This Week in the Single Market — Brussels (#19, 2026)
EU-Mexico deal signed; Commission approves German hydrogen aid; EU-US trade agreement advances; Fertiliser Action Plan adopted; Single Market Parliament debate; New disease control measures.
May 17, 2026 to May 23, 2026
EU-Mexico deal signed; Commission approves German hydrogen aid; EU-US trade agreement advances; Fertiliser Action Plan adopted; Single Market Parliament debate; New disease control measures.
📋 In This Week's Newsletter
• 📅 This Week's Calendar in Brussels
• 🇪🇺 European Commission
• ⚖️ EU Legislation
• 🏛️ European Parliament
• 🤝 EU Council
• ✒️ EP Committee Work
This Week's Calendar in Brussels
- Competitiveness Council (Internal market and Industry): On May 28, the EU Council's Competitiveness Council (Internal market and Industry) configuration is scheduled to hold an ministerial meeting in Brussels.
- Competitiveness Council (Research and Space): On May 29, the EU Council's Competitiveness Council (Research and Space) configuration is scheduled to hold an ministerial meeting in Brussels.
European Commission
EU-Mexico Summit marks signature of Modernised Global Agreement and interim Trade Agreement
On 22 May 2026, at the 8th EU-Mexico Summit, leaders from the European Union and the United Mexican States welcomed the signature of the Political, Economic and Cooperation Strategic Partnership Agreement (Modernised Global Agreement) and the Interim Trade Agreement (ITA). The modernisation aims to strengthen political dialogue, cooperation, and flows of trade and investment, enhancing supply chain resilience and supporting industrial complementarities. The Summit reaffirmed mutual commitments to effective multilateralism, the reformed WTO, and joint action in several strategic sectors, including energy, health, and digital. Mexico's accession to the Enterprise Europe Network as an international partner was announced. Bilateral trade has quadrupled since the previous Economic Partnership Political Coordination and Cooperation Agreement came into force in 2000. The parties agreed to launch a High-Level Dialogue on Security and Migration, enhance sectoral cooperation, and commit to biennial summits.
Commission approves €1.3 billion German State aid for renewable hydrogen production
The European Commission has approved, under EU State aid rules, a €1.3 billion German scheme supporting the production of renewable hydrogen through the European Hydrogen Bank's Auctions-as-a-Service tool. The scheme targets construction of up to 1,000 MW of electrolyser capacity and production of up to 10 million tonnes of renewable hydrogen, with expected avoidance of up to 55 million tonnes of CO2. The aid is granted via competitive bidding and will support both production and cross-border infrastructure, including delivery to buyers connected to the German Hydrogen Core Network. Projects must comply with EU RFNBO criteria. The Commission applied Article 107(3)(c) TFEU and the 2022 CEEAG; it concluded the measures are necessary, appropriate, and limited in impact. This follows earlier hydrogen auctions in Germany, Austria, Lithuania, and Spain.
Commission presents Fertiliser Action Plan to support farmers and food security
On 18 May 2026, the European Commission adopted the Fertiliser Action Plan with immediate and longer-term measures to support farmers facing rising fertiliser costs and supply disruptions. The Plan mobilises the agricultural reserve, revises CAP Strategic Plans for greater liquidity and flexibility, and promotes nutrient-efficient practices and bio-based fertilisers. Domestic production will be reinforced, and circular economy approaches accelerated, including through biogas and nutrient recovery. An EU fertilisers value chain partnership will be established to facilitate market dialogue and transparency. The Commission will streamline red tape and assess options for stockpiling and joint procurement, while reviewing CBAM/ETS cost impacts on fertilisers. Cohesion funds will support innovation and resilience. These actions build on earlier tariff quota adjustments and the temporary State aid framework for sectors affected by the Middle East crisis.
