Chinese e-commerce giant JD.com was hit with formal notice of regulatory concerns over its US$2.5 billion bid for German electronics retailer Ceconomy on Wednesday in a move that could require hefty concessions.

The European Commission opened a full-scale investigation into the deal in May under the Foreign Subsidies Regulation that targets unfair foreign state aid.

The Commission was investigating whether JD received preferential financing, tax incentives and grants from the Chinese government that may have helped it to offer a higher price for Ceconomy.

JD.com, which can now offer remedies to address the EU concerns, said that the Commission’s statement of grounds is a normal procedural step.

“We remain confident the transaction supports Europe’s broader objectives around innovation and competitiveness. We continue to expect a positive conclusion of the process in the second half of 2026,” the company said ahead of the Commission’s announcement.

The Commission set an October 2 deadline for its decision on whether to clear the deal.

The acquisition would allow one of China’s largest retailers to expand outside its home market via Ceconomy-owned electronic products retailers MediaMarkt and Saturn.

• Reporting by Foo Yun Chee; Additional reporting by Philip Blenkinsop; Editing by Joe Bavier, Louise Heavens and David Goodman, of Reuters.