BRUSSELS (Business Emerge/Europe): European regulators have opened a formal review into the activities of security equipment manufacturer Nuctech as part of an examination into whether the company benefited from financial support originating in China that could have shaped its commercial standing in the region. The action marks the latest step in the application of the European Union’s Foreign Subsidies Regulation.
The assessment began after coordinated inspections were carried out at Nuctech sites in Poland and the Netherlands in April of the previous year. Officials involved in the process indicated that the review aims to determine whether various forms of financial assistance may have enabled the company to expand or operate in a way that did not reflect standard market conditions.
Preliminary information released by the European Commission noted that any potential support under consideration could involve grants, favourable taxation practices or loan-related financial arrangements. Authorities stated that such support, if verified, may have influenced competition in the market for security screening technologies used at transport hubs.
Commission representatives said their goal is to ensure balanced access for all companies operating in sectors linked to border control, transport screening and cargo inspection. They said technologies such as threat detection systems used in airports and ports form an essential component of Europe’s security infrastructure, which underscores the importance of maintaining equal market conditions for all participants.
Nuctech, in a public statement, indicated that it intends to remain engaged with the process. The company said it views its operations as independent and compliant with international commercial standards. It added that it expects the review to evaluate its conduct based on the information it provides during the inquiry.
The company supplies scanning and inspection systems for luggage, cargo and body screening, and its equipment is deployed in numerous countries. Nuctech has been subject to scrutiny in earlier years, including restrictions set by authorities in the United States in 2020. The firm, however, continues to maintain an international client base spanning aviation, shipping and transport facilities.
Under the Foreign Subsidies Regulation, companies found to have benefited from non-EU financial support in a manner that distorts fair competition can face financial penalties. These penalties can reach up to a tenth of a company’s global turnover if regulators identify non-compliance.
The review is expected to proceed through several phases, including requests for additional information and a detailed analysis of the company’s financial relationships. Stakeholders in the security technology industry stated that outcomes of such inquiries may influence procurement frameworks and future investment decisions once regulators issue their findings.
