The EU finally has strong rules against unfair foreign subsidies on its own market!



Promoting an open, rules-based and assertive EU trade policy with a strong toolbox is a priority for Renew Europe. After the International Procurement Instrument came into effect a few weeks ago, Renew Europe now warmly welcomes today’s adoption of the Foreign Subsidies Instrument by the European Parliament.

There are strong rules on state aid on the internal market. However, these rules did not cover subsidies granted by foreign governments to companies operating on the EU internal market. The result was that fair competition within the internal market could easily be affected by certain companies, for instance from other countries. The crucial aim of this regulation is to avoid such distortions which have critical consequences for the competitiveness of our own companies, in particular our SMEs. The EU will now be able to act if a distortion caused by unfair foreign subsidies has been found.

Renew Europe successfully called for strong measures that give the possibility to block procurement tenders or takeover, as well as the need to look closely at possible distortions by state-owned enterprises, and the potential impact on strategic sectors.

Catharina Rinzema (VVD, Netherlands), Renew Europe shadow rapporteur on this regulation in the committee on International trade (INTA), declared: "We need fair competition for our European companies on the internal market. That means a level-playing field with the same rules for everyone, whether you are a European or a foreign company. That is why today's adoption of a Foreign Subsidies Instrument is so crucial. If for stance a Chinese foreign state-owned enterprise distorts our market, we will now have the possibility to block a tender or a takeover. It is important to stand up against government support that leads to unfair competition here, not only from China but also from other countries."

Stéphanie Yon-Courtin (Europe Ensemble, France), Renew Europe coordinator of the committee on Economic and Monetary Affairs (ECON) and rapporteur on this file in ECON, added: “This is the end of the Europe naïve regarding its international partners. Today, we make sure that all companies - European and foreign - operating in our internal market will play by the same rules. This regulation gives us the right tools to prevent unfair competition from foreign companies that benefit from massive subsidies while we have a strict state aid control in the single market.


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