FSR Radar: Foreign Subsidies Regulation Report

A Data-Driven Analysis of the Notification Process Under the EU Foreign Subsidies Regulation

The Foreign Subsidies Regulation (Regulation (EU) 2022/2560, "FSR") represents one of the most significant expansions of the European Commission's regulatory toolkit in recent years. It was designed to close a perceived longstanding regulatory gap: prior to its introduction, subsidies granted by EU Member States were subject to rigorous scrutiny under the EU's state aid framework, while financial contributions from non-EU governments to companies operating in the Single Market were not subject to equivalent oversight. The FSR addresses this asymmetry by extending an analogous review discipline to foreign state financing that may distort the EU's internal market.

The FSR has, in a short period, established itself as a structurally significant component of EU regulatory compliance. It establishes three distinct investigative instruments:

• A mandatory, suspensive pre-closing regime for concentrations that meet certain thresholds.
• A notification requirement for certain public procurement bids.
• A broad ex officio power, enabling the Commission to investigate any commercial activity in the EU, including below-threshold transactions, where foreign subsidies may be distorting the internal market.

The Dechert FSR Radar is a data-driven analysis focusing on the first of these instruments: the mandatory notification regime for concentrations. It tracks investigation durations, intervention rates and remedies to help companies understand the timing and regulatory risks of transactions subject to the FSR's notification requirements.

Headline Findings

• Since the FSR's entry into force in October 2023, the Commission has reviewed a total of 216 notified transactions through to 13 March 2026. Despite this significant volume, only two cases have proceeded to a Phase II investigation, and none has resulted in prohibition, placing the FSR's intervention rate at less than 1% of all notified deals.
• Across all 216 reviewed cases, the average total duration of an FSR notification process stands at ~5.2 months. The data nonetheless reveals a clear year-on-year improvement in processing efficiency: average total duration fell from ~5.7 months in 2024 to ~5.1 months in 2025, an improvement of ~11%, with the average pre-notification period declining by ~13% over the same period.
• These averages mask substantial variation by acquirer type. Private equity transactions consistently achieve total processing times of two to four months, while transactions involving sovereign wealth funds and strategic sector targets have generated processing times of 10 to 14 months, driven by extended pre-notification phases and, in two cases, Phase II investigations.
• The geographical distribution of acquirers reflects the regulation's focus on cross-border investment flows into the European Union. Non-EU acquirers account for ~58% of all notifications, EU acquirers for ~38%, and mixed-nationality acquirers for the remaining ~3%. UAE acquirers present a markedly different risk profile: accounting for ~3% of notifications, they face an average processing time of  ~10.0 months and a Phase II rate of ~40%.
• Across all sectors, the most consistent predictor of extended processing times is the presence of an acquirer with links to a non-EU state, adding an estimated two to four months to average processing times.