THE European Commission (EC) has cleared the way for Lisbon Metro to award the contract to design, build and maintain the new Violet Line to a consortium led by Mota-Engil. The EC accepts commitments made by the consortium to replace CRRC with Pesa as subcontractor on the light rail project.
The EC says that the commitments remove any potential distortion of competition in the internal market, as Polish rolling stock manufacturer Pesa “has not received distortive foreign subsidies.” This is the first time that the EC has adopted a final decision subject to conditions after an in-depth public procurement investigation under the Foreign Subsidies Regulation (FSR), in force since July 13 2023.
In a tender launched by Lisbon Metro in April 2025, the consortium led by Mota-Engil was selected as preferred bidder, after submitting the most economically advantageous offer of €598.9m to build the 11.5km light rail line from Várzea de Loures to Hospital Beatriz Ângelo in Lisbon. The consortium indicated that Portugal CRRC Tangshan Rolling Stock would be its future subcontractor.
The EC opened an in-depth investigation on November 5 2025, based on indications that Portugal CRRC Tangshan Rolling Stock may have received foreign subsidies that distorted the procurement procedure, enabling the consortium to submit an unduly advantageous bid. The in-depth investigation confirmed these preliminary findings, revealing that the subsidies in question had indeed given the consortium an unfair competitive edge.
The commitments made by the consortium remove this distortion of competition in the internal market, enabling the EC to approve the consortium's participation in the tender. The EC stresses that the ultimate decision to award the contract lies with Lisbon Metro, which must assess whether the bid, including the new subcontractor, complies with all technical and quality requirements.
Under the FSR, companies are required to notify the EC when participating in large public tenders in the European Union (EU) if the estimated contract value is at least €250m net of VAT, and if participants, including their main subcontractors and suppliers, have received aggregate foreign financial contributions of at least €4m per third country over the three years prior to notification. Where the foreign financial contributions are below €4m, a declaration is sufficient.
“From the very beginning of this mandate, we committed to making full and systematic use of the FSR as a key tool to protect our single market against unfair practices,” says Stéphane Séjourné, EC executive vice-president for prosperity and industrial strategy.
“We remain vigilant to protect public procurement procedures from distortive practices, while maintaining our openness to trade and investment.”
“This marks a very important moment for the credibility of the [FSR] instrument at large,” says Enno Wiebe, director general of European Rail Supply Industry Association (Unife). “The decision also confirms the importance of the FSR in safeguarding fair competition in Europe’s strategic industries, such as rail.”
