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The EU Foreign Subsidies Regulation: Journal Artikel

Substantive Assessment Issues and Open Questions

Morris Schonberg

European State Aid Law Quarterly, Jahrgang 21 (2022), Ausgabe 2, Seite 143 - 152

The EU Institutions have now reached political agreement in relation to the Foreign Subsidies Regulation, a potentially far-reaching instrument that effectively creates a new subsidy control regime for non-EU subsidies affecting the EU's internal market. This article addresses the key substantive assessments that the European Commission will need to consider when investigating foreign subsidies under the Regulation, namely: (i) the existence of a ‘foreign subsidy’; (ii) whether the subsidy causes a ‘distortion’ in the internal market; (iii) whether the negative effects in the internal market may be balanced by any positive effects of the subsidy; and (iv) the determination of redressive measures or commitments required to address the distortions. It identifies a number of significant open issues and questions that could have a substantial effect on how the Regulation operates and ultimately, its impact in practice on competitive conditions within the internal market. Keywords: foreign subsidies; WTO; distortion; balancing; redressive measures


The Foreign Subsidies Regulation: Journal Artikel

Countering State Aid Beyond the European Union

Raymond Luja

European State Aid Law Quarterly, Jahrgang 20 (2021), Ausgabe 2, Seite 187 - 199

The European Commission proposed a Regulation to deal with the effects of foreign subsidies on the internal market. Undertakings involved in large mergers, acquisitions and upcoming joint ventures or those in the lead of submitting a tender may have to notify foreign subsidies directly or indirectly received in future. The proposal also allows the Commission to launch investigations into other foreign subsidies that distort the internal market. This contribution discusses both the material and formal framework as proposed and takes a first look at parallels and differences with the State aid regime governing intra-EU government subsidies, including guarantees and special tax treatment. The author recommends, inter alia, to clarify the concepts of ‘undertaking’ and ‘interim measures’, to limit notification to selective subsidies in the context of tenders, and to restrict the retroactive effect of the notification requirement in light of the administrative burden involved. Further suggestions to increase consistency and legal certainty have been included as well. As the new obligations imposed on undertakings may affect future public procurement procedures and concentrations, they should be given sufficient attention in time in order not to delay such procedures and to avoid fines or redressive measures. Keywords: foreign subsidies; common commercial policy; redressive measures; mergers; public procurement.

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