Commission consults on draft FSR Implementing Regulation

On 6 February 2023, the Commission published its proposal for a FSR Implementing Regulation (see on the FSR, our website). The Implementing Regulation will set out the general procedural rules (e.g. on use of language, of persons responsible for notification, timelines, on confidentiality of information, access to file, etc.) whereas the annexes to the Implementing Regulation will contain the template forms that will need to be used for the notifications (one form for concentrations and another for public procurements).

For concentrations, many items in the proposed form will be identical to the items that can be found in the template submission for concentrations under the EU Merger Regulation (Form CO). However, it is worth noting the following:

• Contrary to some views expressed by commentators, the Commission does not intend to narrow down the scope of ‘financial contributions’ as defined in the FSR; if the proposal is adopted in its current form, companies may therefore still have issues identifying all financial contributions received in the last three years (this will be necessary to determine the application of the notification threshold). However, the specific disclosure of financial contributions received in the notification itself will be limited to those above 200.000 EUR. In addition, financial contributions will not need disclosing if the total financial contributions received per year and per third country is not 4 million EUR or more. Moreover, the Commission indicates to be open to further disclosure waivers on an individual basis in the context of pre-notification talks (which will be strongly encouraged) as regards information that is not reasonably available.
• Substantively, the Commission will ask for further details on those financial contributions that are (i) also foreign subsidies and (ii) are considered most likely to distort the internal market (discussed on our website under Key take-aways). In addition, the Commission will ask for certain additional information on the concentration to (i) assess to what extent financial contributions may have helped the undertaking in getting the deal in question and (ii) assess possible positive effects.

For public procurements, it is worth noting the following:

• Again, as for concentrations, the Commission does not intend to narrow down the scope of ‘financial contributions’ as defined in the FSR for the purpose of companies to determine whether they meet the thresholds. However, the specific disclosure of financial contributions received will be limited to those that in total exceed 4 million EUR over the last three years. This appears therefore in practice to reduce significantly the disclosure obligations for companies, allowing them in many instances to simply indicate whether the thresholds are met (or not). In addition, also in this context, the Commission indicates to be open to further disclosure waivers on an individual basis in the context of pre-notification talks (which will be strongly encouraged) as regards information that is not reasonably available.
• Substantively, the Commission is asking for further details on those financial contributions that need disclosing only, with a particular attention to foreign subsidies that (i) cover operational expenses and/or facilitate the participation in the public procurement procedure, (ii) are given to ailing undertakings, (iii) are unlimited guarantees or (iv) relate to export financing. The opportunity will be provided to give reasons why the tender in question should not be considered unduly advantageous directly or indirectly due to the financial contributions received. In addition, notifying parties will be able to indicate possible effects in support of their bid.

The Commission is seeking views on its proposal as part of its public consultation procedure. Interested parties have until 6 March 2023 to present their views and submit comments. Please do not hesitate to reach out if you need our assistance in this respect.