The first ex officio investigations under the EU Foreign Subsidies Regulation in Nuctech and Goldwind. What are the Commission’s priorities?
Author: Pierfrancesco Mattiolo (PhD Candidate, University of Antwerp)
The European Commission has recently announced the opening of two in-depth investigations under the Foreign Subsidies Regulation on the Chinese companies Nuctech (security equipment) and Goldwind (wind turbines).
Introduction: is the Commission prioritising strategic sectors in ex officio investigations?
Over the recent months, new enforcement developments have emerged under the EU Foreign Subsidies Regulation (FSR). Alongside the first two “in‑depth” decisions under the concentration procedure in the e&/PPF Telecom Group and ADNOC/Covestro cases, the European Commission has also been conducting ex officio investigations. Three proceedings involving Chinese companies have attracted media attention. Two of these ex officio cases, Nuctech and Goldwind, have recently progressed to the in‑depth phase and will be discussed by this blogpost. The third involves Temu: the Commission launched a preliminary investigation and has already carried out inspections at the company’s European headquarters.
In fact, the Commission may not yet have exploited the full potential of the FSR ex officio procedure, largely because it has been busy managing the substantial workload generated by the two notification procedures. The first two “final” decisions under the FSR, e&/PPF Telecom Group and ADNOC/Covestro, arose under the concentration procedure and concerned companies with strong links to the Emirati Government. Although the general ex officio tool has not yet produced a final decision, the announcement of the two in-depth investigations suggest that we may have soon two regarding Chinese companies.
All three companies are Chinese, and each had already attracted a degree of scrutiny from European policymakers and stakeholders before the ex officio FSR investigations began. The choice to advance these cases could be significant, even though other preliminary ex officio inquiries are almost certainly under way without public disclosure. The Commission retains discretion to determine which cases and sectors merit early attention and may align its enforcement priorities with broader industrial policy objectives, as the Goldwind case illustrates. What can we learn about the Commission’s priorities from these two in-depth investigations?
Nuctech: the first FSR dawn raid and the first case before the Court of Justice
One of the earliest ex officio investigations to attract public attention concerned Nuctech, a Chinese producer of security scanners with subsidiaries operating within the EU, whose equipment is widely used in European airports. Even before the FSR investigation, Nuctech had been part of wider security debates because of its success in public procurement procedures across the EU, coupled with concerns regarding its proximity to the Chinese government and the access it obtained to sensitive infrastructure in the EU. The question that the Commission seeks to answer via the FSR investigation is whether such success was achieved thanks to subsidies from the Chinese government, which may have distorted competition in the internal market. This investigation was noteworthy for two reasons. First, in April 2024 Nuctech became the first company subjected to a dawn raid by the Commission under the FSR. Second, this inaugural use of the Commission’s investigatory powers prompted the first court case under the Regulation, brought by Nuctech in an attempt to halt the inspection. The case has been discussed in detail in an earlier blogpost by the author.
During the preliminary review, the Commission carried out on‑site inspections at Nuctech’s premises in Poland and the Netherlands, with assistance from national authorities. The legal basis for these inspections is Article 14 FSR, which empowers the Commission to enter business premises, examine records, question staff and secure evidence, in a manner similar to other EU competition tools. Articles 16 and 17 complement these powers by allowing the Commission to take decisions on the basis of available facts or to impose fines and periodic penalties where an undertaking obstructs the investigation or fails to cooperate.
A key point of contention during the inspection concerned the Commission’s request for access to internal email accounts. Nuctech refused on the grounds that the relevant data were stored on servers in China and that disclosure could expose the firm and its employees to breaches of Chinese law, including potentially severe sanctions. The company therefore sought annulment of the inspection decision and interim measures before the General Court. The Court dismissed the request, noting among other considerations that, by operating in the EU internal market, Nuctech had voluntarily accepted the EU legal framework, including the FSR. The mere fact that data relating to EU‑based employees were stored abroad or that the company was simultaneously subject to foreign legal obligations could not exempt it from EU rules. Otherwise, companies with non‑EU parent entities would enjoy a procedural advantage over EU‑controlled firms. Nuctech appealed, but the Court of Justice upheld the order.
