company and that the investor licenses its intellectual property to the EU investment.
The hotly debated proposal has already been delayed twice and could change before its publication by the European Commission, as well as later when EU countries and the European Parliament agree on the final law.
A key question is how to define "made in Europe". The draft is in line with the European Economic Area, which covers the 27 EU member states, Iceland, Liechtenstein and Norway, but excludes the UK.
But it also says the Commission could add other "trusted partners" in the future, including those that have reciprocal international commitments, such as the World Trade Organization's Government Procurement Agreement, or that contribute to the EU's competitiveness and security objectives.
The draft foresees some exceptions - for example, it could remove the "made in Europe" requirement if a product is produced by only one company worldwide or if switching to made in Europe would be at least 30% more expensive.
The plans enjoy strong support from France, whose European Commissioner Stephane Séjourn is responsible for drafting the law.
A large part of European industry also supports the plan, with more than 1,100 business leaders signing its article published this month. However, car manufacturers were absent, reflecting concerns that the "made in Europe" definition would shut out their sprawling global supply chains.
German Chancellor Friedrich Merz also struck a cautious tone, telling an industry event last week that European preference rules should be a "last resort" and proposing a "made with Europe" approach that could include other trading partners.
Some governments are more critical. Sweden and the Czech Republic have warned that the plans could deter investment and raise prices in Europe.