Foreign Subsidies Regulation

The Foreign Subsidies Regulation (Regulation (EU) 2022/2560) aims to ensure a level playing field in the EU internal market by addressing distortive foreign subsidies granted by non-EU governments to companies operating in the Union. The purpose of the FSR is to address the most distortive foreign subsidies in the EU in concentrations and public procurement procedures to ensure a level playing field.

The Regulation established three tools for the Commission to investigate financial contributions by a public authority in non-EU country:

  • one ex officio market investigation tool to investigate all other market situations as well as mergers and public procurement tenders below the notification thresholds. The Commission may also initiate a market investigation into an entire sector, a particular type of economic activity or a specific subsidy instrument where it reasonably suspects that foreign subsidies are distorting the internal market.
  • two (prior authorisation) notification tools to ensure a level playing field for (1) the large mergers (at least €500 million) and (2) bids in large-scale public procurement procedures (at least €250 million).

International Procurement Instrument

The International Procurement Instrument (Regulation (EU) 2022/1031) aims at increasing the level playing field in public procurement by mirroring the treatment of EU companies in a third country and applying a similar treatment to that third country’s companies inside Europe:

  • if EU companies can access the 3rd country market, 3rd country companies can access the EU market;
  • if no access in third country, price penalty or no access in the EU;
  • if serious and recurrent access restrictions, then price penalty or no access in the EU. 

The Regulation aims to limit access to the EU procurement market to companies from countries that seriously and recurrently impair access to their procurement markets for Union economic operators.