EU Law and Practice Contributed by: Porter Elliott, Catherine Gordley and Niharika Parshurampuria, Van Bael & Bellis
merger decisions (including decisions imposing fines for procedural violations) have ever been annulled. As the appeals process is lengthy, costly and rarely suc - cessful, few merger decisions are appealed. Never - theless, the Commission carefully considers the likeli - hood of an appeal when issuing its decisions. If a Commission decision is annulled, the case reverts to the Commission, which is obliged to reassess the concentration. The annulment of a prohibition deci - sion does not automatically result in the clearance of the transaction, nor does the Commission have the discretion to avoid undertaking a second review. 8.3 Ability of Third Parties to Appeal Clearance Decisions Sufficiently interested third parties may appeal a clear - ance decision (see 7.1 Third-Party Rights and 8.2 Typical Timeline for Appeals ). 9. Foreign Direct Investment/Subsidies Review 9.1 Legislation and Filing Requirements Foreign Subsidies On 12 January 2023, Regulation 2022/2560 on Foreign Subsidies (FSR) came into effect. The FSR includes notification requirements in certain concentrations and public procurement processes and also allows the Commission to investigate potentially distortive foreign subsidies ex officio. As of 12 October 2023, the FSR requires mandatory, ex ante notification to the Commission of any concen - tration in which: • the target, JV or at least one of the merging parties is established in the EU and generates an aggre - gate turnover in the EU of at least EUR500 million; and • all undertakings involved (ie, the merging par - ties, acquirer and target, or the JV and its parents) received combined aggregate financial contribu - tions from third countries of more than EUR50 mil - lion in the three financial years prior to notification.
“Financial contributions” is a term that is very broadly defined under the FSR to include a wide range of interactions with state-controlled entities that extend far beyond the traditional notion of subsidies (con - tributions include the transfer of funds or liabilities, the foregoing of revenue that is otherwise due, and even the provision/purchase of goods or services). It is therefore advisable for any party engaging in a trans - action that meets the EU turnover threshold above to conduct a thorough assessment to determine whether an FSR filing is required. As under the EUMR, merging parties are required to wait to receive Commission clearance under the FSR before implementing the concentration. Penalties for failing to observe the FSR notification and standstill obligations are the same as under the EUMR (see 2.2 Failure to Notify ). The Commission published the Foreign Subsidies Implementing Regulation in July 2023, which provides further detail on the required format and contents of the FSR notification. In addi - tion, in January 2026, the Commission published its first Guidelines under the FSR, which are intended to clarify key concepts of the FSR. As a result of the above thresholds, there may be cases in which a concentration requires an FSR noti - fication and no EUMR notification (or vice versa). The EUMR and FSR notifications are made to the Com - mission separately. The FSR notification timeline is statutorily similar to the EUMR (involving a first phase review and a second phase in-depth investigation in complex cases). However, as different Commission case teams review FSR and EUMR notifications under different standards, the two clearance processes can proceed at different speeds and reach different sub - stantive outcomes. Foreign Direct Investment Unlike foreign subsidies, foreign direct investment (FDI) is a competence of the individual EU member states; there is no notification or assessment of FDI at EU level. In 2020, the EU established a mechanism to harmonise member state approaches to FDI screen - ing through Regulation 2019/452, which enables the Commission to provide its opinions on particular investments. In early 2026, the agreed text of a new Regulation on the screening of foreign investments in
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