Consultation of the European Commission
on the white paper on foreign subsidies

The European Commission consulted stakeholders on proposals to remedy the distortive effects of foreign subsidies on the EU internal market.

AFEP supports its 3 module-approach as well as the proposals on distortive foreign subsidies in the context of EU funding, and suggests some clarifications and modifications:

  • A strict specialisation of modules to avoid overlapping effects and the development of ex-post controls in particular for merger and acquisition operations, which should with public procurement respectively fall under Modules 2 and 3, while Module 1 should be a subsidiary tool to control the other distorting effects on the internal market;
  • The use of a methodology similar to the one already existing for merger control to better target potentially distortive merger and acquisitions transactions (by notably retaining the notion of control and quantitative thresholds);
  • An alternative two-tier system for public procurement (at Union and decentralised levels) to simplify the conditions for rejecting bids based on distortive subsidies and limit administrative burden.
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