EU antitrust regulators are scrutinizing the $2.5 billion acquisition of electronics retailer Ceconomy by Chinese e-commerce giant JD.com for potential state subsidies. The European Commission has until May 28 to complete its preliminary investigation, according to documents published by the Brussels authority on Wednesday. Should these concerns be substantiated, an in-depth probe could follow, potentially requiring concessions from JD.com.

The review is being conducted under the EU's Foreign Subsidies Regulation, which aims to prevent unfair state aid from abroad. In contrast, the deal does not meet the thresholds for mandatory review under EU merger control rules. By acquiring the MediaMarkt and Saturn electronics chains owned by Ceconomy, one of China's largest retailers seeks to expand its footprint outside its domestic market. However, the project is already facing hurdles in Austria, where it is being reviewed under national foreign direct investment rules. Conversely, the Italian government has already given the transaction the green light.

(Reporting by Foo Yun Chee, edited by Patricia Weiss and Ralf Banser. For inquiries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for corporate and markets).)