Commission approves €288 million German State aid for semiconductor value chain facilities
The Commission approved €288 million in German State aid for two projects in the semiconductor supply chain: €222 million for Carl Zeiss's 'HNA@SCALE' facility in Oberkochen, producing EUV optical columns, and €66 million for Zadient Materials Europe GmbH's 'Sic-Pro' investment in Bitterfeld, manufacturing ultra-pure silicon carbide. Both projects are integral to the European Chips Act and aim to strengthen EU autonomy in critical technology. Companies agreed to increase workforce skills, research collaborations, prioritise supply during shortages, and apply for Integrated Production Facility status. The Commission used Article 107(3)(c) TFEU, finding the measures necessary, appropriate, and with wide positive effects for the European semiconductor ecosystem.
State aid: Commission approves €13 million French scheme for fishing companies hit by fuel price increases
The Commission has approved a €13 million aid scheme for French fishing companies under the Middle East Crisis Temporary State Aid Framework (METSAF), adopted on 29 April 2026. The scheme provides direct grants based on fuel volume procured in April and May 2026—€0.20/litre for April, €0.35/litre for May—to mitigate impacts of marine fuel price surges, which rose over 75% this year. Approved under Article 107(3)(c) TFEU, the scheme aims to ensure food sector resilience and is the first in the fishery sector under METSAF, which will remain in force until 31 December 2026.
Commission awards €400 million to decarbonise industrial heat production across Europe
The Commission selected 65 projects in 10 EEA countries under the Innovation Fund Heat Auction, marking the first EU-wide auction for clean heat technologies in industry. Projects using resistance heating, heat pumps, solar thermal, and hybrid systems are expected to avoid over 6.6 million tonnes of CO2 in ten years and produce 16.3 TWh of decarbonised heat over five years. Sectors addressed include pulp and paper, glass, ceramics, iron and steel, food and beverage, textiles, and pharmaceuticals. The grants draw from the EU ETS and will support the clean transition and competitiveness. Grant agreements are expected in H2 2026; implementation will be closely monitored. Preparations for the 2026 Heat Auction, with a €1 billion budget, are underway.
Commission positively assesses Lithuania's sixth payment request under NextGenerationEU
Lithuania's sixth payment request for €178 million under the Recovery and Resilience Facility was positively reviewed by the Commission. The package targets digitalisation and transparency in the public sector, including legislative updates for minimum income schemes and electricity grid data publication. Ten milestones and eight targets were verified, with actions covering digital health monitoring, advanced tax analytics, and building renovation. The Economic and Financial Committee will now review the request. Lithuania has now received 73.7% of its allocated funds, with the Facility closing in December 2026.
Commission launches €5 billion Scaleup Europe Fund and selects EQT as fund manager
The European Innovation Council Fund Board selected EQT to manage the €5 billion Scaleup Europe Fund, the EU's largest growth capital initiative targeting deep tech scaleups in AI, quantum, clean energy, space technology, biotech, and medical innovation. The fund aims to bridge Europe's late-stage financing gap and was developed with investors including Novo Holdings, CriteriaCaixa, ABP, and Allianz. Legal agreements and investor approvals are expected soon; first investments will take place in autumn 2026, following the EIC Summit on 3 June 2026.
EU Legislation (Official Journal)
Council Decision (EU) 2026/1133 concludes Air Transport Agreement with US, EU, Iceland, Norway
Council Decision (EU) 2026/1133, adopted 18 May 2026, approves the Air Transport Accession Agreement among the United States, the European Union, its Member States, Iceland, and Norway. The Decision, under Article 100(2) and 218(6) TFEU, formalises the full aviation market integration for Iceland and Norway, following previous provisional application since 2011 and compliance with CJEU case C-28/12. The Ancillary Agreement is also approved and enters into force immediately.
Commission Implementing Regulation (EU) 2026/1136 updates ASF control zones in four Member States
Commission Implementing Regulation (EU) 2026/1136, published 21 May 2026, revises disease control zones for African swine fever in Germany, Italy, Poland, and Slovakia after new outbreaks in April and May 2026. Restricted zones I, II, and III boundaries are updated per Regulation (EU) 2023/594. The changes are effective immediately and support cross-border disease management.
