19 Jul 2022

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Political agreement on the Foreign Subsidies Regulation

The European Parliament and the Member States reached a political agreement on 30 June on the Regulation on foreign subsidies distorting the European internal market proposed by the Commission.

This Regulation forms part of the EU's instruments to ensure a level playing field for all operators in the EU market. Indeed, without such Regulation, foreign subsidies are largely unchecked, while subsidies granted by Member States are subject to strict and rigorous scrutiny. This Regulation will allow the Commission to investigate foreign subsidies granted by non-EU countries to companies operating within the European internal market.

Companies receiving foreign subsidies will therefore have to notify concentrations and bids in public procurement procedures that reach certain thresholds. Such concentrations cannot be completed and an investigated bidder cannot be awarded the contract until cleared by the Commission.

In order to enforce this obligation, the Commission will have the power to impose fines and prohibit a subsidised merger or the award of a public contract to the subsidised bidder.

The Regulation will enter into force once it is formally adopted by the Council and the Parliament and published in the Official Journal. The Regulation will become directly applicable across the EU 6 months after entry into force.

For further information: Commission’s press release