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Parliament and EU governments reach deal to clamp down on unfair foreign competition to better protect European companies and jobs


01 Jul 2022


Social Europe & Jobs

Last night, the European Parliament reached a political agreement with EU member states on a new EU instrument to deal with foreign subsidies distorting the internal market. This new tool would empower the Commission to investigate cases, to require remedies such as repayments of subsidies or even impose fines. Together with the International Procurement Instrument, screening of foreign investments, the anti-coercion instrument and the ban on dual-use goods, this new instrument will equip the EU with a toolbox to defend European companies  and jobs from unfair competition.

The S&D Group managed to keep the thresholds low enough to be meaningful and cover as many financial contributions in public procurement procedures as possible.

As strongly advocated by our Group, these thresholds will be subject to the Commission’s Delegated Acts with the possibility to raise or lower them. This will give the EP the power to adopt or reject the Commission’s proposal.

The S&D negotiator also defended a meaningful review clause to allow the legislators to allow for the timely fine-tuning of the instrument.

Inmaculada Rodríguez-Piñero MEP, negotiator and newly elected S&D coordinator for trade, said:

“It’s high time we equipped the EU with an effective tool to investigate, redress and block unfair competition from foreign companies. Today, European companies must comply with strict rules on state aid, while non-EU competitors can benefit from foreign subsidies giving them an unfair advantage. Beefed up with state money, companies can offer lower prices to win public procurement contracts or pay higher prices for taking over other companies. That is simply unfair. With this new instrument, we want to close this legal loophole and level the playing field.

"The S&D Group fought especially hard for low and fair thresholds for public procurement bids. When public money is spend it is crucial to ensure that it does not go to companies who are not playing fair, at the expense of European companies and jobs.

“Thanks to tonight's agreement the Commission will soon have an effective tool in their hands to tackle unfair play. The Commission will be empowered to investigate cases, require the repayment of subsidies and even impose fines. This new instrument to clamp down on unfair foreign subsidies will further complement our toolbox to better defend Europe's interests.”

Note to editors:

The political agreement will be voted on by the full plenary of the European Parliament in September.