Financial and business news from Bulgaria

European Commission adopts White Paper on foreign subsidies in the Single Market

The European Commission has adopted a White Paper examining the distorting effects caused by foreign subsidies in the Single Market. The Commission is now seeking the views and input of all stakeholders on the options set out in the White Paper. This was announced by the Commission's representation in Bulgaria.
The public consultation, which will be open until 23 September 2020, will help the Commission prepare for relevant legislative proposals in this area.

Subsidies granted by non-EU governments to companies in the EU appear to have an increasingly negative impact on competition in the single market, but fall outside the control of EU State aid. There is a growing number of cases where foreign subsidies appear to have facilitated the acquisition of EU companies or deformed the investment decisions, market operations or pricing policies of their beneficiaries, or distorted public procurement tenders to the detriment of unsubsidized companies.

Existing trade protection rules apply only to exports of goods from third countries and thus do not apply to all infringements caused by foreign subsidies granted by non-EU countries. Where foreign subsidies are either in the form of financial flows facilitating the acquisition of EU companies, or directly support the activities of a company in the EU or support participation in public procurement tenders, there are gaps in regulation. That is why the White Paper proposes solutions and calls for new tools to address this regulatory gap.

Now the White Paper is open for public consultation until 23 September 2020. In the spirit of comments and comments received, the Commission will present relevant legislative proposals to address the distorting effects of foreign subsidies on the single market.