Expands its FDI screening regime

29 Nov 2022

On 29 November 2022, the National Council adopted Act No. 497/2022 Coll. on Screening of Foreign Direct Investments for the protection of the security and public order, which significantly expands the scope of FDI screening regime established by the Act No. 45 on critical infrastructure.

The essential elements of the new regime include: 1. Three screening procedures: obligatory screening; voluntary screening and ex officio screening; 2. All foreign investments may be screened when there is a reasonable presumption that they may threaten or disrupt security or public order (under the previous regime only investments into critical infrastructure were subject to screening procedures); 3. Foreign investments falling under the category of critical investments should be made only after the approval of the Slovak Ministry of Economy. The list of the critical investments is to be determined by the separate legislation; 4. The screening may result in a ban on investment (with an obligation to revert it) or in conditional approval; 5. The new law establishes fines and sanctions ranging from 1 to 2 per cent of the aggregate total net turnover of the foreign investor or from EUR 100 000 to 1 million.

This law enters into force on 1 March 2023. The new FDI screening rules do not apply to investments completed prior to the effective date.