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EU to Expand Scrutiny of Foreign-Funded Companies, Says Antitrust Chief

By  |  July 14, 2025
European Commission, banking regulation, Basel III

The European Union (EU) is preparing to ramp up investigations into foreign companies benefiting from state subsidies, part of an effort to shield European markets from what officials describe as unfair external competition. The moves come under the bloc’s new foreign subsidies regulation (FSR), a tool that has already been used to scrutinize several Chinese firms, according to Financial Times.

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    While the EU maintains that the FSR is not aimed at any single country, many of the recent inquiries have targeted companies based in China. The regulation, which came into effect in 2023, grants Brussels the authority to prevent subsidized firms from taking part in public tenders, mergers, or even selling within the EU’s single market.

    In an interview with the Financial Times, Teresa Ribera, EU Executive Vice-President responsible for overseeing the green and competitive transition, confirmed that more such investigations are in the pipeline. “Of course,” she said when asked if additional probes could be expected.

    Ribera emphasized that increased foreign investment interest across multiple sectors could bring greater regulatory scrutiny. Per the  Financial Times, she cited industries such as pharmaceuticals, chemicals, automotive, and battery manufacturing as areas of growing attention.

    The EU has already launched investigations into Chinese electric vehicle maker BYD, a state-run train producer, and a solar panel manufacturer linked to China’s government. Additional “ex officio” probes—those initiated without a formal complaint—have also targeted Chinese companies involved in security scanners and wind turbines.

    Ribera is currently in Beijing co-chairing the Sixth EU-China High-Level Dialogue on Environment and Climate with Chinese Vice-Premier Ding Xuexiang. Her visit precedes a high-profile meeting later this month between European Commission President Ursula von der Leyen and Chinese President Xi Jinping, a summit marking five decades of diplomatic ties amid rising geopolitical and trade tensions.

    According to Financial Times, Ribera stressed that the goal of the FSR is to ensure that foreign investors in the EU contribute meaningfully to local economies, particularly by promoting innovation and skills development. She pointed to China’s own past requirement for joint ventures and technology transfer as a model Europe could potentially adapt—albeit with safeguards to protect knowledge and avoid overreliance on external manufacturing.

    The EU is also strengthening “Buy European” clauses in its policy framework, seeking to bolster domestic production and competitiveness across key industries.

    On climate cooperation, Ribera underscored the importance of renewed global engagement, particularly in light of the United States’ previous withdrawal from the Paris Agreement.

    Source:  Financial Times