The Commission’s preliminary review continued and, in December 2025, the case entered the in‑depth phase since the Commission considered that it had sufficient indications that Nuctech had received foreign subsidies. The company’s stance now appears to have softened, with Nuctech signalling a willingness to cooperate. Although the Chinese government and the national Chamber of Commerce remain critical of the FSR, companies under investigation may still find cooperation more beneficial. Recent cases, including e& and ADNOC, show that constructive engagement and acceptance of commitments can lead to comparatively favourable outcomes and avoid the imposition of redressive measures.
Goldwind: limiting subsidy‑driven expansion in the wind energy sector?
In February 2026, the Commission opened an in‑depth investigation into another Chinese company, Goldwind, which is active in wind turbine manufacturing. The preliminary review had begun in April 2024, although the Commission did not disclose the company’s identity at that time. It is notable that the investigation proceeded for almost two years before reaching the in‑depth stage, which confirms that the Commission can set its own pace in ex officio cases and that the identity of the company may remain confidential unless circumstances dictate otherwise. In contrast, Nuctech itself publicly disclosed that it was under investigation.
At this stage, the Commission suspects that Goldwind receives subsidies from the Chinese government and state‑influenced banks, which may have distortive effects. these subsidies may have allowed the company to offer prices below those of its competitors, enabling it to secure tenders it would otherwise have lost. The Commission has also indicated that “while the current presence of Goldwind in the EU seems to be limited, there are indications that Goldwind has important incentives to increase its presence in the EU”.
Two points stand out from the published summary of the decision to open the in‑depth investigation. First, the ex officio tool can be used to review ex post a pattern of successful tender bids that would not individually fall within the scope of an ex ante public procurement review. Second, the Commission aims to prevent what it views as subsidy‑driven expansion by a foreign competitor in a strategic sector. While Goldwind is not yet established in the EU wind turbine market to the same extent that Nuctech operates in the security scanner sector, both cases concern industries where issues of economic security and increasing market penetration by Chinese companies are salient. In addition, the wind energy sector is an area where the Commission has articulated clear industrial policy goals. Targeted use of the FSR can complement these policy priorities by limiting the expansion of a foreign‑supported competitor to the benefit of EU‑based firms. However, these same firms may themselves benefit from European subsidy schemes, which could create tensions with the FSR’s objective of maintaining a level playing field. The Commission therefore needs to strike a careful balance.
Conclusion
This blogpost discussed how the Commission may prioritise certain sectors in its ex officio enforcement in a way that aligns with broader industrial policy objectives, using the FSR to restore competitive conditions in strategic sectors and thereby reducing or supporting public intervention at EU or Member State level. At the same time, the two notification‑based FSR procedures do not permit such prioritisation. The Commission must examine the notifications it receives and assess distortions based on economic indicators, following the logic of its wider competition practice. These procedures have so far absorbed most of its enforcement capacity.
Although the early ex officio investigations and the media attention surrounding them may foster the perception that the FSR will be used primarily vis-à-vis Chinese companies, the first decisions, which concern Emirati groups, indicate that the scope of The Regulation is broader. The FSR addresses practices originating from a variety of jurisdictions where governments play an active role in the economy, although the forms of intervention may differ markedly. The forthcoming decisions in Nuctech and Goldwind will provide important insights for understanding the future direction of FSR enforcement.
The blogpost is based on a section of the chapter “The EU Foreign Subsidies Regulation, Industrial Policy and Competitiveness: Dragons, Uncharted Frontiers and Epic Quests”, forthcoming in Lena Hornkohl and Dionysios Pelekis (eds), “State Aid and Industrial Policy in the European Union”. A preprint version of the chapter is available here.
