European Union

European Union

Proposes new initiatives on inward and outward FDI screening

24 Jan 2024

On 24 January 2024, the European Commission unveiled several initiatives aimed at strengthening the economic security of the European Union (EU). Among these, two initiatives concern specifically inward and outward FDI.

A new proposed regulation for the screening of foreign investments seeks to boost the efficiency and coordination of Foreign Direct Investment (FDI) review processes across the EU. Key changes include extending their coverage to acquisitions by EU entities under foreign control and to greenfield investments. The regulation also mandates the establishment of comprehensive and suspensory FDI screening mechanism in all EU Member States for a list of identified sensitive sectors. It also proposes a post-closing review of all foreign investments and sets up an enhanced cooperation framework for the exchange of information and recommendations between Member States and the Commission. This draft regulation awaits the endorsement of the European Parliament and the Council.

Furthermore, the Commission has issued a White Paper on Outbound Foreign Direct Investments (OFDI), aiming to create a system within Member States to monitor OFDI in crucial technological fields such as advanced semiconductors, artificial intelligence, quantum technologies, and bio-technologies. The White Paper will be subject to a consultation process and the Commission is expected to issue recommendations on the launch of the propose monitoring by the summer of 2024. Based on this monitoring framework, Member States would furnish the Commission with preliminary risk assessments of OFDI in these sectors by mid-2025.

  • Type:
    • Entry and establishment (Approval and admission)
    • Treatment and operation (Other)
  • Industry:
    • Primary (Mining and quarrying)
    • Manufacturing (Manufacture of computer, electronic and optical products, and electrical equipment)
    • Services (Telecommunications, Computer programming, consultancy and related activities, Financial and insurance activities, Scientific research and development)
  • Sources: