EU Law and Practice Contributed by: Porter Elliott, Catherine Gordley and Niharika Parshurampuria, Van Bael & Bellis
cial contributions from third countries of more than EUR50 million 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 enti - ties that extend far beyond the traditional notion of subsidies (contributions 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 transaction 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 notifica - tion 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.
As a result of the above thresholds, there may be cases in which a concentration requires an FSR notification and no EUMR notification (or vice versa). The EUMR and FSR notifications are made to the Commission 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 dif - Unlike foreign subsidies, foreign direct invest - ment (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 mem - ber state approaches to FDI screening through Regulation 2019/452, which enables the Com - mission to provide its opinions on particular investments. The EU institutions are currently negotiating a revised Regulation on the screen - ing of foreign investments in the EU. ferent substantive outcomes. Foreign Direct Investment
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