### (27) in order to ensure the correct and effective application of this regulation , the commission should have the power to revoke a decision and adopt a new one , where the decision was based on incomplete , incorrect or misleading information , or where an undertaking acts contrary to its commitments or the redressive measures imposed. ### (27) in order to ensure the correct and effective application of this regulation , the investigative authority should have the power to revoke a decision and adopt a new one , where the decision was based on incomplete , incorrect or misleading information , or where an undertaking acts contrary to its commitments or the redressive measures imposed.


### (28) given the potentially significant impact of concentrations on the internal market , the commission should have the power , upon notification , to examine information on foreign financial contributions in the context of a proposed concentration. undertakings should not be allowed to implement the concentration prior to the conclusion of the commission’s review. ### (28) given the potentially significant impact of concentrations on the internal market , the investigative authority should have the power , upon notification , to examine information on foreign financial contributions in the context of a proposed concentration. undertakings should not be allowed to implement the concentration prior to the conclusion of the investigative authority’s review.


### (31) below the notification thresholds , the commission could require the notification of potentially subsidised concentrations that were not yet implemented or the notification of potentially subsidised bids prior to the award of a public contract , if it considers that the concentration or the bid would merit ex-ante review given their impact in the union. the commission should also have the possibility to carry out a review on its own initiative of already implemented concentrations or awarded public contracts. ### (31) below the notification thresholds , the investigative authority could require the notification of potentially subsidised concentrations that were not yet implemented or the notification of potentially subsidised bids prior to the award of a public contract , if it considers that the concentration or the bid would merit ex-ante review given their impact in the union. the investigative authority should also have the possibility to carry out a review on its own initiative of already implemented concentrations or awarded public contracts.


### (31) below the notification thresholds , the commission could require the notification of potentially subsidised concentrations that were not yet implemented or the notification of potentially subsidised bids prior to the award of a public contract , if it considers that the concentration or the bid would merit ex-ante review given their impact in the union. the commission should also have the possibility to carry out a review on its own initiative of already implemented concentrations or awarded public contracts. ### (31) below the notification thresholds , the commission could require the notification of potentially subsidised concentrations that were not yet implemented or the notification of potentially subsidised bids prior to the award of a public contract , if it considers that the concentration or the bid would merit ex-ante review given their impact in the union. the commission should also have the possibility to carry out a review on its own initiative of already implemented concentrations or awarded public contracts. the commission should publish a guidance on the criteria to require such a notification.


### (33) the need to address distortive foreign subsidies is especially salient in public procurement , given its economic significance in the internal market and the fact that it is financed by taxpayer funds. the commission should have the power , upon notification prior to the award of a public contract or concession , to examine information on foreign financial contributions to the participating undertakings in the context of a public procurement procedure. prior notifications should be mandatory above a threshold set in this regulation to capture economically significant cases while minimising the administrative burden and not hindering the participation of smes in public procurement. that obligation of prior notification above a threshold should also apply to groups of economic operators referred to in article 26(2) of directive 2014/23/eu of the european parliament and of the council40 , article 19(2) of directive 2014/24/eu of the european parliament and of the council41 and article 37(2) of directive 2014/25/eu of the european parliament and of the council42 . it should also apply to the main subcontractors and the main suppliers of undertaking. ### (33) the need to address distortive foreign subsidies is especially salient in public procurement , given its economic significance in the internal market and the fact that it is financed by taxpayer funds. the investigative authority should have the power , upon notification prior to the award of a public contract or concession , to examine information on foreign financial contributions to the participating undertakings in the context of a public procurement procedure. prior notifications should be mandatory above a threshold set in this regulation to capture economically significant cases while minimising the administrative burden and not hindering the participation of smes in public procurement. that obligation of prior notification above a threshold should also apply to groups of economic operators referred to in article 26(2) of directive 2014/23/eu of the european parliament and of the council40 , article 19(2) of directive 2014/24/eu of the european parliament and of the council41 and article 37(2) of directive 2014/25/eu of the european parliament and of the council42 . it should also apply to the main subcontractors and the main suppliers of undertaking.


### (39) in the interest of transparency and legal certainty , it is appropriate to publish either in full or in a summary form all decisions adopted by the commission. ### (39) in the interest of transparency and legal certainty , it is appropriate that the commission publishes either in full or in a summary form all decisions adopted by the different investigative authorities.


### (48) in order to ensure a level playing field on the internal market also in the long term , with a view to ensuring adequate coverage of cases investigated both through notifications as well as ex officio , the power to adopt acts in accordance with article 290 of the treaty should be delegated to the commission in respect of amending the notification thresholds for concentrations and for public procurement procedures , exempting certain categories of undertakings from the notification obligations under this regulation , as well as amending the time limits for the preliminary review and the in-depth investigations of notified concentrations or notified financial contributions in the context of a public procurement procedure. in relation to financial contributions in the context of a public procurement procedure , the power to adopt such acts should be exercised in a way that takes into account the interests of smes. it is of particular importance that the commission carries out appropriate consultations during the preparations of those acts , including at expert level , and that those consultations be conducted in accordance with the principles laid down in the interinstitutional agreement of 13 april 2016 on better law-making47 . in particular , to ensure equal participation in the preparation of delegated acts , the european parliament and the council should receive all documents at the same time as member states' experts , and their experts systematically should have access to meetings of commission expert groups dealing with the preparation of delegated acts. ### (48) in order to ensure a level playing field on the internal market also in the long term , with a view to ensuring adequate coverage of cases investigated , the power to adopt acts in accordance with article 290 of the treaty should be delegated to the commission to provide details on the structure of a communication network between the different investigative authorities , detailed rules on the calculation of time limits , the conditions and time limits for proposing commitments under article 30 , provide detailed rules on the procedural steps referred to in articles 28 , 29 , 30 and 31 as well as to provide with guidance on the procedure adopted to balance the effects of foreign subsidies. it is of particular importance that the commission carries out appropriate consultations during the preparations of those acts , including at expert level , and that those consultations be conducted in accordance with the principles laid down in the interinstitutional agreement of 13 april 2016 on better law-making47 .in particular , to ensure equal participation in the preparation of delegated acts , the european parliament and the council should receive all documents at the same time as member states' experts , and their experts systematically should have access to meetings of commission expert groups dealing with the preparation of delegated acts.


### (1) this regulation lays down rules and procedures for investigating foreign subsidies that distort the internal market and for redressing such distortions. such distortions may arise with respect to any economic activity , and in particular in concentrations and public procurement procedures. ### (1) this regulation lays down rules and procedures for investigating foreign subsidies that distort the internal market and for eventually redressing such distortions where detected. such distortions may arise with respect to any economic activity , and in particular in concentrations and public procurement procedures.


### (2) this regulation addresses foreign subsidies granted to an undertaking engaging in an economic activity in the internal market. an undertaking acquiring control or merging with an undertaking established in the union or an undertaking participating in a public procurement procedure is considered to be engaging in an economic activity in the internal market. ### (2) this regulation addresses foreign subsidies granted to an undertaking engaging in an economic activity in the eu's internal market. specifically , an undertaking acquiring control or merging with an undertaking established in the union or an undertaking participating in a public procurement procedure is considered to be engaging in an economic activity in the internal market.


### (1) the commission shall , where warranted , balance the negative effects of a foreign subsidy in terms of distortion on the internal market with positive effects on the development of the relevant economic activity. ### (1) the investigative authority shall balance the negative effects of a foreign subsidy in terms of distortion on the internal market with positive effects on the development of the relevant economic activity taking into account the contribution of a foreign subsidy to overarching goals based on international agreements such as the paris agreement and the sustainable development goals (sdgs).


