JD.com offers EU remedies in $2.5B Ceconomy probe

JD.com has offered remedies to the European Commission in its probe of the $2.5 billion acquisition of German electronics retailer Ceconomy, an EU filing shows, as Beijing barred Chinese entities from assisting the investigation.

"The EU has again made unreasonable demands on banking institutions in China for extensive information held in the country that is unrelated to the investigation," He Yadong, spokesman for China's Ministry of Commerce, said Thursday.

The filing did not specify the remedies. The commission opened an in-depth investigation May 28 under the Foreign Subsidies Regulation, or FSR, and issued JD.com a Statement of Objections on July 22 alleging preferential financing, tax advantages and grants may have let it overpay for Ceconomy. China's Ministry of Justice, in its second such order, declared the cross-border demands improper extraterritorial jurisdiction.

The commission is expected to rule by Oct 2, when it could approve the deal, attach conditions or block it. If the conflict over information requests is unresolved, the commission may draw adverse inferences under Article 16 of the FSR, raising the risk of a lengthy delay or prohibition. If the remedies are accepted, the deal could close by year-end; if not, JD.com faces a choice between abandoning the transaction or accepting conditions that erode its value.

China's Second Blocking Order

On Aug 19, the Ministry of Justice, with the Ministry of Commerce, issued Announcement No. 8 of 2026, prohibiting any organization or individual from implementing or assisting the EU's investigative measures. It was the second such order after China's first in May over the FSR probe into Nuctech, a Beijing-based security inspection equipment maker. The regulations on countering improper extraterritorial jurisdiction took effect in April 2026, and Beijing has warned it will take countermeasures if the EU persists.

The escalation follows a longer dispute over the FSR's reach. In July 2024, the Ministry of Commerce launched a trade and investment barriers investigation into whether the EU's application of the regulation discriminated against Chinese companies, reaching a final determination in January 2025 that flagged an excessively broad definition of foreign financial contributions and heavy evidentiary burdens.

A Conflict of Laws for JD.com

JD.com says the acquisition will be financed through commercial bank loans and cash from operations, without government subsidies. The commission's inquiry is broader, examining whether the group received foreign financial contributions over the previous three years that could have strengthened its bid. Ceconomy operates the MediaMarkt and Saturn brands across several EU member states, giving JD.com a physical retail footprint in Europe in its largest push into the region.

Germany's Federal Cartel Office approved the deal in September 2025, finding little competitive overlap. JD.com's board approved the transaction, valued at about 2.2 billion euros, in July 2025, with closing initially expected in the first half of 2026. The company formally notified the commission of the transaction on April 17.

For JD.com, the announcement provides both protection and risk. It can invoke the Chinese prohibition to refuse some information requests, but the commission may treat non-cooperation as obstruction. The outcome could set a precedent for other Chinese cross-border acquisitions in Europe, where the FSR has concentrated scrutiny on Chinese companies since it took effect in July 2023. JD-SW shares traded with short selling at a 25.4 percent ratio, indicating meaningful bearish positioning as the regulatory overhang persists. A resolution through commitments rather than full information access could become the template for future cases, while a prohibition would chill Chinese dealmaking in the bloc. The dispute also deepens friction between Beijing and Brussels, which have set up a trade and investment consultation mechanism to manage differences through dialogue.

This article is for informational purposes only and does not constitute investment advice.