Commission Implementing Regulation (EU) 2026/1085 registers certain acrylic esters imports for anti-dumping
Commission Implementing Regulation (EU) 2026/1085, dated 21 May 2026, initiates registration of imports of butyl acrylate and 2-ethylhexyl acrylate from China, Saudi Arabia, South Africa, and the US. This is preparatory for possible anti-dumping duties under Regulation (EU) 2016/1036; the product is classified under CN code ex 2916 12 00. Registration is valid for nine months.
Commission Implementing Regulation (EU) 2026/1140 amends import rules for poultry products
Commission Implementing Regulation (EU) 2026/1140 updates Annexes V and XIV of Regulation (EU) 2021/404, modifying authorised territory entries for Canada and the US following avian influenza outbreaks in both countries. Both protective suspensions and re-authorisations are established for affected zones, as per Regulation (EU) 2016/429.
European Parliament
Parliament votes for stronger European single market in forestry
On 19 May 2026, the European Parliament approved a regulation to improve the quality, traceability, and availability of forest reproductive material in the EU internal market. New standards require certified seeds and plants, digital traceability, and producer notifications for harvesting. The regulation's application date is set for five years.
Protecting EU strategic sectors from risky foreign investments
On 19 May 2026, Parliament adopted revised procedures for mandatory screening of foreign investments in sensitive sectors, including defence, semiconductors, AI, raw materials, and financial services. The new regulation streamlines national screening mechanisms and increases Commission oversight. The regulation enters into force after Council approval.
Steel overcapacity: MEPs approve new measures to protect EU steel market
Parliament approved a regulation setting annual tariff-free steel import quotas at 18.3 million tonnes, a 47% reduction. Imports above quota face 50% duty and new 'melt and pour' origin rules. Ukraine receives special quota treatment. The regulation applies from 1 July 2026.
Upgrading cross-border railway capacity coordination
On 19 May 2026, Parliament adopted new rules for the planning and allocation of EU railway infrastructure capacity, enhancing ENIM's coordination role and introducing penalties for unused or misallocated train paths. The regulation enters into force directly, with phased provisions between 2028 and 2031.
EU Council
ECOFIN ministers hold informal meeting amid Middle East crisis
On 22 May 2026, Economic and Financial Affairs ministers convened informally to discuss the effects of the Middle East crisis on EU financial stability and economic outlook.
8th EU-Mexico summit: Leaders reaffirm multilateralism and sign new agreements
On 22 May 2026, EU and Mexico leaders held the 8th summit, signing a modernised global agreement and interim trade agreement, renewing commitments to multilateralism and international rules.
Agriculture ministers to debate fertiliser supply and trade issues
At the Agriculture and Fisheries Council on 26 May 2026, ministers will discuss fertiliser availability, affordability, and agriculture trade matters.
EP Committee Work
Committee on International Trade: Draft report on monitoring and controlling drug precursors
INTA published a draft report on a regulation for monitoring and controlling drug precursors, repealing Regulations (EC) No 273/2004 and No 111/2005. The rapporteur is Nicolas Bay.
Committee on Civil Liberties: Draft report on Union support for Schengen area, border management and visas 2028-2034
LIBE's draft report, led by rapporteur Karlo Ressler, covers regulation establishing Union support for Schengen, European integrated border management, and visa policy from 2028 to 2034.
Committee on Civil Liberties: Draft report on Union support for asylum, migration, integration 2028-2034
Ana Catarina Mendes, rapporteur, published LIBE's draft report for regulation establishing Union support for asylum, migration, and integration policy for 2028-2034.
Committee on Industry, Research and Energy: Draft opinion on CO2 emission standards for new light vehicles
ITRE's draft opinion, rapporteur Matej Tonin, amends Regulation (EU) 2019/631 regarding CO2 standards and vehicle labelling, repealing Directive 1999/94/EC.
Budgetary Control Committee: Opinion on access to VAT information by EPPO and OLAF
CONT committee opinion, rapporteur Gilles Boyer, reviews the proposal for Council regulation amending Regulation (EU) No 904/2010 for EPPO and OLAF access to VAT information at Union level.