### (2) the commission shall take into account the balancing between the negative and positive effects when deciding whether to impose redressive measures or to accept commitments , and the nature and level of those redressive measures or commitments. ### (2) the investigative authority shall take into account the balancing between the negative and positive effects when deciding whether to impose redressive measures or to accept commitments , and the nature and level of those redressive measures or commitments while respecting the international regime on trade.


### (2) the commission shall take into account the balancing between the negative and positive effects when deciding whether to impose redressive measures or to accept commitments , and the nature and level of those redressive measures or commitments. ### (2) the commission shall take into account the balancing between the negative and positive effects when deciding whether to impose redressive measures or to accept commitments , and the nature and level of those redressive measures or commitments. by [the date of application of this regulation] , the commission will publish guidance on how to perform the balancing exercise.


### (1) to remedy the distortion on the internal market actually or potentially caused by a foreign subsidy , the commission may impose redressive measures. the undertaking concerned may also offer commitments. ### (1) to remedy the distortion on the internal market actually or potentially caused by a foreign subsidy , the investigative authority may impose redressive measures. the undertaking concerned may also offer commitments.


### (4) the commission may impose reporting and transparency requirements. ### (4) the investigative authority may impose reporting and transparency requirements.


### (6) where the undertaking concerned proposes to repay the foreign subsidy including an appropriate interest rate , the commission shall accept such repayment as commitment if it can ascertain that the repayment is transparent and effective , while taking into account the risk of circumvention. ### (6) where the undertaking concerned proposes to repay the foreign subsidy including an appropriate interest rate , the investigative authority shall accept such repayment as commitment if it can ascertain that the repayment is transparent and effective , while taking into account the risk of circumvention.


### the commission may on its own initiative examine information from any source regarding alleged distortive foreign subsidies. ### the commission may on its own initiative examine information from any source regarding alleged distortive foreign subsidies.


### the undertakings concerned received from third countries an aggregate financial contribution in the three calendar years prior to notification of more than eur 50 million. ### all the undertakings concerned received from third countries an aggregate financial contribution in the three calendar years prior to notification of more than eur 50 million.


### (4) if the undertakings concerned fail to meet their obligation to notify , the commission may review a notifiable concentration in accordance with this regulation by requesting the notification of that concentration. in that case the commission shall not be bound by the time limits referred to in article 23(1) and (4). ### deleted


### (2) for the purpose of article 28 , a notifiable foreign financial contribution in an eu public procurement procedure shall be deemed to arise where the estimated value of that public procurement is equal or greater than eur 250 million. ### (2) for the purpose of article 28 , a notifiable foreign financial contribution in an eu public procurement procedure shall be deemed to arise where the estimated value of that public procurement is equal or greater than eur 250 million and the undertaking concerned received from third countries an aggregate financial contribution in the three calendar years prior to notification of more than eur 50 million.


### (2) the obligation to notify foreign financial contributions under this paragraph shall extend to economic operators , groups of economic operators referred to in article 26(2) of directive 2014/23/eu , article 19(2) of directive 2014/24/eu and article 37(2) of directive 2014/25/eu , main subcontractors and main suppliers. a subcontractor or supplier shall be deemed to be main where their participation ensures key elements of the contract performance and in any case where the economic share of their contribution exceeds 30% of the estimated value of the contract. ### (2) the obligation to notify foreign financial contributions under this paragraph shall extend to economic operators , groups of economic operators referred to in article 26(2) of directive 2014/23/eu , article 19(2) of directive 2014/24/eu and article 37(2) of directive 2014/25/eu , main subcontractors and main suppliers. a subcontractor or supplier shall be deemed to be main where their participation ensures key elements of the contract performance and in any case where the economic share of their contribution exceeds 35% of the estimated value of the contract.


### (2) the commission shall carry out a preliminary review no later than 60 days after it received the notification. ### (2) the investigative authority shall carry out a preliminary review no later than 30 working days after it received the notification.


### (1) a financial contribution notified in the context of a concentration under article 19 may be relevant and assessed again in relation to another economic activity. ### (1) a financial contribution notified in the context of a concentration under articles 18 and 19 may be relevant and assessed again in relation to another economic activity.


### (2) a financial contribution notified in the context of a public procurement procedure under article 28 may be relevant and assessed again in relation to another economic activity. ### (2) a financial contribution notified in the context of a public procurement procedure under articles 27 and 28 may be relevant and assessed again in relation to another economic activity.


### (1) where the information available substantiates a reasonable suspicion that foreign subsidies in a particular sector , for a particular type of economic activity or based on a particular subsidy instrument may distort the internal market , the commission may conduct a market investigation into the particular sector , the particular type of economic activity or into the use of the subsidy instrument concerned. in the course of that market investigation , the commission may request the undertakings or associations of undertakings concerned to supply the necessary information and may carry out the necessary inspections. the commission may also request the member state or third country concerned to supply information. ### (1) where the information available substantiates a reasonable suspicion that foreign subsidies above the thresholds established in this regulation , in a particular sector , for a particular type of economic activity or based on a particular subsidy instrument may distort the internal market , the investigative authority may conduct a market investigation into the particular sector , the particular type of economic activity or into the use of the subsidy instrument concerned. in the course of that market investigation , the investigative authority may request the undertakings or associations of undertakings concerned , as well as the relevant national authorities , to supply the necessary information and may carry out the necessary inspections.


### (2) the commission may publish a report on the results of its market investigation into particular sectors , particular types of economic activity or particular subsidy instruments and invite comments from interested parties. ### (2) the investigative authority may publish a report on the results of its market investigation into particular sectors , particular types of economic activity or particular subsidy instruments and invite comments from interested parties.


### (13) the lack of transparency concerning many foreign subsidies and the complexity of the commercial reality may make it difficult to unequivocally identify or quantify the impact of a given foreign subsidy on the internal market. to determine the distortion , it therefore appears necessary to use a non-exhaustive set of indicators. when assessing the extent to which a foreign subsidy can improve the competitive position of the undertaking concerned and , in doing so , actually or potentially negatively affects competition in the internal market , the commission could have regard to certain indicators , including but not limited to the amount and nature of the subsidy , the purpose and conditions attached to the foreign subsidy as well as its use in the internal market. ### (13) the lack of transparency concerning many foreign subsidies and the complexity of the commercial reality may make it difficult to unequivocally identify or quantify the impact of a given foreign subsidy on the internal market and equally difficult for companies to identify all the relevant subsidies. to determine the distortion , it therefore appears necessary to use a non-exhaustive set of indicators. when assessing the extent to which a foreign subsidy can improve the competitive position of the undertaking concerned and , in doing so , actually or potentially negatively affects competition in the internal market , the investigative authority could have regard to certain indicators , including but not limited to the amount and nature of the subsidy , the purpose and conditions attached to the foreign subsidy as well as its use in the internal market.


