ICC shares business view on EU Foreign Subsidies Regulation 

The European Union (EU) is seeking to introduce an effective and comparable control mechanism for third-country subsidies. Such a mechanism would apply to companies operating in the EU internal market in addition to the existing state aid and public procurement rules. However, there is still a need to provide greater clarity and legal certainty  to companies, within and outside the EU, that are affected by the new regulation.. 

Why business input on the EU Foreign Subsidies Regulation matters 

As the institutional representative of more than 45 million businesses in over 170 countries, ICC is able to paint a comprehensive picture of the challenges faced by companies operating in the EU internal market.  

In 2022, ICC first gathered business input and comments on the draft EU Foreign Subsidies Regulation allowing for a comprehensive analysis of business concerns and the potential adverse effects of the regulation, such as administrative burdens, competitive disadvantages and lack of clarity.  

In 2023, ICC reacted to the draft Implementing Regulation of the Foreign Subsidies Regulation issued by the European Commission. The regulation introduces new rules and procedures to address distortions caused by foreign subsidies in the EU Single Market.  

By responding to the European Commission’s call for contributions, ICC acknowledged the importance of providing feedback on such regulations given their implications for fair competition, investment and economic activities within the EU.   

What does the global business community think about the EU Foreign Subsidies Regulation? 

The papers and comments, intended for the European Commission, mirror business views on the 2022 draft EU Foreign Subsidies Regulation and the 2023 draft Implementing Regulation of the Foreign Subsidies Regulation. 

In the papers, ICC 

• emphasises concerns about the administrative burden, lack of clarity, and potential disadvantages for foreign companies. 
• urges a more manageable and balanced approach that considers the practicality of information collection, ensures fair competition and provides legal certainty for undertakings, within and outside the EU. 
• acknowledges that further guidance may be provided through guidelines or subsequent notices but stresses the importance of timely clarification to assist companies in complying with the Foreign Subsidies Regulation. 
• suggests including block exemption rules for certain categories of foreign subsidies. 
• emphasises the significance of preserving the EU’s openness to foreign and domestic investments while maintaining clear and streamlined procedures to minimise unnecessary burdens and delays for businesses. 
• calls for clear, predictable and streamlined procedures to minimise bureaucratic hurdles.  
• stresses the need to strike a balance between effective regulation and facilitating economic activities within the EU Single Market. 

While the comments were intended for the European Commission as it seeks to shape the final regulation, the following actors may gain valuable insights from these documents: 

• Companies and businesses operating in the EU internal market, specifically those that might be affected by foreign subsidies 
• Public authorities involved in the implementation and enforcement of the EU Foreign Subsidies Regulation 

Should you have any further questions, please contact us. 

Read ICC’s comments on the 2022 draft EU Foreign Subsidies Regulation  

Read ICC’s comments on the 2023 draft Implementing Regulation of the Foreign Subsidies Regulation