By Foo Yun Chee

BRUSSELS (Reuters) – EU international locations and lawmakers will on Thursday kick off discussions on a European Fee plan focusing on international state-backed consumers of European corporations amid fears of a Chinese language shopping for spree.

The 27-country bloc fears Chinese language corporations strengthened with state funding could purchase European corporations whose share costs have been dented by the COVID-19 pandemic.

The Fee, which introduced the proposal final 12 months, mentioned the measure takes intention at subsidies which hurt competitors.

The measure additionally covers bids in public tenders in an effort to stop international subsidies used to develop market share or underbid European rivals to achieve entry to strategically necessary markets or vital infrastructure.

Each EU international locations and EU lawmakers agreed on their widespread positions on Wednesday, forward of the negotiations to thrash out the ultimate particulars of the proposal earlier than it will possibly grow to be regulation.

EU international locations nevertheless need the foundations to use to takeovers of EU corporations with a turnover of 600 million euros ($633 million) and for procurement contracts above 300 million euros versus the Fee’s proposed 500 million euros and 250 million euros respectively.

EU lawmakers however need to set the bar decrease to cowl extra acquisitions and public tenders.

EU international locations additionally need to shorten to 5 years the interval throughout which the Fee can retrospectively examine subsidies granted earlier than the regulation enters into drive.

“With this regulation we will lastly finish the longstanding regulatory free-for-all that pits European corporations, topic to rigorous state help management, in opposition to international corporations that may profit from distortive international subsidies on the interior market,” EU lawmaker Christophe Hansen, who’s steering the controversy, mentioned in a press release.

($1 = 0.9486 euros)