Position paper - Foreign Subsidies Regulation roadmap for proportionality and effectiveness

After more than two years of enforcement experience, the Foreign Subsidies Regulation (FSR) has proven to be more burdensome than intended and disproportionate to what is needed to address the risk of distortive subsidisation. A thorough revision of the FSR is necessary to ensure that it targets genuinely distortive subsidies without chilling investment or overwhelming businesses and enforcers. In particular, the revision of the FSR should focus on:

1. Narrowing the scope of the Regulation to focus on actual subsidies with a clear EU nexus, rather than covering all financial contributions regardless of selectivity and impact on competition.
2. Reducing administrative burdens through ambitious simplification measures, including higher notification thresholds, an annual reporting mechanism and broader exemptions.
3. Simplifying notification procedures for public procurement, particularly by exempting certain procurement methods and bidders, allowing direct filing with the Commission and establishing consistent review timelines.
4. Improving procedural clarity and predictability, including through more consistent application of published guidance, streamlined information requests and enhanced transparency.
5. Strengthening institutional capacity through additional enforcement resources, better case management procedures and enhanced support and training for contracting authorities.