On 30 June 2022, the Council and the European Parliament reached a provisional political agreement on the regulation on foreign subsidies distorting the EU’s internal market (the Regulation). The Regulation will allow the European Commission (the Commission) to review subsidies granted by non-EU countries to companies and industries operating in the single market.

The Regulation, due to come into force in mid-2023, will represent an additional and complex regulatory hurdle for all parties (whether or not based in the EU) before they can:

  1. complete certain acquisitions in the EU, in addition to the pre-existing EU and Member State merger control and foreign direct investment (FDI) requirements
  2. participate in certain public procurement tenders

There will also be a general market investigation tool allowing the Commission to review smaller acquisitions and public procurement processes, as well as other situations involving potentially disruptive foreign subsidies.

Our A&L Goodbody briefing paper looks at the practical implications of the Regulation in more detail.