- within Government and Public Sector topic(s)
- with readers working within the Utilities industries
- within Government, Public Sector, Intellectual Property and Immigration topic(s)
- in South America
On 9 January 2026, the European Commission published Guidelines on the interpretation of certain concepts essential to the application of the Foreign Subsidies Regulation.
The Foreign Subsidies Regulation is intended to regulate subsidies that are granted by third countries and that are deemed to distort competition within the internal market.
The Guidelines clarify:
– How the Commission will carry out the assessment of
"distortions" – briefly, it will first examine if
the foreign subsidiary strengthens the company's competitive
position within the European Union, and secondly, it will consider
the impact on competition.
– How the Commission will assess distortions within the
sphere of public procurement procedures – firstly, the
Commission will assess whether the company in question has utilized
the foreign subsidiary in designing its bid; if the answer is in
the affirmative, the Commission will assess whether the bid is
unduly advantageous. If that is the case, the Commission will then
consider whether the advantage stems from the foreign subsidy or
from other elements.
The Commission also clarifies how the balancing test in Article 6 of the Foreign Subsidies Regulation will be applied. The Guidelines also introduce new safe harbours from call-in procedures, essentially clarifying that in the case of low value public procurement procedures subsidies below EUR 4 million, and subsidies addressing certain extraordinary circumstances, will not be subject to a call-in procedure for evaluation.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
