EU Geopolitical Risk Update - Key Policy & Regulatory Developments No. 124

COMPETITION & STATE AID

On 23 November 2025, the Commission announced the approval of a €450 million Czech State aid measure to support US chipmaker Onsemi in building the European Union's first integrated chip manufacturing plant for Silicon Carbide ("SiC") power devices* in Ro~nov pod Radhoatěm, Czech Republic. The State aid will take the form of a €450 million direct grant to Onsemi to support the company's €1.64 billion investment.

Basis. The Commission's assessment was based on Article 107(3)(c) TFEU (which enables Member States to grant aid to facilitate the development of certain economic activities subject to certain conditions) and on the principles set out in the European Chips Act, which entered into force on 21 September 2023 (Regulation (EU) 2023/1781 of 13 September 2023 establishing a framework of measures for strengthening Europe's semiconductor ecosystem).

To recall, the Chips Act is part of the Commission's package of measures released in 2022 (see here) aimed at ensuring the EU's security of supply and technological leadership in the field of semiconductors. (Micro-) chips or semiconductors are key building blocks for digital products, e.g., smartphones, computers, and medical equipment (see also Jones Day EU Emergency Response Update No. 107 of 29 September 2023).

The Commission also deemed the Czech measure as in line with the objectives of the Political Guidelines for the European Commission 2024- 2029, which encompass boosting investment in innovative technologies (e.g., semiconductors, supercomputing, quantum computing) to ramp up Europe's competitiveness.

Assessment. According to the Commission's assessment of the Czech measure, the State aid to Onsemi will contribute to both reinforcing the EU's technological autonomy in semiconductor technologies and to accelerating the digital and green transitions. In particular, the Commission deemed the Onsemi facility as:

• first-of-a-kind, as the plant will use innovative manufacturing technologies and will aim to manufacture products with superior performance, which are currently not present in Europe; and
• contributing to security of supply in Europe (e.g., by committing to comply with priority-rated orders to produce in Europe in case of a supply crisis and by helping to halt overreliance on semiconductor devices manufactured outside of Europe).

This State aid measure is the Commission's eighth approval based on principles set out in the Chips Act, with earlier measures including, for example, the Commission's approval on 18 December 2024 of a €1.3 billion Italian State aid measure to support Silicon Box in constructing a semiconductor advanced packaging and testing facility in Novara, Italy (see Jones Day EU Emergency Response Update No. 119 of 31 December 2024).

Looking ahead. The new facility is expected to start commercial operations by 2027.

The non-confidential version of the decision will be made available under case number SA.117291 in the State aid register on the Commission's competition website after addressing confidentiality issues.

* SiC power devices are vital to enabling efficient, compact, high-performance power electronics used in electric vehicles, fast-charging stations, renewable energy generation, and other industrial applications. The integrated Onsemi plant aims to cover all manufacturing steps, from SiC crystal growth to finished devices.

On 14 October 2025, the Commission published its Evaluation of the EU Public Procurement Directives*, a first step towards their planned revision. The Evaluation, spanning 2016 to 2024, is based on EU and Member State procurement data, as well as other sources such as studies contracted by the Commission and stakeholder input.

Backdrop / objectives. The Evaluation indicates that public authorities in the EU spend over €2 trillion per year (representing some 15% of GDP) on purchasing services, works and supplies in sectors such as energy, transport, healthcare, and education.

Last reformed in 2014, the Public Procurement Directives aim to ensure transparency and integrity in public spending and strengthen competition in the EU for the provision of public goods and services with respect to highervalue public tenders (with monetary values exceeding certain thresholds)** and which are presumed to be of cross-border interest.

The Evaluation states that it takes place against the background of a changed geopolitical and global trade landscape, the EU's shortcomings in economic competitiveness, and the need to foster resilience of the EU's economic infrastructure and sustainability goals.

To recall, the Commission's planned revision of the Public Procurement Directives, as set out in its Political Guidelines 2024-2029 issued by Commission President Ursula von der Leyen, seeks to:

• enable giving preference to European products for certain strategic sectors in public procurement;
• ensure EU security of supply for vital technologies, products and services; and
• modernize and simplify EU public procurement rules, in particular for EU start-ups and innovators.

The Commission's plan to give preference to European products in certain strategic sectors has already raised the concerns of, inter alia, U.S. companies active in Europe.

Evaluation's findings. The Evaluation notably states its view that the Public Procurement Directives have only partially met their objectives, e.g.:

• There are shortcomings in the advancement of legal clarity, flexibility, and simplification. Procedures are still viewed as too complex and rigid, thereby impeding contracting authorities from effectively attaining their public investment objectives;
• While transparency has improved and contract values have doubled, data gaps impede compliance checks and corruption risks persist; and
• Direct cross-border procurement – where the successful bidder is not located in the same Member State as the contracting authority and the bidder is not domestically owned – remains limited.

According to the Evaluation's conclusions, the current public procurement framework lacks the agility, coherence, and strategic focus needed to effectively tackle current and emerging challenges.

Next steps. On 3 November 2025, the Commission opened a consultation, seeking input and evidence from stakeholders to further inform the ongoing review of the Public Procurement Directives.

The consultation runs until 26 January 2026, and feedback will contribute to preparing a legislative proposal anticipated for release in Q2 2026.

* Commission Staff Working Document SWD(2025) 332 final of 14 October 2025 – Evaluation of Public Procurement Directives comprising (i) Directive 2014/24/EU on public procurement; (ii) Directive 2014/25/EU on procurement by entities operating in the water, energy, transport and postal services sectors (Utilities Directive); and (iii) Directive 2014/23/EU on the award of concession contracts

The Commission approved additional measures under the Clean Industrial Deal State Aid Framework (CISAF) of 25 June 2025 (see also Jones Day EU Geopolitical Update No. 122 of 31 August 2025). The CISAF is a key component of the Commission's Clean Industrial Deal: A joint roadmap for competitiveness and decarbonization of 26 February 2025, which aims to support the EU manufacturing industry's competitiveness and resilience, while accelerating decarbonization.

The CISAF replaces the Temporary Crisis and Transition Framework (TCTF)* and sets out streamlined rules aimed at the simplified and swifter approval of priority State aid measures that seek to accelerate Europe's competitiveness and green transition goals (e.g., accelerating renewable energy rollout; facilitating industrial decarbonization and energy-efficiency projects; ensuring sufficient EU manufacturing capacity for net-zero technologies; and easing private investment risk).

The Commission Staff Working Document of 4 November 2025, accompanying the CISAF, also sets out main policy choices taken and the main evidence and experience that the Commission considered when adopting the CISAF.

Among the most recently approved State aid schemes under the CISAF and deemed in line with the objectives of the Clean Industrial Deal (up to 30 November 2025):

• €219 million Italian scheme to support clean technology manufacturing capacity in the region of Lazio, contributing to the transition towards a net-zero economy;
• €700 million Spanish scheme to support strategic investments that add clean technology manufacturing capacity in Spain, contributing to the transition towards a net-zero economy; and
• €61.5 million Italian scheme to support strategic investments that add clean technology manufacturing capacity in the region of Emilia Romagna, contributing to the transition towards a net-zero economy.

Looking ahead. The CISAF, applicable since 25 June 2025, will remain in force until 31 December 2030.

* The TCTF was established in 2022 to support the EU economy in the context of Russia's invasion of Ukraine and in sectors key to accelerating the green transition and reducing fuel dependencies.

From March 2022 to June 2024, nearly €796 billion of aid was approved either under the TCTF or directly under the Treaty and based on TCTF principles (see also the Commission brief on the use of State aid measures under the TCTF of 20 February 2025, here).