### (14) when applying these indicators , the commission could take into account different elements such as the size of the subsidy in absolute terms or in relation to the size of the market or to the value of the investment. for instance , a concentration , in the context of which a foreign subsidy covers a substantial part of the purchase price of the target , is likely to be distortive. similarly , foreign subsidies covering a substantial part of the estimated value of a contract to be awarded in a public procurement procedure are likely to cause distortions. if a foreign subsidy is granted for operating costs , it seems more likely to cause distortions than if it is granted for investment costs. foreign subsidies to small and medium-sized undertakings may be considered less likely to cause distortions than foreign subsidies to large undertakings. furthermore , the characteristics of the market , and in particular the competitive conditions on the market , such as barriers to entry , should be taken into account. foreign subsidies leading to overcapacity by sustaining uneconomic assets or by encouraging investment in capacity expansions that would otherwise not have been built are likely to cause distortions. a foreign subsidy to a beneficiary that shows a low degree of activity in the internal market , measured for instance in terms of turnover achieved in the union , is less likely to cause distortions than a foreign subsidy to a beneficiary that has a more significant level of activity in the internal market. finally , foreign subsidies not exceeding eur 5 million should be deemed , as a general rule , unlikely to distort the internal market within the meaning of this regulation. ### (14) when applying these indicators , the investigative authority could take into account different elements such as the size of the subsidy in absolute terms or in relation to the size of the market or to the value of the investment. for instance , a concentration , in the context of which a foreign subsidy covers a substantial part of the purchase price of the target , is likely to be distortive. similarly , foreign subsidies covering a substantial part of the estimated value of a contract to be awarded in a public procurement procedure are likely to cause distortions. if a foreign subsidy is granted for operating costs , it seems more likely to cause distortions than if it is granted for investment costs. foreign subsidies to small and medium-sized undertakings may be considered less likely to cause distortions than foreign subsidies to large undertakings. furthermore , the characteristics of the market , and in particular the competitive conditions on the market , such as barriers to entry , should be taken into account. foreign subsidies leading to overcapacity by sustaining uneconomic assets or by encouraging investment in capacity expansions that would otherwise not have been built are likely to cause distortions. a foreign subsidy to a beneficiary that shows a low degree of activity in the internal market , measured for instance in terms of turnover achieved in the union , is less likely to cause distortions than a foreign subsidy to a beneficiary that has a more significant level of activity in the internal market. finally , foreign subsidies not exceeding eur 5 million should be deemed unlikely to distort the internal market within the meaning of this regulation.


### (17) where the commission examines a foreign subsidy on its own initiative , it should have the power to impose redressive measures on an undertaking to remedy any distortion caused by a foreign subsidy in the internal market. redressive measures should be proportionate and suitable to remedy the distortion at stake. they should include behavioural or structural remedies or the repayment of the foreign subsidy. ### deleted


### (18) the undertaking concerned should have the possibility to offer commitments in order to remedy the distortion caused by the foreign subsidy. if the commission considers that the commitments offered fully and effectively remedy the distortion , it could accept them and make them binding by decision. ### (18) the undertaking concerned should have the possibility to offer commitments in order to remedy the distortion caused by the foreign subsidy. if the investigative authority considers that the commitments offered fully and effectively remedy the distortion , it could accept them and make them binding by decision.


### (19) the undertaking concerned could offer to repay the subsidy , together with appropriate interest. the commission should accept a repayment offered as a commitment if it can ascertain that the repayment fully remedies the distortion , is executed in a transparent manner and is effective in practice , while taking into account the risk of circumvention of the objectives of this regulation. ### (19) the undertaking concerned could offer to repay the subsidy , together with appropriate interest. the investigative authority should accept a repayment offered as a commitment if it can ascertain that the repayment fully remedies the distortion , is executed in a transparent manner and is effective in practice , while taking into account the risk of circumvention of the objectives of this regulation.


### (20) unless the undertakings concerned offer commitments that would fully and effectively remedy the identified distortion , the commission should have the power to prohibit a concentration or the award of a public contract before it takes place. where the concentration has already been implemented , notably in cases where no prior notification was required because the notification thresholds were not reached , the distortion may nonetheless be so substantial that it cannot be remedied by behavioural or structural measures or by the repayment of the subsidy. in such cases , the commission could decide to remedy the distortion by ordering the undertakings concerned to dissolve the concentration. ### (20) unless the undertakings concerned offer commitments that would fully and effectively remedy the identified distortion , the investigative authority should have the power to prohibit a concentration or the award of a public contract before it takes place. where the concentration has already been implemented , notably in cases where no prior notification was required because the notification thresholds were not reached , the distortion may nonetheless be so substantial that it cannot be remedied by behavioural or structural measures or by the repayment of the subsidy. in such cases , the investigative authority could decide to remedy the distortion by ordering the undertakings concerned to dissolve the concentration.


### (22) the commission should be given adequate investigative powers to gather all necessary information. it should therefore have the power to request information from any undertaking or association of undertakings throughout the whole procedure. in addition , the commission should have the power to impose fines and periodic penalty payments for failure to timely supply the requested information or for supplying incomplete , incorrect or misleading information. the commission could also address questions to member states or to third countries. furthermore , the commission should have the power to make fact-finding visits at the union premises of the undertaking , or , subject to agreement by the undertaking and the third country concerned , at the premises of the undertaking in the third country. the commission should also have the power to take decisions on the basis of facts available if the undertaking in question does not cooperate. ### (22) the investigative authority should be given adequate investigative powers to gather all necessary information. it should therefore have the power to request information from any undertaking or association of undertakings throughout the whole procedure. in addition , the investigative authority should have the power to impose fines and periodic penalty payments for failure to timely supply the requested information or for supplying incomplete , incorrect or misleading information. the investigative authority could also address questions to member states or to third countries. furthermore , the investigative authority should have the power to make fact-finding visits at the union premises of the undertaking , or , subject to agreement by the undertaking and the third country concerned , at the premises of the undertaking in the third country. the investigative authority should also have the power to take decisions on the basis of facts available if the undertaking in question does not cooperate.


### (25) the commission should close the in-depth investigation by adopting a decision. ### (25) the investigative authority should close the in-depth investigation by adopting a decision.


### (29) this examination by the commission should follow the same procedure as the one where a foreign subsidy is reviewed on the commission’s initiative , subject to adjustments to reflect the specificities of concentrations. ### (29) this examination by the investigative authority should follow the same procedure as the one where a foreign subsidy is reviewed on the investigative authority’s initiative , subject to adjustments to reflect the specificities of concentrations.


### (37) taking into account the nature of the ex ante review mechanism for concentrations and public procurement awards , and the need for legal certainty regarding these specific transactions , a concentration or public procurement tender notified and assessed under the respective procedures cannot be reviewed again by the commission on its own initiative. financial contributions of which the commission was informed through the notification procedure may however also be relevant outside the concentration or procurement procedure. in order to gather information on foreign subsidies , the commission should have the possibility to launch investigations regarding specific sectors of the economy , particular types of economic activity or the use of particular foreign subsidy instruments. ### (37) taking into account the nature of the ex ante review mechanism for concentrations and public procurement awards , and the need for legal certainty regarding these specific transactions , a concentration or public procurement tender notified and assessed under the respective procedures cannot be reviewed again by the investigative authority on its own initiative. financial contributions of which the investigative authority was informed through the notification procedure may however also be relevant outside the concentration or procurement procedure. in order to gather information on foreign subsidies , the investigative authority should have the possibility to launch investigations regarding specific sectors of the economy , particular types of economic activity or the use of particular foreign subsidy instruments.


### (40) the commission , when publishing its decisions , should respect the rules on professional secrecy , including the protection of all confidential information , business secrets and personal data , in accordance with article 339 of the treaty. ### (40) when publishing decisions , investigative authorities should respect the rules on professional secrecy , including the protection of all confidential information , business secrets and personal data , in accordance with article 339 of the treaty.


### (41) in cases where information marked by the undertaking as confidential or business secret does not seem to be covered by obligations of professional secrecy , it is appropriate to have a mechanism in place according to which the commission can decide the extent to which such information can be disclosed. any such decision to reject a claim that information is confidential should indicate a period at the end of which the information will be disclosed , so that the respondent can make use of any judicial protection available to it , including any interim measure. ### (41) in cases where information marked by the undertaking as confidential or business secret does not seem to be covered by obligations of professional secrecy , it is appropriate to have a mechanism in place according to which the investigative authority can decide the extent to which such information can be disclosed. any such decision to reject a claim that information is confidential should indicate a period at the end of which the information will be disclosed , so that the respondent can make use of any judicial protection available to it , including any interim measure.


