The European Commission has published its first review of the Foreign Subsidies Regulation (FSR), covering the initial three-year period since the regulation entered into force on 13 January 2023. The report, dated 14 July 2026, concludes that the FSR is effectively closing a regulatory gap by enabling the Commission to investigate and redress distortions caused by third-country subsidies to undertakings active in the EU, covering all economic sectors.
The FSR introduced ex ante notification obligations for concentrations involving foreign financial contributions exceeding EUR 50 million over three years and EU turnover of at least EUR 500 million, as well as for public procurement contracts valued at EUR 250 million or more with foreign financial contributions of at least EUR 4 million. These obligations became applicable from 13 October 2023. By 31 May 2026, the Commission had received 273 formal concentration notifications, of which 247 were closed after preliminary review, 4 were withdrawn, and 19 remained ongoing. Three concentration in-depth investigations were launched: e&/PPF Telecom (commitments adopted 24 September 2024), ADNOC/Covestro (commitments adopted), and JD.COM/CECONOMY (opened 28 May 2026). Two ex officio in-depth investigations were also opened: Nuctech on 11 December 2025 and Goldwind on 3 February 2026.
The Commission published FSR Guidelines in January 2026 and regularly updates its Q&As. Stakeholders have welcomed the guidance but are seeking higher legal certainty on key concepts such as foreign financial contributions and the distortion assessment. Two court challenges are pending: Nuctech (Case T-284/24) and Goldwind (Case T-335/26). The report notes that while the FSR is working as intended, stakeholders call for simplification and more legal certainty. The Commission continues to build case practice and guidance.
Impact on stakeholders
The FSR imposes compliance costs on companies receiving foreign subsidies, particularly those involved in large mergers or public procurement. EU-based competitors benefit from a level playing field, as the regulation aims to prevent unfair advantages from foreign state support. Legal uncertainty around key definitions creates administrative burdens for businesses, while the Commission gains a new enforcement tool to protect the internal market. The review suggests that further simplification could reduce costs for all parties without undermining the regulation's effectiveness.
Institutional follow-up
The report is addressed to the European Parliament and the Council. The Commission is expected to continue refining its guidance and may propose legislative amendments based on the review's findings. The pending court cases will also shape the interpretation of the FSR.