On 14 July 2026, the European Commission published the first review of the Foreign Subsidies Regulation (Regulation (EU) 2022/2560) (the FSR), delivered to the European Parliament and the Council under Article 52(2) FSR. The headline is reassuring for the Commission and, on balance, for the market, with the FSR judged “fit for purpose” – working well in practice, without requiring structural changes – after three years of enforcement.

The more consequential message for practitioners sits beneath that verdict. The Commission conceded that the regime imposes real administrative burden, and it has committed to a package of targeted simplifications to the procedural framework, with draft text due this autumn and adoption expected in 2027. In short, the review is a vote of confidence in the instrument, not a free pass on its cost.

For a tool that only became fully operational in October 2023, the review is also the clearest picture yet of how the Commission actually enforces the FSR, and of where it intends to concentrate its firepower next. Below we set out what the FSR does, what the first review found, why it matters as a precedent for the Commission’s enforcement posture, and what businesses with EU exposure should [...]

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