### (46) where the commission adopts a decision at the end of an in-depth investigation , member states should be adequately involved prior to the decision making in an advisory procedure pursuant to article 4 of regulation (eu) no 182/2011 of the european parliament and of the council46 . the choice of this procedure is justified taking into account the role of member states in competition and state aid instruments , which also aim at levelling the playing field in the internal market. ### (46) where the investigative authority adopts a decision at the end of an in-depth investigation , member states should be adequately involved prior to the decision making in an advisory procedure pursuant to article 4 of regulation (eu) no 182/2011 of the european parliament and of the council46 . the choice of this procedure is justified taking into account the role of member states in competition and state aid instruments , which also aim at levelling the playing field in the internal market.


### (1) a foreign subsidy granted to an ailing undertaking , that is to say which will likely go out of business in the short or medium term in the absence of any subsidy , unless there is a restructuring plan that is capable of leading to the long-term viability of that undertaking and includes a significant own contribution by the undertaking; ### (1) a foreign subsidy granted to an ailing undertaking , likely to go out of business in the short or medium term in the absence of any subsidy , unless there is a restructuring plan that is capable of leading to the long-term viability of that undertaking and includes a significant own contribution by the undertaking;


### (5) if an undertaking offers commitments which fully and effectively remedy the distortion on the internal market , the commission may accept them and make them binding on the undertaking in a decision with commitments according to article 9(3). ### (5) if an undertaking offers commitments which fully and effectively remedy the distortion on the internal market , the investigative authority may accept them and make them binding on the undertaking in a decision with commitments according to article 9(3).


### article 7 ### deleted


### article 8 ### deleted


### (2) where the commission , based on the preliminary review , considers that there are sufficient indications that an undertaking has been granted a foreign subsidy that distorts the internal market , it shall ### (2) where the commission , based on the preliminary review and in the light of solid evidence , considers that there are sufficient indications that an undertaking has been granted a foreign subsidy that distorts the internal market , it shall


### publish a notice in the official journal of the european union , which invites interested parties , member states and the third country concerned to express their views in writing within a prescribed period of time. ### publish a notice in the official journal of the european union , which , while respecting confidential company information , invites interested parties , member states and the third country concerned to express their views in writing within a prescribed period of time


### article 9 ### deleted


### (2) where the commission finds that a foreign subsidy distorts the internal market pursuant to articles 3 to 5 , it may impose redressive measures (‘decision with redressive measures’). ### (2) where the commission finds that a foreign subsidy distorts the internal market pursuant to articles 3 to 5 , it may impose redressive measures (‘decision with redressive measures’) or it may require the company to remedy the situation urgently under strict supervision , within a specified period of time and subject to certain conditions.


### article 10 ### deleted


### article 11 ### deleted


### article 12 ### deleted


### article 13 ### deleted


### article 14 ### deleted


### (2) where an undertaking or association of undertakings , a member state or the third country has supplied incorrect or misleading information to the commission , that information shall be disregarded. ### (2) where an undertaking or association of undertakings , a member state or the third country has supplied incorrect or misleading information to the commission , that information shall be disregarded and the appropriate penalties applied.


### [...] ### deleted


### article 16 ### deleted


### the acquired undertaking or at least one of the merging undertakings is established in the union and generates an aggregate turnover in the union of at least eur 500 million; and ### the acquired undertaking or at least one of the merging undertakings is established in the union and each generates an aggregate turnover in the union of at least eur 500 million; and


### (1) notifiable concentrations shall be notified to the commission prior to their implementation and following the conclusion of the agreement , the announcement of the public bid , or the acquisition of a controlling interest. ### (1) notifiable concentrations above the thresholds outlined in article 18 shall be notified to the commission prior to their implementation and following the conclusion of the agreement , the announcement of the public bid , or the acquisition of a controlling interest.


### (2) the undertakings concerned may also notify the proposed concentration when they demonstrate to the commission a good faith intention to conclude an agreement or , in the case of a public bid , where they have publicly announced their intention to make such a bid , provided that the intended agreement or bid would result in a notifiable concentration under paragraph 1. ### (2) the undertakings concerned may also notify the proposed concentration when they demonstrate a good faith intention to conclude an agreement or , in the case of a public bid , where they have publicly announced their intention to make such a bid , provided that the intended agreement or bid would result in a notifiable concentration under paragraph 1.


### (5) the commission may request the prior notification of any concentration which is not a notifiable concentration within the meaning of article 18 at any time prior to its implementation where the commission suspects that the undertakings concerned may have benefitted from foreign subsidies in the three years prior to the concentration. that concentration shall be deemed to be a notifiable concentration for the purposes of this regulation. ### (5) the commission may request the prior notification of any concentration which is not a notifiable concentration within the meaning of article 18 at any time prior to its implementation where the commission suspects that the undertakings concerned may have benefitted from foreign subsidies in the three years prior to the concentration. that concentration shall be deemed to be a notifiable concentration for the purposes of this regulation. by [the date of application of this regulation] , the commission shall publish guidance on the criteria to require such a notification.


### the aggregate financial contribution to an undertaking concerned shall be calculated by adding together the respective financial contributions received from third countries by all undertakings referred to in article 21(4) , points (a) to (e). ### the aggregate financial contribution to an undertaking concerned shall be calculated by adding together the respective financial contributions in the form of distortive state aid received from third countries by all undertakings referred to in article 21(4) , points (a) to (e).


### (2) in addition , the commission may impose by decision on undertakings concerned fines not exceeding 1 % of their aggregate turnover in the preceding business year where they , intentionally or negligently , supply incorrect or misleading information in a notification pursuant to article 19 or supplement thereto. ### (2) in addition , the commission may impose by decision on undertakings concerned fines not exceeding 1 % of the aggregate turnover generated by the undertaking concerned in the preceding business year where they , intentionally or negligently , supply incorrect or misleading information in a notification pursuant to article 19 or supplement thereto.


### (3) the commission may impose by decision on undertakings concerned fines not exceeding 10 % of their aggregate turnover in the preceding business year where they , intentionally or negligently: ### (3) the commission may impose by decision on undertakings concerned fines not exceeding 10 % of the aggregate turnover generated by the undertaking concerned in the preceding business year where they , intentionally or negligently:


### (4) the contracting authority or the contracting entity shall transfer the notification to the commission without delay. ### (4) the contracting authority or the contracting entity shall transfer the notification to the investigative authority without delay.


### (5) where the undertaking , economic operators or groups of economic operators referred to in paragraph 1 fail to notify a foreign financial contribution , or where such a notification is not transferred to the commission , the commission may initiate a review. ### (5) where the undertaking , economic operators or groups of economic operators referred to in paragraph 1 fail to notify a foreign financial contribution , the investigative authority may initiate a review.


### (6) where the commission suspects that an undertaking may have benefitted from foreign subsidies in the three years prior to the submission of the tender or request to participate in the public procurement procedure , it may request the notification of the foreign financial contributions received by that undertaking in any public procurement procedure which are not notifiable under article 27(2) or fall within the scope of paragraph 5 of this article , at any time before the award of the contract. once the commission has requested the notification of such a financial contribution , it is deemed to be a notifiable foreign financial contribution in a public procurement procedure. ### (6) where the investigative authority suspects that an undertaking may have benefitted from foreign subsidies in the three years prior to the submission of the tender or request to participate in the public procurement procedure , it may request the notification of the foreign financial contributions received by that undertaking in any public procurement procedure which are not notifiable under article 27(2) or fall within the scope of paragraph 5 of this article , at any time before the award of the contract. once the investigative authority has requested the notification of such a financial contribution , it is deemed to be a notifiable foreign financial contribution in a public procurement procedure.


