Clifford Chance

EU Foreign Investment Screening Regulation takes effect: a high-level review of regimes across Europe

13 October 2020

Since the EU Foreign Direct Investment (FDI) Screening Regulation (Regulation 2019/452 or the “FDI Regulation”) entered into force in April 2019, there has been an increasing trend by Member States towards reforming foreign (direct) investment to shield strategic industries and businesses from opportunistic acquisitions by “foreign” investors. Whilst the Covid-19 pandemic has intensified consideration of this issue, there was a move by national governments to tighten foreign investment controls prior to the global outbreak.

Member States were required to implement the cooperation mechanism established under the FDI Regulation by 11 October 2020. The FDI Regulation does not create a new FDI regime, but seeks to regulate the screening of FDI transactions across the EU.

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