European Parliament urges early review of foreign subsidies legislation

 

European Parliament urges early review of foreign subsidies legislation

 

Members of the EU Parliament warn that the Commission should assess its proposed new regulation to tackle distortive foreign subsidies within three years.  This is fuelled by concerns that there is currently insufficient data to show how such measures may be affecting the internal market.

The Parliament’s Committee on the Internal Market and Consumer Protection (IMCO) met on 25 January to discuss its draft opinion on the Commission’s suggested amendments to the proposed legislation on foreign subsidies.

The Commission published its draft legislation in May 2021.  The Commission would be able to investigate transactions involving financial contributions by a non-EU state where the target company’s EU turnover is at least EUR500 million and the foreign contribution is at least EU50 million.  This would enable the Commission to examine foreign economic assistance that could harm competition.

The IMCO’s draft opinion says that the Commission should review the economic effects of regulation on the internal market and the number of notified and investigated cases each year.  It has further proposed a provision on cooperation with national public procurement authorities. It recommends that the national authorities should information the Commission of any foreign subsidies that fall below the thresholds for notification and which threaten the internal market.  It also advises that the national authorities should collect and share with the Commission data on contracts bid for and won by foreign entities.

The legislation itself, the IMCO’s amendments and the reservations expressed by the Parliament reflect an increasing intensity in its vigilance to seek long-arm jurisdiction on deals involving third countries which it considers have impacts in the internal market.

https://www.europarl.europa.eu/meetdocs/2014_2019/plmrep/COMMITTEES/IMCO/PA/2022/01-25/1245928EN.pdf