### (3) the commission shall decide whether to initiate an in-depth investigation within the time limit for completing the preliminary review and inform the undertaking concerned and the contracting authority or the contracting entity without delay. ### (3) the investigative authority shall decide whether to initiate an in-depth investigation within the time limit for completing the preliminary review and inform the undertaking concerned and the contracting authority or the contracting entity within a 15 working day period.


### (4) the commission may adopt a decision closing the in-depth investigation no later than 200 days after it received the notification. in exceptional circumstances , this time limit may be extended after consultation with the concerned contracting authority or contracting entity. ### (4) the investigative authority may adopt a decision closing the in-depth investigation no later than 60 working days after it received the notification. in exceptional circumstances , this time limit may be extended after consultation with the concerned contracting authority or contracting entity.


### (1) where , after an in-depth investigation , the commission finds that an undertaking benefits from a foreign subsidy which distorts the internal market pursuant to articles 3 to 5 , and where the undertaking concerned offers commitments that fully and effectively remove the distortion on the internal market , it shall adopt a decision with commitments pursuant to article 9(3). the assessment under article 5 shall not result in a modification of the initial tender submitted by the undertaking that is incompatible with union law. ### (1) where , after an in-depth investigation , the investigative authority finds that an undertaking benefits from a foreign subsidy which distorts the internal market pursuant to articles 3 to 5 , and where the undertaking concerned offers commitments that fully and effectively remove the distortion on the internal market , it shall adopt a decision with commitments pursuant to article 9(3). the assessment under article 5 shall not result in a modification of the initial tender submitted by the undertaking that is incompatible with union law.


### (2) where the undertaking concerned does not offer commitments or where the commission considers that the commitments referred to in paragraph 1 are neither appropriate nor sufficient to fully and effectively remove the distortion it shall adopt a decision prohibiting the award of the contract to the undertaking concerned (“decision prohibiting the award of the contract”). ### (2) where the undertaking concerned does not offer commitments or where the investigative authority considers that the commitments referred to in paragraph 1 are neither appropriate nor sufficient to fully and effectively remove the distortion it shall adopt a decision prohibiting the award of the contract to the undertaking concerned (“decision prohibiting the award of the contract”).


### (3) where , after an in-depth investigation , the commission does not find that an undertaking benefits from a foreign subsidy which distorts the internal market , it shall adopt a decision pursuant to article 9(4). ### (3) where , after an in-depth investigation , the investigative authority does not find that an undertaking benefits from a foreign subsidy which distorts the internal market , it shall adopt a decision pursuant to article 9(4).


### (2) if a decision to open an in-depth investigation is taken pursuant to article 29(3) , the contract shall not be awarded to an undertaking submitting a notification under article 28 until the commission reaches a decision under article 30(3) or the time limit set in article 29(4) elapses. if the commission has not adopted a decision within this time limit , the contract may be awarded to any undertaking , including the one submitting the notification. ### (2) if a decision to open an in-depth investigation is taken pursuant to article 29(3) , the contract shall not be awarded to an undertaking submitting a notification under article 28 until the investigative authority reaches a decision under article 30(3) or the time limit set in article 29(4) elapses. if the investigative authority has not adopted a decision within this time limit , the contract may be awarded to any undertaking , including the one submitting the notification.


### (3) the contract may be awarded to an undertaking submitting a declaration under article 28 before the commission takes any of the decisions referred to in article 30 or before the time limit laid down in article 29(4) elapses only if the tender evaluation has established that the undertaking in question has in any case submitted the most economically advantageous tender. ### (3) the contract may be awarded to an undertaking submitting a declaration under article 28 before the investigative authority takes any of the decisions referred to in article 30 or before the time limit laid down in article 29(4) elapses only if the tender evaluation has established that the undertaking in question has in any case submitted the most economically advantageous tender.


### (4) where the commission issues a decision under article 30(2) regarding the most economically advantageous tender , the contract may be awarded to the undertaking having submitted the next best tender not subject to a decision under article 30(2). ### (4) where the investigative authority issues a decision under article 30(2) regarding the most economically advantageous tender , the contract may be awarded to the undertaking having submitted the next best tender not subject to a decision under article 30(2).


### (5) where the commission adopts a decision in accordance with article 30(1) or (3) , the contract may be awarded to any undertaking having submitted the most economically advantageous tender , including , as the case may be , the undertaking(s) having submitted the notification under article 28. ### (5) where the investigative authority adopts a decision in accordance with article 30(1) or (3) , the contract may be awarded to any undertaking having submitted the most economically advantageous tender , including , as the case may be , the undertaking(s) having submitted the notification under article 28.


### (6) in all cases , the contracting authority or the contracting entity shall inform the commission of any decision relating to the outcome of the public procurement procedure. ### (6) in all cases , the contracting authority or the contracting entity shall inform the investigative authority of any decision relating to the outcome of the public procurement procedure.


### (8) each time limit shall begin on the working day following that of the receipt of the notification or of the adoption of the relevant commission decision. ### (8) each time limit shall begin on the working day following that of the receipt of the notification or of the adoption of the relevant decision by the investigative authority.


### (1) the commission may impose fines and periodic penalty payments as set out in article 15. ### (1) the investigative authority may impose fines and periodic penalty payments as set out in article 15.


### (2) in addition , the commission may impose by decision on the undertakings concerned fines not exceeding 1 % of their aggregate turnover in the preceding business year , where they intentionally or negligently supply incorrect or misleading information in a notification pursuant to article 28 or supplement thereto; ### (2) in addition , the investigative authority may impose by decision on the undertakings concerned fines not exceeding 1 % of their aggregate turnover in the preceding business year , where they intentionally or negligently supply incorrect or misleading information in a notification pursuant to article 28 or supplement thereto;


### (3) the commission may impose by decision on the undertakings concerned fines not exceeding 10 % of their aggregate turnover in the preceding business year where they , intentionally or negligently , fail to notify a subsidy in accordance with article 28 during the public procurement procedure. ### (3) the investigative authority may impose by decision on the undertakings concerned fines not exceeding 10 % of their aggregate turnover in the preceding business year where they , intentionally or negligently , fail to notify a subsidy in accordance with article 28 during the public procurement procedure.


### (3) the commission may use the information obtained from such market investigations in the framework of procedures under this regulation. ### (3) the investigative authority may use the information obtained from such market investigations in the framework of procedures under this regulation.


### (1) the powers of the commission under article 9 shall be subject to a limitation period of ten years , starting on the day on which a foreign subsidy is granted to the undertaking concerned. any action taken by the commission under articles 8 , 11 , 12 or 13 with respect to a foreign subsidy shall interrupt the limitation period. after each interruption , the limitation period shall start to run afresh. ### (1) the powers conferred under article 9 shall be subject to a limitation period of five years , starting on the day on which a foreign subsidy is granted to the undertaking concerned. any action taken under articles 8 , 11 , 12 or 13 with respect to a foreign subsidy shall interrupt the limitation period. after each interruption , the limitation period shall start to run afresh.


