The Foreign Subsidies Regulation (FSR) is showing its first results: on Tuesday 24 September, the European Commission authorised the takeover of the Dutch telecommunications company PPF Telecom Group B.V. (PPF) by the Emirati operator Telecommunications Group Company PJSC (e&) under certain conditions (see EUROPE 13428/17).
The investigation, launched 3 months ago, revealed that aid in the form of unlimited guarantees and loans from state banks received by e& did not play a disruptive role in the takeover. “e& was the sole bidder for the target and had sufficient own resources to perform the acquisition, which reflected the target’s market value”, said the Commission.
However, the investigation concluded that the aid provided by the United Arab Emirates may distort competition once the takeover has been completed. This is why the Commission has agreed with e& on specific commitments for the next ten years: - the end of unlimited guarantees by the United Arab Emirates; - a ban on financing from the Emirati investment authorities for any PPF activity in the single market, with a few exceptions; - an undertaking by e& to inform the Commission of any future acquisition that does not fall within the scope of the FSR.
The Commission’s decision is “balanced and well-reasoned”, according to the chairman of the European Parliament’s Committee on International Trade, Bernd Lange (S&D, German). He praised the work carried out during the last mandate to bring these regulations into being. (Original version in French by Léa Marchal)