The proposed regulation on foreign subsidies fills an important gap. However, it is crucial to ensure that the regulation is proportionate and does not lead to undue administrative burden or constitute a barrier to trade.
The rapporteur for the European Commission’s proposed regulation on foreign subsidies, Christophe Hansen (EPP, Luxembourg), has presented his draft report to the European Parliament’s responsible Committee on International Trade (INTA). The Confederation of Swedish Enterprise welcome the general approach that the rapporteur has taken, as well as the reasoning why the overall aim and design of the proposal is suitable. However, it is crucial to ensure that the regulation is proportionate and does not lead to undue administrative burden or constitute a barrier to trade.
The Rapporteur is focusing on the overall efficacy of the instrument, and to make sure the instrument does not lead to excessive administrative burden. The Confederation of Swedish Enterprise would here like to draw the attention to the underestimate in the Commission’s impact assessment in relation to the suggested requirement to notify bids in large procurements. As we have described previously, the Commission bases its calculation on the number of contract award notices.
Contract award notices are, however, not in itself a good proxy for the number of bids, as they include several contracts and several economic actors. The number of contracts, ie. the number of companies, that would be hit by this requirement, are in fact significantly higher. Most companies hit by higher administrative burden and uncertainty are EU-based companies. This also means that the power of the ex officio instrument, that both we and the Rapporteur values highly, are in danger.
The Confederation of Swedish Enterprise does not believe that the solution to this problem is to include a possibility to engage in pre-notification discussions with the Commission or to make minor adjustments to the threshold. It is instead necessary to change the use of financial contributions to subsidies in the pre-notification requirements. This would lead to a significant ease of burden on both companies and the Commission, to make sure that Commission can focus on the most severe cases.
Please read our suggestions for changes in the articles in the attachment.