Openness to the global economy proved to be an effective instrument for the promotion of prosperity and wellbeing in the European Union. As a result, the European economy is now deeply interconnected with that of its trading partners, and the internal market allows both Europeans and foreign firms to compete on the merits. EU law aims at protecting fair competition and ensuring a level playing field in the internal market for all economic operators. Assuming that the current WTO and EU rules are not adequate to effectively tackle distortions on the internal market caused by foreign subsidies to firms operating in the EU, the Commission proposed a new Regulation, currently discussed by the European Parliament and by the Council. The paper analyzes the regulatory gap between the WTO SCM Agreement and EU law, and discusses three potentially problematic aspects of the proposed Regulation, namely the notion of foreign subsidy, the problem of distortions in the internal market and the balancing test between positive and negative effects caused by foreign subsidies.