EU seeks to rein in competition from foreign rivals

BRUSSELS (AP) — The European Union unveiled plans Wednesday to fight unfair competition from foreign companies backed by powerful non-EU trade rivals amid China's growing influence in the bloc's single market.

With its project, the EU's executive arm intends to tackle what it calls the “distortive effects" of foreign subsidies facilitating takeovers of European businesses by companies that receive large amounts of public aid from non-EU governments. Competing with European businesses that labor under strict state aid rules, these companies can take advantage of the unfair support to invest massively and win public procurement tenders.

“Everyone is welcome here," Thierry Breton, the European Commissioner for Internal Market, told a press conference. “But it’s also true that when one comes to benefit from the internal market, to do business here, one has to respect our rules."

Amid the economic recession triggered by the coronavirus pandemic, the Commission's plan could help protect from hostile takeovers the thousands of European business that have been severely hit by the crisis.

“Europe’s economy is open and closely interlinked to the rest of the world. If this is to remain a strength, we must stay vigilant," said EU Commission vice-president Margrethe Vestager, who is also in charge of competition policy. “That is why we need the right tools to ensure that foreign subsidies do not distort our market, just as we do with national subsidies."

The proposals came only days before a video EU-China summit next week. Although the commission did not explicitly target economic giants like the U.S. or China as it unveiled its plan, the EU last year branded the communist country a “systemic rival.”

“We are happy that the European Commission is finally taking this issue seriously. But China will not be...