### (2) the powers of the commission to impose fines and periodic penalty payments under articles 15 , 25 and 32 shall be subject to a limitation period of three years , starting on the day on which the infringement referred to in articles 15 , 25 or 32 took place. in the case of continuing or repeated infringements , the limitation period shall start on the day on which the infringement ceases. any action taken by the commission with respect to an infringement referred to in articles 15 , 25 or 32 shall interrupt the limitation period for the imposition of fines or periodic penalty payments. after each interruption , the limitation period shall start to run afresh. ### (2) the powers to impose fines and periodic penalty payments under articles 15 , 25 and 32 shall be subject to a limitation period of three years , starting on the day on which the infringement referred to in articles 15 , 25 or 32 took place. in the case of continuing or repeated infringements , the limitation period shall start on the day on which the infringement ceases. any action taken by the investigative authority with respect to an infringement referred to in articles 15 , 25 or 32 shall interrupt the limitation period for the imposition of fines or periodic penalty payments. after each interruption , the limitation period shall start to run afresh.


### (3) the powers of the commission to enforce decisions imposing fines and periodic penalty payments under articles 15 , 25 and 32 shall be subject to a limitation period of five years , starting on the day on which the commission decision imposing fines or periodic penalty payments was taken. any action taken by the commission , or by a member state acting upon request of the commission , intended to enforce payment of the fine or periodic penalty payment shall interrupt that limitation period. after each interruption , the limitation period shall start to run afresh. ### (3) the powers of the investigative authority to enforce decisions imposing fines and periodic penalty payments under articles 15 , 25 and 32 shall be subject to a limitation period of five years , starting on the day on which the decision imposing fines or periodic penalty payments was taken. any action taken by the investigative authority intended to enforce payment of the fine or periodic penalty payment shall interrupt that limitation period. after each interruption , the limitation period shall start to run afresh.


### (1) the commission shall publish a summary notice of the decisions adopted pursuant to article 8(2). ### (1) each investigative authority shall publish a summary notice of the decisions adopted pursuant to article 8(2).


### (2) the commission shall publish the decisions adopted pursuant to article 9(2) , (3) and (4) , article 24(3) , and article 30(1) , (2) and (3) in the official journal of the european union. ### (2) each investigative authority shall publish the decisions adopted pursuant to article 9(2) , (3) and (4) , article 24(3) , and article 30(1) , (2) and (3) in the official journal of the european union.


### (3) when publishing summary notices and decisions , the commission shall take due account of the legitimate interests of undertakings in the protection of their business secrets and other confidential information. ### (3) when publishing summary notices and decisions , due account of the legitimate interests of undertakings in the protection of their business secrets and other confidential information shall be taken.


### (1) decisions adopted pursuant to articles 8 , 9 , 15 , 24(3) , 25 , 30(1) and 32 shall be addressed to the undertakings or to the association of undertakings concerned. the commission shall notify the decision to the addressee without delay and shall give the addressee the opportunity to indicate to the commission which information it considers to be confidential. the commission shall provide the contracting authority or the contracting entity concerned with a copy of any commission decision addressed to an undertaking participating in a public procurement procedure. ### (1) decisions adopted pursuant to articles 8 , 9 , 15 , 24(3) , 25 , 30(1) and 32 shall be addressed to the undertakings or to the association of undertakings concerned. the investigative authority shall notify the decision to the addressee without delay and shall give the addressee the opportunity to indicate which information it considers to be confidential. the investigative authority shall provide the contracting authority or the contracting entity concerned with a copy of any decision it addressed to an undertaking participating in a public procurement procedure.


### (2) decisions adopted pursuant to article 30(2) and (3) shall be addressed to the contracting authority or the contracting entity concerned. the commission shall provide the undertaking to which the award of the public contract is prohibited with a copy of that decision. ### (2) decisions adopted pursuant to article 30(2) and (3) shall be addressed to the contracting authority or the contracting entity concerned. the investigative authority shall provide the undertaking to which the award of the public contract is prohibited with a copy of that decision.


### (1) the commission shall , before adopting a decision pursuant to articles 9 , 15 , 24(3) point (c) , 25 , 30(2) or 32 give the undertaking concerned the opportunity to submit observations on the grounds on which the commission intends to adopt its decision. ### (1) the investigative authority shall , before adopting a decision pursuant to articles 9 , 15 , 24(3) point (c) , 25 , 30(2) or 32 give the undertaking concerned the opportunity to submit observations on the grounds on which a decision intends to be adopted.


### (2) the commission shall base its decision only on grounds on which the undertakings concerned have been given the opportunity to submit their observations. ### (2) the investigative authority shall base its decision only on grounds on which the undertakings concerned have been given the opportunity to submit their observations.


### detailed rules on the calculation of time limits; ### deleted


### the conditions and time limits for proposing commitments under article 30; ### deleted


### detailed rules on the procedural steps referred to in article 28 , 29 , 30 and 31 concerning investigations regarding public procurement procedures. ### deleted


### amending the thresholds for notifications as set out in articles 18 and 27 , in the light of the practice of the commission during the first five years of application of this regulation , and taking into account the effectiveness of application; ### deleted


### exempting certain categories of undertakings concerned from the obligation to notify pursuant to articles 19 and 28 , in light of the practice of the commission in the first five years of application of this regulation , in case this practice allows to identify economic activities where foreign subsidies are unlikely to distort the internal market; ### deleted


### amending the timelines for review and in-depth investigations as set out in articles 24 and 29. ### deleted


### within five years after the entry into force of this regulation at the latest , the commission shall present a report to the european parliament and the council on the application of this regulation , accompanied , where the commission considers it appropriate , by relevant legislative proposals. ### by ... [two years after the entry into force of this regulation] , and every year thereafter , the commission shall present a report to the european parliament and the council on the application of this regulation , accompanied , where the commission considers it appropriate , by relevant legislative proposals.


### (1) this regulation shall apply to foreign subsidies granted in the ten years prior to the date of application of this regulation where such foreign subsidies distort the internal market after the start of application of this regulation. ### (1) this regulation shall apply to foreign subsidies granted in the five years prior to the date of application of this regulation where such foreign subsidies distort the internal market after the start of application of this regulation.


### (1) the commission has , in its communication on the european green deal31 , set out a new growth strategy that aims to transform the union into a fair and prosperous society , with a modern , resource-efficient and competitive economy , where there are no net emissions (emissions after deduction of removals) of greenhouse gases (‘ghg emissions’) in 2050 and where economic growth is decoupled from resource use. the european green deal also aims to protect , conserve and enhance the eu’s natural capital , and protect the health and well-being of citizens from environment-related risks and impacts. at the same time , that transformation must be just and inclusive , leaving no one behind. the commission also announced in its eu action plan: towards zero pollution for air , water and soil32 the promotion of relevant instruments and incentives to better implement the polluter pays principle as set out in article 191(2) of the treaty on the functioning of the european union (‘tfeu’) and thus complete the phasing out of ‘pollution for free’ with a view to maximising synergies between decarbonisation and the zero pollution ambition. ### (1) the commission has , in its communication on the european green deal31 , set out a new growth strategy that aims to transform the union into a fair and prosperous society , with a modern , resource-efficient and competitive economy , where there are no net emissions (emissions after deduction of removals) of greenhouse gases (‘ghg emissions’) in 2050 and where economic growth is decoupled from resource use. the european green deal also aims to protect , conserve and enhance the eu’s natural capital , and protect the health and well-being of citizens and future generations from environment-related risks and impacts. at the same time , that transformation must be just and inclusive , leaving no one behind. the commission also announced in its eu action plan: towards zero pollution for air , water and soil32 the promotion of relevant instruments and incentives to better implement the polluter pays principle as set out in article 191(2) of the treaty on the functioning of the european union (‘tfeu’) and thus complete the phasing out of ‘pollution for free’ with a view to maximising synergies between decarbonisation and the zero pollution ambition.


