EU adopts Foreign Subsidies Regulation to protect Single Market
Measure in Brief
The Foreign Subsidies Regulation gives the European Commission powers to investigate financial contributions from non-EU authorities that may confer an unfair advantage and to redress distortive effects. It establishes three tools: ex-ante notification for concentrations meeting an EU turnover threshold of €500 million and foreign contributions above €50 million, ex-ante notification for procurements with estimated value at least €250 million and foreign contributions of at least €4 million per non-EU country, and a general ex-officio investigation tool, and failure to notify can lead to fines up to 10% of annual aggregated turnover.
Who Is Affected
The Regulation applies across all sectors and to subsidies granted by any non-EU country, targeting financial contributions that benefit companies engaging in economic activity in the EU. Enforcement lies exclusively with the Commission, with Member States consulted through an advisory committee.
What Comes Next
The Regulation will start to apply on 12 July 2023 and the notification obligation will take effect from 12 October 2023, and the Commission will present a draft Implementing Regulation ahead of application.
Sources
Official Documents
- Questions and Answers: New Regulation to address foreign subsidies distorting the Single Market The EC explains the Foreign Subsidies Regulation, establishing ex-ante notification for large concentrations and public procurements, an ex-officio investigation tool, and potential remedies to address distortive foreign subsidies, with enforcement starting in mid-2023.
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