Chinese firms exit Romanian solar tender amid EU scrutiny

LONGi Solar Technologie GmbH, a German subsidiary of Chinese solar PV solutions supplier LONGi Green Energy Technology, and electrical equipment manufacturer Shanghai Electric have withdrawn from the auction following an in-depth investigation launched by the Commission under the Foreign Subsidies Regulation (FSR), the Commission said in a statement on Monday.

The FSR, which took effect at mid-2023, allows the Commission to address distortions caused by foreign subsidies in order to ensure a level playing field for all companies operating in the EU.

The new rules are part of European Union's efforts to reduce dependence on cheaper Chinese wind and solar tech. The Commission has already launched several probes into Chinese firms over state subsidies.

The Commission will now drop its investigation after the companies withdrew from the tender, it said. The tender for the solar plant project, which is partially financed by the EU Modernisation Fund, was launched by Romanian company Parc Fotovoltaic Rovinari Est. It is jointly owned by Romania’s top oil and gas group OMV Petrom [BSE:SNP] and state-owned electricity producer Complexul Energetic Oltenia. The tendered contract is valued at 375 million euro ($404.7 million).

"Solar power is vital for Europe’s economic security. We are massively investing in the installation of solar panels to decrease our carbon emissions and energy bills – but this should not come at the expense of our energy security, our industrial competitiveness and European jobs. The Foreign Subsidies Regulation is ensuring that foreign companies which participate in the European economy do so by abiding to our rules on fair competition and transparency," said Thierry Breton, commissioner for internal market.

Last month, the Commission said it launched an investigation into the potentially market distortive role of foreign subsidies given to the two companies following notifications by the companies that they had already been granted at least 4 million euro in foreign financial contributions from at least one third country in the prior three years. Such notifications are mandated under the EU's FSR when the estimated value of the tendered contract exceeds 250 million euro.

(1 euro=4.9763 lei)