### having regard to the treaty on the functioning of the european union , and in particular article 192(1) thereof , ### having regard to the treaty on the functioning of the european union , and in particular article 192(2)(a) thereof ,


### (8) as long as a significant number of the union’s international partners have policy approaches that do not result in the same level of climate ambition , there is a risk of carbon leakage. carbon leakage occurs if , for reasons of costs related to climate policies , businesses in certain industry sectors or subsectors were to transfer production to other countries or imports from those countries would replace equivalent but less ghg emissions intensive products. that could lead to an increase in their total emissions globally , thus jeopardising the reduction of ghg emissions that is urgently needed if the world is to keep the global average temperature to well below 2 °c above pre-industrial levels. ### (8) as long as a significant number of the union’s international partners have policy approaches that do not result in the same level of climate ambition and action in mitigating climate change , there is a risk of carbon leakage. carbon leakage occurs if , for reasons of costs related to climate policies , businesses in certain industry sectors or subsectors were to transfer production to other countries that do not tax ghg emissions or tax at a lower rate or imports from those countries would replace equivalent but less ghg emissions intensive products. that could lead to an increase in their total emissions globally , thus jeopardising the reduction of ghg emissions that is urgently needed if the world is to keep the global average temperature to well below 2 °c above pre-industrial levels. the risk of carbon leakage is particularly prevalent in trade-exposed and carbon-intensive industrial sectors.


### (8) as long as a significant number of the union’s international partners have policy approaches that do not result in the same level of climate ambition , there is a risk of carbon leakage. carbon leakage occurs if , for reasons of costs related to climate policies , businesses in certain industry sectors or subsectors were to transfer production to other countries or imports from those countries would replace equivalent but less ghg emissions intensive products. that could lead to an increase in their total emissions globally , thus jeopardising the reduction of ghg emissions that is urgently needed if the world is to keep the global average temperature to well below 2 °c above pre-industrial levels. ### (8) as long as a significant number of the union’s international partners have policy approaches that do not result in the same level of climate ambition , there is a risk of carbon leakage. an effective cbam implementation should ensure the creation of a level playing field while encouraging trade partners to decarbonize. carbon leakage occurs if , for reasons of costs related to climate policies , businesses in certain industry sectors or subsectors were to transfer production to other countries or imports from those countries would replace equivalent but less ghg emissions intensive products. that could lead to an increase in their total emissions globally , thus jeopardising the reduction of ghg emissions that is urgently needed if the world is to keep the global average temperature to well below 2 °c above pre-industrial levels.


### (9) the initiative for a carbon border adjustment mechanism (‘cbam’) is a part of the ‘fit for 55 package’. that mechanism is to serve as an essential element of the eu toolbox to meet the objective of a climate-neutral union by 2050 in line with the paris agreement by addressing risks of carbon leakage resulting from the increased union climate ambition. ### (9) the initiative for a carbon border adjustment mechanism (‘cbam’) is a part of the ‘fit for 55 package’. that mechanism is to serve as an essential element of the eu toolbox to meet the objective of a climate-neutral union by 2050 in line with the paris agreement by addressing risks of carbon leakage resulting from the increased union climate ambition whilst ensuring a sustainable level playing field and by incentivising more ambitious climate action internationally.


### (9) the initiative for a carbon border adjustment mechanism (‘cbam’) is a part of the ‘fit for 55 package’. that mechanism is to serve as an essential element of the eu toolbox to meet the objective of a climate-neutral union by 2050 in line with the paris agreement by addressing risks of carbon leakage resulting from the increased union climate ambition. ### (9) the initiative for a carbon border adjustment mechanism (‘cbam’) is a part of the ‘fit for 55 package’. that mechanism is to serve as an essential element of the eu toolbox to meet the objective of a climate-neutral union by 2050 in line with the paris agreement by addressing risks of carbon leakage resulting from the increased union climate ambition and ensuring a level playing field to preserve the competitiveness of eu industries.


### (10) existing mechanisms to address the risk of carbon leakage in sectors or sub-sectors at risk of carbon leakage are the transitional free allocation of eu ets allowances and financial measures to compensate for indirect emission costs incurred from ghg emission costs passed on in electricity prices respectively laid down in articles 10a(6) and 10b of directive 2003/87/ec. however , free allocation under the eu ets weakens the price signal that the system provides for the installations receiving it compared to full auctioning and thus affects the incentives for investment into further abatement of emissions. ### (10) existing mechanisms to address the risk of carbon leakage in sectors or sub-sectors at risk of carbon leakage are the transitional free allocation of eu ets allowances and financial measures to compensate for indirect emission costs incurred from ghg emission costs passed on in electricity prices respectively laid down in articles 10a(6) and 10b of directive 2003/87/ec. such measures are based on strict benchmarks set by the best performing installations so that they preserve an incentive to reduce emissions under the ets and provide a carbon price signal for emissions above the benchmark level; they have proven so far to be effective in mitigating the risk of carbon leakage , although in the context of lower carbon prices than those experienced recently and those forecasted by 2030.


### (10) existing mechanisms to address the risk of carbon leakage in sectors or sub-sectors at risk of carbon leakage are the transitional free allocation of eu ets allowances and financial measures to compensate for indirect emission costs incurred from ghg emission costs passed on in electricity prices respectively laid down in articles 10a(6) and 10b of directive 2003/87/ec. however , free allocation under the eu ets weakens the price signal that the system provides for the installations receiving it compared to full auctioning and thus affects the incentives for investment into further abatement of emissions. ### deleted


### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. ### (11) the cbam seeks to strengthen carbon leakage protection in view of higher eu climate ambition by 2030 and thereafter to replace progressively these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products and by ensuring that eu products exported in the global market are not replaced by more carbon intensive products , which would undermine the objective of reducing global emissions. as indicated in the impact assessment accompanying the commission proposal , “changes in employment are largely driven by the presence (or not) of free allocation” , since retaining free allocation results in better impact on employment. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out as of 2030 after a test phase and an assessment by the commission has proven the effectiveness of the cbam regulation in terms of protection from the risk of carbon leakage both for imports and exports. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union.


### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. ### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. this gradual transition shall be supported by a review mechanism in which the commission assesses the gradual implementation of the instrument , including the need for its scope extension.


### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. ### (11) the cbam seeks to strengthen carbon leakage protection in view of higher eu climate ambition by 2030 and thereafter replace progressively these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products and by ensuring that eu products exported in the global market are not replaced by more carbon intensive products , which would undermine the objective of reducing global emissions. as indicated in the impact assessment accompanying the commission proposal , “changes in employment are largely driven by the presence (or not) of free allocation” , since retaining free allocation results in better impact on employment. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out as of 2030 after a test phase and an assessment by the commission has proven the effectiveness of the cbam regulation in terms of protection from the risk of carbon leakage both for imports and exports. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union.


### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. ### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. in order to make the cbam retrievable , there will be a two-year review period in addition to the transitional period followed by a report of the commission. after positive assessment , the reduction of free allocation should be implemented by applying a factor to free allocation for cbam sectors , while the cbam is phased in. this percentage (cbam factor) should be equal to 100 % during the transitional and the review period between the entry into force of [cbam regulation] and 2027 , 85% in 2028 , 70% in 2029 , 55% in 2030 , 40% in 2031 , 30% in 2032 , 20% in 2033 , 10% in 2034 and will reach 0 % by the end of 2035. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union.


### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. ### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. the cbam should ensure an integrated approach between imports dynamics , the internal market development and the exports. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union.


### (11) the cbam seeks to replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union. ### (11) the cbam should complement and progressively replace these existing mechanisms by addressing the risk of carbon leakage in a different way , namely by ensuring equivalent carbon pricing for imports and domestic products. to ensure a gradual transition from the current system of free allowances to the cbam , the cbam should be progressively phased in while free allowances in sectors covered by the cbam are phased out once cbam has been proven to be effective. the combined and transitional application of eu ets allowances allocated free of charge and of the cbam should in no case result in more favourable treatment for union goods compared to goods imported into the customs territory of the union.


