Enhancing the Foreign Subsidies Regulation to deliver EU solar targets

In its current form, the FSR is overly bureaucratic, complex and unpredictable, with unclear definitions and limited guidance on key provisions. The absence of clear, practical criteria on what constitutes a foreign subsidy, leaves companies uncertain about what must be reported and increases the risk that non-qualifying measures will be treated as subsidies. This undermines legal certainty and adds administrative burden for both companies and public authorities. To address this, the European Commission should provide a clearer and more exhaustive list of measures that qualify as foreign subsidies, including illustrative examples, to help companies report with confidence and authorities apply the rules consistently. 

The FSR lacks an adequate framework for ‘insignificant’ subsidies. While the Regulation sets notification thresholds, these are jurisdictional (i.e. when a company must notify or file a declaration) and do not create a presumption of non-distortion. A clearer threshold approach for low-risk cases would improve predictability and reduce administrative effort. SolarPower Europe recommends that these thresholds be expressed as indicative ranges adapted to specific market contexts – for example, relative to company turnover or project size – to create practical ‘safe areas’. Where a contribution falls below these ranges, it should be presumed as a non-distortive measure. 

Companies lack visibility on what triggers ex officio investigations and how evidence is assessed. The ex officio review (Regulation (EU) 2022/2560, Article 9) – which empowers the European Commission to investigate potential distortions independently of notifications – does not set out sufficiently clear criteria for when and how this mandate will be used. Without such clarity, the system risks appearing arbitrary, adding to its unpredictability. This is especially important to rectify in light of recent statements that the European Commission intends to focus more and more on below-threshold procedures (INTA Committee meeting, 25 September 2025). The use of such powers should be limited to exceptional cases supported by clear, objective evidence. 

Balancing test application remains unclear and is not tailored to sectors. The balancing test (Regulation (EU) 2022/2560, Article 6) – whereby the European Commission weighs a subsidy’s distortive effects against its potential benefits to the internal market and EU policy objectives – adds to the FSR's unpredictability, especially as Union interests differ across sectors. We believe the balancing test would benefit from sector-specific guidelines to explain how positive contributions are evaluated. For solar, in particular, clarity on how Union interest is assessed and on what basis, would materially improve predictability in implementing the FSR. 

Heavy reporting obligations add another layer of procedural complexity. In public procurement, reporting requirements are extensive and often disproportionate. The European Commission should introduce simpler and more targeted procedures to facilitate bidder participation and reduce administrative burden for companies. Additionally, the European Commission should publish clear conditions and procedures for granting waivers from information requirements, so companies know in advance when simplified reporting is acceptable. 

The FSR’s broad scope and procedural complexity risks deterring investment and participation in the EU market – including in tenders, mergers, and projects – even where no distortive subsidy is involved. Many companies, including those able to comply with the FSR, are choosing not to participate in tenders due to uncertainty, documentation burdens, and the risk of delays. This includes European bidders using globally sourced components. In some cases where FSR investigations have been applied, bids have been withdrawn without clear evidence of improved competitive outcomes. Consequently, the FSR risks creating market access barriers and uncertainty for solar project developers, thereby undermining Europe's decarbonisation goals without yet demonstrating tangible effectiveness in addressing genuine market distortions.