New FDI Screening Rules In The EU

Author:Mr Pat English

The EU is introducing a new set of rules designed to protect its interests in strategic sectors while remaining open for investment as the world's largest single market. This move puts the EU on an equal footing to its major trading partners with similar FDI screening regimes.

The new law coordinates the scrutiny of investments by third (non-EU) countries to ensure that those investments do not threaten security or public order. The focus will be on areas such as critical infrastructure and technologies, food security and free press. Investments by foreign governments, including through their state bodies or armed forces, will also be put under the spotlight.

Ireland, like many EU member states, does not have an FDI screening framework and will not be obliged to establish one. The final decision on whether to review or block foreign direct investment on security and public order grounds remains with individual member states. Existing and new FDI screening regimes will, however, have to be in line with a number of EU-wide requirements set out in the new law.

A new cooperation mechanism will allow member states and the EU Commission to exchange information and raise concerns about...

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