/ world today news/ The European Commission proposed to limit the access of foreign state-owned companies and enterprises that receive large foreign state subsidies to tenders and large investments in EU countries. This was stated in Brussels on Wednesday by the deputy head of the European Commission, Margrethe Vestager, presenting the EC’s proposals for finalizing the EU’s Industrial Strategy.
“The EU has very strict regulations on the granting of state aid to European companies. Therefore, we must protect the European market from foreign companies receiving significant state subsidies. These companies must be obliged to notify us at the European Commission of their state funding and we will take decision whether to admit them to transactions. If they withhold information or provide false data, they will be deprived of the opportunity to participate in transactions, “she said.
“We are certainly open to all companies, but we must be able to intervene in case of excessive influence of foreign subsidies in the specific transactions of our market,” said Thierry Breton, European Commissioner for the Internal Market.
Standards for correcting distortions in the EU Single Market
As part of the renewal of the EU Industrial Strategy, the European Commission proposed the adoption of the so-called Regulation to correct distortions in the EU’s single market resulting from the impact of foreign state subsidies.
Within the framework of this mechanism, the European Commission intends to check for the presence of foreign state subsidies, first, the merger or acquisition transactions of European companies, if their annual turnover exceeds 500 million euros and if the amount of foreign investment in the transaction is at least 50 million euro.
In second place are tenders in the field of public procurement in EU countries, if the amount of the offer involving foreign players exceeds 250 million euros. Thirdly, any other transactions and other “market situations” in which the European Commission will be able to “independently” launch” an investigation of foreign actors for obtaining state aid for them.
In the first two categories, where specific financial thresholds are set, foreign companies will have to independently notify the European Commission if they have received state subsidies from non-EU governments. Without the conclusion of the European Commission, such a deal cannot be completed.
Now this proposal of the European Commission will have to be discussed by the EU countries, after which it has to be approved by the Council of the EU.
Dependence on the import of high-tech products
According to the proposals, the European Union should explore the possibilities of reducing its strategic dependence on the import of high-tech products, energy resources and ingredients for the pharmaceutical industry. “The EU is the largest exporter and importer, but the pandemic has highlighted numerous areas where the EU is strategically dependent on imports. Correcting this situation will make our single market more resilient,” Vestager said.
According to research conducted by the European Commission, out of 5,200 categories of goods imported into the EU, the community is “heavily dependent” on imports of 137 categories, which together represent 6% of European imports. The European Commission noted that the European Union depends on the import of high-tech products, energy resources, ingredients for the developed European pharmaceutical industry.
It was with the shortage of medicinal ingredients that the pharmaceutical companies explained their inability to fully fulfill the contracts for the supply of vaccines against the coronavirus to the EU countries.
In these areas, the EC proposes to further diversify foreign supply chains, as well as to tackle import substitution, in particular through the creation of industrial alliances aimed at making up for the deficit of the EU’s own production on its territory or abroad, for enterprises , controlled by European business.
Translation: V. Sergeev
#proposed #limit #access #investments #foreign #companies
