This regular alert covers key regulatory developments related to EU emergency responses, including in particular, to COVID-19, Russia's war of aggression against Ukraine, and cyber threats. It does not purport to provide an exhaustive overview of developments.
This regular update expands from the previous COVID-19 Key EU Developments – Policy & Regulatory Updates (last issue No. 99).
LATEST KEY DEVELOPMENTS
Competition & State Aid
- Council of the European Union approves European Chips Act
- Foreign Subsidies Regulation becomes applicable / European Commission publishes practical guidance
- European Commission approves further schemes under new Temporary Crisis and Transition Framework to support economy in context of Russia's invasion of Ukraine and accelerating green transition and reducing fuel dependencies
- European Commission approves further scheme to compensate for damage due to COVID19 crisis
Trade / Export Controls
- Council of the European Union prolongs and expands sanctions against Russia
- European Parliament issues Briefing on proposed Directive on violation of EU sanctions
- European Commission releases reporting rules for transitional phase of CBAM Regulation (Carbon Border Adjustment Mechanism)
Medicines and Medical Devices
- Recommendations for actions to avoid shortage of key antibiotics issued by European Commission, Heads of Medicines Agencies and European Medicines Agency
- Report published on EMA/ETF Workshop on Lessons Learned on Clinical Trials in Public Health Emergencies
Cybersecurity, Privacy & Data Protection
- European Parliament and Council move forward on draft Cyber Resilience Act
- European Commission publishes Communication on a common European tourism data space
COMPETITION & STATE AID
|Council of the European Union approves European Chips Act (see here)||
On 25 July 2023, the Council approved the Regulation establishing a framework of measures for strengthening Europe's semiconductor ecosystem (European Chips Act).
To recall, the Chips Act is part of the Commission's package of measures released in February 2022 (see here) aimed at ensuring the EU's security of supply and technological leadership in the field of semiconductors (see also Jones Day COVID-19 Update No. 76 of 9 February 2022; and Jones Day Commentary, EU Chips Act: The EU's Push for Semiconductor Autonomy, March 2022). (Micro-)chips or semiconductors are described as the "DNA of modern technology", with chip demand anticipated to double between 2022 and 2030, and the semiconductor industry's value expected to reach some $1 trillion by 2030 (see Council infographic on proposed Chips Act).
In announcing its adoption of the Chips Act, the Council stated its view that Europe is currently "too dependent on chips produced abroad, which became even more evident during the COVID-19 crisis. Industry and other strategic sectors such as health, defence and energy faced supply disruptions and shortages."
The Chips Act seeks to respond to these perceived critical dependencies and contains three main pillars:
(i) The Chips for Europe Initiative aims at supporting large-scale technological capacity building. Notably, the planned Joint Chips Undertaking (a public-private partnership involving the EU, Member States, and the private sector) will undertake the selection of centers of excellence as part of its work program. The Council also passed an amendment to the Regulation establishing joint undertakings under Horizon Europe on 25 July 2023 to enable the establishment of this Chips Joint Undertaking, which builds on and renames the existing key digital technologies joint undertaking.
(ii) A framework to ensure security of supply seeks to spur investment and enhance production capacities. In particular, "first-of-a-kind" facilities, including those producing equipment used in semiconductor manufacturing, are expected to reinforce the EU's security of supply and can benefit from fast-tracked permit granting procedures.
On the funding of "first-of-a-kind" facilities, Executive Vice-President and Competition Commissioner Margrethe Vestager earlier commented that these require large investments that private investors cannot fund on their own, such that the Commission believes that it may be justified to cover up to 100% of a proven funding gap with public resources. She specified the Commission's view that such funding does not require creating new, modified, or "bended" rules. Rather, the Commission must assess projects directly on the Treaty in seeking to avoid any competition distortions and to avoid a subsidy race in Europe and elsewhere.
(iii) A monitoring and crisis response coordination mechanism will seek to anticipate supply shortages and provide responses in case of crisis. For example, early warning indicators in Member States will be used to trigger an EU-wide shortage alert. Such mechanism will allow the Commission to implement emergency measures such as prioritizing the supply of products
particularly affected by a shortage, or carrying out common purchasing for Member States. These would be last-resort measures in the event of a crisis in the semiconductors sector.
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