CCIA Welcomes EU Parliament Vote on Foreign Subsidies Tool, Urges Action to Avoid Excessive Burden on Businesses

BY Kasper Peters
April 26, 2022

Brussels, BELGIUM — The Computer & Communications Industry Association (CCIA Europe) welcomes last night’s vote of the European Parliament Committee on International Trade (INTA) on the EU foreign subsidies proposal, but says unresolved issues must be addressed in the final negotiations with the European Commission and Member States.

Following the INTA vote on this legislative proposal aimed at tackling the distortive effect of foreign subsidies, CCIA Europe said it is encouraged by Rapporteur Christian Hansen’s overall approach, particularly when it comes to the need for a balance between efficacy and less red tape.

CCIA Europe welcomes the additions in the Committee’s report offering businesses and governments the legal certainty that multilateral rules on subsidisation will still be promoted.

The Association agrees with the suggestion of additional guidelines clarifying what constitutes a distortion and giving further details on the balancing test, as well as with the exclusion from the definition of foreign subsidy of goods / services that are purchased and sold following competitive, transparent and non-discriminatory tendering procedures.

Indeed, the amendments on the reduction of timelines for preliminary and in-depth investigations are crucial to avoid further delays in already complex procurement procedures in the European Union to the detriment of EU and partner country companies.

The following can be attributed to CCIA Vice President and Head of Office, Christian Borggreen:

“Despite improvements to the European Commission’s proposal, the Parliament report on the foreign subsidies tool leaves untouched several issues that may place an excessive burden on companies and discourage much-needed foreign investment. We hope that these issues will be addressed in the final interinstitutional negotiations.”

“Provisions related to public procurement remain particularly unclear. Companies might think twice before participating in procurement processes, which would lead to less customer choice in Europe.”

“The obligation for the main bidder to notify its subcontractor and supplier’s financial contributions is especially burdensome, as it creates a high risk for the bidder who often has no visibility into the suppliers’ financial records.”

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