One year ago, the EU Commission proposed a Regulation to protect
EU companies against distorted competition from foreign companies
benefiting from the financial support of their government abroad
(see our previous posts on this topic here).
The Regulation was more than welcomed as EU companies are under
strict state aid control by the EU Commission.
Yesterday (4 May 2022), the EU Parliament and the Council agreed on
their negotiating positions. They seem to endorse the main
principles underlying the Regulation and negotiations are likely to
focus on technical elements such as:
- exact amount of the companies' turnovers triggering the EU
Commission's right to investigate a foreign takeover;
- value of a public procurement where a foreign company's
participation could call for investigation;
- involvement of the Member States' national authorities in the
review of distortive foreign subsidies; and
- period during which the EU Commission may investigate subsidies
granted before the entry into force of the Regulation (5/10
years?).
The Regulation on foreign subsidies could be fairly quickly adopted
by the two EU co-legislators.
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