### (12) while the objective of the cbam is to prevent the risk of carbon leakage , this regulation would also encourage the use of more ghg emissions-efficient technologies by producers from third countries , so that less emissions per unit of output are generated. ### (12) while the objective of the cbam is to prevent the risk of carbon leakage , this regulation would also encourage the deployment and use of more ghg emissions-efficient technologies by producers from third countries , so that less emissions per unit of output are generated.


### (13) as an instrument to prevent carbon leakage and reduce ghg emissions the cbam should ensure that imported products are subject to a regulatory system that applies carbon costs equivalent to the ones that otherwise would have been borne under the eu ets. the cbam is a climate measure which should prevent the risk of carbon leakage and support the union’s increased ambition on climate mitigation , while ensuring wto compatibility. ### (13) as an instrument to prevent carbon leakage and reduce ghg emissions the cbam should ensure that imported products are subject to a regulatory system that applies carbon costs equivalent to the ones that otherwise would have been borne under the eu ets , resulting in a carbon cost equalization between national products and imported. the cbam is a climate measure which should support increased ambition on the reduction of emissions in the union in line with the european green deal and the european climate law and it should prevent the risk of carbon leakage , while ensuring wto compatibility.


### (28) whilst the ultimate objective of the cbam is a broad product coverage , it would be prudent to start with a selected number of sectors with relatively homogeneous products where there is a risk of carbon leakage. union sectors deemed at risk of carbon leakage are listed in commission delegated decision 2019/70842 . ### (28) whilst the ultimate objective of the cbam is a broad product coverage , it would be prudent to start with a selected number of sectors with relatively homogeneous products where there is a risk of carbon leakage. union sectors deemed at risk of carbon leakage are listed in commission delegated decision 2019/70842 . the commission should set up a review mechanism in order to better assess the broadening of the broad product coverage , including downstream products covered by this regulation.


### (29) the goods under this regulation should be selected after a careful analysis of their relevance in terms of cumulated ghg emissions and risk of carbon leakage in the corresponding eu ets sectors while limiting complexity and administrative burden. in particular , the actual selection should take into account basic materials and basic products covered by the eu ets with the objective of ensuring that imports of energy intensive products into the union are on equal footing with eu products in terms of eu ets carbon pricing , and to mitigate risks of carbon leakage. other relevant criteria to narrow the selection should be: firstly , relevance of sectors in terms of emissions , namely whether the sector is one of the largest aggregate emitters of ghg emissions; secondly , sector’s exposure to significant risk of carbon leakage , as defined pursuant to directive 2003/87/ec; thirdly , the need to balance broad coverage in terms of ghg emissions while limiting complexity and administrative effort. ### (29) the goods under this regulation should be selected after a careful analysis of their relevance in terms of cumulated ghg emissions and risk of carbon leakage in the corresponding eu ets sectors while limiting complexity and administrative burden. in particular , the actual selection should take into account basic materials and basic products covered by the eu ets with the objective of ensuring that imports of energy intensive products into the union are on equal footing with eu products in terms of eu ets carbon pricing , and to mitigate risks of carbon leakage. other relevant criteria to narrow the selection should be: firstly , relevance of sectors in terms of emissions , namely whether the sector is one of the largest aggregate emitters of ghg emissions; secondly , sector’s exposure to significant risk of carbon leakage , as defined pursuant to directive 2003/87/ec; thirdly , the need to balance broad coverage in terms of ghg emissions while limiting complexity and administrative effort. particular attention should also be paid to the risk of market distortions between the different sectors covered by the cbam.


### (51) to facilitate and ensure a proper functioning of the cbam , the commission should provide support to the competent authorities responsible for the application of this regulation in carrying out their obligations. ### (51) to facilitate and ensure a proper functioning of the cbam , the commission should ensure interoperability between the national and central databases. the commission should also provide support to the competent authorities responsible for the application of this regulation in carrying out their obligations. the commission should assist enterprises , especially smes , in adapting to this regulation and establish an expert group to share information and best practices with the competent authorities.


### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . ### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050 whilst preventing distortion of competition in the eu and global markets. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , such as downstream products using goods initially covered by this regulation , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . the report should be based upon a review mechanism that assesses , in particular , the implementation of the regulation vis-à-vis its objectives and the governance system. if appropriate , the report should be accompanied by legislative proposals whose entry into force should be consistent with the start of the implementation of cbam.


### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . ### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . with regard to indirect emissions , the evaluation should take into account the exposure of eu producers to carbon costs passed on in electricity prices due to the functioning of the eu energy market.


### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . ### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . the assessment of the inclusion of indirect emissions in the cbam needs to take into account that eu producers are also exposed to indirect carbon costs passed on in electricity prices , which depend on the functioning of the electricity market instead of the actual carbon content of the consumed electricity.


### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . ### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on the impact on competitiveness of eu downstream industry and its synchronisation with the technological perspectives and maturities , concerning namely the new clean energy alternatives such as the availability of cost-competitive green hydrogen. the report should also evaluate the possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 .


### (52) the commission should evaluate the application of this regulation before the end of the transitional period and report to the european parliament and the council. the report of the commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . ### (52) the commission should evaluate the application of this regulation two years before the start of removal of free allowances in the ets and report to the european parliament and the council. the report of the commission should in particular focus on the impact on competitiveness of the eu downstream industry and on possibilities to enhance climate actions towards the objective of a climate neutral union by 2050. the commission should , as part of that evaluation , initiate collection of information necessary to possibly extend the scope to indirect emissions , sectors and goods other than those listed in annex i , such as downstream products using or containing goods listed in annex i , as well as to other goods and services at risk of carbon leakage , and to develop methods of calculating embedded emissions based on the environmental footprint methods47 .


### (55) as the cbam aims to encourage cleaner production processes , the eu stands ready to work with low and middle-income countries towards the de-carbonisation of their manufacturing industries. moreover , the union should support less developed countries with the necessary technical assistance in order to facilitate their adaptation to the new obligations established by this regulation. ### (55) as the cbam aims to encourage cleaner production processes , the eu stands ready to work with low and middle-income countries towards the de-carbonisation of their manufacturing industries. moreover , the union should support less developed countries with the necessary technical assistance in order to facilitate their adaptation to the new obligations established by this regulation. the union should make use of the union policies and the union budget to support those action , if appropriate.


### 3. the mechanism will progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive. ### 3. the mechanism progressively replaces the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive.


### 3. the mechanism will progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive. ### 3. the mechanism should progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive , if it has proven to be effective to prevent the risk of carbon leakage both for imports into or exports from the customs territory of the union , and without prejudice to maintaining eu ets allowances free of charge at benchmark level until a test period with actual surrendering obligation has proven such effectiveness.


### 3. the mechanism will progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive. ### 3. the mechanism should progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive , if it has proven to be effective to prevent the risk of carbon leakage both for imports into or exports from the customs territory of the union.


### 3. the mechanism will progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive. ### 3. the mechanism will complement and progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive , once it has proven to be effective against carbon leakage.


### 3. the mechanism will progressively become an alternative to the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage , notably the allocation of allowances free of charge in accordance with article 10a of that directive. ### 3. the mechanism will progressively replace the mechanisms established under directive 2003/87/ec to prevent the risk of carbon leakage before their phasing out at least in 2036 , notably the allocation of allowances free of charge in accordance with article 10a of that directive.