Brussels ( Brussels Morning) – EU Commission investigates foreign subsidies in EU procurement. Two examinations initiated under the Foreign Subsidies Regulation focus on potential market distortion.
The European Commission launched two in-depth examinations under the Foreign Subsidies Regulation. The investigations connect to the potentially market distortive role of foreign subsidies provided to bidders in a public procurement procedure. The Commission will evaluate whether the economic operators involved benefit from an unfair edge to win public contracts in the EU.
The investigations projected follow notifications offered by on the one hand the ENEVO Group including LONGi Solar Technologie GmbH, and on the other hand Shanghai Electric UK Co. Ltd. and Shanghai Electric Hong Kong International Engineering Co. Ltd. The appropriate public procedure was established by a Romanian contracting authority for the design, structure and operation of a photovoltaic park in Romania, with an established power of 110 MW. This project is partially sponsored by the EU Modernisation Fund.
According to the Foreign Subsidies Regulation, companies are obliged to inform their public procurement tenders in the EU when the assessed value of the contract exceeds €250 million, and when the company was awarded at least €4 million in foreign financial assistance from at least one-third country in the three years before notice.
Following its preliminary assessment of all the submissions, the Commission thought it justified to open an in-depth investigation for two bidders since there are adequate indications that both have been given foreign subsidies that deform the internal market.
During the in-depth investigation, the Commission will further evaluate the alleged foreign subsidies and acquire all the information required to demonstrate whether they may have permitted the companies to submit an unduly advantageous proposal in reply to a tender. Such an offer could force other companies participating in the public procurement process to lose sales opportunities potentially.
In line with the conditions of the Foreign Subsidies Regulation, at the end of its in-depth investigation, the Commission may (i) tolerate commitments proposed by the company if they fully and remedy the distortion, (ii) prohibit the recognition of the contract, or (iii) issue a no-objection decision.
Both consortia proposed a complete notification on 4 March 2024. The Commission now has 110 working days as of that date to take a conclusion. The beginning of an in-depth investigation does not prejudge the result of the investigation.
The first investigated consortium includes the ENEVO Group and LONGi Solar Technologie GmbH. ENEVO Group, the consortium boss, is a Romanian-based provider of engineering and consulting assistance. LONGi Solar Technologie GmbH is a newly installed, fully owned and fully owned German subsidiary of LONGi Green Energy Technology Co., Ltd, which is a significant supplier of solar photovoltaic solutions, documented on the Hong Kong Stock Exchange. Both LONGi Solar Technologie GmbH and LONGi Green Energy Technology Co., Ltd. are engaged in the development, manufacturing and servicing of solar wafers, cells and modules.
The second investigated consortium is comprised of Shanghai Electric UK Co. Ltd. and Shanghai Electric Hong Kong International Engineering Co. Ltd. Both organisations are 100% owned and managed by Shanghai Electric Group Co. Ltd, a State-run Enterprise of the People’s Republic of China. It is ultimately possessed and controlled by the Shanghai State-owned Industry Supervision and Management Committee, a state-owned firm subordinate to the China Central People’s Government. Shanghai Electric UK Co., Ltd. and Shanghai Electric Hong Kong International Engineering Co., Ltd. are ruling global suppliers of industrial-grade solutions for energy, manufacturing and the integration of digital intelligence. They deliver services on wind, solar and hydrogen storage, as well as an integrated approach of generation, grid, load, and storage.
