Commission provides guidance on Foreign Subsidies Regulation

The European Commission has published a Staff Working Document (‘SWD'), clarifying how it will determine when a foreign subsidy distorts the internal market and how it will apply the balancing test under the Foreign Subsidies Regulation (‘FSR').

The SWD consists of a series of questions and answers providing initial clarifications on the assessment of distortions caused by foreign subsidies in the internal market and on the application of the balancing test. In particular, the SWD offers initial guidance on the interpretation and assessment of the concept of distortion in both concentrations and public procurement procedures. It also clarifies the Commission's approach to subsidies most likely to distort the single market, notably unlimited guarantees. Furthermore, the SWD explains the Commission's approach to the balancing test and its potential impact on the outcome of an investigation.