Today, the European Commission launched two detailed investigations under the Foreign Subsidies Regulation. The investigations concern the possible market-distorting role of foreign subsidies granted to bidders in public procurement. The Commission will assess whether the relevant economic operators used an unfair advantage in order to win public procurement contracts in the EU.
The investigations are carried out following reports from the ENEVO Group, including LONGi Solar Technologie GmbH, on the one hand, and Shanghai Electric UK Co., on the other hand. Ltd. and Shanghai Electric Hong Kong International Engineering Co. Ltd”. The Romanian procurement organization (Societatea PARC fotovoltaic ROVINARI EST SA) has started the procedure for the design, construction and operation of a 110 MW photovoltaic park in Romania. This project is partially financed by the EU modernization fund.
According to the Foreign Subsidies Regulation, companies must notify their public procurement tenders in the EU when the estimated value of the contract exceeds 250 million. EUR and when the company was allocated at least 4 million during the three years prior to the notification. EUR of foreign financial contributions from at least one third country.
After a preliminary review of all submissions, the Commission decided that it was appropriate to open a full investigation into the two bidders, as there were sufficient indications that foreign subsidies distorting the internal market had been granted in both cases.
As part of the full investigation, the Commission will continue to assess the alleged foreign subsidies and obtain all the information necessary to determine whether they may have allowed the companies to make an unduly favorable offer. As a result of such an offer, other companies participating in the public procurement procedure could lose sales opportunities.
According to the provisions of the Foreign Subsidies Regulation, after a detailed investigation, the Commission can approve the company’s obligations (if the distortions are completely eliminated), prohibit the conclusion of the contract or make a decision not to object.
in 2024 March 4 both consortia submitted a detailed report. From that date, the Commission must make a decision within 110 working days. The fact that a detailed investigation has been initiated does not affect the results of the investigation.
Companies
The first consortium under investigation consists of ENEVO Group and LONGi Solar Technologie GmbH. Consortium leader ENEVO Group is a Romania-based engineering and consulting services provider. LONGi Solar Technologie GmbH is a newly established company founded and managed by the German company LONGi Green Energy Technology Co., Ltd. It is a leading provider of solar photovoltaic solutions listed on the Hong Kong Stock Exchange. LONGi Solar Technologie GmbH and LONGi Green Energy Technology Co., Ltd. are engaged in the development, production and maintenance of solar panels, cells and modules.
The second consortium under investigation consists of Shanghai Electric UK Co. Ltd. and Shanghai Electric Hong Kong International Engineering Co. Ltd”. Both companies 100 percent. belongs to Shanghai Electric Group Co., a state-owned company of the People’s Republic of China. Ltd.” and are controlled by them. It is ultimately owned and controlled by the Shanghai State-owned Industrial Supervision and Administration Committee, a state-owned entity under the Chinese Central People’s Government. Shanghai Electric UK Co., Ltd. and Shanghai Electric Hong Kong International Engineering Co., Ltd. are leading global providers of industrial energy, manufacturing and digital intelligence integration solutions. They provide wind, solar and hydrogen storage services, as well as an integrated generation, grid, load and storage process.
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The regulation on foreign subsidies came into force in 2023. July 12 This new set of rules enables the Commission to remove distortions caused by foreign subsidies, thus enabling the EU to ensure a level playing field for all companies operating in the internal market, while remaining open to trade and investment.
In recent years, foreign subsidies appear to have distorted the EU’s internal market, among other things, by giving recipients an unfair advantage in acquiring companies or awarding public procurement contracts in the EU, which undermines fair competition. The Foreign Subsidies Regulation provides the EU with new tools to effectively prevent foreign subsidies that cause distortions and harm the level playing field in the internal market based on a competitive social market economy.
EC information
123rf photo.
Tags: Commission launching indepth investigations foreign subsidies solar sector
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