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Wednesday, March 22, 2023

The European Union extends subsidies to green companies in response to those applied by the US

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The European Union(EU) relaxed this Thursday the regulations on subsidies for projects that include green technologiesin a response to grants awarded in the United States and China.

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The European Commission (executive arm of the EU) indicated that the regulations will run until the end of 2025 and will allow the 27 countries of the bloc, “in exceptional cases”, matching subsidies agreed in other countries that could “divert investment from Europe”.

In a statement, the European Commissioner for Competition, Margrethe Vestagerreinforced that the relaxation of measures is “proportionate, for specific purposes, and temporary“.

The EU has already reiterated that does not intend to start a war of subsidies with countries like the United States or Chinabut is also willing to protect their companies of competition distorted by state aid.

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In 2022, the american government announced a huge invention plan which includes state aid to those who acquire electric cars produced in that countrya gesture that raised alarm bells in European capitals.

German auto giant VolkswagenFor example, it had plans to set up battery factories for electric cars in Eastern Europe, but announced this week that it would await the EU’s response to that US plan.

The EU is in talks with the US about the possibility of European companies operating in the US market can benefit from the plan announced in Washington.

This announcement of the relaxation of rules was made on the eve of the visit that the president of the commission, Ursula von der Leyen will perform Washington, where he intends to hold a meeting with the American president, Joe Biden.

The question of subsidies is an extremely sensitive issue in the EU, as some countries fear that the bloc’s most powerful members could gain competitive advantages.

Source: Ambito

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