JD.com Photo: VCG

The China Chamber of Commerce to the EU (CCCEU) on Friday urged the European Commission to ensure legal certainty, proportionality and non-discrimination in its investigation under the Foreign Subsidies Regulation (FSR) into JD.com’s proposed acquisition of CECONOMY, warning against generalizing normal market-based competitive advantages as so-called “market distortions.”

The remarks came after the European Commission announced on Thursday an in-depth investigation under the FSR into Chinese e-commerce giant JD.com’s proposed acquisition of German electronics retailer CECONOMY, citing so-called preliminary concerns that JD.com “may have received foreign subsidies that could distort the EU internal market,” Reuters reported on Thursday.

JD.com could be required to offer concessions to address the Commission’s concerns under the EU’s FSR, which targets what the bloc sees as unfair foreign state aid, Reuters reported.

In a statement responding to the move, the CCCEU said the case marks the first time a Chinese acquisition has been subject to a Phase II investigation under the new FSR.

“We attach great importance to this development and hope that the procedures will adhere to legal certainty, proportionality, and non-discrimination principles,” the chamber said.

One of the key focuses of the investigation is the assessment of whether alleged “foreign subsidies” may affect both the transaction process and post-transaction market competition, according to the statement.

“In this regard, we believe that any analysis must be strictly based on verifiable facts and clear legal standards, and should not generalize normal corporate financing capacity, market-driven operational efficiency, or competitive advantages arising from innovation and supply chain capabilities as so-called ‘market distortions,’” the CCCEU said.

The Commission has indicated that it will examine whether subsidies contributed to a higher acquisition price. 

Responding to such concerns, the CCCEU said that price premiums are common in merger and acquisition practice, as transaction prices are driven by multiple market factors, including expected synergies, technological integration value and long-term growth expectations.

“In assessing the impact of subsidies, the use of a ‘high price’ as an indicator should be approached with caution. Conclusions should not be drawn solely from outcomes, and a clear causal relationship should be established on the basis of sufficient evidence,” the chamber said.

JD.com has rejected the EU’s claims, saying the deal will not be financed by any foreign subsidies granted by China or any other non-EU member state, but will instead be funded through external private bank debt and available cash from ordinary business activities, according to a company statement.

The CCCEU said it has long expressed serious concerns regarding certain structural issues in the implementation of the FSR, including the overly broad scope of foreign financial contribution definitions, an imbalance in the burden of proof, high compliance costs for enterprises, and issues related to extraterritorial application and resulting legal conflicts.

China’s Ministry of Commerce concluded in January 2025 that certain EU practices under the FSR constitute barriers to trade and investment and called for corrective measures, the CCCEU noted.

In May 2026, China’s Ministry of Justice, pursuant to the Regulations of the People’s Republic of China on Countering Foreign States’ Unlawful Extraterritorial Jurisdiction, determined that the EU’s cross-border investigative measures targeting Chinese security firm Nuctech under the FSR constitute improper extraterritorial jurisdiction, the chamber said.

The Chamber believes that amid increasing global regulatory density, it is important to ensure that relevant measures remain consistent with international law and established jurisdictional principles so as to avoid unintended extraterritorial effects and resulting uncertainty for cross-border business activities and international investment, the CCCEU said.

The chamber also called on the EU side to take an objective view of the competitive advantages arising from the efficiency improvements of Chinese enterprises.

“Such competitiveness, formed through technological capability, logistics systems, and operational efficiency, is fundamentally driven by market forces. This is particularly evident in highly competitive and rapidly evolving sectors such as e-commerce,” the CCCEU said.

“In relevant assessments, such advantages should be properly distinguished and objectively considered, to avoid a regulatory approach that gradually shifts from correcting market distortions towards over-interpreting normal competitive outcomes,” it said.

The CCCEU said that in the context of rising global economic uncertainty and increasing complexity in cross-border investment, policy stability and predictability have become key determinants of market confidence.

In recent years, Chinese enterprises have continued to expand investment in Europe, contributing to Europe’s digital transformation, green development and consumer market vitality through localization, technological innovation, supply chain development and job creation, the chamber said.

“As a normal practice in market economies, mergers and acquisitions should be assessed within a stable, transparent, and rules-based framework,” the CCCEU said.

“At a time when China-EU economic relations are at an important stage of development, maintaining an open, fair, transparent, and non-discriminatory business environment serves the common interests of both sides,” it said.

The CCCEU said it will continue to closely follow the development of the case and stands ready to maintain constructive engagement with relevant stakeholders “to promote the stable and sustainable development of China-EU trade and investment relations.”

Whatever the terms – “de-risking,” “reducing reliance” or “trade imbalance,” they are just different names for protectionism, and will only hurt the interest of European consumers, raise companies’ costs and weaken Europe’s industry competitiveness in the long run, China’s Foreign Ministry spokesperson Mao Ning said on Thursday, in response to a question on reported new EU trade measures targeting China.

The EU needs to put trade ties with China in perspective and honor its commitment to free trade. China will closely follow the EU’s moves and take all measures necessary to safeguard legitimate rights and interests, the spokesperson said.


Global Times