The European Commission has opened an in-depth investigation to assess, under the Foreign Subsidies Regulation ('FSR'), the proposed acquisition by JD.com, Inc. ('JD.com') of CECONOMY AG ('CECONOMY'). The Commission has preliminary concerns that JD.com may have been granted foreign subsidies that could distort the EU internal market.
JD.com belongs to a group operating a retail business and an online e-commerce marketplace in the People's Republic of China ('PRC'). CECONOMY is a German retail company operating in the brick-and-mortar and online retail businesses, specialised in the field of consumer electronics and home appliances.
The Commission's preliminary concerns
The preliminary investigation indicates that JD.com may have received foreign subsidies distorting the EU internal market. These include preferential financing, tax incentives and grants provided by entities possibly attributable to the PRC.
In particular, the Commission preliminarily identified concerns that the potential foreign subsidies have enabled JD.com to offer conditions that potentially distorted the negotiation process related to the acquisition of CECONOMY. The Commission also has preliminary concerns that the transaction could allow the merged entity to adopt investment and business strategies that could impact competitive conditions in the EU internal market.
During its in-depth investigation, the Commission will assess in particular:
- Whether the potential foreign subsidies received by JD.com distorted the outcome of the acquisition process, notably by enabling JD.com to offer a high price and to support CECONOMY's economic activities and growth plan through JD.com's own technological and logistics capabilities.
- Whether such potential foreign subsidies may improve the competitive position of the merged entity and lead to a negative impact in the internal market, with respect to its activities after the transaction.
The transaction was notified to the Commission on 17 April 2026. The Commission now has 90 working days, until 2 October 2026, to take a decision. The opening of an in-depth investigation does not prejudge the outcome of the investigation.
Companies and products
JD.com, headquartered in the Cayman Islands, is a holding company listed on the Nasdaq and the Hong Kong Stock Exchange, heading a group operating a retail business and an e-commerce marketplace in the PRC, as well as providing logistic and technological solutions.
CECONOMY, headquartered in Germany, is a retail company specialised in the field of consumer electronics and home appliances. Its main brands are MediaMarkt, MediaWorld and Saturn, which operate online and brick-and-mortar retail businesses in several Member States.
The procedure under the Foreign Subsidies Regulation
The FSR started to apply on 13 July 2023. The Regulation enables the Commission to address distortions caused by foreign subsidies, and thereby ensures a level playing field for all companies operating in the internal market while remaining open to trade and investment.
According to the FSR, companies must notify concentrations to the Commission when at least one of the merging companies, the acquired company or the joint venture is established in the EU and generates an EU turnover of at least €500 million, and when the parties were granted at least €50 million in combined aggregate foreign financial contributions from third countries in the three years prior to the concentration.
By the end of its 90-working day in-depth investigation the Commission may (i) accept commitments proposed by the company if they fully and effectively remedy the distortion, (ii) prohibit the concentration, or (iii) issue a no-objection decision.
